EXHIBIT 10.27.4
CAIS Internet, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. - ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Tel. (▇▇▇) ▇▇▇-▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
April 23, 1999
▇▇. ▇▇▇▇▇▇ ▇▇▇▇
Senior Vice President
Hilton Hotels Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇▇▇▇▇:
This letter will confirm the understanding and agreement among Hilton Hotels
Corporation ("HHC"), CAIS, Inc. and CAIS Internet, Inc. (CAIS, Inc. and CAIS
Internet, Inc. referred to jointly as "CAIS") regarding the establishment of a
Hilton Hotel Digital Entertainment Fund (the "Fund").
1. The purpose of the Fund is for the parties to jointly explore opportunities
to develop future digital entertainment solutions for guest rooms, and meeting
and other function rooms, at HHC properties. The opportunities would include,
but would not be limited to, the creation, design, installation and
implementation of digital video and audio services to be used by HHC guests and
others at HCC properties.
2. CAIS agrees that not later than ten (10) business days following the
effective date of CAIS Internet, Inc.'s initial public offering of its common
stock, for the purpose of funding the Fund, CAIS shall contribute into an
account (the "Fund"), to be jointly owned by CAIS and HHC, One Hundred
Thirty-Three Thousand (133,000) shares of the common stock of CAIS Internet,
Inc. (the "Contributed Shares"), with 50% of the Contributed Shares allocated to
a CAIS sub-account within the Fund. HHC will not contribute to the initial
funding of the Fund. In the future, by mutual agreement, additional funding
mechanisms for the Fund may be developed by the parties, with 50% of any such
future contributions to the Fund allocated to the HHC sub-account and 50% to the
CAIS sub-account. If the effective date of CAIS Internet, Inc.'s initial public
offering or of its common stock does not occur on or before November 1, 1999,
then the parties agree that this letter agreement shall be null and void.
3. HHC and CAIS Internet, Inc. agree that the Contributed Shares allocated to
the HHC sub-
1
account are included within the definition of Registrable Securities under the
terms of the Warrant Agreement of even date herewith between CAIS Internet, Inc.
and HHC, and HHC shall have all registration rights with respect to the
Contributed Shares allocated to the HHC sub-account that HHC has with respect to
the Registrable Securities referenced in such Warrant Agreement. At any time
following the effectiveness of a registration statement covering the Contributed
Shares allocated to the HHC sub-account or if HHC is entitled to sell such
shares under U.S. Securities and Exchange Commission Rule 144 or otherwise, HHC
shall have the right to sell any or all of the Contributed Shares in HHC's
sub-account provided that the proceeds of any such transaction(s) remain in
HHC's sub-account of the Fund.
4. HHC and CAIS commit to work together over the next 24 months to develop and
refine the direction and goals of the Fund.
5. In the event that at any time following such 24 month period, after good
faith and diligent negotiations, HHC and CAIS are unable to agree upon the
direction and goals of the Fund, then in such event the Fund would be
terminated, and HHC and CAIS Internet, Inc. each would be entitled to ownership
of the assets contained in their respective Fund sub-accounts.
If the above meets with your understanding and approval, please so indicate by
acknowledging below on behalf of HHC.
Sincerely,
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇
______________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇
President, CAIS Internet, Inc.
President, CAIS, Inc.
Agreed:
Hilton Hotels Corporation
a Delaware corporation
By: /s/ Seth Keri
_____________________
Name:
_____________________
Title: SVP-HHC
_____________________
Date: 4/23/99
_____________________
2
