Stock Rights Agreement [Amendment] - Interland Inc., Bryan Heitman and Gabriel Murphy
[INTERLAND, INC. LETTERHEAD]
March 28, 2002
Mr. Bryan Heitman
6338 N. Camden Avenue, Apt. 1
Kansas City, MO 64151
Mr. Gabriel Murphy
9228 N. Harrison
Kansas City, MO 64155
Re: Amendment to Stock Rights Agreement
Gentlemen:
I am writing to confirm our agreement amending the Stock Rights
Agreement by and among Interland, Inc., Brian Heitman and Gabriel Murphy dated
as of February 8, 2002 (the "Stock Rights Agreement"). Our agreement is to amend
Section 3(d) of the Stock Rights Agreement as follows:
1. Section 3(d) of the Stock Rights Agreement is deleted and the
following is substituted in lieu thereof, effective immediately:
(d) On the first month anniversary of the Effective Time,
and on each monthly anniversary thereafter for the next 16
months, there shall be released from the restrictions of
Section 3(a), automatically and without any action on the part
of any party hereto, an amount of Common Stock equal to 5.566%
of the Common Stock issued to such Stockholder pursuant to the
Merger Agreement as of the Effective Time, and on the
eighteenth monthly anniversary thereafter, all Common Stock
not previously released hereunder shall be released; provided
that in the event the employment of such Shareholder with the
Company ceases for any or no reason (including, without
limitation, voluntarily or involuntarily, with or without
cause or by resignation, death, disability or otherwise) then
the applicable per month percentage for releasing the
restrictions of Section 3(a) shall be 11.112% instead of
5.556%. All Common Stock released from the restrictions of
Section 3(a) shall be released for all time and all purposes,
notwithstanding
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Mr. Bryan Heitman
Mr. Gabriel Murphy
March 28, 2002
Page 2
any previous or subsequent circumstance, event, sale, transfer
or disposition including without limitation the exercise of
the Put Option Agreement. Mr. Murphy covenants and agrees to
use 50% of the proceeds (net of reasonable provisions for
federal, state and local taxes and of brokers' fees) of the
sale of his Registrable Securities to reduce his obligations
under the Promissory Notes (described in Section 3(c)).
2. If the registration statement referred to in Section 2.1(a) of
the Stock Rights Agreement (the "Registration Statement") has not been filed and
declared effective by the Securities and Exchange Commission ("SEC") on or
before June 8, 2002, then Section 3(d) of the Stock Rights Agreement, as amended
by the foregoing paragraph 1, shall be deleted and the following inserted in
lieu thereof:
(d) On the first month anniversary of the Effective Time,
and on each monthly anniversary thereafter for the next 14
months, there shall be released from the restrictions of
Section 3(a), automatically and without any action on the part
of any party hereto, an amount of Common Stock equal to 6.25%
of the Common Stock issued to such Stockholder pursuant to the
Merger Agreement as of the Effective Time, and on the
sixteenth anniversary thereafter, all Common Stock not
previously released hereunder shall be released; provided that
in the event the employment of such Shareholder with the
Company ceases for any or no reason (including, without
limitation, voluntarily or involuntarily, with or without
cause or by resignation, death, disability or otherwise) then
the applicable per month percentage for releasing the
restrictions of Section 3(a) shall be 12.5% instead of 6.25%.
All Common Stock released from the restrictions of Section
3(a) shall be released for all time and all purposes,
notwithstanding any previous or subsequent circumstance,
event, sale, transfer or disposition including without
limitation the exercise of the Put Option Agreement. Mr.
Murphy covenants and agrees to use 50% of the proceeds (net of
reasonable provisions for federal, state and local taxes and
of brokers' fees) of the sale of his Registrable Securities to
reduce his obligations under the Promissory Notes (described
in Section 3(c)).
<PAGE>
Mr. Bryan Heitman
Mr. Gabriel Murphy
March 28, 2002
Page 2
3. If the Registration Statement has not been filed and declared
effective by June 8, 2002, then each of you, and an authorized representation of
Interland, Inc., shall meet in good faith to negotiate whether and how you
should be made whole. Interland, Inc. shall continue to use its best efforts to
cause the Registration Statement to be declared effective by the SEC.
If this accurately sets forth our agreement, please execute a copy of
this letter and return it to me by facsimile (1 copy) and overnight courier (3
copies). I will then send each of you a signed original.
Very truly yours,
INTERLAND, INC.
By: /s/ Allen L. Shulman
-------------------------
Allen L. Shulman
Read and Agreed to:
/s/ Bryan Heitman
-------------------------
Bryan Heitman
/s/ Gabriel Murphy
-------------------------
Gabriel Murphy
cc: P. Mitchell Woolery, Esq.
T. Clark Fitzgerald III, Esq.