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Document Preview Put Option Agreement |
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Title: |
Put Option Agreement |
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Entities: |
Peoplepc Inc; Cravath, Swaine & Moore LLP; Sullivan & Cromwell; Wilson Sonsini Goodrich & Rosati |
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Date: |
2001 |
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Size: |
Preview shows 13KB of 80KB total |
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Price: |
$43 |
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ID: |
#1565590 |
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PUT OPTION AGREEMENT
May 30, 2001
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TABLE OF CONTENTS
Page
----
1. Certain Definitions....................................................................................... 1
2. Put Option Granted to @viso............................................................................... 3
2.1 @viso Primary Put Option......................................................................... 3
2.2 @viso Secondary Put Option....................................................................... 4
2.3 Partial Exercise of Secondary Put Option by @viso................................................ 5
2.4 Change of Control................................................................................ 6
3. Put Option Granted to Softbank............................................................................ 6
3.1 Exercise or Cancellation of Warrant.............................................................. 6
3.2 Softbank Primary Put Option...................................................................... 7
3.3 Softbank Secondary Put Option.................................................................... 8
3.4 Partial Exercise of Secondary Put Option by Softbank............................................. 8
3.5 Change of Control................................................................................ 9
4. Procedure for Exercise of Put Option...................................................................... 10
4.1 Generally........................................................................................ 10
4.2 Triggering Event................................................................................. 10
4.3 Change of Control................................................................................ 10
5. Closing................................................................................................... 10
6. Representations and Warranties of Company................................................................. 11
6.1 Organization and Standing; Certificate of Incorporation and Bylaws............................... 11
6.2 Corporate Power.................................................................................. 11
6.3 Capitalization................................................................................... 11
6.4 Authorization.................................................................................... 12
6.5 Proprietary Rights............................................................................... 12
6.6 Employees........................................................................................ 12
6.7 Litigation....................................................................................... 13
6.8 Title to Properties and Assets; Liens, etc....................................................... 13
6.9 No Conflicts..................................................................................... 13
6.10 Registration Rights.............................................................................. 13
6.11 Governmental Consent, etc........................................................................ 13
6.12 Permits.......................................................................................... 14
6.13 Brokers.......................................................................................... 14
6.14 Exchange Act Reporting........................................................................... 14
6.15 Compliance with Exchange Act..................................................................... 14
7. Representations and Warranties of the Purchasers.......................................................... 14
7.1 Preexisting Relationship with Company; Business and Financial Experience......................... 14
7.2 Investment Intent; Blue Sky...................................................................... 14
-i-
7.3 Rule 144......................................................................................... 14
7.4 Restrictions on Transfer; Restrictive Legends.................................................... 15
7.5 Access to Data................................................................................... 15
7.6 Authorization.................................................................................... 15
7.7 Governmental Consent, etc........................................................................ 15
8. Covenants................................................................................................. 15
8.1 Management of PPC Europe and PPC UK.............................................................. 15
8.2 No Action........................................................................................ 16
8.3 Termination of PPC Europe Shareholders' Agreement................................................ 16
8.4 Amendment of PPC Europe Articles of Association.................................................. 16
8.5 Resignation of PPC Europe Directors.............................................................. 16
8.6 Stockholder Approval............................................................................. 16
8.7 Series A Preferred Stock......................................................................... 16
9. Delivery Obligations...................................................................................... 17
9.1 Delivery Obligations of the Company.............................................................. 17
9.2 Delivery Obligations of the Purchasers........................................................... 17
9.3 Other Delivery Obligations....................................................................... 17
10. Closing Conditions........................................................................................ 17
10.1 Conditions to Obligations of Each Party to Consummate the Acquisition............................ 17
10.2 Conditions to Obligations of the Purchasers...................................................... 18
10.3 Conditions to Obligations of Company............................................................. 18
11. Assignment of Rights...................................................................................... 19
12. Amendment................................................................................................. 19
13. Governing Law............................................................................................. 19
14. Entire Agreement.......................................................................................... 19
15. Notices, etc.............................................................................................. 19
16. Counterparts.............................................................................................. 21
17. Fees and Expenses......................................................................................... 21
18. Titles and Subtitles...................................................................................... 21
-ii-
PUT OPTION AGREEMENT
THIS PUT OPTION AGREEMENT (this "Agreement") is made and entered into as of
May 30, 2001 (the "Effective Date"), by and among (i) PeoplePC, Inc., a Delaware
corporation ("PeoplePC" or the "Company"), (ii) @viso Limited, a company
organized under the laws of the United Kingdom ("@viso"), (iii) Bowerbrook
Limited, a company organized under the laws of the United Kingdom and a wholly
owned subsidiary of @viso (iv) SOFTBANK Capital Partners LP, SOFTBANK Capital
Advisors Fund LP and SOFTBANK Capital LP, each a Delaware limited partnership
(together, "Softbank"), and (v) PeoplePC Europe N.V., a Dutch company ("PPC
Europe").
A. PeoplePC and @viso, together, own all of the outstanding capital stock
of PPC Europe, with @viso holding 11,666,667 shares of Series A Preferred Stock
and 5,000,000 shares of Series B Preferred Stock and PeoplePC holding 30,952,381
shares of Class B Common Stock.
B. Softbank holds a warrant to purchase 2,380,952 shares of Series A
Preferred Stock of PPC Europe (the "Warrant").
C. PeoplePC desires to grant to @viso (and to Softbank to the extent that
it exercises its Warrant) the option (the "Put Option") to sell all of its
shares in PPC Europe to PeoplePC in exchange for shares of PeoplePC capital
stock, such that after the exercise in full of the Put Option, PeoplePC will own
all of the outstanding capital stock of PPC Europe and @viso will hold stock of
PeoplePC.
D. The Put Option shall have two alternative forms, one which is
exercisable for a particular number of shares of PeoplePC capital stock (the
"Primary Put Option") and the other which is exercisable for PeoplePC capital
stock based on a predetermined cash value; provided that the aggregate number of
shares of capital stocks issuable shall be subject to a percentage cap (the
"Secondary Put Option").
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
contained herein, the parties to this Agreement hereby agree as follows:
1. Certain Definitions. As used in this Agreement, the following terms
-------------------
shall have the following respective meanings:
"@viso Aggregate Partial Exercise Value" shall mean the aggregate value of
the PPC Europe Stock sold to the Company by @viso in a Partial Exercise under
the @viso Secondary Put Option determined by multiplying the applicable @viso
Secondary Put Conversion Value by the Ratio then in effect.
"@viso Secondary Put Conversion Value" shall initially be US$65,000,000,
and shall thereafter be adjusted in connection with each Partial Exercise of the
Secondary Put Option by @viso as set forth in Section 2.3(b).
"Acquisition" shall mean the issuance of new equity securities by PeoplePC
to the stockholders of another company subsequent to February 20, 2001, in order
to acquire the stock or assets of that company.
"Affiliate" shall have the meaning set forth in Rule 144 promulgated under
the Securities Act.
"Change of Control" means a reorganization, merger, consolidation, sale of
all or substantially all the assets of PeoplePC, or sale of 50% or more of the
capital stock of PeoplePC where the pre-transaction stockholders of PeoplePC own
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