1
CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION, CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
EXHIBIT 10.4
OPTION CONFIDENTIAL
THIS AGREEMENT made on 11 January 1999.
BETWEEN:
WEBTRAK LIMITED
00 Xxxxxxxxx Xxxxx
Xxxxxxxxx XX0 0XX XX
("WEBTRAK")
OF THE FIRST PART
AND:
THE PARTIES LISTED ON SCHEDULE "A"
TO THIS AGREEMENT, BEING ALL OF THE
SHAREHOLDERS OF WEBTRAK LIMITED
(individually the "Shareholder" and collectively the "Shareholders")
OF THE SECOND PART
AND:
HNC SOFTWARE INC.
0000 Xxxxxxxxxxx Xxxxx Xxxx
Xxx Xxxxx, Xxxxxxxxxx XXX 00000
("HNC")
OF THE THIRD PART
IN CONSIDERATION for HNC agreeing to cause its subsidiary, Retek Information
Systems, Inc., to enter into a distribution agreement with WebTrak and for other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged) the parties hereto each covenant and agree with the other as
follows:
1. DEFINITIONS
The following terms when used in this Agreement shall have the following
definitions:
(1) "ASSETS" - means all assets owned by WebTrak including without limitation
all assets used by WebTrak in the Business and shall include the Software
and all agreements to which WebTrak is a party that HNC Software Inc.
agrees to acquire by exercising the option.
(2) "BUSINESS" - means the business carried on by WebTrak as at the date of
this Agreement and as may be expanded from time to time and shall include
the
2
- 2 -
development, maintenance, licensing, promotion, marketing and distribution
of the Software.
(3) "GROSS REVENUE" - means the License Fees paid by third party end users for
the right to license or sublicense and use the WebTrak Software.
(4) "SHARES" - means all of the issued and outstanding shares in the capital of
WebTrak not already owned by HNC which, for purposes of clarity, shall
include all of the issued and outstanding shares of each class and kind of
share in the capital of WebTrak and any options, warrants or other
agreements, securities or arrangements issued or granted that include the
right to issue shares or otherwise acquire shares in the capital of
WebTrak.
(5) "SOFTWARE" - means all the computer programs developed by WebTrak or under
license from WebTrak including the WebTrak Software and all derivatives,
object code, source code, configuration, routines and algorithms,
alterations, modifications, reconfigurations (in all forms of expression)
and all user, design, development and program manuals and other
documentation no matter how stored, transmitted, read, utilized or related
thereto and all patents, copyrights, worldwide distribution rights, trade
secrets, inventions and other intellectual property rights related thereto.
(6) "WEBTRAK SOFTWARE" - means the computer programs listed on Schedule "B".
2. EXCLUSIVE OPTION TO PURCHASE
2.1 WebTrak and the Shareholders do hereby grant to HNC the irrevocable and
exclusive option (the "OPTION") to purchase (the "OPTION TRANSACTION")
either the Assets from WebTrak or the Shares from the Shareholders, free
and clear of all claims, liens, encumbrances and rights of third parties of
every kind and nature whatsoever. The purchase price:
(1) for the Assets shall be an amount equal to the greater of: [ * ] in either
case subject to adjustments commensurate with a transaction of this nature;
or
(2) for the Shares shall be an amount equal to the greater of: [ * ] and in
either case subject to adjustments commensurate with a transaction of this
nature.
[ * ] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3
- 3 -
The decision to purchase either the Assets or the Shares shall be at the sole
option and discretion of HNC and HNC shall have no obligation to exercise the
Option or to enter into any transaction whatsoever with WebTrak and/or
Shareholders. The Option Transaction will be documented by an agreement prepared
by HNC and containing the warranties, representations, covenants and agreements
of WebTrak and the Shareholders and shall provide similar ancillary documents
and agreements all as set forth in the subscription agreement (the "SUBSCRIPTION
AGREEMENT") entered into between WebTrak, Picardy International Inc. (et al) and
dated 11 January 1999) and shall contain such other terms and conditions as HNC
may reasonably require in order to effect the Option Transaction. The Option
shall be irrevocable and open for exercise by written notice from HNC to WebTrak
(the "PURCHASE OPTION NOTICE") during the period commencing September 30th,
1999 and ending December 31st, 1999. The date on which HNC duly exercises the
Purchase Option by giving WebTrak the Purchase Option Notice is herein referred
to as the "PURCHASE OPTION NOTICE DATE". The closing of the Option Transaction
shall occur on a date as determined by HNC after completion of all necessary
documentation and in any event within one hundred twenty (120) days of the
Purchase Option Notice Date.
3. NON-SOLICITATION
3.1 ASSETS. WebTrak shall not solicit offers, agree to sell or grant any
exclusive options, licenses or similar rights with respect to all or any portion
of the Assets or the Business or agree to obtain new financing or increase
financing or loans or indebtedness of WebTrak or issue or sell, or agree to
issue or sell, any Shares after the date of this Agreement without the prior
written consent of HNC, which consent may be arbitrarily withheld unless HNC
does not duly exercise the Option in which event this clause 3.1 shall become
null and void after December 31st, 1999. WebTrak will immediately notify HNC
after receipt by WebTrak (or any of its officers, directors, employees,
affiliates, shareholders or agents) of any unsolicited proposal for or inquiry
respecting acquisition of any of the Assets or Shares or any request for
non-public information in connection with such proposal or inquiry or for access
to the properties, books or records of WebTrak by any person or entity. Such
notice to HNC will indicate in reasonable detail the identity of the person
making the proposal or inquiry and the terms and conditions of such proposal or
inquiry.
3.2 SHARES. The Shareholders shall not solicit offers or agree to sell,
encumber, hypothecate or pledge or mortgage all or any of the Shares without the
prior written consent of HNC, which consent may be arbitrarily withheld unless
HNC does not duly exercise the Option in which event this clause 3.2 shall
become null and void after December 31st, 1999. WebTrak and the Shareholders
will immediately notify HNC after receipt by WebTrak (or any of its officers,
directors, shareholders, employees, affiliates or agents) of any unsolicited
proposal for or inquiry respecting acquisition of any of the Shares or any
request for non-public information in connection with such proposal or inquiry
or for access to the properties, books or records of WebTrak by any person or
4
- 4 -
entity. Such notice to HNC will indicate in reasonable detail the identity of
the person making the proposal or inquiry and the terms and conditions of such
proposals or inquiry.
3.3 CORPORATE SHAREHOLDER. If any Shareholder is a corporate shareholder,
control of such corporate Shareholder may not be changed, directly or
indirectly, whether by operation of law or otherwise, without the prior written
of the other Shareholders and HNC (which consent may be arbitrarily withheld)
unless HNC does not duly exercise the Option in which event this clause 3.3
shall become null and void after December 31st, 1999. In addition to any other
remedies available to HNC, if such prior written consent is not obtained, and
control of a corporate shareholder changes as aforesaid, then such Shareholder
shall be deemed to be a Defaulting Shareholder as that term is defined in the
Shareholders Agreement entered into between WebTrak and the Shareholders and
dated 11 January 1999.
4. FEES AND EXPENSES
4.1 In relation to this Agreement and the Option Transaction, each party
shall be responsible for their own legal, accounting and other third party
advisory fees and expenses.
5. CONFIDENTIALITY
5.1 Neither party (or any of their officers, directors, employees,
affiliates or agents) shall discuss or disclose the existence or terms of this
Agreement or the Option Transaction other than to such legal, accounting and
financial advisors as the parties may retain with respect to the Option
Transaction on a need-to-know basis; provided that HNC may disclose such
information about this Agreement and the Option Transaction as HNC in good faith
determines may be necessary for HNC to comply with applicable securities laws,
rules and regulations. Neither party shall use or disclose confidential or
proprietary information of the other, either during or following termination of
this Agreement, save and except for disclosure to employees and consultants on a
need-to-know basis. Confidential information shall include all information of a
party that is not available in the public domain. All parties to the Agreement,
including the officers, directors and employees of the parties to this Agreement
shall not make any public announcement concerning this Agreement or discussions
or any other memorandum, letters or agreements between the parties relating to
this Agreement unless such disclosure has first been approved in writing by all
parties; provided that HNC may disclose such information about this Agreement
and the Option Transaction as in good faith HNC determines may be necessary for
HNC to comply with applicable securities laws, rules and regulations.
6. ACCESS
6.1 Upon execution of this Agreement, WebTrak shall cause and permit HNC
and its representatives, accountants, lawyers and other consultants full access,
from time to time, to the information, books, records and premises of WebTrak
and shall provide HNC with monthly reports including: (i) financial status
(balance sheet and operating
5
- 5 -
statement); (ii) sales figures; (iii) product development report; and (iv) a
report of any claims by or against WebTrak or of any off-balance sheet
liabilities of WebTrak.
7. MISCELLANEOUS
7.1 NOTICE. Any notice which may be or is required to be given pursuant to
this Agreement shall be sufficiently be given if served personally upon the
party for whom it is intended or hand delivered to the party at the address
first above written or as set forth in Schedule "A" as the case might be. The
date of receipt of any such notice shall be deemed to be the date of delivery.
7.2 ASSIGNMENT. HNC may assign all or any portion of its rights or interest
in this Agreement to any parent or subsidiary or affiliate of HNC or any company
that merges or consolidates with or into HNC. Neither WebTrak nor any of the
Shareholders may assign their rights or interest under this Agreement.
7.3 LAW. This Agreement shall be governed by and construed in accordance
with the laws of England and the parties hereto submit to the exclusive
jurisdiction of the English courts.
7.4 FURTHER ASSURANCES. Each of the parties hereto agree to execute and
deliver such further deeds and documents and give such further assurances as may
be required by the other party or parties hereto so as to give full effect to
this Agreement and its purpose.
7.5 COUNTERPARTS. This Agreement may be executed by the parties in
counterparts and when all parties have executed at least as many counterparts as
there are parties, all of such counterparts shall be deemed to be originals and
all such counterparts taken together shall constitute one and the same
agreement.
7.6 FACSIMILE EXECUTION. The parties hereto acknowledge and agree to accept
and be bound by facsimile transmitted copies of this Agreement and its
counterparts including facsimiled signatures of the parties hereto.
7.7 TIME OF THE ESSENCE. Time is of the essence of this Agreement.
7.8 ENUREMENT. This agreement shall enure to the benefit of and be binding
upon the parties hereto and their personal representatives.
AS WITNESS the hands of the parties the day and year first above written.
WEBTRAK LIMITED by its
6
- 6 -
_________________________________________
authorized signatory )
)
)
Signature ) XXXXXX
)
Print Name ) XXXXXX
_________________________________________ __________________________________
Signed by XXXXXX XXXXX XXXXX XXXXXX )
)
) XXXXXX
) XXXXXX XXXXX XXXXXX XXXXXX
)
)
)
)
)
)
)
)
)
)
_________________________________________ ___________________________________
Signed by XXXXXXX XXXXX )
)
) XXXXXX
)
)
) XXXXXXX XXXXX
)
)
)
)
)
)
)
)
7
- 7 -
_________________________________
PICARDY INTERNATIONAL INC. by it )
authorized signatory )
)
)
Signature XXXXX )
)
Print Name )
X. XXXXXXXXX
---------------------------------
TTEE XXXXXXX LIVING TRUST U/A )
DTD 12/12/90 by its authorized )
signatory )
)
XXXXX )
Signature )
)
)
XX XXXXXXX )
Print Name )
---------------------------------
THE XXXXXX X. XXXXXX & XXXX J )
XXXXXX LIVING TRUST by its )
authorized signatory )
)
XXXXX XXXXX )
Signature )
)
)
R XXXXXX X XXXXXX )
Print Name )
---------------------------------
HNC SOFTWARE INC. by its )
authorized signatory )
)
Signature XXXXX )
)
)
X.X. XXXXXX )
Print Name )
Page 7
8
SCHEDULE "A"
SHAREHOLDERS OF WEBTRAK LIMITED
AS AT THE CLOSING
SHAREHOLDER NUMBER OF
------------------------------------------------------ SHARES LEGALLY
AND BENEFICIALLY
NAMED ADDRESS OWNED
----------------------- ------------------------ -------------------
Xx. Xxxxxx Xxxxx Xxxxxx Xxxxxxxxxxx, Green Trees 00
Xxxxxx Xxxxxxx Xxxx, XX0 0XX XX Ordinary L.1 shares
Dr. Xxxxxxx Xxxxx 0, Xxxxxxxxxxx Xxxx, 00
Xxxxxxxxx XX0 0XX XX Ordinary L.1 shares
TTEE Xxxxxxx Living 0000 Xxxxxxx Xxxx 1
Trust U/A DTD 12/12/90 Xxx Xxxxxxx, XX 00000 XXX Ordinary L.1 share
The Xxxxxx X. Xxxxxx & 13333 la Cresta Drive 1
Xxxx X. Xxxxxx Living Xxx Xxxxx, XX 00000 XXX Ordinary L.1 share
Trust U/D/T
Dated April 18, 1995
Picardy International Inc. Jardine Building - 4th Floor 50
00-00 Xxxx Xxxxxx Xxxxxxxx L.1 shares
Xxxxxxxx XX-00 XXX,
Xxxxxxx
0
XXXXXXXX "X"
SOFTWARE
The software comprises all current and future developments of and derivatives of
the following products:
WebTrak Pathway
WebTrak Portfolio
