TERREMARK WORLDWIDE,
INC.
12.00% Senior Secured Notes due
2017
REGISTRATION RIGHTS
AGREEMENT
Credit Suisse
Securities (USA) LLC
Jefferies & Company, Inc.
RBC Capital Markets Corporation
Piper Jaffray & Co.
TD Securities (USA) LLC
c/o Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, New York
10010-3629
Terremark
Worldwide, Inc., a Delaware corporation (the “Issuer”),
proposes to issue and sell to Credit Suisse Securities
(USA) LLC, Jefferies & Company, Inc., RBC Capital Markets
Corporation, Piper Jaffray & Co. and TD Securities
(USA) LLC (collectively, the “Initial
Purchasers”), upon the terms set forth in a purchase
agreement of even date herewith (the “Purchase
Agreement”), $420,000,000 aggregate principal amount of its
12.00% Senior Secured Notes due 2017 (the “Initial
Securities”) to be unconditionally guaranteed (the
“Guaranties”) by the subsidiary guarantors of the
Company named in Schedule A hereto (the
“Guarantors” and together with the Issuer, the
“Company”). The Initial Securities will be issued
pursuant to an Indenture, dated as of June 24, 2009, (the
“Indenture”) among the Issuer, the Guarantors named
therein and The Bank of New York Mellon Trust Company, N.A. (the
“Trustee”). As an inducement to the Initial Purchasers,
the Company agrees with the Initial Purchasers, for the benefit of
the holders of the Initial Securities (including, without
limitation, the Initial Purchasers), the Exchange Securities (as
defined below) and the Private Exchange Securities (as defined
below) (collectively the “Holders”), as
follows:
1.
Registered Exchange Offer . The Company shall, at its own
cost, prepare and, not later than 90 days after (or if the
90th day is not a business day, the first business day thereafter)
the date of original issue of the Initial Securities (the
“Issue Date”), file with the Securities and Exchange
Commission (the “Commission”) a registration statement
(the “Exchange Offer Registration Statement”) on an
appropriate form under the Securities Act of 1933, as amended (the
“Securities Act”), with respect to a proposed offer
(the “Registered Exchange Offer”) to the Holders of
Transfer Restricted Securities (as defined in Section 6
hereof), who are not prohibited by any law or policy of the
Commission from participating in the Registered Exchange Offer, to
issue and deliver to such Holders, in exchange for the Initial
Securities, a like aggregate principal amount of debt securities
(the “Exchange Securities”) of the Company issued under
the Indenture and identical in all material respects to the Initial
Securities (except for the transfer restrictions relating to the
Initial Securities and the provisions relating to the matters
described in Section 6 hereof) that would be registered under
the Securities Act. The Company shall use its best efforts to cause
such Exchange Offer Registration Statement to become effective
under the Securities Act within 180 days (or if the 180th day
is not a business day, the first business day thereafter) after the
Issue Date of the Initial Securities and shall keep the Exchange
Offer Registration Statement effective for not less than
30 days (or longer, if required by applicable law) after the
date notice of the Registered Exchange Offer is mailed to the
Holders (such period being called the “Exchange Offer
Registration Period”).
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If the Company
effects the Registered Exchange Offer, the Company will be entitled
to close the Registered Exchange Offer 30 days after the
commencement thereof provided that the Company has accepted all the
Initial Securities theretofore validly tendered in accordance with
the terms of the Registered Exchange Offer.
Following the
declaration of the effectiveness of the Exchange Offer Registration
Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange
Offer to enable each Holder of Transfer Restricted Securities (as
defined in Section 6 hereof) electing to exchange the Initial
Securities for Exchange Securities (assuming that such Holder is
not an affiliate of the Company within the meaning of the
Securities Act, acquires the Exchange Securities in the ordinary
course of such Holder’s business and has no arrangements with
any person to participate in the distribution of the Exchange
Securities and is not prohibited by any law or policy of the
Commission from participating in the Registered Exchange Offer) to
trade such Exchange Securities from and after their receipt without
any limitations or restrictions under the Securities Act and
without material restrictions under the securities laws of the
several states of the United States.
The Company
acknowledges that, pursuant to current interpretations by the
Commission’s staff of Section 5 of the Securities Act,
in the absence of an applicable exemption therefrom, (i) each
Holder which is a broker-dealer electing to exchange Securities,
acquired for its own account as a result of market making
activities or other trading activities, for Exchange Securities (an
“Exchanging Dealer”), is required to deliver a
prospectus containing the information set forth in (a) Annex A
hereto on the cover, (b) Annex B hereto in the “Exchange
Offer Procedures” section and the “Purpose of the
Exchange Offer” section, and (c) Annex C hereto in the
“Plan of Distribution” section of such prospectus in
connection with a sale of any such Exchange Securities received by
such Exchanging Dealer pursuant to the Registered Exchange Offer
and (ii) an Initial Purchaser that elects to sell Exchange
Securities acquired in exchange for Securities constituting any
portion of an unsold allotment is required to deliver a prospectus
containing the information required by Items 507 or 508 of
Regulation S-K under the Securities Act, as applicable, in
connection with such sale.
The Company shall
use its best efforts to keep the Exchange Offer Registration
Statement effective and to amend and supplement the prospectus
contained therein, in order to permit such prospectus to be
lawfully delivered by all persons subject to the prospectus
delivery requirements of the Securities Act for such period of time
as such persons must comply with such requirements in order to
resell the Exchange Securities; provided, however, that (i) in
the case where such prospectus and any amendment or supplement
thereto must be delivered by an Exchanging Dealer or an Initial
Purchaser, such period shall be the lesser of 180 days and the
date on which all Exchanging Dealers and the Initial Purchasers
have sold all Exchange Securities held by them (unless such period
is extended pursuant to Section 3(j) below) and (ii) the
Company shall make such prospectus and any amendment or supplement
thereto, available to any broker-dealer for use in connection with
any resale of any Exchange Securities for a period of not less than
90 days after the consummation of the Registered Exchange
Offer.
If, upon
consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its
initial distribution, the Company, simultaneously with the delivery
of the Exchange Securities pursuant to the Registered Exchange
Offer, shall issue and deliver to such Initial Purchaser upon the
written request of such Initial Purchaser, in exchange (the
“Private Exchange”) for the Initial Securities held by
such Initial Purchaser, a like principal amount of debt securities
of the Company issued under the Indenture and identical in all
material respects (including the existence of restrictions on
transfer under the Securities Act and the securities laws of the
several states of the United States, but excluding provisions
relating to the matters described in Section 6 hereof) to the
Initial Securities (the “Private Exchange Securities”).
The Initial Securities, the Exchange Securities and the Private
Exchange Securities are herein collectively called the
“Securities”.
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In connection with
the Registered Exchange Offer, the Company shall:
(a) mail to each
Holder a copy of the prospectus forming part of the Exchange Offer
Registration Statement, together with an appropriate letter of
transmittal and related documents;
(b) keep the
Registered Exchange Offer open for not less than 30 days (or
longer, if required by applicable law) after the date notice
thereof is mailed to the Holders;
(c) utilize the
services of a depositary for the Registered Exchange Offer with an
address in the Borough of Manhattan, The City of New York, which
may be the Trustee or an affiliate of the Trustee;
(d) permit Holders
to withdraw tendered Securities at any time prior to the close of
business, New York time, on the last business day on which the
Registered Exchange Offer shall remain open; and
(e) otherwise
comply with all applicable laws.
As soon as
practicable after the close of the Registered Exchange Offer or the
Private Exchange, as the case may be, the Company shall:
(x) accept for
exchange all the Securities validly tendered and not withdrawn
pursuant to the Registered Exchange Offer and the Private
Exchange;
(y) deliver to the
Trustee for cancellation all the Initial Securities so accepted for
exchange; and
(z) cause the
Trustee to authenticate and deliver promptly to each Holder of the
Initial Securities, Exchange Securities or Private Exchange
Securities, as the case may be, equal in principal amount to the
Initial Securities of such Holder so accepted for
exchange.
The Indenture will
provide that the Exchange Securities will not be subject to the
transfer restrictions set forth in the Indenture and that all the
Securities will vote and consent together on all matters as one
class and that none of the Securities will have the right to vote
or consent as a class separate from one another on any
matter.
Interest on each
Exchange Security and Private Exchange Security issued pursuant to
the Registered Exchange Offer and in the Private Exchange will
accrue from the last interest payment date on which interest was
paid on the Initial Securities surrendered in exchange therefor or,
if no interest has been paid on the Initial Securities, from the
date of original issue of the Initial Securities.
Each Holder
participating in the Registered Exchange Offer shall be required to
represent to the Company that at the time of the consummation of
the Registered Exchange Offer (i) any Exchange Securities
received by such Holder will be acquired in the ordinary course of
business, (ii) such Holder will have no arrangements or
understanding with any person to participate in the distribution of
the Securities or the Exchange Securities within the meaning of the
Securities Act, (iii) such Holder is not an
“affiliate,” as defined in Rule 405 of the
Securities Act, of the Company or if it is an affiliate, such
Holder will comply with the registration and prospectus delivery
requirements of the Securities Act to the extent applicable,
(iv) if such Holder is not a broker-dealer, that it is not
engaged in, and does not intend to engage in, the distribution of
the Exchange Securities and (v) if such Holder is a
broker-dealer, that it will receive Exchange Securities for its own
account in exchange for Initial Securities that were acquired as a
result of market-making activities or other trading activities and
that it will be required to acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange
Securities.
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Notwithstanding
any other provisions hereof, the Company will ensure that
(i) any Exchange Offer Registration Statement and any
amendment thereto and any prospectus forming part thereof and any
supplement thereto complies in all material respects with the
Securities Act and the rules and regulations thereunder,
(ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading and (iii) any prospectus
forming part of any Exchange Offer Registration Statement, and any
supplement to such prospectus, does not include an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
2. Shelf
Registration . If, (i) because of any change in law or in
applicable interpretations thereof by the staff of the Commission,
the Company is not permitted to effect a Registered Exchange Offer,
as contemplated by Section 1 hereof, (ii) the Registered
Exchange Offer is not consummated within 210 days of the Issue
Date, (iii) any Initial Purchaser so requests with respect to
the Initial Securities (or the Private Exchange Securities) not
eligible to be exchanged for Exchange Securities in the Registered
Exchange Offer and held by it following consummation of the
Registered Exchange Offer, or (iv) any Holder (other than an
Exchanging Dealer) is not eligible to participate in the Registered
Exchange Offer or, in the case of any Holder (other than an
Exchanging Dealer) that participates in the Registered Exchange
Offer, such Holder does not receive freely tradeable Exchange
Securities on the date of the exchange, the Company shall take the
following actions:
(a) The Company
shall, at its cost, as promptly as practicable (but in no event
more than 30 days after so required or requested pursuant to
this Section 2) file with the Commission and thereafter shall
use its best efforts to cause to be declared effective (unless it
becomes effective automatically upon filing) a registration
statement (the “Shelf Registration Statement” and,
together with the Exchange Offer Registration Statement, a
“Registration Statement”) on an appropriate form under
the Securities Act relating to the offer and sale of the Transfer
Restricted Securities (as defined in Section 6 hereof) by the
Holders thereof from time to time in accordance with the methods of
distribution set forth in the Shelf Registration Statement and
Rule 415 under the Securities Act (hereinafter, the
“Shelf Registration”); provided, however, that no
Holder (other than an Initial Purchaser) shall be entitled to have
the Securities held by it covered by such Shelf Registration
Statement unless such Holder agrees in writing to be bound by all
the provisions of this Agreement applicable to such
Holder.
(b) The Company
shall use its best efforts to keep the Shelf Registration Statement
continuously effective in order to permit the prospectus included
therein to be lawfully delivered by the Holders of the relevant
Securities, for a period of two years (or for such longer period if
extended pursuant to Section 3(j) below) from the Issue Date or
such shorter period that will terminate when all the Securities
covered by the Shelf Registration Statement (i) have been sold
pursuant thereto or (ii)(a) are freely transferable without
restriction by persons that are not affiliates of the Company
pursuant to Rule 144 under the Securities Act or any successor
provision thereto or otherwise where no conditions of Rule 144
are then applicable (other than the holding period requirement in
paragraph (d)(1)(ii) of Rule 144 so long as such holding
period requirement is satisfied, (b) do not bear any
restrictive legends and (c) do not bear a restrictive CUSIP
number. The Company shall be deemed not to have used its best
efforts to keep the Shelf Registration Statement effective during
the requisite period if it voluntarily takes any action that would
result in Holders of Securities covered thereby not being able to
offer and sell such Securities during that period, unless such
action is required by applicable law.
(c)
Notwithstanding any other provisions of this Agreement to the
contrary, the Company shall cause the Shelf Registration Statement
and the related prospectus and any amendment or supplement thereto,
as of the effective date of the Shelf Registration Statement,
amendment or supplement, (i) to comply in all material
respects with the applicable requirements
4
of the
Securities Act and the rules and regulations of the Commission and
(ii) not to contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not
misleading.
3.
Registration Procedures . In connection with any Shelf
Registration contemplated by Section 2 hereof and, to the
extent applicable, any Registered Exchange Offer contemplated by
Section 1 hereof, the following provisions shall
apply:
(a) The Company
shall (i) furnish to each Initial Purchaser, prior to the
filing thereof with the Commission, a copy of the Registration
Statement and each amendment thereof and each supplement, if any,
to the prospectus included therein and, the Company shall use its
best efforts to reflect in each such document, when so filed with
the Commission, such comments as such Initial Purchaser reasonably
may propose; (ii) include the information set forth in Annex A
hereto on the cover, in Annex B hereto in the “Exchange Offer
Procedures” section and the “Purpose of the Exchange
Offer” section and in Annex C hereto in the “Plan of
Distribution” section of the prospectus forming a part of the
Exchange Offer Registration Statement and include the information
set forth in Annex D hereto in the Letter of Transmittal delivered
pursuant to the Registered Exchange Offer; (iii) if requested
by an Initial Purchaser, include the information required by Items
507 or 508 of Regulation S-K under the Securities Act, as
applicable, in the prospectus forming a part of the Exchange Offer
Registration Statement; (iv) include within the prospectus
contained in the Exchange Offer Registration Statement a section
entitled “Plan of Distribution,” reasonably acceptable
to the Initial Purchasers, which shall contain a summary statement
of the positions taken or policies made by the staff of the
Commission with respect to the potential “underwriter”
status of any broker-dealer that is the beneficial owner (as
defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) of Exchange
Securities received by such broker-dealer in the Registered
Exchange Offer (a “Participating Broker-Dealer”),
whether such positions or policies have been publicly disseminated
by the staff of the Commission or such positions or policies, in
the reasonable judgment of the Initial Purchasers based upon advice
of counsel (which may be in-house counsel), represent the
prevailing views of the staff of the Commission; and (v) in
the case of a Shelf Registration Statement, include in the
prospectus included in the Shelf Registration Statement (or, if
permitted by Commission Rule 430B(b), in a prospectus
supplement that becomes a part thereof pursuant to Commission
Rule 430B(f)) that is delivered to any Holder pursuant to
Section 3(d) and (f), the names of the Holders, who propose to sell
Securities pursuant to the Shelf Registration Statement, as selling
securityholders.
(b) The Company
shall give written notice to the Initial Purchasers, the Holders of
the Securities to be sold pursuant to the Shelf Registration
Statement and any Participating Broker-Dealer from whom the Company
has received prior written notice that it will be a Participating
Broker-Dealer in the Registered Exchange Offer (which notice
pursuant to clauses (ii)-(v) hereof shall be accompanied by an
instruction to suspend the use of the prospectus until the
requisite changes have been made):
(i) when the
Registration Statement or any amendment thereto has been filed with
the Commission and when the Registration Statement or any
post-effective amendment thereto has become effective;
(ii) of any
request by the Commission for amendments or supplements to the
Registration Statement or the prospectus included therein or for
additional information;
(iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of
any proceedings for that purpose, of the issuance by the Commission
of a notification of objection to the use of the
5
form on which
the Registration Statement has been filed, and of the happening of
any event that causes the Company to become an “ineligible
issuer,” as defined in Commission Rule 405.
(iv) of the
receipt by the Company or its legal counsel of any notification
with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and
(v) of the
happening of any event that requires the Company to make changes in
the Registration Statement or the prospectus in order that the
Registration Statement or the prospectus do not contain an untrue
statement of a material fact nor omit to state a material fact
required to be stated therein or necessary to make the statements
therein (in the case of the prospectus, in light of the
circumstances under which they were made) not
misleading.
(c) The Company
shall make every reasonable effort to obtain the withdrawal at the
earliest possible time, of any order suspending the effectiveness
of the Registration Statement.
(d) The Company
shall furnish to each Holder of Securities included within the
coverage of the Shelf Registration, without charge, at least one
copy of the Shelf Registration Statement and any post-effective
amendment or supplement thereto, including financial statements and
schedules, and, if the Holder so requests in writing, all exhibits
thereto (including those, if any, incorporated by reference). The
Company shall not, without the prior consent of the Initial
Purchasers, make any offer relating to the Securities that would
constitute a “free writing prospectus,” as defined in
Commission Rule 405.
(e) The Company
shall deliver to each Exchanging Dealer and each Initial Purchaser,
and to any other Holder who so requests, without charge, at least
one copy of the Exchange Offer Registration Statement and any
post-effective amendment thereto, including financial statements
and schedules, and, if any Initial Purchaser or any such Holder
requests, all exhibits thereto (including those incorporated by
reference).
(f) The Company
shall, during the Shelf Registration Period, deliver to each Holder
of Securities included within the coverage of the Shelf
Registration, without charge, as many copies of the prospectus
(including each preliminary prospectus) included in the Shelf
Registration Statement and any amendment or supplement thereto as
such person may reasonably request. The Company consents, subject
to the provisions of this Agreement, to the use of the prospectus
or any amendment or supplement thereto by each of the selling
Holders of the Securities in connection with the offering and sale
of the Securities covered by the prospectus, or any amendment or
supplement thereto, included in the Shelf Registration
Statement.
(g) The Company
shall deliver to each Initial Purchaser, any Exchanging Dealer, any
Participating Broker-Dealer and such other persons required to
deliver a prospectus following the Registered Exchange Offer,
without charge, as many copies of the final prospectus included in
the Exchange Offer Registration Statement and any amendment or
supplement thereto as such persons may reasonably request. The
Company consents, subject to the provisions of this Agreement, to
the use of the prospectus or any amendment or supplement thereto by
any Initial Purchaser, if necessary, any Participating
Broker-Dealer and such other persons required to deliver a
prospectus following the Registered Exchange Offer in connection
with the offering and sale of the Exchange Securities covered by
the prospectus, or any amendment or supplement thereto, included in
such Exchange Offer Registration Statement.
6
(h) Prior to any
public offering of the Securities, pursuant to any Registration
Statement, the Company shall register or qualify or cooperate with
the Holders of the Securities included therein and their respective
counsel in connection with the registration or qualification of the
Securities for offer and sale under the securities or “blue
sky” laws of such states of the United States as any Holder
of the Securities reasonably requests in writing and do any and all
other acts or things necessary or advisable to enable the offer and
sale in such jurisdictions of the Securities covered by such
Registration Statement; provided, however, that the Company shall
not be required to (i) qualify generally to do business in any
jurisdiction where it is not then so qualified or (ii) take
any action which would subject it to general service of process or
to taxation in any jurisdiction where it is not then so
subject.
(i) The Company
shall cooperate with the Holders of the Securities to facilitate
the timely preparation and delivery of certificates representing
the Securities to be sold pursuant to any Registration Statement
free of any restrictive legends and in such denominations and
registered in such names as the Holders may request a reasonable
period of time prior to sales of the Securities pursuant to such
Registration Statement.
(j) Upon the
occurrence of any event contemplated by paragraphs
(ii) through (v) of Section 3(b) above during the period
for which the Company is required to maintain an effective
Registration Statement, the Company shall promptly prepare and file
a post-effective amendment to the Registration Statement or a
supplement to the related prospectus and any other required
document so that, as thereafter delivered to Holders of the
Securities or purchasers of Securities, the prospectus will not
contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading. If the Company notifies the Initial
Purchasers, the Holders of the Securities and any known
Participating Broker-Dealer in accordance with paragraphs
(ii) through (v) of Section 3(b) above to suspend the use
of the prospectus until the requisite changes to the prospectus
have been made, then the Initial Purchasers, the Holders of the
Securities and any such Participating Broker-Dealers shall suspend
use of such prospectus, and the period of effectiveness of the
Shelf Registration Statement provided for in Section 2(b) above and
the Exchange Offer Registration Statement provided for in
Section 1 above shall each be extended by the number of days
from and including the date of the giving of such notice to and
including the date when the Initial Purchasers, the Holders of the
Securities and any known Participating Broker-Dealer shall have
received such amended or supplemented prospectus pursuant to this
Section 3(j). During the period during which the Company is
required to maintain an effective Shelf Registration Statement
pursuant to this Agreement, the Company will prior to the
three-year expiration of that Shelf Registration Statement file,
and use its best efforts to cause to be declared effective (unless
it becomes effective automatically upon filing) within a period
that avoids any interruption in the ability of Holders of
Securities covered by the expiring Shelf Registration Statement to
make registered dispositions, a new registration statement relating
to the Securities, which shall be deemed the “Shelf
Registration Statement” for purposes of this
Agreement.
(k) Not later than
the effective date of the applicable Registration Statement, the
Company will provide a CUSIP number for the Initial Securities, the
Exchange Securities or the Private Exchange Securities, as the case
may be, and provide the applicable trustee with printed
certificates for the Initial Securities, the Exchange Securities or
the Private Exchange Securities, as the case may be, in a form
eligible for deposit with The Depository Trust Company.
(l) The Company
will comply with all rules and regulations of the Commission to the
extent and so long as they are applicable to the Registered
Exchange Offer or the Shelf Registration and will make
genera
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