SECOND AMENDMENT TO AMENDED AND RESTATED STOCKHOLDER PROTECTION RIGHTS AGREEMENT
Exhibit 99.1
SECOND AMENDMENT
TO
AMENDED AND RESTATED
STOCKHOLDER PROTECTION RIGHTS AGREEMENT
STOCKHOLDER PROTECTION RIGHTS AGREEMENT
This SECOND AMENDMENT to the AMENDED AND RESTATED STOCKHOLDER PROTECTION RIGHTS AGREEMENT
(this “Amendment”) is made and entered into as of October 28, 2007, by and between Covad
Communications Group, Inc., a Delaware corporation (the “Company”), and Mellon Investor Services
LLC, a New Jersey limited liability company (“Agent”).
RECITALS
WHEREAS, the Company and Agent are parties to that certain Amended and Restated Stockholder
Protection Rights Agreement, dated as of November 1, 2001, as amended by the Amendment to Amended
and Restated Stockholder Protection Rights Agreement dated as of March 29, 2006 (the “Agreement”);
WHEREAS, as of the date of this Amendment the Flip-in Date (as defined in the Agreement) has
not occurred;
WHEREAS, Section 5.4 of the Agreement provides that the Agreement may be amended at
the direction of the Company without the approval of the holders of Rights at any time prior to the
Flip-in Date;
WHEREAS, the Company hereby certifies to the Agent that this Amendment is in compliance with
Section 5.4 of the Agreement;
WHEREAS, the Company proposes to enter into that certain Agreement and Plan of Merger by and
among Blackberry Holding Corporation, a Delaware corporation (“Parent”), Blackberry Merger
Corporation, a Delaware corporation and a wholly-owned subsidiary of Parent (“Purchaser”) and the
Company, dated on or about October 28, 2007, as may be amended from time to time in accordance with
its terms (the “Merger Agreement”), pursuant to which Purchaser will be merged with and into the
Company, with the Company continuing as the surviving corporation and wholly-owned subsidiary of
Parent; and
WHEREAS, the Board of Directors of the Company has determined that an amendment to the
Agreement as set forth herein is necessary and desirable in connection with the foregoing.
NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Agent
hereby agree as follows:
1. Defined Terms. All capitalized terms used, but not defined, in this Amendment
shall have the meanings given to such terms in the Agreement.
2. Additional Defined Terms. Section 1.1 of the Agreement is hereby amended to add
thereto the following defined terms:
“‘Merger’ shall mean the merger of Purchaser with and into the Company pursuant to the
terms of the Merger Agreement.”
“‘Merger Agreement’ shall mean that certain Agreement and Plan of Merger dated as of
October 28, 2007, by and among the Company, Parent and Purchaser, as it may be amended from
time to time.”
“‘Parent’ shall mean Blackberry Holding Corporation, a Delaware corporation.”
“‘Purchaser’ shall mean Blackberry Merger Corporation, a Delaware corporation.”
3. Acquiring Person. The definition of “Acquiring Person” set forth in
Section 1.1 of the Agreement shall be deleted and replaced in its entirety with the
following:
“‘Acquiring Person’ shall mean any Person who is a Beneficial Owner of 15% or more of
the outstanding shares of Common Stock; provided, however, that the term
‘Acquiring Person’ shall not include any Person (i) who shall become the Beneficial Owner of
15% or more of the outstanding shares of Common Stock solely as a result of an acquisition
by the Company of shares of Common Stock, until such time thereafter as such Persons shall
become the Beneficial Owner (other than by means of a stock dividend or stock split) of any
additional shares of Common Stock, (ii) who is the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock but who acquired Beneficial Ownership of shares of Common
Stock without any plan or intention to seek or affect control of the Company, if such Person
promptly enters into an irrevocable commitment promptly to divest, and thereafter promptly
divests (without exercising or retaining any power, including voting, with respect to such
shares), sufficient shares of Common Stock (or securities convertible into, exchangeable
into or exercisable for Common Stock) so that such Person ceases to be the Beneficial Owner
of 15% or more of the outstanding shares of Common Stock or (iii) who Beneficially Owns
shares of Common Stock consisting solely of one or more of (A) shares of Common Stock
Beneficially Owned pursuant to the grant or exercise of an option granted to such Person by
the Company in connection with an agreement to merge with, or acquire, the Company at a time
at which there is no Acquiring Person, (B) shares of Common Stock (or securities convertible
into, exchangeable into or exercisable for Common Stock), Beneficially Owned by such Person
or its Affiliates or Associates at the time of grant of such option or (C) shares of Common
Stock (or securities convertible into, exchangeable into or exercisable for Common Stock)
acquired by Affiliates or Associates of such Person after the time of such grant which, in
the aggregate, amount to less than 1% of the outstanding shares of Common Stock. In
addition, the Company, any wholly-owned Subsidiary of the Company and any employee stock
ownership or other employee benefit plan of the Company or a wholly-owned Subsidiary of the
Company shall not be an Acquiring Person. Notwithstanding anything in this Agreement to the
contrary, (i) solely
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for purposes of determining the amount of Common Stock Beneficially Owned by EarthLink,
Inc., a Delaware corporation, or its Affiliates or Associates (collectively,
“EarthLink”), any Common Stock consisting solely of Primary Shares or Underlying
Shares (each, as defined in that certain Purchase Agreement, dated March 15, 2006, among the
Company, Covad Communications Company, a California corporation and a wholly-owned
subsidiary of the Company, and Earthlink) or any shares of Common Stock received in respect
of such Primary Shares or Underlying Shares pursuant to a stock split, dividend,
recapitalization, merger or similar transaction (collectively, “Phase I Shares”)
shall be disregarded for so long as such Phase I Shares are the only shares of Common Stock
Beneficially Owned by EarthLink and (ii) neither Parent nor Purchaser nor any of their
existing or future Affiliates or Associates shall be or become an Acquiring Person solely by
reason of (A) the approval, announcement, execution, delivery, or amendment of the Merger
Agreement, (B) the consummation of the Merger, or (C) the consummation of any other
transaction contemplated by the Merger Agreement.”
4. Flip-over Transaction or Event. The definition of “Flip-over Transaction or Event”
set forth in Section 1.1 of the Agreement shall be amended by adding the following sentence
at the end of such definition:
“Notwithstanding the foregoing, a Flip-over Transaction or Event shall not be deemed to
have occurred by reason of (A) the approval, announcement, execution, delivery or amendment
of the Merger Agreement, (B) the consummation of the Merger, or (C) the consummation of any
other transaction contemplated by the Merger Agreement.”
5. Stock Acquisition Date. The definition of “Stock Acquisition Date” set forth in
Section 1.1 of the Agreement shall be amended by adding the following sentence at the end
of such definition:
“Notwithstanding the foregoing, a Stock Acquisition Date shall not be deemed to have
occurred by reason of (A) the approval, announcement, execution, delivery or amendment of
the Merger Agreement, (B) the consummation of the Merger, or (C) the consummation of any
other transaction contemplated by the Merger Agreement.”
6. Expiration Time. The definition of “Expiration Time” set forth in Section
1.1 of the Agreement shall be amended by deleting the word “and” immediately preceding clause
(iv) and adding the following at the end of clause (iv):
“and (v) immediately prior to the Effective Time (as defined in the Merger Agreement).”
7. Effectiveness. This Amendment shall be deemed effective as of immediately prior to
the execution and delivery of the Merger Agreement.
8. Termination of Merger Agreement. If for any reason the Merger Agreement is
terminated, then this Amendment shall be of no further force or effect and the Agreement shall
remain exactly the same as it existed immediately prior to the effectiveness of this Amendment.
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9. Waiver of Notice or Certificate Requirements. The Company and Agent hereby waive
any notice or certificate requirements under the Agreement with respect to matters covered by this
Amendment.
10. Governing Law. This Amendment shall be governed and construed in accordance with
the internal laws of the State of Delaware without regard to the choice-of-law or conflict-of-laws
principles of any jurisdiction; provided, however, that all provisions regarding the rights, duties
and obligations of the Agent shall be governed by and construed in accordance with the laws of the
State of New York applicable to contracts made and to be performed entirely within such State.
11. Entire Agreement. This Amendment and the Agreement shall constitute the entire
understanding and agreement between the Company and the Agent with regard to the subjects hereof
and thereof.
12. No Other Modification. Except as set forth in this Amendment, the terms and
conditions of the Agreement shall remain in full force and effect.
13. Counterparts. This Amendment may be executed in multiple counterparts or
originals, and by the different parties hereto in separate counterparts or multiple originals, each
of which when executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year
first written above.
| COVAD COMMUNICATIONS GROUP, INC. | ||||||
| By: | /s/ Xxxxxxx Xxxxxxx
|
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| Name: Xxxxxxx Xxxxxxx | ||||||
| Title: President and Chief Executive Officer | ||||||
| Attest: | ||||||
| By: | /s/ Xxxxxxxx Xxxxxxxx
|
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| Name: Xxxxxxxx Xxxxxxxx | ||||||
| Title: V.P., Legal and Corporate Affairs | ||||||
| MELLON INVESTOR SERVICES LLC | ||||||
| By: | /s/ Xxx Xxxx
|
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| Name: Xxx Xxxx | ||||||
| Title: Relationship Manager | ||||||
| Attest: | ||||||
| By: | /s/ Xxxxxx Madgison
|
|||||
| Name: Xxxxxx Madgison | ||||||
| Title: Relationship Manager | ||||||
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