Exhibit 4.37
SECOND SUPPLEMENTAL WARRANT AGREEMENT
This Second Supplemental Warrant Agreement (the "Agreement") is made as of
March 30, 2000 by and among Splitrock Services, Inc., a Delaware corporation
(the "Company"), Splitrock Holdings, Inc., a Delaware corporation ("Holdings"),
and Xxxxxx Trust and Savings Bank, a New York trust company (formerly, Bank of
Montreal Trust Company), as Warrant Agent (the "Warrant Agent").
WHEREAS, the Company and the Warrant Agent are parties to a Warrant
Agreement, dated as of July 24, 1998, as amended by the First Supplemental
Warrant Agreement, dated as of February 22, 2000 (collectively, the "Warrant
Agreement"), pursuant to which the Company issued certain warrants to purchase
shares of the Company's Common Stock, par value $.001 per share (the
"Warrants");
WHEREAS, the Company is a party to that certain Amended and Restated
Agreement and Plan of Merger, dated as of February 11, 2000 (the "Merger
Agreement") by and among the Company, Holdings, Splitrock Merger Sub, Inc., a
Delaware corporation ("Merger Sub"), McLeodUSA, Inc., a Delaware corporation
("XxXxxx"), and Southside Acquisition Corporation, also a Delaware corporation
("Southside"), that provides for, among other things, the merger of Merger Sub,
a wholly-owned subsidiary of Holdings, with and into the Company with the
Company as both the surviving corporation and a wholly-owned subsidiary of
Holdings;
WHEREAS, pursuant to the Merger Agreement, at the Holdco Effective Time (as
defined in the Merger Agreement), (i) each issued and outstanding share of
Common Stock, par value $.001 per share, of the Company (the "Company Common
Stock") will be converted into the right to receive one share of Common Stock,
par value $.001 per share, of Holdings (the "Holdings Common Stock"), and (ii)
each outstanding Warrant will become a warrant to purchase a number of whole
shares of Holdings Common Stock equal to the number of shares of Company Common
Stock subject to such Warrant at the same exercise price;
WHEREAS, the Company and the Warrant Agent hereby amend the Warrant
Agreement pursuant to its terms to add Holdings as a party thereto and each of
the Company, Holdings and the Warrant Agent are entering into this Agreement as
required by Section 4.05(a) of the Warrant Agreement in order to evidence the
assumption by Holdings of all of the Company's obligations with respect to the
Warrants and to confirm the rights of the holders of the Warrants to receive
shares of Holdings Common Stock upon exercise of such Warrants.
NOW, THEREFORE, in consideration of the promises and the mutual agreements
contained herein and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged by the parties, the parties, intending
to be legally bound, hereby agree as follows:
1. Defined Terms. Terms defined in the recitals to this Agreement have
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the meanings ascribed to them thereto. All capitalized terms not defined herein
have the meanings assigned to such terms in the Warrant Agreement.
2. Assumption of Warrants. Pursuant to Section 4.05(a) of the Warrant
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Agreement and Section 1A.06(d) of the Merger Agreement, Holdings hereby assumes,
effective as of the Holdco Effective Time, all of the Company's obligations with
respect to the Warrants, including, without limitation, the Company's
obligations under Article V and Section 7.01 of the Warrant Agreement. Holdings
will comply with Section 4.09 of the Warrant Agreement as promptly as
practicable following the Holdco Effective Time.
3. Shares Issuable Upon Exercise of Warrants. At the Holdco Effective Time,
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each outstanding warrant shall become a warrant to purchase the same number of
whole shares of Holdings Common Stock equal to the number of shares of Company
Common Stock subject to such Warrant.
4. Warrant Price. As provided in Section 1A.06(d) of the Merger Agreement,
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at the Holdco Effective Time, the Exercise Price per share of Holdings Common
Stock shall be the same Exercise Price as for a share of Company Common Stock
immediately prior to the Holdco Merger unless the Custodian Shares have been
issued pursuant to Section 2A.01 in which case the Exercise Price shall remain
zero.
5. Adjustments. Pursuant to the terms of the Warrant Agreement and
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until the Exercise Price has not been reduced to zero pursuant to Section
2A.01(d), the Exercise Price provided in Section 3 above shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions of Article IV of the Warrant Agreement with
respect to the Company Common Stock. Pursuant to the terms of the Warrant
Agreement, the provisions of Article III of the Warrant Agreement with respect
to Company Common Stock shall apply on like terms to the shares of Holdings
Common Stock issuable upon exercise of the Warrants.
6. Liability for Certain Obligations. Holdco agrees that it shall be and
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become jointly and severally liable with the Company to the Warrant Agent for
the performance of the obligations of the Company under Sections 5.05, 5.07 and
6.05 of the Warrant Agreement.
7. Rights and Obligations of the Warrant Agent. All of the provisions of
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the Warrant Agreement with respect to the rights, privileges, immunities, powers
and duties of the Warrant Agent shall be applicable in respect of this Agreement
as fully and with the same effect as if set forth herein in full.
8. Effect of Execution and Delivery of this Agreement. From and after the
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execution and delivery of this Agreement, (i) the Warrant Agreement shall be
deemed to be amended and modified as provided herein, (ii) this Agreement shall
form a part of the Warrant Agreement to which Holdings shall be a party, (iii)
except as modified and amended by this Agreement, the Warrant Agreement shall
continue in full force and effect, and (iv) each Holder of a Warrant
(irrespective of whether such Warrant has been
heretofore or is hereafter executed, countersigned and delivered under the
Warrant Agreement) shall be bound by this Agreement.
9. Effectiveness. This Agreement shall not become effective unless and
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until the Holdco Effective Time shall have occurred.
10. Counterparts. This Agreement may be executed simultaneously in one or
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more counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
11. Benefits of This Agreement. Nothing in this Agreement, the Warrant
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Agreement, or the Warrants, express or implied, shall give to any Person, other
than the parties hereto and thereto and their successors hereunder and
thereunder, and the Holders, any benefit of any legal or equitable right, remedy
or claim under the Warrant Agreement, this Agreement or the Warrants.
12. No Third Party Rights. Nothing in this Agreement shall be deemed
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to create any right in any creditor or other person or entity other than the
Holders of the Warrants and this Agreement shall not be construed in any respect
to be a contract in whole or in part for the benefit of any other third party.
13. Severability. Each of the provisions contained in this Agreement is
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distinct and severable and a declaration of invalidity or unenforceability of
any such provision or part thereof by a court of competent jurisdiction shall
not affect the validity or enforceability of any other provision hereof. The
parties agree to replace such invalid or unenforceable provision of this
Agreement with a valid and enforceable provision that shall achieve, to the
extent possible, the economic, business and other purposes of such invalid or
unenforceable provision.
14. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
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ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF. This Agreement shall be governed and
construed in accordance with the applicable terms and provisions of the Warrant
Agreement as amended hereby, which terms and provisions are incorporated herein
by reference, as if this Agreement were the "Warrant Agreement" referred to
therein.
15. Entire Agreement. This Agreement and the Warrant Agreement, as
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amended by the First Supplemental Warrant Agreement, set forth all of the
promises, agreements, conditions, understandings, warranties and representations
between the Company, Holdings, and the Warrant Agent with respect to the
transactions contemplated hereby, and supersede all prior agreements,
arrangements and understandings between the Company, Holdings and the Warrant
Agent, whether written, oral or otherwise. There are no promises, agreements,
conditions, understandings, warranties or representations, oral or written,
express or implied, between any of the Company, Holdings and the Warrant Agent
concerning the subject matter hereof except as set forth herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.
SPLITROCK SERVICES, INC.
By:______________________
Name: Xxxxxxx X. Xxxxxx
Title: President
SPLITROCK HOLDINGS, INC.
By: ______________________
Name: Xxxxxxx X. Xxxxxx
Title: President
XXXXXX TRUST AND SAVINGS BANK,
as Warrant Agent
By: ______________________
Name:
Title:
