1032 LICEnergy Letter Agreement.SSI
EXHIBIT A
LICENERGY, INC.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
May 1, 1998
Scientific Software-Intercomp, Inc.
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▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, President
Gentlemen:
Reference is made to that certain Asset Purchase Agreement dated as of
March 1, 1998 (the "Agreement"), by and among Scientific Software-Intercomp,
Inc. ("SSI"), SSI ▇▇▇▇▇▇▇, Inc. and Scientific Software-Intercomp U.K., Ltd., as
Seller, and LICENERGY, INC., as Purchaser. Pursuant to the terms of the
Agreement, Seller has agreed to sell and Purchaser has agreed to buy certain
assets of the Pipeline Simulation Division of SSI as more particularly described
in the Agreement. All capitalized terms used in this letter that are not
otherwise defined shall have the meaning ascribed to such terms in the
Agreement.
Seller and Purchaser recognize that certain provisions in the Agreement
contemplated that Seller and Purchaser would need to agree upon certain matters
prior to Closing. The purpose of this letter is to set forth the understanding
of Seller and Purchaser with respect to such matters as more particularly set
forth below.
1. Exhibit B of the Agreement (List of Assumed Obligations) currently
sets forth estimated amounts for certain Assumed Obligations that are to be
assumed by Purchaser at Closing. Exhibit B further provides that the total
aggregate amount of Accounts Payable, Employee Sick Leave/Annual Leave
Liabilities and Accrued but Unpaid Sales Commission Liabilities assumed by
Purchaser would not exceed $230,000. Seller and Purchaser have now determined
that the actual amount of Accounts Payable, Employee Sick Leave/Annual Leave
Liabilities and Accrued but Unpaid Sales Commissions to be assumed by Purchaser
is $145,000. Therefore, wherever the amount "$230,000" appears in Exhibit B it
shall be replaced with "$145,000".
SSI
May 1, 1998
Page 3
2. The definition of Assets currently provides that there shall be
excluded from the Accounts Receivable to be assigned to Purchaser at Closing
those accounts receivable described in Part V of Exhibit A. Seller and
Purchaser recognize that, with respect to those projects and associated accounts
receivable identified in Part V of Exhibit A as Enron ($35,055) and
Transmitton-Fina ($16,000) (collectively, the "Subject Receivables"), Seller was
unable to complete certain work on these projects that it anticipated completing
prior to Closing. Since Seller was not able to complete such work, Seller has
agreed to assign and shall assign at Closing all of its rights in the Subject
Receivables to Purchaser. Therefore, the Subject Receivables shall be deleted
from Part V of Exhibit A of the Assignment and ▇▇▇▇ of Sale.
3. Section 10.16 of the Agreement anticipates that Seller and Purchaser
shall execute a mutually satisfactory sublease agreement, whereby Seller shall
sublease a portion of SSI-UK's office space to Purchaser. Seller and Purchaser
have agreed that LICENERGY Limited shall be permitted to sublease the top floor
of the building known as ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇,
with the rent therefor deemed prepaid and satisfied, for a term commencing May
1, 1998 and expiring on the date that ▇▇▇▇▇ ▇▇▇▇▇▇ Incorporated (or its
Affiliate) acquires all of the issued and outstanding common stock of SSI or if
earlier, expiring September 30, 1998. Contemporaneously with the execution of
this letter, SSI-UK and LICENERGY Limited shall execute a Tenancy Agreement that
sets forth the remaining terms of such sublease arrangement.
4. Seller and Purchaser recognize that certain of Seller's employees
that have been hired by Purchaser cannot be moved immediately into Purchaser's
offices and will need to remain in Seller's Houston office for a period of time.
Seller agrees that such employees can remain in Seller's Houston office, without
charge to Purchaser for the use of Seller's office space, until May 15, 1998.
5. Section 2.3(b) contemplates that Purchaser shall provide Seller an
allocation of the Purchase Price prior to Closing. Seller and Purchaser hereby
agree that Purchaser shall provide such Purchase Price allocation to Seller by
May 15, 1998.
6. Section 2.4(ii) of the Agreement provides that Seller shall provide
to Purchaser at Closing releases of the liens described on Exhibit J to the
Agreement. Since Seller and Purchaser have excluded all of the Sequent computer
equipment from the Assets being assigned to Purchaser, Seller shall not be
required to provide Purchaser with a release of the ▇▇▇▇▇▇ Leasing-Capital Corp.
Financing Statement.
7. Purchaser acknowledges that the representations and warranties of
Seller in the Agreement with respect to the Contracts described in Part IIa of
Exhibit A and Part IV of Exhibit B of the Agreement, and the Seller's
certificate to be given with respect thereto under Section 6.2 of the Agreement,
shall not be deemed not to be true and correct as a result of the incomplete
status of the performance of such Contracts to the extent that the material
facts relating to such incomplete status have been disclosed to Purchaser either
in written correspondence or reports generated by Seller or Purchaser or in the
estoppel letters delivered to Purchaser in accordance with Section 6.5 of the
Agreement.
8. Purchaser shall timely provide the required acknowledgments of its
obligation to complete the performance of the Contracts with ABB Kraft AS for
the VCP Contract, Foxboro Great Britain Limited for the Enron Contract,
Northwestern Utilities Limited and Texas ▇▇▇▇▇▇▇ Division of ▇▇▇▇▇▇▇ Chemical
Company.
Please indicate your agreement to the foregoing by executing this letter in
the space provided below.
LICENERGY, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: Director of Corporate Finance
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AGREED TO AND ACCEPTED
this 1st day of May, 1998:
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SCIENTIFIC SOFTWARE-INTERCOMP,
INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
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Title: President/CEO
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SSI ▇▇▇▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
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Title: President
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SCIENTIFIC SOFTWARE-INTERCOMP
U.K., LTD.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
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Title: Director
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