EXHIBIT 10.2
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WARRANT AGREEMENT
Dated as of December 1, 1999
By and Between
EQUINIX, INC.
and
STATE STREET BANK AND TRUST COMPANY
OF CALIFORNIA, N.A.
as Warrant Agent
_________________________
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Warrants to Purchase Common Stock
Par Value $.001 Per Share
TABLE OF CONTENTS
ARTICLE 1
ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
Page
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SECTION 1.1 Issuance of Warrants................................................................. 1
SECTION 1.2 Form of Warrant Certificates......................................................... 2
SECTION 1.3 Execution of Warrant Certificates.................................................... 2
SECTION 1.4 Authentication and Delivery.......................................................... 2
SECTION 1.5 Temporary Warrant Certificates....................................................... 3
SECTION 1.6 Separation of Warrants and Notes..................................................... 4
SECTION 1.7 Registration......................................................................... 4
SECTION 1.8 Registration of Transfers or Exchanges............................................... 4
SECTION 1.9 Lost, Stolen, Destroyed, Defaced or Mutilated Warrant Certificates................... 9
SECTION 1.10 Offices for Exercise, etc............................................................ 10
ARTICLE 2
DURATION, EXERCISE OF WARRANTS; EXERCISE
PRICE AND REPURCHASE OF WARRANTS
SECTION 2.1 Duration of Warrants................................................................. 10
SECTION 2.2 Exercise, Exercise Price, Settlement and Delivery.................................... 11
SECTION 2.3 Cancellation of Warrant Certificates................................................. 13
SECTION 2.4 Notice of an Exercise Event.......................................................... 13
ARTICLE 3
OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANTS
SECTION 3.1 Enforcement of Rights................................................................ 13
SECTION 3.2 Obtaining Stock Exchange Listings.................................................... 14
ARTICLE 4
CERTAIN COVENANTS OF THE COMPANY
SECTION 4.1 Payment of Taxes..................................................................... 14
SECTION 4.2 Qualification Under the Securities Laws.............................................. 14
SECTION 4.3 Rules 144 and 144A................................................................... 15
SECTION 4.4 Form of Initial Public Equity Offering............................................... 15
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SECTION 4.5 Registration of Shares............................................................... 15
ARTICLE 5
ADJUSTMENTS
SECTION 5.1 Adjustment of Exercise Rate; Notices................................................. 15
SECTION 5.2 Fractional Shares.................................................................... 21
SECTION 5.3 Certain Distributions................................................................ 22
ARTICLE 6
CONCERNING THE WARRANT AGENT
SECTION 6.1 Warrant Agent........................................................................ 22
SECTION 6.2 Conditions of Warrant Agent's Obligations............................................ 22
SECTION 6.3 Resignation and Appointment of Successor............................................. 26
ARTICLE 7
MISCELLANEOUS
SECTION 7.1 Amendment............................................................................ 27
SECTION 7.2 Notices and Demands to the Company and Warrant Agent................................. 28
SECTION 7.3 Addresses for Notices to Parties and for Transmission of Documents................... 28
SECTION 7.4 Notices to Holders................................................................... 29
SECTION 7.5 Applicable Law; Submission to Jurisdiction........................................... 29
SECTION 7.6 Persons Having Rights Under Agreement................................................ 29
SECTION 7.7 Headings, etc........................................................................ 29
SECTION 7.8 Counterparts......................................................................... 30
SECTION 7.9 Inspection of Agreement.............................................................. 30
SECTION 7.10 Availability of Equitable Remedies................................................... 30
SECTION 7.11 Obtaining of Governmental Approvals.................................................. 30
EXHIBIT A - Form of Warrant Certificate........................................................ A-1
EXHIBIT B - Form of Legend for Global Warrants................................................. B-1
EXHIBIT C - Certificate To Be Delivered upon Exchange or
Registration of Transfer of Warrants............................................... C-1
EXHIBIT D - Form of Transferee Certificate for Institutional
Accredited Investors............................................................... D-1
EXHIBIT E - Form of Transferee Certificate for Regulation S Transfers.......................... E-1
EXHIBIT F - Form of Receipt of Payment of the Exercise Price................................... F-1
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INDEX OF DEFINED TERMS
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Defined Term Section
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Affiliate........................................... 5.01(l)
Agreement........................................... Recitals
Business Day........................................ 2.01
Capital Stock....................................... 5.01(1)
Common Stock........................................ Recitals
Company............................................. Recitals
Current Market Value................................ 5.01(1)
Definitive Warrants................................. 1.02
Distribution........................................ 5.03
Distribution Rights................................. 5.03
Election To Exercise................................ 2.02(b)
Exercisability Date................................. 2.02(a)
Exercise Date....................................... 2.02(d)
Exercise Event...................................... 2.02(a)
Exercise Price...................................... 2.02(a)
Exercise Rate....................................... 2.02(a)
Expiration Date..................................... 2.01
Fundamental Transaction............................. 5.01(d)
Global Shares....................................... 2.02(f)
Global Warrants..................................... 1.02
Indenture........................................... Recitals
Independent Financial Expert........................ 5.01(1)
Initial Public Equity Offering...................... 2.02(a)
Initial Purchasers.................................. Recitals
Notes............................................... Recitals
Notice Date......................................... 2.05(b)
Officers' Certificate............................... 1.08(d)
Person.............................................. 2.02(a)
Private Placement Legend............................ 1.08(g)
Prospectus.......................................... 4.02
Registrar........................................... 1.07
Registration Rights Agreement....................... Recitals
Related Parties..................................... 6.02(e)
Requisite Warrant Holders........................... 7.01
Resale Restriction Termination Date................. 1.08
Securities Act...................................... 1.06
Separability Date................................... 1.06
Separation.......................................... 1.06
Shares.............................................. 1.01
Subject Class....................................... 4.04
Surviving Person.................................... 5.01(d)
Time of Determination............................... 5.01(1)
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Defined Term Section
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Trustee............................................. Recitals
Units............................................... Recitals
Warrant Agent....................................... Recitals
Warrant Agent Office................................ 1.10
Warrant Certificates................................ Recitals
Warrant Exercise Office............................. 2.02(b)
Warrant Register.................................... 1.07
Warrants............................................ Recitals
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WARRANT AGREEMENT
WARRANT AGREEMENT ("Agreement"), dated as of December 1, 1999 by and
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between EQUINIX, INC., a Delaware corporation (together with any successor
thereto, the "Company"), and STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA,
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N.A., as warrant agent (with any successor Warrant Agent, the "Warrant Agent").
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WHEREAS, the Company has entered into a purchase agreement (the
"Purchase Agreement") dated November 24, 1999 with ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
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("▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney"), ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated (collectively, the "Initial Purchasers") in which the Company has
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agreed to sell to the Initial Purchasers 200,000 units (the "Units") consisting
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in the aggregate of (i) $200,000,000 aggregate principal amount of Senior Notes
due 2007 (the "Notes") of the Company to be issued under an indenture dated as
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of December 1, 1999 (the "Indenture"), between the Company and State Street Bank
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and Trust Company of California, N.A., as trustee (in such capacity, the
"Trustee"), and (ii) 2,251,000 Warrants (the "Warrants"), each Warrant initially
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entitling the holder thereof to purchase 11.255 shares of Common Stock, par
value $.001 per share (the "Common Stock"), of the Company. The certificates
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evidencing the Warrants are herein referred to collectively as the "Warrant
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Certificates"; and
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WHEREAS, each Unit will consist of one Note in the principal amount of
$1,000 and Warrants; the Notes and the Warrants comprising part of the Units
shall not be separately transferable until the Separability Date (as defined
below); and
WHEREAS, the price of the units includes the exercise price of the
Warrants; and
WHEREAS, the holders of the Warrants are entitled to the benefits of a
Common Stock Registration Rights Agreement dated as of December 1, 1999 between
the Company and the Initial Purchasers (the "Registration Rights Agreement");
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and
WHEREAS, the Company desires the Warrant Agent as warrant agent to
assist the Company in connection with the issuance, exchange, cancellation,
replacement and exercise of the Warrants, and in this Agreement wishes to set
forth, among other things, the terms and conditions on which the Warrants may be
issued, exchanged, cancelled, replaced and exercised;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
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SECTION 1.1 Issuance of Warrants. Warrants comprising part of the
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Units shall be originally issued in connection with the issuance of the Units
and such Warrants shall not be separately transferable from the Notes until on
or after the Separability Date as provided in Section 1.06 hereof.
Each Warrant Certificate shall evidence the number of Warrants
specified therein, and each Warrant evidenced thereby shall, when exercisable as
provided herein and therein, represent the right, subject to the provisions
contained herein and therein, to purchase from the Company (and the Company
shall issue and sell to the holder of such Warrant) 11.255 fully paid,
registered and non-assessable shares of Common Stock at an exercise price of
$0.01 per share. The number of Shares issuable upon exercise of a Warrant is
subject to adjustment as provided herein and in the Warrant. The shares
purchasable upon exercise of a Warrant are hereinafter referred to as the
"Shares" and, unless the context otherwise requires, such term shall also
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include any other securities or property purchasable and deliverable upon
exercise of a Warrant as provided in Article V, subject to adjustment as
provided herein and in the Warrant.
SECTION 1.2 Form of Warrant Certificates. The Warrant Certificates
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will initially be issued either in global form (the "Global Warrants"),
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substantially in the form of Exhibit A hereto, or in registered form as
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definitive Warrant Certificates (the "Definitive Warrants") substantially in the
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form of Exhibit A attached hereto. Any Global Warrants to be delivered pursuant
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to this Agreement shall bear the legend set forth in Exhibit B attached hereto.
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Such Global Warrants shall represent such of the outstanding Warrants as shall
be specified therein and each shall provide that it shall represent the
aggregate amount of outstanding Warrants from time to time endorsed thereon and
that the aggregate amount of outstanding Warrants represented thereby may from
time to time be reduced or increased, as appropriate. Any endorsement of a
Global Warrant to reflect the amount of any increase or decrease in the amount
of outstanding Warrants represented thereby shall be made by the Warrant Agent
and the Depositary (as defined below) in accordance with instructions given by
the holder thereof. The Depository Trust Company shall act as the Depositary
with respect to the Global Warrants until a successor shall be appointed by the
Company and the Warrant Agent.
SECTION 1.3 Execution of Warrant Certificates. The Warrant
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Certificates shall be executed on behalf of the Company by the chairman of its
Board of Directors, its president or any vice president and attested by its
secretary or assistant secretary. Such signatures may be the manual or
facsimile signatures of the present or any future such officers. Typographical
and other minor errors or defects in any such reproduction of any such signature
shall not affect the validity or enforceability of any Warrant Certificate that
has been duly countersigned and delivered by the Warrant Agent.
In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificate so signed shall be countersigned and delivered by the Warrant Agent
or disposed-of by the Company, such Warrant Certificate nevertheless may be
countersigned and delivered or disposed of as though the person who signed such
Warrant Certificate had not ceased to be such officer of the Company; and any
Warrant Certificate may be signed on behalf of the Company by such persons as,
at the actual date of the execution of such Warrant Certificate, shall be the
proper officers of the Company, although at the date of the execution and
delivery of this Agreement any such person was not such an officer.
SECTION 1.4 Authentication and Delivery. Subject to the immediately
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following paragraph, Warrant Certificates shall be authenticated by manual
signature and dated the date of authentication by the Warrant Agent and shall
not be valid for any purpose unless so
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authenticated and dated. The Warrant Certificates shall be numbered and shall be
registered in the Warrant Register (as defined in Section 1.07 hereof).
Upon the receipt by the Warrant Agent of a written order of the
Company, which order shall be signed by the chairman of its Board of Directors,
its president, chief financial officer or any vice president and attested by its
secretary or assistant secretary, and shall specify the amount of Warrants to be
authenticated, whether the Warrants are to be Global Warrants or Definitive
Warrants, the date of such Warrants and such other information as the Warrant
Agent may reasonably request, without any further action by the Company, the
Warrant Agent is authorized, upon receipt from the Company at any time and from
time to time of the Warrant Certificates, duly executed as provided in Section
1.03 hereof, to authenticate the Warrant Certificates and upon the holder's
request deliver them. Such authentication shall be by a duly authorized
signatory of the Warrant Agent (although it shall not be necessary for the same
signatory to sign all Warrant Certificates).
In case any authorized signatory of the Warrant Agent who shall have
authenticated any of the Warrant Certificates shall cease to be such authorized
signatory before the Warrant Certificate shall be disposed of by the Company or
the Warrant Agent, such Warrant Certificate nevertheless may be delivered or
disposed of as though the person who authenticated such Warrant Certificate had
not ceased to be such authorized signatory of the Warrant Agent; and any Warrant
Certificate may be authenticated on behalf of the Warrant Agent by such persons
as, at the actual time of authentication of such Warrant Certificates, shall be
the duly authorized signatories of the Warrant Agent, although at the time of
the execution and delivery of this Agreement any such person is not such an
authorized signatory.
The Warrant Agent's authentication on all Warrant Certificates shall
be in substantially the form set forth in Exhibit A hereto.
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SECTION 1.5 Temporary Warrant Certificates. Pending the preparation
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of definitive Warrant Certificates, the Company may execute, and the Warrant
Agent shall authenticate and deliver, temporary Warrant Certificates, which are
printed, lithographed, typewritten or otherwise produced, substantially of the
tenor of the definitive Warrant Certificates in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Warrant Certificates may determine, as
evidenced by their execution of such Warrant Certificates.
If temporary Warrant Certificates are issued, the Company will cause
definitive Warrant Certificates to be prepared without unreasonable delay.
After the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at any office or agency
maintained by the Company for that purpose pursuant to Section 1.10 hereof.
Subject to the provisions of Section 4.01 hereof, such exchange shall be without
charge to the holder. Upon surrender for cancellation of any one or more
temporary Warrant Certificates, the Company shall execute, and the Warrant Agent
shall authenticate and deliver in exchange therefor, one or more definitive
Warrant Certificates representing in the aggregate a like number of warrants.
Until so exchanged, the holder of a temporary Warrant Certificate shall in all
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respects be entitled to the same benefits under this Agreement as a holder of a
definitive Warrant Certificate.
SECTION 1.6 Separation of Warrants and Notes. The Notes and the
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Warrants will not be separately transferable until the Separability Date.
"Separability Date" shall mean the earliest to occur of: (i) June 1, 2000, (ii)
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the occurrence of an Exercise Event (as defined herein), (iii) the occurrence of
an Event of Default (as defined in the Indenture), (iv) the date on which a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to a registered exchange offer for the Notes or
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covering the sale by holders of the Notes is declared effective under the
Securities Act, or (v) such earlier date as may be determined by ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney in its sole discretion and specified to the Company, the Trustee, the
Warrant Agent and the Unit Agent in writing. Notwithstanding the foregoing, the
Warrants shall become separately transferable on the date of commencement of a
Change of Control Offer (as defined in the Indenture). The separation of the
Warrants and the Notes is herein referred to as a "Separation."
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SECTION 1.7 Registration. The Company will keep, at the office or
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agency maintained by the Company for such purpose, a register or registers in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of, and registration of transfer and exchange
of, Warrants as provided in this Article. Each person designated by the Company
from time to time as a person authorized to register the transfer and exchange
of the Warrants is hereinafter called, individually and collectively, the
"Registrar." The Company hereby initially appoints the Warrant Agent as
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Registrar. Upon written notice to the Warrant Agent and any acting Registrar,
the Company may appoint a successor Registrar for such purposes.
The Company will at all times designate one person (who may be the
Company and who need not be a Registrar) to act as repository of a master list
of names and addresses of the holders of Warrants (the "Warrant Register"). The
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Warrant Agent will act as such repository unless and until some other person is,
by written notice from the Company to the Warrant Agent and the Registrar,
designated by the Company to act as such. The Company shall cause each
Registrar to furnish to such repository, on a current basis, such information as
to all registrations of transfer and exchanges effected by such Registrar, as
may be necessary to enable such repository to maintain the Warrant Register on
as current a basis as is practicable.
SECTION 1.8 Registration of Transfers or Exchanges.
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(a) Transfer or Exchange of Definitive Warrants. When
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Definitive Warrants are presented to the Warrant Agent with a request from the
holder:
(i) to register the transfer of the Definitive
Warrants; or
(ii) to exchange such Definitive Warrants for an
equal number of Definitive Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested
if the requirements under this Warrant Agreement as set forth in this Section
1.08 hereof for such
4
transactions are met; provided, however, that the Definitive Warrants presented
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or surrendered by a holder for registration of transfer or exchange:
(x) shall be duly endorsed or accompanied by a written instruction of
transfer or exchange in form satisfactory to the Company and the
Warrant Agent, duly executed by such holder or by his attorney,
duly authorized in writing; and
(y) in the case of Warrants the offer and sale of which have not been
registered under the Securities Act and are presented for
transfer or exchange prior to (X) the date which is two years (or
such shorter period as may be prescribed by Rule 144(k) (or any
successor provision thereto)) after the later of the date of
original issuance of the Warrants and the last date on which the
Company or any affiliate of the Company was the owner of such
Warrants, or any predecessor thereto, and (Y) such later date, if
any, as may be required by any subsequent change in applicable
law (the "Resale Restriction Termination Date"), such Warrants
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shall be accompanied by the following additional information and
documents, as
(A) if such warrants are being delivered to the
Warrant Agent by a holder for registration in the name of such holder, without
transfer, a certification from such holder to that effect (in substantially the
form of Exhibit C hereto); or
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(B) if such Warrants are being transferred to a
qualified institutional buyer (as defined in Rule 144A under the Securities Act)
(a "QIB") in accordance with Rule 144A under the Securities Act, a certification
from the transferor to that effect (in substantially the form of Exhibit C
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hereto); or
(C) if such warrants are being transferred to an
institutional "accredited investor" within the meaning of subparagraphs (a)(1),
(a)(2), (a)(3) or (a)(7) of Rule 501 under the Securities Act (an "Institutional
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Accredited Investor"), delivery by the transferor of a certification to that
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effect (in substantially the form of Exhibit C hereto), and delivery by the
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proposed transferee of a Transferee Certificate for Institutional Accredited
Investors (in substantially the form of Exhibit D hereto); or
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(D) if such Warrants are being transferred in
reliance on Regulation S under the Securities Act, delivery by the transferor of
a certification to that effect (in substantially the form of Exhibit C hereto),
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and a Certificate for Regulation S Transfers in the form of Exhibit E hereto; or
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(E) if such Warrants are being transferred in
reliance on Rule 144 under the Securities Act, delivery by the transferor of (i)
a certification from the transferor to that effect (in substantially the form of
Exhibit C hereto), and (ii) an opinion of counsel reasonably satisfactory to the
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Company to the effect that such transfer is in compliance with the Securities
Act; or
(F) if such Warrants are being transferred in
reliance on another exemption from the registration requirements of the
Securities Act, a
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certification from the transferor to that effect (in substantially the form of
Exhibit C hereto) and an opinion of counsel reasonably satisfactory to the
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Company to the effect that such transfer is in compliance with the Securities
Act; provided that the Company may, based upon the views of its own counsel,
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instruct the Warrant Agent not to register such transfer in any case where the
proposed transferee is not a QIB, Non-U.S. Person or Institutional Accredited
Investor.
(b) (Restrictions on Transfer of a Definitive Warrant
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for a Beneficial Interest in a Global Warrant. A Definitive Warrant may not be
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transferred by a holder for a beneficial interest in a Global Warrant except
upon satisfaction of the requirements set forth below. Upon receipt by the
Warrant Agent of a Definitive Warrant, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the Warrant Agent,
together with:
(A) certification from such holder (in
substantially the form of Exhibit C hereto) that such Definitive Warrant is
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being transferred to a QIB in accordance with Rule 144A under the Securities
Act; and
(B) written instructions directing the Warrant
Agent to make, or to direct the Depositary to make, an endorsement on the Global
Warrant to reflect an increase in the aggregate amount of the Warrants
represented by the Global Warrant,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or direct
the Depositary to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Agent, the number of
Shares represented by the Global Warrant to be increased accordingly. If no
Global Warrant is then outstanding, the Company shall issue and the Warrant
Agent shall upon written instructions from the Company authenticate a new Global
Warrant in the appropriate amount.
(c) Transfer or Exchange of Global Warrants. The
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transfer or exchange of Global Warrants or beneficial interests therein shall be
effected through the Depositary, in accordance with this Section 1.08, the
Private Placement Legend, this Agreement (including the restrictions on transfer
set forth herein) and the procedures of the Depositary therefor.
(d) Transfer or Exchange of a Beneficial Interest in
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a Global Warrant for a Definitive Warrant.
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(i) Any person having a beneficial interest in a
Global Warrant may transfer or exchange such beneficial interest for a
Definitive Warrant upon receipt by the Warrant Agent of written instructions or
such other form of instructions as is customary for the Depositary from the
Depositary or its nominee on behalf of any person having a beneficial interest
in a Global Warrant, including a written order containing registration
instructions and, in the case of any such transfer or exchange prior to the
Resale Restriction Termination Date, the following additional information and
documents:
(A) if such beneficial interest is being
transferred to the person designated by the Depositary as being the beneficial
owner, a certification from such person to that effect (in substantially the
form of Exhibit C hereto); or
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(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under the Securities Act, a
certification from the transferor to that effect (in substantially the form of
Exhibit C hereto); or
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(C) if such beneficial interest is being
transferred to an Institutional Accredited Investor, delivery by the transferor
of a certification to that effect (in substantially the form of Exhibit C
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hereto), and delivery by the proposed transferee of a Transferee Certificate for
Institutional Accredited Investors (in substantially the form of Exhibit D
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hereto); or
(D) if such beneficial interest is being
transferred in reliance on Regulation S under the Securities Act, delivery by
the transferor of (i) a certification to that effect (in substantially in the
form of Exhibit C hereto), and (ii) a Certificate for Regulation S Transfers in
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Transfers in the form of Exhibit E hereto; or
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(E) if such beneficial interest is being
transferred in reliance on Rule 144 under the Securities Act, delivery by the
transferor of (i) a certification to that effect (in substantially the form of
Exhibit C hereto) and (ii) an opinion of counsel reasonably satisfactory to the
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Company to the effect that such transfer is in compliance with the Securities
Act; or
(F) if such beneficial interest is being
transferred in reliance on another exemption from the registration requirements
of the Securities Act, a certification from the transferor to that effect (in
substantially the form of Exhibit C hereto) and an opinion of counsel reasonably
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satisfactory to the Company to the effect that such transfer is in compliance
with the Securities Act; provided that the Company may instruct the Warrant
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Agent not to register such transfer in any case where the proposed transferee is
not a QIB, Non-U.S. Person or Institutional Accredited Investor.
then the Warrant Agent will cause, in accordance with the standing instructions
and procedures existing between the Depositary and the Warrant Agent, the
aggregate amount of the Global Warrant to be reduced and, following such
reduction, the Company will execute and, upon receipt of an authentication order
in the form of an officers' certificate (a certificate signed by two officers of
such company, one of whom must be the principal executive officer, principal
financial officer or principal accounting officer) (an "Officers' Certificate"),
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the Warrant Agent will authenticate and deliver to the transferee a Definitive
Warrant.
(ii) Definitive Warrants issued in exchange for a
beneficial interest in a Global Warrant pursuant to this Section 1.08(d) shall
be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Warrant Agent in writing. The Warrant Agent shall
deliver such Definitive Warrants to the persons in whose names such Warrants are
so registered and adjust the Global Warrant pursuant to paragraph (h) of this
Section 1.08.
(e) Restrictions on Transfer or Exchange of Global
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Warrants. Notwithstanding any other provisions of this Agreement (other than the
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provisions set forth in subsection (f) of this Section 1.08), a Global Warrant
may not be transferred or exchanged as a
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whole except by the Depositary to a nominee of the Depositary or by a nominee of
the Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary.
(f) Authentication of Definitive Warrants in Absence
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of Depositary. If at any time:
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(i) the Depositary for the Global Warrants
notifies the Company that the Depositary is unwilling or unable to continue as
Depositary for the Global Warrant and a successor Depositary for the Global
Warrant is not appointed by the Company within 90 days after delivery of such
notice; or
(ii) the Company, at its sole discretion,
notifies the Warrant Agent in writing that it elects to cause the issuance of
Definitive Warrants for all Global Warrants under this Agreement,
then the Company will execute, and the Warrant Agent will, upon receipt of an
Officers' Certificate requesting the authentication and delivery of Definitive
Warrants, authenticate and deliver Definitive Warrants, in an aggregate number
equal to the aggregate number of warrants represented by the Global Warrant, in
exchange for such Global Warrant.
(g) Private Placement Legend. Upon the registration of
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transfer, exchange or replacement of Warrant Certificates not bearing the legend
set forth in the first paragraph of Exhibit A attached hereto (the "Private
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Placement Legend"), the Warrant Agent shall deliver Warrant Certificates that
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do not bear the Private Placement Legend. Upon the registration of transfer,
exchange or replacement of Warrant Certificates bearing the Private Placement
Legend, the Warrant Agent shall deliver Warrant Certificates that bear the
Private Placement Legend unless, and the Warrant Agent is hereby authorized to
deliver Warrant Certificates without the Private Placement Legend if, (i) the
requested transfer is not prior to the date which is two years (or such shorter
period as may be prescribed by Rule 144(k) (or any successor provision thereto)
under the Securities Act or any successor provision thereunder) after the later
of the original Issue Date of the Warrants or the last day on which the Company
or any of its Affiliates was the owner of the Warrant or any predecessor
security, (ii) there is delivered to the Warrant Agent an opinion of counsel
reasonably satisfactory to the Company and the Warrant Agent to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act or (iii)
the Warrants to be transferred or exchanged represented by such Warrant
Certificates are being transferred or exchanged pursuant to an effective
registration statement under the Securities Act.
(h) Cancellation or Adjustment of a Global Warrant.
----------------------------------------------
At such time as all beneficial interests in a Global Warrant have either been
exchanged for Definitive Warrants, redeemed, repurchased or cancelled, such
Global Warrant shall be returned to the Company or, upon written order to the
Warrant Agent in the form of an Officers' Certificate from the Company, retained
and cancelled by the Warrant Agent. At any time prior to such cancellation, if
any beneficial interest in a Global Warrant is exchanged for Definitive
warrants, redeemed, repurchased or cancelled, the number of Warrants represented
by such Global
8
Warrant shall be reduced and an endorsement shall be made on such Global Warrant
by the Warrant Agent to reflect such reduction.
(i) Obligations with Respect to Transfers or Exchanges
--------------------------------------------------
of Definitive Warrants.
----------------------
(i) To permit registrations of transfers or
exchanges, the Company shall execute, at the Warrant Agent's request, and the
Warrant Agent shall authenticate Definitive Warrants and Global Warrants.
(ii) All Definitive Warrants and Global Warrants
issued upon any registration, transfer or exchange of Definitive Warrants or
Global Warrants shall be the valid obligations of the Company, entitled to the
same benefits under this Warrant Agreement as the Definitive Warrants or Global
Warrants surrendered upon the registration of transfer or exchange.
(iii) Prior to due presentment for registration
of transfer of any Warrant, the Warrant Agent and the Company may deem and treat
the person in whose name any Warrant is registered as the absolute owner of such
Warrant, and neither the Warrant Agent nor the Company shall be affected by
notice to the contrary.
SECTION 1.9 Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
-----------------------------------------------------
Certificates. Upon receipt by the Company and the Warrant Agent (or any agent
------------
of the Company or the Warrant Agent, if requested by the Company) of evidence
satisfactory to them of the loss, theft, destruction, defacement, or mutilation
of any Warrant Certificate and of an indemnity bond satisfactory to them and, in
the case of mutilation or defacement, upon surrender thereof to the Warrant
Agent for cancellation, then, in the absence of notice to the Company or the
Warrant Agent that such Warrant Certificate has been acquired by a bona fide
purchaser or holder in due course, the Company shall execute, and an authorized
signatory of the Warrant Agent shall manually authenticate and deliver, in
exchange for or in lieu of the lost, stolen, destroyed, defaced or mutilated
Warrant Certificate, a new Warrant Certificate representing a like number of
Warrants, bearing a number or other distinguishing symbol not contemporaneously
outstanding. Upon the issuance of any new Warrant Certificate under this
Section in a name other than the prior registered holder of the lost, stolen,
destroyed, defaced or mutilated Warrant Certificate, the Company may require the
payment from the holder of such Warrant Certificate of a sum sufficient to cover
any tax, stamp tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Warrant
Agent and the Registrar) in connection therewith. Every substitute Warrant
Certificate executed and delivered pursuant to this Section in lieu of any lost,
stolen or destroyed Warrant Certificate shall constitute an additional
contractual obligation of the Company, whether or not the lost, stolen or
destroyed Warrant Certificate shall be at any time enforceable by anyone, and
shall be entitled to the benefits of (but shall be subject to all the
limitations of rights set forth in) this Agreement equally and proportionately
with any and all other Warrant Certificates duly executed and delivered
hereunder. The provisions of this Section 1.09 are exclusive with respect to
the replacement of lost, stolen, destroyed, defaced or mutilated Warrant
Certificates and shall preclude (to the extent lawful) any and all other rights
or remedies
9
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement of lost, stolen, destroyed, defaced or mutilated
Warrant Certificates.
The Warrant Agent is hereby authorized to authenticate in accordance
with the provisions of this Agreement, and deliver the new Warrant Certificates
required pursuant to the provisions of this Section.
SECTION 1.10 Offices for Exercise, etc. So long as any of the
-------------------------
Warrants remain outstanding, the Company will designate and maintain in the
Borough of Manhattan, The City of New York: (a) an office or agency where the
Warrant Certificates may be presented for exercise, (b) an office or agency
where the Warrant Certificates may be presented for registration of transfer and
for exchange (including the exchange of temporary Warrant Certificates for
definitive Warrant Certificates pursuant to Section 1.05 hereof), and (c) an
office or agency where notices and demands to or upon the Company in respect of
the Warrants or of this Agreement may be served. The Company may from time to
time change or rescind such designation, as it may deem desirable or expedient;
provided, however, that an office or agency shall at all times be maintained in
-------- -------
the Borough of Manhattan, The City of New York, as provided in the first
sentence of this Section. In addition to such office or offices or agency or
agencies, the Company may from time to time designate and maintain one or more
additional offices or agencies within or outside The City of New York, where
Warrant Certificates may be presented for exercise or for registration of
transfer or for exchange, and the Company may from time to time change or
rescind such designation, as it may deem desirable or expedient. The Company
will give to the Warrant Agent written notice of the location of any such office
or agency and of any change of location thereof. The Company hereby designates
State Street Bank and Trust Company, N.A., an affiliate of the Warrant Agent, at
its principal corporate trust office identified in Section 7.03 in the Borough
of Manhattan, The City of New York (the "Warrant Agent Office"), as the initial
--------------------
agency maintained for each such purpose. In case the Company shall fail to
maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made and notice may be served at the Warrant Agent Office and the Company
appoints the Warrant Agent as its agent to receive all such presentations,
surrenders, notices and demands.
ARTICLE 2
DURATION, EXERCISE OF WARRANTS; EXERCISE
PRICE AND REPURCHASE OF WARRANTS
--------------------------------
SECTION 2.1 Duration of Warrants. Subject to the terms and conditions
--------------------
established herein, the Warrants shall expire at 5:00 p.m., New York City time,
on December 1, 2007. The applicable date of expiration of a particular Warrant
is referred to herein as the "Expiration Date" of such Warrant. Each Warrant
---------------
may be exercised on any Business Day (as defined below) on or after the
Exercisability Date (as defined in Section 2.02) and on or prior to the close of
business on the Expiration Date.
Any Warrant not exercised before the close of business on the
Expiration Date shall become void, and all rights of the holder under the
Warrant Certificate evidencing such Warrant and under this Agreement shall
cease.
10
"Business Day" shall mean any day on which (i) banks in New York City,
------------
(ii) the principal U.S. securities exchange or market, if any, on which any
Common Stock is listed or admitted to trading and (iii) the principal U.S.
securities exchange or market, if any, on which the Warrants are listed or
admitted to trading are open for business.
SECTION 2.2 Exercise, Exercise Price, Settlement and Delivery. (a)
-------------------------------------------------
Subject to the provisions of this Agreement, a holder of a Warrant shall have
the right to purchase from the Company on or after the Exercisability Date and
on or prior to the close of business on the Expiration Date 11.255 fully paid,
registered and non-assessable shares of Common Stock (and any other securities
or property purchasable or deliverable upon exercise of such Warrant as provided
in Article V), subject to adjustment in accordance with Article V hereof. The
purchase price of $0.01 for each share purchased (the "Exercise Price") will be
--------------
paid to the Warrant Agent on the date hereof as part of the purchase price of
the Units and promptly remitted to the Company which shall deliver a receipt
therefor in the form of Exhibit F hereof. The number of Shares for which a
---------
particular Warrant may be exercised (the "Exercise Rate") shall be subject to
-------------
adjustment from time to time as set forth in Article V hereof.
"Exercisability Date" means, with respect to each Warrant, the date as
-------------------
of which both of the following shall have occurred (whether before or on such
date): (i) the Separability Date and (ii) an Exercise Event.
"Exercise Event" means, with respect to each Warrant, the date of the
--------------
occurrence of the earliest of: (1) immediately prior to a Warrant Change of
Control (as defined in the Registration Rights Agreement), (2) the 90th day (or
such earlier date as determined by the Company in its sole discretion) following
an Initial Public Equity Offering, (3) other than in connection with an Initial
Public Equity Offering the date upon which a class of equity securities of the
Company becomes subject to registration under the Exchange Act, (4) December 1,
2001.
"Initial Public Equity Offering" means the first primary public
------------------------------
offering (whether or not underwritten, but excluding any offering pursuant to
Form S-8 under the Securities Act or any other publicly registered offering
pursuant to the Securities Act pertaining to an issuance of shares of Common
Stock or securities exercisable therefor under any benefit plan, employee
compensation plan, or employee or director stock purchase plan) of Common Stock
of the Company pursuant to an effective registration statement under the
Securities Act.
"Person" means any individual, corporation, partnership, limited
------
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity, including any predecessor of any such entity.
(a) Warrants may be exercised on or after the date
they are exercisable hereunder by surrendering at any office or agency
maintained for that purpose by the Company pursuant to Section 1.10 (each a
"Warrant Exercise Office") the Warrant Certificate evidencing such Warrants with
-----------------------
the form of election to exercise Shares set forth on the reverse side of the
Warrant Certificate (the "Election to Exercise") duly completed and signed by
--------------------
the registered holder or holders thereof or by the duly appointed legal
representative thereof or by a
11
duly authorized attorney, and in the case of a transfer, such signature shall be
guaranteed by an eligible guarantor institution. Each Warrant may be exercised
-----------------------------
only in whole.
-------------
(b) Upon exercise of a Warrant, no payment or adjustment shall be made
on account of any dividends on the Shares issued. No refund of the exercise
price will be made in the event that any Warrant is not exercised or otherwise
is surrendered.
(c) Upon such surrender of a Warrant Certificate at any Warrant
Exercise Office (other than any Warrant Exercise Office that also is an office
of the Warrant Agent), such Warrant Certificate and payment shall be promptly
delivered to the Warrant Agent. The "Exercise Date" for a Warrant shall be the
-------------
date when all of the items referred to in the first sentence of paragraph (b) of
this Section 2.02 are received by the Warrant Agent at or prior to 12:00 Noon,
New York City time, on a Business Day and the exercise of the Warrants will be
effective as of such Exercise Date. If any items referred to in the first
sentence of paragraph (b) are received after 12:00 Noon, New York City time, on
a Business Day, the exercise of the Warrants to which such item relates will be
effective on the next succeeding Business Day. Notwithstanding the foregoing,
in the case of an exercise of Warrants on the Expiration Date, if all of the
items referred to in the first sentence of paragraph (b) are received by the
Warrant Agent at or prior to 5:00 p.m., New York City time, on the Expiration
Date, the exercise of the Warrants to which such items relate will be effective
on the Expiration Date.
(d) Upon the exercise of a Warrant in accordance with the terms
hereof, the receipt of a Warrant Certificate, the Warrant Agent shall, as soon
as practicable, advise the Company in writing of the number of Warrants
exercised in accordance with the terms and conditions of this Agreement and the
Warrant Certificates, the instructions of each exercising holder of the Warrant
Certificates with respect to delivery of the Shares to which such holder is
entitled upon such exercise, and such other information as the Company shall
reasonably request.
(e) Subject to Section 5.02 hereof, as soon as practicable after the
exercise of any Warrant or Warrants in accordance with the terms hereof, the
Company shall issue or cause to be issued to or upon the written order of the
registered holder of the Warrant Certificate evidencing such exercised Warrant
or Warrants, a certificate or certificates evidencing the Shares to which such
holder is entitled, in fully registered form, registered in such name or names
as may be directed by such holder pursuant to the Election to Exercise, as set
forth on the reverse of the Warrant Certificate. Such certificate or
certificates evidencing the Shares shall be deemed to have been issued and any
persons who are designated to be named therein shall be deemed to have become
the holder of record of such Shares as of the close of business on the Exercise
Date; the Shares may initially be issued in global form (the "Global Shares").
-------------
Such Global Shares shall represent such of the outstanding Shares as shall be
specified therein and each shall provide that it shall represent the aggregate
amount of outstanding Shares from time to time endorsed thereon and that the
aggregate amount of outstanding Shares represented thereby may from time to time
be reduced or increased, as appropriate. Any endorsement of a Global Share to
reflect the amount of any increase or decrease in the amount of outstanding
Shares represented thereby shall be made by the registrar for the Shares and the
Depositary (referred to below) in accordance with instructions given by the
holder thereof. The Depository Trust Company shall (if possible) act as the
Depositary with respect to the Global
12
Shares until a successor shall be appointed by the Company and the registrar for
the Shares. After such exercise of any Warrant or Shares, the Company shall also
issue or cause to be issued to or upon the written order of the registered
holder of such Warrant Certificate, a new Warrant Certificate, countersigned by
the Warrant Agent pursuant to written instruction, evidencing the number of
Warrants, if any, remaining unexercised unless such Warrants shall have expired.
SECTION 2.3 Cancellation of Warrant Certificates. In the event the
------------------------------------
Company shall purchase or otherwise acquire Warrants, the Warrant Certificates
evidencing such Warrants may thereupon be delivered to the Warrant Agent, and if
so delivered, shall at the Company's written instruction be canceled by it and
retired. The Warrant Agent shall cancel all Warrant Certificates properly
surrendered for exchange, substitution, transfer or exercise. Upon the
Company's written request, the Warrant Agent shall deliver such canceled Warrant
Certificates to the Company.
SECTION 2.4 Notice of an Exercise Event. The Company shall, as soon as
--------------------------- ----------
practicable after the occurrence of an Exercise Event, send or cause to be sent
----------- --------------
to each holder of Warrants and to each beneficial owner of the warrants with
respect to which such Exercise Event has occurred to the extent that the
Warrants are held of record by a depositary or other agent (with a copy to the
Warrant Agent), by first-class mail, at the addresses appearing on the Warrant
Register, a notice prepared by the Company advising such holder of the Exercise
Event which has occurred, which notice shall describe the type of Exercise Event
and the date of the occurrence thereof, as applicable, and the date of
expiration of the right to exercise the Warrants prominently set forth in the
face of such notice. The Company agrees to make available the foregoing right
notwithstanding any other provision herein to the contrary. Such right may, if
it would be in the best interests of holders of Warrants, be in lieu of the
right to receive the number of Shares to which the holder would have been
entitled.
ARTICLE 3
OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANTS
-----------------------------
SECTION 3.1 Enforcement of Rights. (a) Notwithstanding any of the
---------------------
provisions of this Agreement, any holder of any Warrant Certificate, without the
consent of the Warrant Agent, the holder of any Shares or the holder of any
other Warrant Certificate, may, in and for his own behalf, enforce, and may
institute and maintain any suit, action or proceeding against the Company
suitable to enforce, his right to exercise the Warrant or Warrants evidenced by
his Warrant Certificate in the manner provided in such Warrant Certificate and
in this Agreement.
(b) Neither the Warrants nor any Warrant Certificate shall entitle the
holders thereof to any of the rights of a holder of Shares, including, without
limitation, the right to vote or to receive any dividends or other payments or
to consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or any other
matter, or any rights whatsoever as stockholders of the Company, except as
expressly provided herein (including Section 5.03 hereof).
13
SECTION 3.2 Obtaining Stock Exchange Listings. The Company will from
---------------------------------
time to time take all action which may be necessary so that the Shares,
immediately upon their issuance upon the exercise of Warrants, will be listed on
the principal securities exchanges and markets within the United States
(including the Nasdaq National Market), if any, on which other shares of Common
Stock are then listed.
ARTICLE 4
CERTAIN COVENANTS OF THE COMPANY
--------------------------------
SECTION 4.1 Payment of Taxes. The Company will pay all documentary
----------------
stamp taxes attributable to the initial issuance of Warrants and of the Shares
upon the exercise of Warrants; provided, however, that the Company shall not be
-------- -------
required to pay any tax or other governmental charge which may be payable in
respect of any transfer or exchange of any Warrant Certificates or any
certificates for Shares in a name other than the registered holder of a Warrant
Certificate surrendered upon the exercise of a Warrant. In any such case, no
transfer or exchange shall be made unless or until the person or persons
requesting issuance thereof shall have paid to the Company the amount of such
tax or other governmental charge or shall have established to the satisfaction
of the Company that such tax or other governmental charge has been paid or an
exemption is available therefrom.
SECTION 4.2 Qualification Under the Securities Laws. (b) Immediately
---------------------------------------
prior to the occurrence of an Exercise Event arising as a result of an Initial
Public Equity Offering, the Company will, if permitted by applicable law, take
all such action as is necessary to cause the offer and sale by the Company of
the Shares issuable or deliverable upon exercise of the Warrants to be
registered or otherwise qualified under the provisions of the Securities Act and
pursuant to all applicable state securities laws and to provide for the issuance
of all Shares delivered upon exercise of the Warrants pursuant to an effective
shelf registration statement under the Securities Act. Subject to the last
sentence of this Section 4.02(a) and to paragraph (b) of this Section 4.02, so
long as any unexpired Warrants which have become exercisable due to the
occurrence of such an Exercise Event remain outstanding, the Company will file
such amendments and/or supplements to any registration statement under the
Securities Act or under any state securities laws covering the issuance of such
Shares and supplement and keep current any prospectus forming a part of such
registration statement as may be necessary to permit the Company to deliver to
each person exercising a Warrant a prospectus meeting the requirements of
Section 10(a)(3) of the Securities Act (a "Prospectus") and the regulations of
----------
the Securities and Exchange Commission and otherwise complying with the
Securities Act and regulations thereunder, and as may be necessary to comply
with any applicable state securities laws. The Warrant Agent shall have no duty
to monitor when such registration or qualification is necessary nor shall the
Warrant Agent be responsible for the Company's failure to comply with this
Section 4.02. The Company's obligation to maintain a Prospectus for delivery to
each person exercising a Warrant shall be terminated on the date the Company
delivers to the Warrant Agent an unqualified opinion of counsel reasonably
satisfactory to the Warrant Agent to the effect that all Shares registrable or
deliverable upon exercise of the Warrants may be issued without the requirement
of registration under the Securities Act and will be freely transferable after
receipt without limitation under the Securities Act.
14
(b) The Company may suspend the effectiveness of such shelf
registration statement and the use of any related prospectus in the event that,
and for a period not to exceed an aggregate of 45 days in any calendar year if,
(i) an event occurs and is continuing as a result of which the shelf
registration statement would, in the Company's good faith judgment, which
determination shall be evidenced by a resolution of the Company's board of
directors, contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make statements therein, in the light of the
circumstances under which they were made, not misleading, and (ii) (a) the
Company determines in its good faith judgment, which determination shall be
evidenced by a resolution of the Company's board of directors, that the
disclosure of an event at such time would be required to be disclosed in the
registration statement and would have a material adverse effect on the business,
operations or prospects of the Company (provided, the Company would not
--------
otherwise be required to disclose such event) or (b) the disclosure otherwise
relates to a pending material business transaction which has not yet been
publicly disclosed.
SECTION 4.3 Rules 144 and 144A. The Company covenants that it will
------------------
file the reports required to be filed by it under the Securities Act and the
Exchange Act and the rules and regulations adopted by the Securities and
Exchange Commission thereunder in a timely manner in accordance with the
requirements of the Securities Act and the Exchange Act and, if at any time the
Company is not required to file such reports, it will, upon the request of any
holder or beneficial owner of warrants, make available such information
necessary to permit sales pursuant to Rule 144A under the Securities Act.
SECTION 4.4 Form of Initial Public Equity Offering. The Company agrees
--------------------------------------
that it will not make an Initial Public Equity Offering of any class of its
Capital Stock (other than the Shares) without amending the terms of the
Company's certificate of incorporation to provide that the Shares are
convertible into the class of Capital Stock subject to the Initial Public Equity
Offering (the "Subject Class") on a share-for-share basis and that the rights,
-------------
conditions and privileges of the Subject Class shall not be adverse to the
holders of the Shares.
SECTION 4.5 Registration of Shares. The Company agrees that it will
----------------------
comply with all applicable laws, including the Securities Act and any applicable
state securities laws, in connection with the offer and sale of Common Stock
(and other securities and property deliverable) upon exercise of the Warrants.
ARTICLE 5
ADJUSTMENTS
-----------
SECTION 5.1 Adjustment of Exercise Rate; Notices. The Exercise Rate is
------------------------------------
subject to adjustment from time to time as provided in this Section.
(a) Adjustment for Change in Capital Stock. If, after the date
--------------------------------------
hereof, the Company:
(i) pays a dividend or makes a distribution on any of its Common
Stock in shares of any of its Common Stock or Warrants, rights or options
15
exercisable for its Common Stock, other than a dividend or distribution of the
type described in Section 5.03;
(ii) pays a dividend or makes a distribution on any of
its Common Stock in shares of any of its Capital Stock (as defined below), other
than Common Stock or rights, warrants or options exercisable for its Common
Stock and other than a dividend or distribution of the type of described in
Section 5.03; or
(iii) subdivides any of its outstanding shares of Common
Stock into a greater number of shares; or
(iv) combines any of its outstanding shares of Common
Stock into a smaller number of shares; or
(v) issues by reclassification of any of its Common Stock
any shares of any of its Capital Stock;
then the Exercise Rate in effect immediately prior to such action for each
Warrant then outstanding shall be adjusted so that the holder of a Warrant
thereafter exercised may receive the number of shares of Capital Stock of the
Company which such holder would have owned immediately following such action if
such holder had exercised the Warrant immediately prior to such action or
immediately prior to the record date applicable thereto, if any (regardless of
whether the Warrants then outstanding are then exercisable). If there are no
outstanding shares of Common Stock that are of the same class as the Shares at
the time of any such action and such action has therefore been taken only in
respect of the Shares, the adjustment shall relate to the Shares in their same
form if it would not frustrate the intent and purposes of this Section 5.01.
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
In the event that such dividend or distribution is not so paid or made or such
subdivision, combination or reclassification is not effected, the Exercise Rate
shall again be adjusted to be the Exercise Rate which would then be in effect if
such record date or effective date had not been so fixed.
If after an adjustment a holder of a Warrant upon exercise of such
Warrant may receive shares of two or more classes of Capital Stock of the
Company, the Exercise Rate shall thereafter be subject to adjustment upon the
occurrence of an action taken with respect to any such class of Capital Stock as
is contemplated by this Article V with respect to the Common Stock, on terms
comparable to those applicable to Common Stock in this Article V.
(b) Adjustment for Sale of Common Stock Below Current Market Value.
--------------------------------------------------------------
If, after the date hereof, the Company grants or sells any Common Stock or any
securities convertible into or exchangeable or exercisable for any Common Stock
at a price below the then Current Market Value other than:
----------------------------------------------
(c) pursuant to the exercise of the Warrants,
16
(d) pursuant to any security convertible into, or exchangeable or
exercisable for shares of Common Stock outstanding as of the date of this
Agreement,
(e) upon the conversion, exchange or exercise of any convertible,
exchangeable or exercisable security as to which upon the issuance thereof an
adjustment pursuant to this Article V has been made, and
(f) upon the conversion, exchange or exercise of convertible,
exchangeable or exercisable securities of the Company outstanding on the date of
this Agreement (to the extent in accordance with the terms of such securities as
in effect on the date of this Agreement)
(g) the Exercise Rate for each Warrant then outstanding shall be
adjusted in accordance with the formula:
E' = E x (O + N)
--------------
(O + (N x P/M))
where:
E' = the adjusted Exercise Rate for each Warrant then outstanding;
E = the then current Exercise Rate for each Warrant then outstanding;
O = the number of shares of Common Stock outstanding immediately prior
to the sale of Common Stock or issuance of securities convertible,
exchangeable or exercisable for Common Stock;
N = the number of shares of Common Stock so sold or the maximum stated
number of shares of Common Stock issuable upon the conversion,
exchange or exercise of any such convertible, exchangeable or
exercisable securities, as the case may be;
P = the proceeds per share of Common Stock received by the Company,
which (i) in the case of shares of Common Stock is the amount
received by the Company in consideration for the sale and issuance
of such shares; and (ii) in the case of securities convertible into
or exchangeable or exercisable for shares of Common Stock is the
amount received by the Company in consideration for the sale and
issuance of such convertible or exchangeable or exercisable
securities, plus the minimum aggregate amount of additional
consideration, other than the surrender of such convertible or
exchangeable securities, payable to the Company upon exercise,
conversion or exchange thereof; and
M = the Current Market Value as of the Time of Determination or at the
time of sale, as the case may be.
The adjustment shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights,
warrants or options to which this paragraph (b) applies or upon consummation of
the sale of Common Stock, as the case may be. To the extent that shares of
Common Stock are not delivered after the expiration of such rights or warrants,
the Exercise Rate for each Warrant then outstanding shall be readjusted to the
Exercise Rate which would otherwise be in effect had the adjustment made upon
the issuance of such
17
rights or warrants been made on the basis of delivery of only the number of
shares of Common Stock actually delivered. In the event that such rights or
warrants are not so issued, the Exercise Rate for each Warrant then outstanding
shall again be adjusted to be the Exercise Rate which would then be in effect if
such date fixed for determination of stockholders entitled to receive such
rights or warrants had not been so fixed.
No adjustment shall be made under this paragraph (b) if the
application of the formula stated above in this paragraph (b) would result in a
value of E' that is lower than the value of E.
No adjustment shall be made under this paragraph (b) for any
adjustment which is the subject of paragraph (a) of this Section 5.01.
No adjustment in the Exercise Rate shall be made under this paragraph
(b) upon the conversion, exchange or exercise of options to acquire shares of
Common Stock by officers, directors or employees of the Company; provided that
--------
the exercise price of such options, at the time of issuance thereof, is at least
equal to the then Current Market Value of the Common Stock underlying such
options.
(h) Notice of Adjustment. Whenever the Exercise Rate is adjusted, the
--------------------
Company shall promptly mail to holders of Warrants then outstanding at the
addresses appearing on the Warrant Register a notice of the adjustment. The
Company shall file with the Warrant Agent and any other Registrar such notice
and a certificate from the Company's independent public accountants briefly
stating the facts requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence that the adjustment is correct.
Neither the Warrant Agent nor any such Registrar (a) shall be deemed to have
knowledge of any adjustment of the Exercise Rate unless and until such
certificate is received, and (b) shall be under any duty or responsibility with
respect to any such certificate except to exhibit the same during normal
business hours to any holder desiring inspection thereof.
(i) Reorganization of Company; Special Distributions. (i) If the
------------------------------------------------
Company, in a single transaction or through a series of related transactions,
merges, consolidates or amalgamates with or into any other person or sells,
assigns, transfers, leases, conveys or otherwise disposes of all or
substantially all of its properties and assets to another person or group of
affiliated persons or is a party to a merger or binding share exchange which
reclassifies or changes its outstanding Common Stock (a "Fundamental
-----------
Transaction"), as a condition to consummating any such transaction the person
-----------
formed by or surviving any such consolidation or merger if other than the
Company or the person to whom such transfer has been made (the "Surviving
---------
Person") shall enter into a supplemental warrant agreement. The supplemental
------
warrant agreement shall provide (a) that the holder of a warrant then
outstanding may exercise it for the kind and amount of securities, cash or other
assets which such holder would have received immediately after the Fundamental
Transaction if such holder had exercised the Warrant immediately before the
effective date of the transaction (regardless of whether the Warrants are then
exercisable), assuming (to the extent applicable) that such holder (i) was not a
constituent person or an affiliate of a constituent person to such transaction,
(ii) made no election with respect thereto, and (iii) was treated alike with the
plurality of non-electing holders, and (b) that the Surviving Person shall
succeed to and be substituted to every right and obligation of the
18
Company in respect of this Agreement and the Warrants. The supplemental warrant
agreement shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article V. The
Surviving Person shall mail to holders of Warrants at the addresses appearing on
the Warrant Register a notice briefly describing the supplemental warrant
agreement. If the issuer of securities deliverable upon exercise of Warrants is
an affiliate of the Surviving Person, that issuer shall join in the supplemental
warrant agreement.
(ii) Notwithstanding the foregoing, if the Company enters into a
Fundamental Transaction with another Person (other than a subsidiary of the
Company) and consideration is payable to holders of shares of Capital Stock (or
other securities or property) issuable or deliverable upon exercise of the
Warrants that are exercisable in exchange for their shares in connection with
such Fundamental Transaction which consists solely of cash, then the holders of
Warrants shall be entitled to receive distributions on the date of such event on
an equal basis with holders of such shares (or other securities issuable upon
exercise of the Warrants) as if the Warrants had been exercised immediately
prior to such event, less the Exercise Price therefor. Upon receipt of such
payment, if any, the rights of a holder of such a Warrant shall terminate and
cease and such holder's Warrants shall expire.
(iii) If this paragraph (d) applies, it shall supersede the
application of paragraph (a) of this Section 5.01.
(j) Company Determination Final. Any determination that the Company
---------------------------
or the Board of Directors of the Company must make pursuant to this Article V is
conclusive absent manifest error.
(k) Warrant Agent's Adjustment Disclaimer. The Warrant Agent has no
-------------------------------------
duty to determine when an adjustment under this Article V should be made, how it
should be made or what it should be. The Warrant Agent has no duty to determine
whether a supplemental warrant agreement under paragraph (f) need be entered
into or whether any provisions of any supplemental warrant agreement are
correct. The Warrant Agent shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon exercise of Warrants. The Warrant Agent shall not be responsible for the
Company's failure to comply with this Article V.
(l) Adjustment for Tax Purposes. The Company may make such increases
---------------------------
in the Exercise Rate, in addition to those otherwise required by this Section,
as it considers to be advisable in order that any event treated for Federal
income tax purposes as a dividend of stock or stock rights shall not be taxable
to the recipients.
(m) Underlying Shares. The Company shall at all times reserve and
-----------------
keep available, free from preemptive rights, out of its authorized but unissued
Common Stock or Common Stock held in the treasury of the Company, for the
purpose of effecting the exercise of Warrants, the full number of Shares then
deliverable upon the exercise of all Warrants then outstanding and payment of
the exercise price, and the shares so deliverable shall be fully paid and
nonassessable and free from all liens and security interests.
19
(n) Specificity of Adjustment. Irrespective of any adjustments in the
-------------------------
number or kind of shares purchasable upon the exercise of the Warrants, Warrant
Certificates theretofore or thereafter issued may continue to express the same
number and kind of Shares per Warrant as are stated on the Warrant Certificates
initially issuable pursuant to this Agreement.
(o) Voluntary Adjustment. The Company from time to time may increase
--------------------
the Exercise Rate by any number and for any period of time (provided that such
--------
period is not less than 20 Business Days). Whenever the Exercise Rate is so
increased, the Company shall mail to holders at the addresses appearing on the
Warrant Register and file with the Warrant Agent a notice of the increase. The
Company shall give the notice at least 15 days before the date the increased
Exercise Rate takes effect. The notice shall state the increased Exercise Rate
and the period it will be in effect. A voluntary increase in the Exercise Rate
does not change or adjust the Exercise Rate otherwise in effect as determined by
this Section 5.01.
(p) Multiple Adjustments. After an adjustment to the Exercise Rate
--------------------
for outstanding Warrants under this Article V, any subsequent event requiring an
adjustment under this Article V shall cause an adjustment to the Exercise Rate
for outstanding Warrants as so adjusted.
(q) Definitions.
-----------
"Affiliate" of any specified Person means any other Person which,
---------
directly or indirectly, controls, is controlled by or is under direct or
indirect common control with such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
-------
"controlling," "controlled by" and "under common control with") when used with
----------- ------------- -------------------------
respect to any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.
"Capital Stock" means, with respect to any person, any and all shares,
-------------
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of, such person's capital stock, whether
outstanding on the Issue Date (as defined in the Indenture) or issued after the
Issue Date, and any and all rights, warrants or options exchangeable for or
convertible into such capital stock.
"Current Market Value" per share of Common Stock of the Company or any
--------------------
other security at any date means (i) if the security is not registered under the
Exchange Act, (a) the value of the security, determined in good faith by the
Board of Directors of the Company and certified in a board resolution, based on
the most recently completed arm's-length transaction between the Company and a
person other than an Affiliate of the Company and the closing of which occurs on
such date or shall have occurred within the six-month period preceding such
date, or (b) if no transaction shall have occurred on such date or within such
six-month period, the fair market value of the security as determined by an
Independent Financial Expert (provided that, in the case of the calculation of
Current Market Value for determining the cash value of fractional shares, any
such determination within six months that is, in the good faith judgment of the
Board, a reasonable determination of value, may be utilized) or (ii) (a) if the
security is
20
registered under the Exchange Act, the average of the daily closing sales prices
of the securities for the 20 consecutive days immediately preceding such date,
or (b) if the securities have been registered under the Exchange Act for less
than 20 consecutive trading days immediately preceding such date, then the
average of the daily closing sales prices for all of the trading days before
such date for which closing sales prices are available, in the case of each of
(ii)(a) and (ii)(b), as certified to the Warrant Agent by the President, the
Chief Executive Officer or the Chief Financial Officer of the Company. The
closing sales price for each such trading day shall be: (A) in the case of a
security listed or admitted to trading on any United States national securities
exchange or quotation system, the closing sales price, regular way, on such day,
or if no sale takes place on such day, the average of the closing bid and asked
prices on such day, (B) in the case of a security not then listed or admitted to
trading on any national securities exchange or quotation system, the last
reported sale price on such day, or if no sale takes place on such day, the
average of the closing bid and asked prices on such day, as reported by a
reputable quotation source designated by the Company, (C) in the case of a
security not then listed or admitted to trading on any national securities
exchange or quotation system and as to which no such reported sale price or bid
and asked prices are available, the average of the reported high bid and low
asked prices on such day, as reported by a reputable quotation service, or a
newspaper of general circulation in the Borough of Manhattan, City and State of
New York, customarily published on each Business Day, designated by the Company,
or, if there shall be no bid and asked prices on such day, the average of the
high bid and low asked prices, as so reported, on the most recent day (not more
than 30 days prior to the date in question) for which prices have been so
reported and (D) if there are not bid and asked prices reported during the 30
days prior to the date in question, the Current Market Value shall be determined
as if the Shares (or other securities) were not registered under the Exchange
Act.
"Independent Financial Expert" means a United States investment
----------------------------
banking firm of national or regional standing in the United States (i) which
does not, and whose directors, officers and employees or Affiliates do not have
a direct or indirect material financial interest for its proprietary account in
the Company or any of its Affiliates and (ii) which, in the judgment of the
Board of Directors of the Company, is otherwise independent with respect to the
Company and its Affiliates and qualified to perform the task for which it is to
be engaged.
"Time of Determination" means, (i) in the case of any distribution of
---------------------
securities or other property to existing stockholders to which paragraph (b)
applies, the time and date of the determination of stockholders entitled to
receive such securities or property or (ii) in the case of any other issuance
and sale to which paragraph (b) applies, the time and date of such issuance or
sale.
(r) When De Minimis Adjustment may be Deferred. No Adjustment in the
------------------------------------------
Exercise Rate need be made unless the adjustment would require an increase of at
least 1% in the Exercise Rate. Any adjustments that are not made shall be
carried forward and taken into account in any subsequent adjustments. All
calculations under this Section 5 shall be made to the nearest 1/1000th of a
share, as the case may be.
SECTION 5.2 Fractional Shares. The Company will not be required to
-----------------
issue fractional Shares upon exercise of the Warrants or distribute Share
certificates that evidence fractional Shares. In lieu of fractional Shares,
there shall be paid to the registered holders of
21
Warrant Certificates at the time Warrants evidenced thereby are exercised as
herein provided an amount in cash equal to the same fraction of the Current
Market Value, per Share on the Business Day preceding the date the Warrant
Certificates evidencing such Warrants are surrendered for exercise. Such
payments will be made by check or by transfer to an account maintained by such
registered holder with a bank in The City of New York. If any holder surrenders
for exercise more than one Warrant Certificate, the number of Shares deliverable
to such holder may, at the option of the Company, be computed on the basis of
the aggregate amount of all the Warrants exercised by such holder.
SECTION 5.3 Certain Distributions. If at any time the Company
---------------------
grants, issues or sells options, convertible securities, or rights to purchase
stock, warrants or other securities pro rata to the record holders of any Common
--- ----
Stock of the Company ("Distribution Rights") or, without duplication, makes any
-------------------
dividend or otherwise makes any distribution, including, subject to applicable
law, pursuant to any plan of liquidation ("Distribution") on Common Stock, then
------------
the Company shall grant, issue, sell or make to each registered holder of
Warrants then outstanding, the aggregate Distribution Rights or Distribution, as
the case may be, which such holder would have acquired if such holder had held
the maximum number of Shares acquirable upon complete exercise of such holder's
Warrants (regardless of whether the Warrants are then exercisable) immediately
before the record date for the grant, issuance or sale of such Distribution
Rights or Distribution, as the case may be, or, if there is no such record date,
the date as of which the record holders of Common Stock are to be determined for
the grant, issue or sale of such Distribution Rights or Distribution, as the
case may be.
ARTICLE 6
CONCERNING THE WARRANT AGENT
----------------------------
SECTION 6.1 Warrant Agent. The Company hereby appoints State
-------------
Street Bank and Trust Company of California, N.A. as Warrant Agent of the
Company in respect of the Warrants and the Warrant Certificates upon the terms
and subject to the conditions herein and in the Warrant Certificates set forth;
and State Street Bank and Trust Company of California, N.A. hereby accepts such
appointment. The Warrant Agent shall have the powers and authority specifically
granted to and conferred upon it in the Warrant Certificates and hereby and such
further powers and authority to act on behalf of the Company as the Company may
hereafter grant to or confer upon it and it shall accept in writing. All of the
terms and provisions with respect to such powers and authority contained in the
Warrant Certificates are subject to and governed by the terms and provisions
hereof. The Warrant Agent may act through agents and shall not be responsible
for the misconduct or negligence of any such agent appointed with due care.
SECTION 6.2 Conditions of Warrant Agent's Obligations. The Warrant
-----------------------------------------
Agent accepts its obligations herein set forth upon the terms and conditions
hereof and in the Warrant Certificates, including the following, to all of which
the Company agrees and to all of which the rights hereunder of the holders from
time to time of the Warrant Certificates shall be subject:
(a) The Warrant Agent shall be entitled to
compensation to be agreed upon with the Company in writing for all services
rendered by it and the Company
22
agrees promptly to pay such compensation and to reimburse the Warrant Agent for
its reasonable out-of-pocket expenses (including reasonable fees and expenses of
counsel) incurred without gross negligence or willful misconduct on its part in
connection with the services rendered by it hereunder. The Company also agrees
to indemnify the Warrant Agent and any predecessor Warrant Agent, their
directors, officers, affiliates, agents and employees for, and to hold them and
their directors, officers, affiliates, agents and employees harmless against,
any loss, liability or expense of any nature whatsoever (including, without
limitation, reasonable fees and expenses of counsel) incurred without gross
negligence or willful misconduct on the part of the Warrant Agent, arising out
of or in connection with its acting as such Warrant Agent hereunder and its
exercise of its rights and performance of its obligations hereunder. The
obligations of the Company under this Section 6.02 shall survive the exercise
and the expiration of the Warrant Certificates and the resignation and removal
of the Warrant Agent.
(b) In acting under this Agreement and in connection
with the Warrant Certificates, the Warrant Agent is acting solely as agent of
the Company and does not assume any obligation or relationship of agency or
trust for or with any of the owners or holders of the Warrant Certificates.
(c) The Warrant Agent may consult with counsel of its
selection and any advice or written opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such advice or
opinion.
(d) The Warrant Agent shall be fully protected and
shall incur no liability for or in respect of any action taken or omitted to be
taken or thing suffered by it in reliance upon any Warrant Certificate, notice,
direction, consent, certificate, affidavit, opinion of counsel, instruction,
statement or other paper or document reasonably believed by it to be genuine and
to have been presented or signed by the proper parties.
(e) The Warrant Agent, and its officers, directors,
affiliates and employees ("Related Parties"), may become the owners of, or
---------------
acquire any interest in, Warrant Certificates, shares or other obligations of
the Company with the same rights that it or they would have it if were not the
Warrant Agent hereunder and, to the extent permitted by applicable law, it or
they may engage or be interested in any financial or other transaction with the
Company and may act on, or as depositary, trustee or agent for, any committee or
body of holders of shares or other obligations of the Company as freely as if it
were not the Warrant Agent hereunder. Nothing in this Agreement shall be deemed
to prevent the Warrant Agent or such Related Parties from acting in any other
capacity for the Company.
(f) The Warrant Agent shall not be under any liability
for interest on, and shall not be required to invest, any monies at any time
received by it pursuant to any of the provisions of this Agreement or of the
Warrant Certificates.
(g) The Warrant Agent shall not be under any
responsibility in respect of the validity of this Agreement (or any term or
provision hereof) or the execution and delivery hereof (except the due execution
and delivery hereof by the Warrant Agent) or in respect of the validity or
execution of any Warrant Certificate (except its authentication thereof).
23
(h) The recitals and other statements contained herein
and in the Warrant Certificates (except as to the Warrant Agent's authentication
thereon) shall be taken as the statements of the Company and the Warrant Agent
assumes no responsibility for the correctness of the same. The Warrant Agent
does not make any representation as to the validity or sufficiency of this
Agreement or the Warrant Certificates, except for its due execution and delivery
of this Agreement; provided, however, that the Warrant Agent shall not be
-------- -------
relieved of its duty to authenticate the Warrant Certificates as authorized by
this Agreement. The Warrant Agent shall not be accountable for the use or
application by the Company of the proceeds of the exercise of any Warrant.
(i) Before the Warrant Agent acts or refrains from
acting with respect to any matter contemplated by this Warrant Agreement, it may
require:
(1) an Officers' Certificate (as defined in the
Indenture) stating on behalf of the Company that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Warrant Agreement
relating to the proposed action have been complied with; and
(2) if reasonably necessary in the sole judgment
of the Warrant Agent, an opinion of counsel for the Company stating that, in the
opinion of such counsel, all such conditions precedent have been complied with
provided that such matter is one customarily opined on by counsel.
(3) Each Officers' Certificate or, if requested,
an opinion of counsel with respect to compliance with a condition or covenant
provided for in this Warrant Agreement shall include:
(4) a statement that the person making such
certificate or opinion has read such covenant or condition;
(5) a brief statement as to the nature and scope
of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(6) a statement that, in the opinion of such
person, he or she has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(7) a statement as to whether or not, in the
opinion of such person, such condition or covenant has been complied with.
(j) The Warrant Agent shall be obligated to perform
such duties as are herein and in the Warrant Certificates specifically set forth
and no implied duties or obligations shall be read into this Agreement or the
Warrant Certificates against the Warrant Agent. The Warrant Agent shall not be
accountable or under any duty or responsibility for the use by the Company of
any of the Warrant Certificates authenticated by the Warrant Agent and delivered
by it to the Company pursuant to this Agreement. The Warrant Agent shall have no
24
duty or responsibility in case of any default by the Company in the performance
of its covenants or agreements contained in the Warrant Certificates or in the
case of the receipt of any written demand from a holder of a Warrant Certificate
with respect to such default, including, without limiting the generality of the
foregoing, any duty or responsibility to initiate or attempt to initiate any
proceedings at law or otherwise or, except as provided in Section 7.02 hereof,
to make any demand upon the Company.
(k) Unless otherwise specifically provided herein, any
order, certificate, notice, request, direction or other communication from the
Company made or given under any provision of this Agreement shall be sufficient
if signed by its chairman of the Board of Directors, its president, its
treasurer, its controller or any vice president or its secretary or any
assistant secretary.
(l) The Warrant Agent shall have no responsibility in
respect of any adjustment pursuant to Article V hereof.
(m) The Company agrees that it will perform, execute,
acknowledge and deliver, or cause to be performed, executed, acknowledged and
delivered, all such further and other acts, instruments and assurances as may
reasonably be required by the Warrant Agent for the carrying out or performing
by the Warrant Agent of the provisions of this Agreement.
(n) The Warrant Agent is hereby authorized and
directed to accept written instructions with respect to the performance of its
duties hereunder from any one of the chairman of the Board of Directors, chief
executive officer, the chief financial officer, any vice president or the
secretary or assistant secretary of the Company or any other officer or official
of the Company reasonably believed to be authorized to give such instructions
and to apply to such officers or officials for advice or instructions in
connection with its duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with instructions with
respect to any matter arising in connection with the Warrant Agent's duties and
obligations arising under this Agreement. Such application by the Warrant Agent
for written instructions from the Company may, at the option of the Warrant
Agent, set forth in writing any action proposed to be taken or omitted by the
Warrant Agent with respect to its duties or obligations under this Agreement and
the date on or after which such action shall be taken and the Warrant Agent
shall not be liable for any action taken or omitted in accordance with a
proposal included in any such application on or after the date specified therein
(which date shall be not less than 10 Business Days after the Company receives
such application unless the Company consents to a shorter period), provided that
(i) such application includes a statement to the effect that it is being made
pursuant to this paragraph (n) and that unless objected to prior to such date
specified in the application, the Warrant Agent will not be liable for any such
action or omission to the extent set forth in such paragraph (n) and (ii) prior
to taking or omitting any such action, the Warrant Agent has not received
written instructions objecting to such proposed action or omission.
(o) Whenever in the performance of its duties under
this Agreement the Warrant Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such
25
fact or matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed on behalf of the Company by any one of the chairman of the
Board of Directors, the chief executive officer, the chief financial officer,
any vice president or the secretary or assistant secretary of the Company or any
other officer or official of the Company reasonably believed to be authorized to
give such instructions and delivered to the Warrant Agent; and such certificate
shall be full authorization to the Warrant Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement in reliance
upon such certificate.
(p) The Warrant Agent shall not be required to risk or
expend its own funds in the performance of its obligations and duties hereunder.
SECTION 6.3 Resignation and Appointment of Successor. (a) The
----------------------------------------
Company agrees, for the benefit of the holders from time to time of the Warrant
Certificates, that there shall at all times be a Warrant Agent hereunder.
(b) The Warrant Agent may at any time resign as
Warrant Agent by giving written notice to the Company of such intention on its
part, specifying the date on which its desired resignation shall become
effective; provided, however, that such date shall be at least 60 days after the
-------- -------
date on which such notice is given unless the Company agrees to accept less
notice. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor Warrant Agent, qualified as provided in Section 6.03(d)
hereof, by written instrument in duplicate signed on behalf of the Company, one
copy of which shall be delivered to the resigning Warrant Agent and one copy to
the successor Warrant Agent. As provided in Section 6.03(d) hereof, such
resignation shall become effective upon the earlier of (x) the acceptance of the
appointment by the successor Warrant Agent or (y) 60 days after receipt by the
Company of notice of such resignation. The Company may, at any time and for any
reason, and shall, upon any event set forth in the next succeeding sentence,
remove the Warrant Agent and appoint a successor Warrant Agent by written
instrument in duplicate, specifying such removal and the date on which it is
intended to become effective, signed on behalf of the Company, one copy of which
shall be delivered to the Warrant Agent being removed and one copy to the
successor Warrant Agent. The Warrant Agent shall be removed as aforesaid if it
shall become incapable of acting, or shall be adjudged a bankrupt or insolvent,
or a receiver of the Warrant Agent or of its property shall be appointed, or any
public officer shall take charge or control of it or of its property or affairs
for the purpose of rehabilitation, conservation or liquidation. Any removal of
the Warrant Agent and any appointment of a successor Warrant Agent shall become
effective upon acceptance of appointment by the successor Warrant Agent as
provided in Section 6.03(d). As soon as practicable after appointment of the
successor Warrant Agent, the Company shall cause written notice of the change in
the Warrant Agent to be given to each of the registered holders of the Warrants
in the manner provided for in Section 8.04 hereof.
(c) Upon resignation or removal of the Warrant Agent,
if the Company shall fail to appoint a successor Warrant Agent within a period
of 60 days after receipt of such notice of resignation or removal, then the
holder of any Warrant Certificate or the retiring Warrant Agent may apply to a
court of competent jurisdiction for the appointment of a successor to the
Warrant Agent. Pending appointment of a successor to the Warrant Agent,
26
either by the Company or by such a court, the duties of the Warrant Agent shall
be carried out by the Company.
(d) Any successor Warrant Agent, whether appointed by
the Company or by a court, shall be a bank or trust company in good standing,
incorporated under the laws of the United States of America or any State thereof
and having (or, in the case of subsidiary of a bank holding company, its parent
shall have), at the time of its appointment, a combined capital surplus of at
least $50 million. Such successor Warrant Agent shall execute and deliver to its
predecessor and to the Company an instrument accepting such appointment
hereunder and all the provisions of this Agreement, and thereupon such successor
Warrant Agent, without any further act, deed or conveyance, shall become vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as Warrant Agent hereunder,
and such predecessor shall thereupon become obligated to (i) transfer and
deliver, and such successor Warrant Agent shall be entitled to receive, all
securities, records or other property on deposit with or held by such
predecessor as Warrant Agent hereunder and (ii) upon payment of the amounts then
due it pursuant to Section 6.02(a) hereof, pay over, and such successor Warrant
Agent shall be entitled to receive, all monies deposited with or held by any
predecessor Warrant Agent hereunder.
(e) Any corporation or bank into which the Warrant
Agent hereunder may be merged or converted, or any corporation or bank with
which the Warrant Agent may be consolidated, or an corporation or bank resulting
from any merger, conversion or consolidation to which the Warrant Agent shall be
a party, or any corporation or bank to which the Warrant Agent shall sell or
otherwise transfer all or substantially all of its corporate trust business
(including the administration of this Warrant Agreement), shall be the successor
to the Warrant Agent under this Agreement (provided that such corporation or
bank shall be qualified as aforesaid) without the execution or filing of any
document or any further act on the part of any of the parties hereto.
(f) No Warrant Agent under this Warrant Agreement
shall be personally liable for any action or omission of any successor Warrant
Agent.
ARTICLE 7
MISCELLANEOUS
-------------
SECTION 7.1 Amendment. This Agreement and the terms of the
---------
Warrants may be amended by the Company and the Warrant Agent, without the
consent of the holder of any Warrant Certificate, for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective or
inconsistent provision contained herein or therein, or to effect any assumptions
of the Company's obligations hereunder and thereunder by a successor corporation
under the circumstances described in Section 5.01(d) hereof or in any other
manner which the Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of the Warrant Certificates.
The Company and the Warrant Agent may amend, modify or supplement this
Agreement and the terms of the Warrants, and waivers to departures from the
terms hereof and
27
thereof may be given, with the consent of the Requisite Warrant Holders (as
defined below) for the purpose of adding any provision to or changing in any
manner or eliminating any of the provisions of this Agreement or modifying in
any manner the rights of the holders of the outstanding Warrants; provided,
--------
however, that no such modification that increases the Exercise Price or
-------
decreases the Exercise Rate, makes any change to the last paragraph of Section
5.01(d), reduces the period of time during which the Warrants are exercisable
hereunder, or effects any change to this Section 7.01 may be made with respect
to any Warrant without the consent of the holder of such Warrant. "Requisite
---------
Warrant Holders" means (i) in the case of any amendment, modification,
---------------
supplement or waiver affecting Warrant Holders as such holders of a majority in
number of the outstanding Warrants so affected, or (ii) in the case of any
amendment, modification, supplement or waiver affecting Warrant Holders, a
majority in number of Shares represented by the Warrants that would be issuable
assuming exercise thereof at the time such amendment, modification, supplement
or waiver is voted upon. Notwithstanding any other provision of this Agreement,
the Warrant Agent's consent must be obtained regarding any supplement or
amendment which alters the Warrant Agent's rights or duties (it being expressly
understood that the foregoing shall not be in derogation of the right of the
Company to remove the Warrant Agent in accordance with Section 6.03 hereof). For
purposes of any amendment, modification or waiver hereunder, Warrants held by
the Company or any of its Affiliates shall be disregarded.
Any modification or amendment made in accordance with this Agreement
will be conclusive and binding on all present and future holders of Warrant
Certificates whether or not they have consented to such modification or
amendment or waiver and whether or not notation of such modification or
amendment is made upon such Warrant Certificates. Any instrument given by or on
behalf of any holder of a Warrant Certificate in connection with any consent to
any modification or amendment will be conclusive and binding on all subsequent
holders of such Warrant Certificate.
SECTION 7.2 Notices and Demands to the Company and Warrant Agent.
----------------------------------------------------
If the Warrant Agent shall receive any notice or demand addressed to the Company
by the holder of a Warrant Certificate pursuant to the provisions hereof or of
the Warrant Certificates, the Warrant Agent shall promptly forward such notice
or demand to the Company.
SECTION 7.3 Addresses for Notices to Parties and for Transmission
-----------------------------------------------------
of Documents. All notices hereunder to the parties hereto shall be deemed to
------------
have been given when sent by certified or registered mail, postage prepaid, or
by facsimile transmission, confirmed by first class mail, postage prepaid,
addressed to any party hereto as follows:
To the Company:
Equinix, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
To the Warrant Agent:
State Street Bank and Trust Company
28
of California, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration (Equinix, Inc. Warrant
Agreement)
To the Warrant Agent's New York Agent:
State Street Bank and Trust Company, N.A.
▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration (Equinix, Inc. Warrant
Agreement)
or at any other address of which either of the foregoing shall
have notified the other in writing.
SECTION 7.4 Notices to Holders. Notices to holders of Warrants
------------------
shall be mailed to such holders at the addresses of such holders as they appear
in the Warrant Register. Any such notice shall be sufficiently given if sent by
first-class mail, postage prepaid.
SECTION 7.5 APPLICABLE LAW; SUBMISSION TO JURISDICTION. THE
------------------------------------------
VALIDITY, INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT AND EACH WARRANT
CERTIFICATE ISSUED HEREUNDER AND OF THE RESPECTIVE TERMS AND PROVISIONS THEREOF
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAWS PROVISIONS THEREOF.
SECTION 7.6 Persons Having Rights Under Agreement. Nothing in this
-------------------------------------
Agreement expressed or implied and nothing that may be inferred from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the Company, the Warrant Agent, the
holders of the Warrant Certificates and, with respect to Sections 4.02 and 4.04,
the holders of Shares issued pursuant to Warrants, any right, remedy or claim
under or by reason of this Agreement or of any covenant, condition, stipulation,
promise or agreement hereof; and all covenants (except for Sections 4.02 and
4.04 which shall be for the benefit of all holders of Shares issued pursuant to
Warrants), conditions, stipulations, promises and agreements in this Agreement
contained shall be for the sole and exclusive benefit of the Company and the
Warrant Agent and their successors and of the holders of the Warrant
Certificates.
SECTION 7.7 Headings, etc.. The table of contents, cross reference
--------------
table and the descriptive headings of the several Articles and Sections of this
Agreement are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
29
SECTION 7.8 Counterparts. This Agreement may be executed in any
------------
number of counterparts, each of which so executed shall be deemed to be an
original; but such counterparts shall together constitute but one and the same
instrument.
SECTION 7.9 Inspection of Agreement. A copy of this Agreement
-----------------------
shall be available during regular business hours at the principal corporate
trust office of the Warrant Agent, for inspection by the holder of any Warrant
Certificate. The Warrant Agent may require such holder to submit his Warrant
Certificate for inspection by it.
SECTION 7.10 Availability of Equitable Remedies. Since a breach of
----------------------------------
the provisions of this Agreement could not adequately be compensated by money
damages, holders of Warrants shall be entitled, in addition to any other right
or remedy available to them, to an injunction restraining such breach or a
threatened breach and to specific performance of any such provision of this
Agreement, and in either case no bond or other security shall be required in
connection therewith, and the parties hereby consent to such injunction and to
the ordering of specific performance.
SECTION 7.11 Obtaining of Governmental Approvals. The Company will
-----------------------------------
from time to time take all action required to be taken by it which may be
necessary to obtain and keep effective any and all permits, consents and
approvals of governmental agencies and authorities and securities acts filings
under United States Federal and state laws, and the rules and regulations of all
stock exchanges on which the Warrants are listed which may be or become
requisite in connection with the issuance, sale, transfer and delivery of the
Warrant Certificates, the exercise of the Warrants or the issuance, sale,
transfer and delivery of the Shares issued upon exercise of the Warrants.
[Signature Page Follows]
30
IN WITNESS WHEREOF, this Warrant Agreement has been duly executed by
the parties hereto as of the day and year first written above.
EQUINIX, INC.
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
STATE STREET BANK AND TRUST COMPANY OF
CALIFORNIA, N.A., as Warrant Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FACE]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE 'SECURITIES ACT'). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE DATE WHICH IS TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUE DATE AND THE LAST DATE ON WHICH THE ISSUER
OR AN AFFILIATE OF THE ISSUER WAS THE OWNER OF THE SECURITY, IN EITHER CASE
OTHER THAN (1) TO THE ISSUER, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ('RULE 144A'), TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER
IS BEING EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE WARRANT AGREEMENT (AS
DEFINED BELOW) PRIOR TO THE EXPIRATION OF THE APPLICABLE DISTRIBUTION COMPLIANCE
PERIOD (WITHIN THE MEANING OF RULE 903(c)(3) OF REGULATION S UNDER THE
SECURITIES ACT), A CERTIFICATE WHICH MAY BE OBTAINED FROM THE ISSUER OR THE
WARRANT AGENT IS DELIVERED BY THE TRANSFEREE TO THE ISSUER AND THE WARRANT
AGENT, (4) TO AN INSTITUTION THAT IS AN ACCREDITED INVESTOR AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION, AND A CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS
DELIVERED BY THE TRANSFEREE TO THE ISSUER AND THE WARRANT AGENT, (5) PURSUANT TO
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF
APPLICABLE) UNDER THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ANY OTHER APPLICABLE SECURITIES LAWS. AN INSTITUTIONAL ACCREDITED INVESTOR
HOLDING THIS SECURITY AGREES IT WILL FURNISH TO THE ISSUER AND THE WARRANT AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER
A-1
HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE ISSUER THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A OR (2) AN INSTITUTION THAT IS AN ACCREDITED INVESTOR AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING
THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING
THE REQUIREMENTS OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT.
A-2
CUSIP #[ ]
No. [ ] [ ] Warrants
WARRANT CERTIFICATE
EQUINIX, INC.
This Warrant Certificate certifies that STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., or registered assigns, is the registered holder of
200,000 warrants (the "Warrants") to purchase shares of Common Stock, par value
$0.001 per share (the "Common Stock"), of EQUINIX, INC., a Delaware corporation
(the "Company," which term includes its successors and assigns). Each Warrant
entitles the holder to purchase from the Company at an any time from 9:00 a.m.
New York City time on or after the Exercisability Date until 5:00 p.m., New York
City time, on December 1, 2007 (the "Expiration Date"), 11.255 fully paid,
registered and non-assessable shares of Common Stock, subject to adjustment as
provided in Article V of the Warrant Agreement, at the exercise price of $0.01
for each share purchased (the "Exercise Price"), which has been paid to the
Company on the date of issuance of this Warrant and is non-refundable whether or
not this Warrant is exercised or otherwise surrendered for cancellation. The
shares of Common Stock purchasable upon exercise of a Warrant are herein
referred to as the "Shares" and, unless the context otherwise requires, such
term shall also mean the other securities or property purchasable and
deliverable upon exercise of a Warrant as provided in the Warrant Agreement. A
Warrant may be exercised solely by the surrender of the Warrant at any office or
agency maintained for that purpose by the Company (the "Warrant Agent Office"),
as provided in the Warrant Agreement. Capitalized terms used herein without
being defined herein shall have the definitions ascribed to such terms in the
Warrant Agreement.
The Company has initially designated the principal corporate trust
office of State Street Bank and Trust Company, N.A., an affiliate of the Warrant
Agent, in the Borough of Manhattan, The City of New York, as the initial Warrant
Agent Office. The number of Shares issuable upon exercise of the Warrants is
subject to adjustment upon the occurrence of certain events set forth in the
Warrant Agreement.
Any Warrants not exercised on or prior to 5:00 p.m., New York City
time, on December 1, 2007 shall thereafter be void.
If the Company merges, amalgamates or consolidates with or into, or
sells all or substantially all of its property and assets to, another Person
solely for cash, the holders of Warrants shall be entitled to receive
distributions on the date of such event on an equal basis with holders of Shares
(or other securities issuable upon exercise of the Warrants) as if the Warrants
had been exercised immediately prior to such event (less the Exercise Price).
Reference is hereby made to the further provisions on the reverse
hereof which provisions shall for all purposes have the same effect as though
fully set forth at this place.
This Warrant Certificate shall not be valid unless countersigned by
the Warrant Agent, as such term is used in the Warrant Agreement.
A-3
THIS WARRANT CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.
A-4
WITNESS the seal of the Company and signatures of its duly authorized officers.
Dated: December 1, 1999
EQUINIX, INC.
By: ___________________________
Name:
Title:
Attest:
By: ___________________________
Name:
Title:
Countersignature:
This is one of the Warrants referred to in the within mentioned Warrant
Agreement:
STATE STREET BANK AND TRUST COMPANY
OF CALIFORNIA, N.A.,
as Warrant Agent
By: ___________________________
Authorized Signatory
A-5
[FORM OF WARRANT CERTIFICATE]
[REVERSE]
EQUINIX, INC.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring at 5:00 p.m., New York City time, on
December 1, 2007 (the "Expiration Date"), each of which represents the right to
purchase at any time on or after the Exercisability Date (as defined in the
Warrant Agreement) and on or prior to the Expiration Date 11.255 shares of
Common Stock, subject to adjustment as set forth in the Warrant Agreement. The
Warrants are issued pursuant to a Warrant Agreement dated as of December 1, 1999
(the "Warrant Agreement"), duly executed and delivered by the Company to State
Street Bank and Trust Company of California, N.A., as Warrant Agent (the
"Warrant Agent"), which Warrant Agreement is hereby incorporated by reference in
and made a part of this instrument and is hereby referred to for a description
of the rights, limitation of rights, obligations, duties and immunities
thereunder of the Warrant Agent, the Company and the holders (the words
"holders" or "holder" meaning the registered holders or registered holder) of
the Warrants.
Warrants may be exercised by surrendering at any Warrant Agent Office
this Warrant Certificate with the form of Election to Exercise set forth hereon
duly completed and executed.
If all of the items referred to in the preceding paragraph are
received by the Warrant Agent at or prior to 12:00 Noon, New York City time, on
a Business Day, the exercise of the Warrant to which such items relate will be
effective on such Business Day. If any items referred to in the preceding
paragraph are received after 12:00 Noon, New York City time, on a Business Day,
the exercise of the Warrants to which such item relates will be deemed to be
effective on the next succeeding Business Day. Notwithstanding the foregoing,
in the case of an exercise of Warrants on December 1, 2007, if all of the items
referred to in the preceding paragraph are received by the Warrant Agent at or
prior to 5:00 p.m., New York City time, on such Expiration Date, the exercise of
the Warrants to which such items relate will be effective on the Expiration
Date.
As soon as practicable after the exercise of any Warrant or Warrants,
the Company shall issue or cause to be issued to or upon the written order of
the registered holder of this Warrant Certificate, a certificate or certificates
evidencing the Share or Shares to which such holder is entitled, in fully
registered form, registered in such name or names as may be directed by such
holder pursuant to the Election to Exercise, as set forth on the reverse of this
Warrant Certificate. Such certificate or certificates evidencing the Share or
Shares shall be deemed to have been issued and any persons who are designated to
be named therein shall be deemed to have become the holder of record of such
Share or Shares as of the close of business on the date upon which the exercise
of this Warrant was deemed to be effective as provided in the preceding
paragraph.
The Company will not be required to issue fractional shares of Common
Stock upon exercise of the Warrants or distribute Share certificates that
evidence fractional shares of Common Stock. In lieu of fractional shares of
A-6
Common Stock, there shall be paid to the registered Holder of this Warrant
Certificate at the time such Warrant Certificate is exercised an amount in cash
equal to the same fraction of the Current Market Value per share of Common Stock
on the Business Day preceding the date this Warrant Certificate is surrendered
for exercise.
Warrant Certificates, when surrendered at any office or agency
maintained by the Company for that purpose by the registered holder thereof in
person or by legal representative or attorney duly authorized in writing, may be
exchanged for a new Warrant Certificate or new Warrant Certificates evidencing
in the aggregate a like number of Warrants, in the manner and subject to the
limitations provided in the Warrant Agreement, without charge except for any tax
or other governmental charge imposed in connection therewith.
Upon due presentment for registration of transfer of this Warrant
Certificate at any office or agency maintained by the Company for that purpose,
a new Warrant Certificate evidencing in the aggregate a like number of Warrants
shall be issued to the transferee in exchange for this Warrant Certificate,
subject to the limitations provided in the Warrant Agreement, without charge
except for any tax or other governmental charge imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the registered
holder hereof as the absolute owner of this Warrant Certificate (notwithstanding
any notation of ownership or other writing hereon made by anyone) for the
purpose of any exercise hereof and for all other purposes, and neither the
Company nor the Warrant Agent shall be affected by any notice to the contrary.
The term "Business Day" shall mean any day on which (i) banks in New
York city, (ii) the principal U.S. securities exchange or market, if any, on
which the Common Stock is listed or admitted to trading and (iii) the principal
U.S. securities exchange or market, if any, on which the Warrants are listed or
admitted to trading are open for business.
The Warrants and the Shares are entitled to the benefits of a
registration rights agreement relating to the Warrants and the shares of Common
Stock issuable upon exercise thereof (the "Registration Rights Agreement"),
pursuant to which the holders representing not less than a majority of
Registrable Securities (as defined in the Registration Rights Agreement) have
the right under certain circumstances to require the Company to effect one
demand registration of the Registrable Securities. The Registration Rights
Agreement also provides the holders of Registrable Securities with the right,
subject to the conditions and limitations contained therein, to include the
Registrable Securities in certain registration statements filed by the Company
for its account or for the account of any of its securityholders.
A-7
(FORM OF ELECTION TO EXERCISE)
(To be executed upon exercise of Warrants on the Exercise Date)
The undersigned hereby irrevocably elects to exercise [ ] of
the Warrants represented by this Warrant Certificate.
The undersigned requests that a certificate representing such Shares
be registered in the name of ____________________ whose address is ____________
and that such shares be delivered to ______________________ whose address is
___________________________. Any cash payments to be paid in lieu of a
fractional Share should be made to _____________ whose address is
__________________________ and the check representing payment thereof should be
delivered to ________________________ whose address is
_____________________________.
Dated ____________________________, _________
Name of holder of
Warrant Certificate: ________________________________________________________
(Please Print)
Tax Identification or
Social Security Number: _____________________________________________________
Address: ____________________________________________________________________
____________________________________________________________________
Signature: _________________________________________________________
Note: The above signature must correspond with the name as
written upon the face of this Warrant Certificate in
every particular, without alteration or enlargement
or any change whatever and if the certificate
representing the Shares or any Warrant Certificate
representing Warrants not exercised is to be
registered in a name other than that in which this
Warrant Certificate is registered, or if any cash
payment to be paid in lieu of a fractional share is
to be made to a person other than the registered
holder of this Warrant Certificate, the signature of
the holder hereof must be guaranteed as provided in
the Warrant Agreement.
A-8
Dated ______________________, _________
Signature: _________________________________________________
Note: The above signature must correspond with the
name as written upon the face of this
Warrant Certificate in every particular,
without alteration or enlargement or any
change whatever.
Signature Guaranteed: ______________________________________
[FORM OF ASSIGNMENT]
For value received _______________________ hereby sells,
assigns and transfers unto __________________________ the within Warrant
Certificate, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint ______________________ attorney, to
transfer said Warrant Certificate on the books of the within-named Company, with
full power of substitution in the premises.
Dated ______________________, _________
Signature: _________________________________________________
Note: The above signature must correspond with the
name as written upon the face of this
Warrant Certificate in every particular,
without alteration or enlargement or any
change whatever.
Signature Guaranteed: ______________________________________
A-9
SCHEDULE OF EXCHANGES OF CERTIFICATED WARRANTS1
The following exchanges of a part of this Global Warrant for certificated
Warrants have been made:
Number of Warrants of
Amount of decrease in Amount of increase in this Global Warrant Signature of
Date of Number of Warrants of Number of Warrants of following such authorized officer
Exchange this Global Warrant this Global Warrant decrease (or increase) of Warrant Agent
------------------------------------------------------------------------------------------------------------------
______________
1 This is to be included only if the Warrant is in global form.
A-10
EXHIBIT B
---------
FORM OF LEGEND FOR GLOBAL WARRANT
Any Global Warrant authenticated and delivered hereunder shall bear a
legend in substantially the following form:
THIS SECURITY IS A GLOBAL WARRANT WITHIN THE MEANING OF THE WARRANT
AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
WARRANT AGREEMENT, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF
THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY
A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE WARRANT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
B-1
EXHIBIT C
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF WARRANTS
Re: Warrants to Purchase Common Stock
(the "Warrants") of EQUINIX, INC.
This Certificate relates to _____ Warrants held in* ____ book-entry
or* _____ certificated form by _____________ (the "Transferor").
The Transferor:*
has requested the Warrant Agent by written order to deliver in
exchange for its beneficial interest in the Global Warrant held by the
Depositary a Warrant or Warrants in definitive, registered form of authorized
denominations and an aggregate number equal to its beneficial interest in such
Global Warrant (or the portion thereof indicated above); or
has requested the Warrant Agent by written order to exchange or
register the transfer of a Warrant or Warrants.
In connection with such request and in respect of each such
Warrant, the Transferor does hereby certify that Transferor is familiar with the
Warrant Agreement relating to the above captioned Warrants and the restrictions
on transfers thereof as provided in Section 1.08 of such Warrant Agreement, and
that the transfer of this Warrant does not require registration under the
Securities Act of 1933, as amended (the "Act") because*:
---
Such Warrant is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 1.08(a)(y)(A) or Section
1.08(d)(i)(A) of the Warrant Agreement).
Such Warrant is being transferred to a qualified institutional
buyer (as defined in Rule 144A under the Act), in reliance on Rule 144A.
Such Warrant is being transferred to an "institutional accredited
investor" (within the meaning of subparagraphs (a)(1), (2), (3) or (7) of Rule
501 under the Act).
Such Warrant is being transferred in reliance on Regulation S
under the Act.
Such Warrant is being transferred in accordance with Rule 144
under the Act.
C-1
Such Warrant is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the Act.
______________________________________________________________________________
[INSERT NAME OF TRANSFEROR]
By:___________________________________________________________________________
Date: ______________________________
*Check applicable box.
C-2
EXHIBIT D
Form of Certificate to Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
-----------------------------------------------
__________, _____
State Street Bank and Trust Company
of California, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration (Equinix, Inc. Warrant Agreement)
Ladies and Gentlemen:
In connection with our proposed purchase of warrants (the
"Warrants") to purchase Common Stock of Equinix, Inc. (the "Company"), we
confirm that:
1. We have received such information as we deem necessary in
order to make our investment decision.
2. We understand that any subsequent transfer of the Warrants
is subject to certain restrictions and conditions set forth in the Warrant
Agreement and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Warrants except in compliance with, such restrictions
and conditions and the Securities Act of 1933, as amended (the "Securities
Act").
3. We understand that the offer and sale of the Warrants have
not been registered under the Securities Act, and that the Warrants may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons except as permitted in the following sentence. We agree, on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Warrants prior to (x) the date which is two
years after the later of the date of original issuance of the Warrants (or such
shorter period as may be prescribed by Rule 144(k) under the Securities Act or
any successor provision thereto) or the last day on which the Company or any
affiliate of the Company was owner of such Warrants, or any predecessor thereto,
and (y) such later date, if any, as may be required by applicable laws, we will
do so only (A) to the Company, (B) inside the United States in accordance with
Rule 144A under the Securities Act to a "qualified institutional buyer" (as
defined therein), (C) inside the United States to an institutional "accredited
investor" (as defined below) that, prior to such transfer, furnishes (or has
furnished on its behalf by a U.S. broker-dealer) to the Warrant Agent a signed
letter substantially in the form hereof, (D) outside the United States in
accordance with Regulation S under the Securities Act, (E) pursuant to the
exemption from registration provided
D-1
by Rule 144 under the Securities Act (if available) or (F) pursuant to an
effective registration statement under the Securities Act and (G) pursuant to
another available exemption under the Securities Act, and we further agree to
provide to any person purchasing Warrants from us a notice advising such
purchaser that resales of the Warrants are restricted as stated herein.
4. We understand that, on any proposed resale of Warrants, we will
be required to furnish to the Warrant Agent and the Company, such certification,
legal opinions and other information as the Warrant Agent and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Warrants purchased by us will bear
a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Warrants, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or their investment, as the case may be.
6. We are acquiring the Warrants purchased by us for our account or
for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
D-2
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:________________________
[Authorized Signatory]
Upon transfer the Warrants would be registered in the name of the new beneficial
owner as follows:
Name:___________________________
Address:________________________
Taxpayer ID Number:_____________
D-3
EXHIBIT E
Form of Certificate to Be Delivered
in Connection with Regulation S Transfers
-----------------------------------------
___________, ______
State Street Bank and Trust Company
of California, N.A.
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Attention: Corporate Trust Administration (Equinix, Inc. Warrant Agreement)
Ladies and Gentlemen:
In connection with our proposed sale of Warrants of Equinix, Inc.
(the "Company"), we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the Securities Act of 1933, as amended (the
"Securities Act"), and, accordingly, we represent that:
(1) the offer of the Warrants was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United States, or
(b) the transaction was executed in, on or through the facilities of a
designated off-shore securities market and neither we nor any person acting on
our behalf knows that the transaction has been pre-arranged with a buyer in the
United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer restrictions
applicable to the Warrants; and
(6) if the circumstances set forth in Rule 904(c) under the
Securities Act are applicable, we have complied with the additional conditions
therein, including (if applicable) sending a confirmation or other notice
stating that the Warrants may be offered and sold during the restricted period
specified in Rule 903(c)(2) or (3), as applicable, in accordance with the
provisions of Regulation S; pursuant to registration of the Warrants under the
Securities Act; or pursuant to an available exemption from the registration
requirements under the Act.
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You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Defined terms used herein without
definition have the respective meanings provided in Regulation S under the
Securities Act.
Very truly yours,
[Name of Transferor]
By:_____________________________
[Authorized Signatory]
Upon transfer the Warrants would be registered in the name of the new beneficial
owner as follows:
Name:________________________________
Address:_____________________________
Taxpayer ID Number:__________________
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EXHIBIT F
FORM OF RECEIPT OF PAYMENT OF THE EXERCISE PRICE
EQUINIX, INC.
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(▇▇▇) ▇▇▇-▇▇▇▇
December 1, 1999
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
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State Street Bank and Trust Company
of California, N.A.
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Attention: Corporate Trust Administration (Equinix, Inc. Warrant Agreement)
Ladies and Gentlemen,
Reference is made to the Warrant Agreement (the "Warrant Agreement")
of even date herewith between Equinix, Inc. (the "Company") and State Street
Bank and Trust Company of California, N.A. Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to such terms in the
Warrant Agreement.
The Company hereby acknowledges receipt on the date hereof of
$22,510.00 representing payment in full of the Exercise Price of the Warrants.
No further payment by any holder of Warrants shall be required upon any exercise
of the Warrants. The payment of the Exercise Price is nonrefundable, whether or
not the Warrants are exercised or otherwise surrendered for cancellation.
F-1
Very truly yours,
EQUINIX, INC.
__________________________
Name:
By:_______________________
Name:
Title:
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