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Exhibit 10.31
PURCHASE AND OPTION AGREEMENT
PURCHASE AND OPTION AGREEMENT (the "Agreement"), dated as of December
31, 1998 by and between Caminus Energy Ventures LLC, a Delaware limited
liability company (the "Company"), and SS&C Technologies, Inc., a Delaware
corporation ("SS&C"). Capitalized terms used herein and not otherwise defined
shall have their respective meanings given in the LLC Agreement (as defined
below).
R E C I T A L S
WHEREAS, SS&C is a Series A Capital Member of the Company and holds the
SS&C Warrant to purchase a Series B Membership Interest in the Company
(collectively, such interest of SS&C in the Company are referred to as the "SS&C
Interests") pursuant to a Subscription Agreement with the Company dated as of
May 12, 1998 (the "Subscription Agreement") and the Limited Liability Company
Agreement of the Company dated as of May 12, 1998 (including the appendices
thereto, and as amended and supplemented to the date hereof, the "LLC
Agreement");
WHEREAS, pursuant to the LLC Agreement, the Company and SS&C are parties
to the License Agreement;
WHEREAS, the parties desire to have the Company repurchase the SS&C
Interests from SS&C;
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein, and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. Repurchase of SS&C Interests. SS&C hereby sells to the Company, and
the Company hereby purchases from SS&C, all of the SS&C Interests, free and
clear of any and all liens, claims and encumbrances whatsoever created by or
through SS&C, in consideration of the payment of TWO MILLION TWO HUNDRED FIFTY
THOUSAND DOLLARS ($2,250,000.00), which amount shall be paid by the Company in
cash by wire transfer to an account identified by SS&C for this purpose not
later than January 31, 1999. Payment of the debt created by this Agreement shall
be made not later than that date, and to the extent such amount is not paid on
or before that date, the unpaid balance shall accrue interest until paid at the
rate of ten percent (10%) per annum. As a result of such purchase, SS&C hereby
ceases to have any interest in the capital, profits or losses of or in the
Company (including, without limitation, pursuant to the SS&C Warrant), and the
SS&C Interest are hereby extinguished without any further obligation or
liability of the parties to one another, effective as of December 31, 1998.
Without limiting the generality of the foregoing, SS&C hereby ceases to have any
liability or obligation for the additional cash call referred to in Section
4.1.2 of the LLC Agreement and hereby ceases to have the right to designate a
member of the Management Committee of the Company pursuant to Section 6.2.1 of
the LLC Agreement.
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2. New License Agreement. The parties acknowledge that the existing
Distributor Agreement dated as of May 12, 1998 relating to the license to the
Company of certain products of SS&C is being terminated pursuant to the terms of
a new, separate Distributor Agreement dated as of even date herewith providing
for the license of certain products of SS&C to the Company.
3. Grant of Option.
(a) Subject to the terms of this Section 3, the Company hereby
grants to SS&C the right and option (the "Option") to purchase the number of
notional shares of the Series B Membership Interest in the Company reflected
opposite its name under the column "Series B Shares" on Exhibit "A" attached
hereto; immediately after giving effect to the repurchase of the SS&C Interests
and the grant of the Option, the ownership of the Company, expressed on a
notional share basis, shall be as set forth on Exhibit "A" hereto. The interest
represented by the Option shall be subject to dilution as a result of the
issuance of additional Membership Interests in the Company after the date hereof
(including, without limitation, pursuant to the exercise of options and other
rights hereafter granted pursuant to any Option Plan). Further, but without
limiting the generality of the foregoing, such interest shall be subject to
dilution as a result of the issuance of a Membership Interest in connection with
the purchase by the Company of the minority interest in the Company's ZAI*NET
Software, L.P. subsidiary.
(b) The Option is fully vested and fully exercisable as of the
date hereof (provided, that at the time of any proposed exercise, SS&C shall be
in full compliance with the New License Agreement). To exercise the Option
(which may be exercised only in full, and not in part), SS&C shall give written
notice ("Exercise Notice") to the Company to that effect not later than December
31, 2003 ("Expiration Date"); if the Option is not properly exercised on or
before the Expiration Date, it shall be null and void and of no further value.
The Exercise Notice shall be accompanied by the cash payment of the exercise
price of the Option, which is TWO MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS
($2,250,000.00). In connection with exercise, the Company shall be entitled to
require that SS&C pay the amount of withholding and other taxes, if any,
required by law to be paid or withheld by the Company in connection therewith.
Further, it shall be a condition to the exercise of the Option that SS&C execute
a counterpart to the LLC Agreement (as it may have been amended or supplemented
through the date of exercise) and agree to be bound by all of the provisions
thereof. No interest in the Option may be transferred or assigned in any form of
transaction without the prior written consent of the Company; provided, that the
Company's consent shall not be required for a transfer in connection with the
sale of all or substantially all of the assets or business of SS&C as an
entirety (whether by merger, stock sale, sale of assets or otherwise), provided
further that the buyer in such transaction is not in any material respect a
competitor of the Company and such buyer expressly agrees in writing to be bound
by all of the restrictive provisions of this Agreement and the LLC Agreement
with respect to the Option and the Membership Interest issuable upon exercise
thereof. In connection with any Sale or Qualified Public Offering, the Company
may require SS&C, by written notice to such effect give at least ten (10) days
prior to the anticipated closing of such transaction, to either exercise or
forfeit the Option, simultaneously with and contingent upon such closing.
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4. Representations and Warrants of SS&C. SS&C hereby represents and
warrants to the Company as follows:
(a) SS&C is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware, having full power and
authority to own its properties and to carry on its business as conducted.
(b) SS&C has the requisite corporate power and authority to
deliver this Agreement and the new License Agreement, and perform its
obligations herein and therein, and consummate the transactions contemplated
hereby and thereby. SS&C has duly executed and delivered this Agreement and the
New License Agreement and has obtained the necessary authorization to execute
and deliver this Agreement and the New License Agreement and to perform its
obligations herein and therein and consummate the transactions contemplated
hereby and thereby. Each of this Agreement and the New License Agreement is
valid, legal and binding obligation of SS&C enforceable against SS&C in
accordance with their respective terms, except to the extent that enforceability
may be limited by applicable bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally and subject to general principles
of equity (regard less of whether such enforcement is considered in a proceeding
at law or in equity).
(c) SS&C understand that the Option and the notional shares of
the Series B Membership Interest issuable upon exercise thereof have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
in reliance on an exemption therefrom for transactions not involving any public
offering, that such securities have not been approved or disapproved by the
Securities and Exchange Commission or by any other federal or state agency, and
that no such agency has passed on the accuracy or adequacy of disclosures made
to SS&C by the Company. SS&C has had an opportunity to ask questions of and
receive answers from the Company, or a person or persons acting on its behalf,
concerning the terms and condition pertaining to the Option, which questions
have been answered to the full satisfaction of SS&C, and has also had an
opportunity to obtain any additional information that the Company possesses or
can reasonably acquire without undue expense that is necessary to verify the
accuracy of the information furnished to SS&C. SS&C further understands that
neither the Option nor the notional shares of the Series B Membership Interest,
nor any interest therein, may be sold or transferred except pursuant to a
registration or an available exemption from registration under the Securities
Act. Finally, SS&C acknowledges that the purchase price for the SS&C Interest
specified in this Agreement is the result of arms' length negotiations involving
a number of factors, including the termination of the existing License Agreement
and the execution of the New License Agreement, and that such purchase price may
not alone reflect a valuation of the Company that is consistent with other
transactions occurring at the same or approximately the same time as the
transactions contemplated by this Agreement. In particular, but without limiting
the generality of the foregoing, SS&C acknowledges that it has been fully
apprised of the Company's discussions with the holder of the minority interest
in the Company's ZAI*NET Software, L.P. subsidiary for the possible exchange of
notional shares of the Series A Membership Interest in the Company for such
minority interest.
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(d) The SS&C Interests are (immediately prior to giving effect
to the repurchase thereof contemplated by this Agreement) owned, beneficially
and of record, solely and wholly by SS&C, and it has not granted any interest
therein to any other person or entity, and such SS&C Interests are held by SS&C
free and clear of any and all liens, claims and encumbrances whatsoever (other
than any such claims arising under the LLC Agreement); and the sale of the SS&C
Interests by SS&C to the Company contemplated hereby will convey to the Company
all right, title and interest therein.
5. Representations and Warrants of the Company. The Company hereby
represents and warrants to SS&C as follows:
(a) The Company is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of Delaware,
having full power and authority to own its properties and to carry on its
business as conducted.
(b) The Company has the requisite power and authority to deliver
this Agreement and the New License Agreement, and perform its obligations herein
and therein; and consummate the transactions contemplated hereby and thereby.
The Company has duly executed and delivered this Agreement and the New License
Agreement and has obtained the necessary authorization to execute and deliver
this Agreement and the New License Agreement and to perform its obligations
herein and therein and consummate the transactions contemplated hereby and
thereby. Each of this Agreement and the New License Agreement is a valid, legal
and binding obligation of the Company enforceable against the Company in
accordance with their respective terms, except to the extent that enforceability
may be limited by applicable bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally and subject to general principles
of equity (regardless of whether such enforcement is considered in a proceeding
at law or in equity).
(c) The notional shares of Series A Membership Interest issuable
upon exercise of the Option, when issued and delivered in accordance with the
terms of this Agreement, will be duly authorized, validly issued, fully paid and
non-assessable.
6. General.
(a) In the event of any litigation or other legal proceeding
involving the interpretation of this Agreement or enforcement of the rights or
obligations of the parties hereto, the prevailing party shall be entitled to
recover reasonable attorney's fees and costs as determined by the court or other
adjudicator.
(b) Each party agrees to execute and deliver any and all further
documents and writings, and to perform such other actions, as may be or become
reasonably necessary or expedient to effect and carry out the terms of this
Agreement.
(c) This Agreement is governed by and shall be construed in
accordance with the laws of the laws of the State of New York, excluding any
conflict-of-laws rule or principle that might refer the governance or
construction of the Agreement to the law of another
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jurisdiction. If any provision of this Agreement or the application thereof to
any person or circumstance is held invalid or unenforceable to any extent, the
remainder of this Agreement and the application of that provision to other
persons or circumstances is not affected thereby, and that provision shall be
enforced to the greatest extent permitted by law.
(d) Except as otherwise expressly provided herein, this
Agreement shall be binding upon and shall inure to the benefit of the parties'
respective successors and assigns.
(e) This Agreement may be executed in counterparts, each of
which shall be deemed an original and both of which shall constitute one and the
same document.
(f) All notices and other communications provided for or
permitted to be given under this Agreement shall be in writing and shall be
given by depositing the notice in the United States mail, addressed to the
person to be notified, postage prepaid, and registered or certified with return
receipt requested, or by such notice being delivered in person or by facsimile
communication to such party. Notices given or served pursuant hereto shall be
effective upon receipt by the person so notified. All notices shall be sent to
or made at, and all payments hereunder shall be made at, the address or number
given below for the parties (or such other address or number as that person may
specify by notice to the other party in the manner specified in this paragraph):
If to the Company:
c/o GFI Energy Ventures LLC
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▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to SS&C:
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Attention: President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(g) This Agreement (together with the other agreements and
instruments referred herein) constitutes the entire agreement of the parties
with respect to the subject matter hereof, and supersedes all prior or
contemporaneous oral and written communications with respect thereto. Any
modification to this Agreement must be in writing, and no modification or waiver
shall be inferred in the absence of a written instrument signed by the party to
be charged.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date first set forth above.
CAMINUS ENERGY VENTURES LLC
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
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Name: ▇. ▇▇▇▇▇▇▇▇
Its: Treasurer
SS&C TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Its: CEO
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Exhibit "A"
Notional Ownership
Post-SS&C Transaction
Series A Series A Series B Series B Series C Series C Total Total
"Shares" Percentage "Shares" Percentage "Shares" Percentage Shares Percentage
-------- ---------- ---------- ---------- -------- ---------- ---------- ----------
GFI Energy Ventures 1,682,198 2.08% 8,080,686 10.00% 9,762,884 12.08%
OCM Caminus Investment 37,176,571 46.01% 37,176,571 46.01%
RIT Capital Partners PLC 6,728,791 8.33% 6,728,791 8.33%
Durham Cam Inc. 1,682,198 2.08% 1,682,198 2.08%
▇▇▇▇▇ ▇▇▇▇▇ 6,055,912 7.49% 3,030,000 3.75% 9,085,912 11.24%
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 4,037,275 5.00% 2,020,000 2.50% 6,057,275 7.50%
SS&C Technologies, Inc. 3,636,309 4.50% 3,636,309 4.50%
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ 672,879 0.83% 672,879 0.83%
▇▇▇▇ ▇▇▇▇▇ 672,879 0.83% 1,363,156 1.69% 2,036,035 2.52%
▇▇▇▇ ▇▇▇▇▇▇ 3,364,396 4.16% 3,364,396 4.16%
▇▇▇▇▇▇ ▇▇▇ 525,629 0.65% 525,629 0.65%
▇▇▇▇ ▇▇▇▇▇ 60,650 0.07% 60,650 0.07%
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 17,328 0.02% 17,328 0.02%
---------- ----- ---------- ----- --------- ----- ---------- ------
Total 62,676,706 77.55% 10,049,465 12.44% 8,080,686 10.00% 80,806,857 100.00%
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CAMINUS LLC
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ph: 212 888 3600
Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇.▇▇▇▇▇▇▇.▇▇▇
March 30, 1999
SS&C Technologies, Incorporated
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Re: Distributor Agreement
Gentlemen:
This letter amends the Distributor Agreement between us dated as of
December 31, 1998 (the "DISTRIBUTOR AGREEMENT"). Specifically, this confirms
that we have agreed to the following matters relating to the Take or Pay License
Fee obligation of Caminus LLC set forth on Schedule 1 attached to the
Distributor Agreement;
1. You acknowledge that the $750,000 Take or Pay License Fee
applicable to the fourth quarter of 1998 was previously paid in
full, resulting in an aggregate remaining balance of Take or Pay
License Fees due (prior to giving effect to this letter
agreement) of $2,600,000. Further, as of the date of this
letter, Caminus LLC hereby purchases from you $1,250,000 in
value (as specified on Schedule 1 attached to the Distributor
Agreement) of licenses for SS&C Products (as defined in the
Distributor Agreement). You agree to provide such SS&C Products
and related SS&C Materials (as defined in the Distributor
Agreement) to Caminus LLC promptly following the date of this
letter. Payment for the licenses being purchased in the first
quarter of 1999 shall be made via wire transfer in accordance
with the instructions set forth in Schedule 1 of the Distributor
Agreement as follows:
(i) $875,000 is due and payable on March 31, 1999; and
(ii) $375,000 is due and payable on April 30, 1999.
2. The aggregate remaining Take or Pay License Fee obligation
(after giving effect to the purchase of licenses pursuant to
paragraph 1) is hereby amended to $750,000, payable by Caminus
LLC as follows;
(i) $250,000 is due and payable on March 31, 2000;
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(ii) $250,000 is due and payable on June 30, 2000; and
(iii) $250,000 is due and payable on September 30, 2000.
3. Payment by Caminus LLC of the amounts specified in paragraphs 1
and 2 shall constitute full payment and satisfaction of the
aggregate remaining Take or Pay License Fee obligation under the
Distributor Agreement, and no other amounts shall be due or
payable in respect thereof.
Except as expressly set forth in this letter agreement, the terms and
conditions of the Distributor Agreement shall remain in full force and effect.
If this letter correctly sets forth our agreement on these matters,
please so indicate by executing a copy of this letter in the space provided
below and return that copy to Caminus LLC. Thank you.
CAMINUS LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its: CEO
AGREED:
SS&C TECHNOLOGIES, INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Its: CEO
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CAMINUS LLC
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ph: 212 888 3600
Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇.▇▇▇▇▇▇▇.▇▇▇
March 30, 1999
SS&C Technologies, Incorporated
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Re: Purchase and Option Agreement
Gentlemen:
This letter amends the Purchase and Option Agreement between us dated as
of December 31, 1998 (the "OPTION AGREEMENT"). Specifically, this confirms that
we have agreed to the following matters relating to the terms of the Option (as
defined in the Option Agreement) specified in Section 3 of the Option Agreement:
1. The number of notional shares of Series B Membership Interest in
the Company subject to the Option is hereby reduced from
3,636,309 to 2,909,047, or a reduction of 20% from the original
position.
2. The cash payment required to exercise the Option is hereby
reduced (proportionately with the reduction in the notional
shares subject to the Option) from $2,250,000 to $1,800,000.
3. In consideration of your agreement to reduce the size of the
Option position, Caminus LLC agrees to make a cash payment to
you of $250,000, which shall be due and payable on December 31,
1999.
Except as expressly set forth in this letter agreement, the terms and
conditions of the Option and the balance of the Option Agreement shall remain in
full force and effect.
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If this letter correctly sets forth our agreement on these matters,
please so indicate by executing a copy of this letter in the space provided
below and return that copy to Caminus LLC. Thank you.
CAMINUS LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its: CEO
AGREED:
SS&C TECHNOLOGIES, INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Its: CEO