EXECUTION COPY
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE. THE SECURITIES MAY NOT BE TRANSFERRED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT
AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS
OR PURSUANT TO A WRITTEN OPINION OF COUNSEL FOR THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
ECLIPSYS OPTION AGREEMENT
ECLIPSYS OPTION AGREEMENT (the "Agreement"), dated as of March 13,
1998, between GAP Coinvestment Partners, L.P., a New York limited partnership
("Optionor"), ALLTEL Information Services, Inc., an Arkansas corporation
("ALLTEL"), and Eclipsys Corporation, a Delaware corporation ("Eclipsys")
(solely with respect to Sections 1.3, 2.2, 3.2, 3.4, 4.1-4.7 and 5.1-5.7).
THE PARTIES AGREE AS FOLLOWS:
1. Option.
1.1 Grant of Option; Exercise Price. Subject to the terms and
conditions herein set forth, Optionor grants to ALLTEL the right (the "Option")
to purchase from Optionor up to an aggregate of 10,463 shares of Series D
Convertible Preferred Stock, par value $.01 per share, of Eclipsys, each share
of which is convertible on the date hereof into 1.5 shares of Common Stock, par
value $.01 per share, of the Company (the "Common Stock"), represented by the
stock certificates listed on Schedule 1 (the "Stock Certificates") hereto (the
"Option Shares") owned by Optionor, at the exercise price (the "Exercise Price")
per share specified in Section 1.2 on the applicable Closing Date (as defined
below) for the sale of Option Shares, which Exercise Price shall be paid by
check or wire transfer of immediately available funds. The number of Option
Shares and the Exercise Price shall be subject to adjustment as provided in
Section 2.1.
1.2 Exercise Price. The Exercise Price shall be $.01 per
share, subject to adjustment as provided in Section 2.1.
1.3 Time of Exercise. The Option may be exercised in whole or
in part by ALLTEL within 90 days after delivery of written notice to ALLTEL by
Eclipsys (in the form attached hereto as Exhibit A) of the exercise, in whole or
in part, by either (a) First Union Corporation ("First Union") of the Warrant
No. 1 to purchase 1,124,822 shares of Non-Voting Common Stock, par value $.01
per share, dated January 24, 1997, granted by Eclipsys to First Union or (b) BT
Investment
2
Partners, Inc. ("BT" and, together with First Union, the "Warrantholders") of
the Warrant No. 2 to purchase 674,893 shares (the "Warrant Shares") of
Non-Voting Common Stock, par value $.01 per share, dated January 24, 1997,
granted by Eclipsys to BT (collectively, the "Warrants"). The Warrants were
issued pursuant to the applicable provisions of the Preferred Stock and Warrant
Purchase Agreement, dated January 24, 1997, among Eclipsys, General Atlantic
Partners 38, L.P. ("GAP 38"), General Atlantic Partners 28, L.P. ("GAP 28"), GAP
Coinvestment Partners, L.P. ("GAP Coinvestment"), Wilfam Ltd. ("Wilfam"),
ALLTEL, First Union, BT, Xxxxx Xxxxxx Associates IHS L.P. ("Xxxxx Xxxxxx"),
Xxxxxx Xxxxxxxxxx ("Xxxxxxxxxx"), St. Xxxx Venture Capital IV, L.L.C. ("St.
Xxxx") and Xxxxx Xxxxxxxx, Jr. ("Karmanos"). The Option shall expire on the
earlier of (a) the date that ALLTEL has received an aggregate of 15,694 Option
Shares and (b) the 91st day following the expiration date of all of the Warrants
(whether by exercise or lapse thereof or otherwise), provided that if the
expiration date of the Warrants is extended, the termination date shall be the
91st day following Eclipsys' written notice to ALLTEL of the occurrence of the
extended expiration date of the Warrants (the "Termination Date"). This Option
may be exercised at any time (and at several different times) on or prior to the
Termination Date according to the aforementioned terms.
1.4 Exercise. Upon exercise by ALLTEL of the Options, the
Option Shares shall be transferred by Escrowholder (acting for Optionor) to
ALLTEL as follows: for each 6.666686 shares of Non-Voting Common Stock, par
value $.01 per share, of Eclipsys (the "Class B Common Stock") issued pursuant
to the Warrants to either First Union or BT or both First Union and BT, Optionor
will transfer to ALLTEL one (1) Option Share, subject to adjustment as provided
in Section 2.1. The Option Shares shall be transferred pro rata by Optionor and
the other persons issuing option rights listed on the attached Schedule 2 (the
"Optionors") and according to the percentages therein specified, and
Escrowholder shall to the extent possible allocate the Option Shares pro rata
among the Optionors.
1.5 Manner of Exercising Option.
(a) The Option shall be exercisable by ALLTEL or any
permitted assigns only by delivering a completed and fully executed Option
Exercise Notice (in the form attached hereto as Exhibit B) to Escrowholder (as
defined below) with a copy to Optionor and Eclipsys, not less than ten (10) days
prior to the date specified by ALLTEL in such exercise notice for the closing of
the purchase and sale of Option Shares pursuant to such exercise notice (the
"Closing Date"). If ALLTEL exercises this Option with respect to an amount of
Option Shares less than the aggregate number of Option Shares available to it
upon such exercise, the remainder of such Option Shares shall remain available
for exercise at one or more later times prior to the Termination Date in
accordance with this Option Agreement.
(b) On the Closing Date, ALLTEL shall deliver to the
Optionor by check or wire transfer, with notice of such payment to the
Escrowholder,
3
the Exercise Price for the Option Shares so acquired, against delivery by
Escrowholder to ALLTEL of certificates representing the Option Shares which
certificates shall be issued in the name of ALLTEL with appropriate legends
affixed thereon.
2. Adjustment of Number of Shares; Substitute Shares.
2.1 Changes in Capital Structure. The number and type of
shares transferable by Optionor upon exercise of the Option by ALLTEL shall be
adjusted from time to time in the same manner as the Warrant Shares are
adjusted, as provided for in the Warrants, in the event of any stock split,
combination, stock dividend or recapitalization, or conversion or exchange for
other securities or property as a result of a merger, sale, liquidation or
reorganization of Eclipsys or the issue of any securities, or other similar
change in capital structure of Eclipsys. Nothing in this Section 2.1, or
elsewhere in this Agreement, however, shall have the effect of altering the
aggregate Exercise Price, and the Exercise Price shall be appropriately adjusted
in respect of the stock split, combination, stock dividend, recapitalization,
conversion, exchange or other event specified herein.
2.2 Distributions and Auxiliary Securities. If any
Distribution (as hereinafter defined) of securities or other property issued in
connection with a transaction contemplated by Section 2.1 ("Auxiliary
Securities") with respect to the Option Shares is due, the cash, certificates or
other instruments evidencing title to such Distribution or Auxiliary Securities,
together with appropriate instruments of transfer shall be delivered by Eclipsys
(or by Optionor if received by Optionor) to Escrowholder to be held in the
Escrow pursuant to Section 3 herein. Any Distribution or Auxiliary Securities
shall become a part of the Option Shares to which it relates, and upon the
exercise of the Option shall be transferred to ALLTEL without extra cost. A
"Distribution" means any property receivable by Optionor as owner of any Option
Shares, or as owner of any Distribution or Auxiliary Securities, and shall
include, without limitation, dividends, whether in cash or other property, such
as securities, cash, securities or other property arising from a combination,
stock dividend, conversion, reorganization, recapitalization, stock split,
liquidation, sale or merger or consolidation of Eclipsys or the issuer of any
security which is a Distribution or Auxiliary Security, or otherwise; provided,
however, that cash dividends in any calendar year out of earnings and profits
for such year shall be the sole property of Optionor and shall not be deemed a
Distribution.
3. Escrow.
3.1 Creation of Escrow. To ensure Optionor's general ability
to perform its obligations under this Agreement, Optionor will, concurrently
with the delivery of this Agreement, deliver to the Eclipsys corporate secretary
(the "Escrowholder") the Stock Certificates together with a stock power (the
"Stock Power") duly executed in blank in the form attached hereto as Exhibit C,
such
4
documents to be held in escrow (the "Escrow") by such corporate secretary
pursuant to the terms of this Section 3.
3.2 Duties Upon Exercise of Option. If, prior to the
expiration of the Option, Escrowholder is given an Option Exercise Notice,
Escrowholder shall first ensure that the number of Option Shares issuable is
correct based on the number of shares of Class B Common Stock issuable upon
exercise of the Warrants, and then (assuming such Option Shares are properly
issuable) Escrowholder shall on the Closing Date specified in the Option
Exercise Notice (i) date the Stock Power necessary for the transfer in question,
(ii) fill in the number of Option Shares being transferred and (iii) deliver to
ALLTEL the Stock Power, together with a certificate or certificates issued in
the name of ALLTEL with appropriate legends affixed thereon representing the
number of Option Shares being transferred, possession of the Distributions and
Auxiliary Securities with respect to such Option Shares, against delivery to
Escrowholder for the benefit of Optionor (or directly to Optionor) of the
aggregate Exercise Price for the Option Shares so transferred. Optionor and
Eclipsys agree to cooperate, and to cause Eclipsys's transfer agent to
cooperate, with respect to furnishing to Escrowholder all necessary stock
certificates and other related instruments as appropriate.
3.3 Term of Escrow. The Escrow shall continue until the
earlier of (i) sixty (60) days following the Termination Date, provided that if
the Option has been duly exercised prior to the Termination Date the Escrow
shall continue until the transfer of the Option Shares so exercised has been
completed on the Closing Date and (ii) such date as ALLTEL has certified to
Escrowholder that the Option has expired or has been exercised in full.
3.4 Attorney-In-Fact; Additional Stock Assignments. Optionor
and Eclipsys hereby constitute and appoint Escrowholder as Optionor's and
Eclipsys's attorney-in-fact and agent for the term of this Escrow to execute,
with respect to such securities or other property as are deposited with
Escrowholder hereunder, all documents necessary or appropriate to make such
securities or other property negotiable and complete any transaction herein
contemplated. Optionor shall deliver to Escrowholder from time to time such
number of Stock Powers or other documents duly executed by Optionor as may be
reasonably requested by Escrowholder.
3.5 Return of Property. If, at the time of termination of the
Escrow, Escrowholder has in Escrowholder's possession any documents, securities,
or other property belonging to Optionor, including, without limitation, the
Option Shares and Stock Power specified in Section 3.1, then Escrowholder shall
deliver all of same to Optionor and shall be discharged of all further
obligations hereunder.
5
3.6 Duties; Modification of Duties.
(a) Escrowholder shall carry out Escrowholder's
duties hereunder to the best of Escrowholder's ability but under all
circumstances in a professional and workmanlike manner, but shall be liable only
for gross negligence or willful misconduct. Escrowholder's duties hereunder may
be altered, amended, modified or revoked only by a written instrument signed by
ALLTEL, Optionor and Escrowholder.
(b) Escrowholder shall be obligated only for the
performance of such duties as are specifically set forth herein and may rely and
shall be protected in relying or refraining from acting on any instrument
reasonably believed by Escrowholder to be genuine and to have been signed or
presented by the proper party or parties. Escrowholder shall not be personally
liable for any act Escrowholder may do or omit to do hereunder as Escrowholder
or as attorney-in-fact for Optionor while acting in good faith and in the
exercise of Escrowholder's own good judgment, and any act done or omitted by
Escrowholder pursuant to the advice of Escrowholder's own attorneys shall be
conclusive evidence of such good faith.
(c) Escrowholder is hereby expressly authorized to
disregard any and all warnings given by any of the parties hereto or by any
other person or corporation, excepting only orders or process of courts of law,
and is hereby expressly authorized to comply with and obey orders, judgments or
decrees of any court. In case Escrowholder obeys or complies with any such
order, judgment or decree of any court, Escrowholder shall not be liable to any
of the parties hereto or to any other person, firm or corporation by reason of
such compliance, notwithstanding that any such order, judgment or decree being
subsequently reversed, modified, annulled, set aside, vacated or found to have
been entered without jurisdiction.
3.7 Authorization to Invest. Any cash distributions received
by Escrowholder pursuant to this Agreement and designated as a Distribution or
Auxiliary Security and which is to be retained in escrow by Escrowholder for
more than fifteen (15) days shall be invested in an interest bearing savings
account specified by ALLTEL and the interest thereon shall constitute a part of
such Distribution or Auxiliary Securities, as applicable.
3.8 Statute of Limitations. Escrowholder shall not be liable
for the lapse of any rights because of any statute of limitation applicable with
respect to this Agreement or any documents deposited with Escrowholder.
3.9 Legal Counsel. Escrowholder shall be entitled to employ
such legal counsel and other experts as Escrowholder may deem necessary properly
to advise Escrowholder in connection with Escrowholder's obligations and may pay
such counsel reasonable compensation therefor, for which Escrowholder shall be
reimbursed 50% by ALLTEL and 50% by Optionor.
6
3.10 Termination of Duties; Successor. Escrowholder's
responsibilities as Escrowholder hereunder shall terminate if (i) Escrowholder
shall resign by (30) days' written notice to Optionor and ALLTEL, (ii) Optionor
and ALLTEL jointly agree to terminate Escrowholder and appoint Escrowholder's
successor or (iii) Escrowholder dies or is otherwise unable to continue to
discharge its duties hereunder. In the event of Escrowholder's termination as
Escrowholder by resignation, death or by otherwise becoming unable to perform,
the successor shall be the successor corporate secretary of Eclipsys or another
corporate officer designated by the Chief Executive Officer, or if no such
officer is appointed, the Chief Executive Officer. Upon Escrowholder's receipt
of notice of any such appointment of Escrowholder's successor, all documents,
shares and other property then in Escrowholder's possession pursuant to this
Agreement shall be delivered to such successor.
3.11 Further Instruments. If Escrowholder reasonably requires
other or further instruments in connection with this Agreement or obligations in
respect hereto, the necessary parties hereto shall join in furnishing such
instruments.
3.12 Conflicting Notices; Disputes. If Escrowholder receives a
notice from ALLTEL that ALLTEL is exercising any of ALLTEL's rights hereunder,
Escrowholder shall first complete all action required with respect to the notice
before taking action with respect to any subsequently received notice which in
any way conflicts with the prior notice. It is understood and agreed that should
any dispute arise with respect to the delivery or ownership or right of
possession of the Option Shares and/or the Distribution and Auxiliary Securities
with respect thereto, and any other property held by Escrowholder hereunder,
Escrowholder is authorized and directed to retain in its possession without
liability to anyone all or any part of such securities and such other property
until such dispute shall have been settled either by mutual written agreement of
the parties concerned or in accordance with Section 4, but Escrowholder shall be
under no duty whatsoever to institute or defend any such proceedings as required
by Section 4.
3.13 Voting of Shares. For so long as the Option Shares and
any other voting securities of Eclipsys shall be held by the Escrowholder,
Optionor shall be entitled to vote the Option Shares and such securities in all
matters presented to the stockholders of Eclipsys and shall be entitled to
exercise all other rights as a stockholder of Eclipsys with respect to such
securities.
3.14 Conversion of Option Shares. Notwithstanding anything to
the contrary set forth in this Agreement, the Optionor and ALLTEL agree that (a)
the Optionor shall be entitled to convert the Option Shares into shares of
Common Stock and (b) in the event of such conversion, the shares of Common Stock
issued to the Optionor upon such conversion shall be deemed Option Shares under
this Agreement and shall be subject to ALLTEL's Option in accordance with this
Agreement.
7
4. Dispute Resolution.
4.1 Dispute Resolution Procedures. In the event that a dispute
arises between ALLTEL, Eclipsys, and Optionor with respect to the terms and
conditions of this Agreement, or any subject matter governed by this Agreement,
such dispute shall be settled as set forth in this Section 4. At the time that
any dispute is resolved, if the dispute involves an amount of money, interest at
a rate equal to the prime rate per annum as announced from time to time by
Boatmen's National Bank of Arkansas plus 1 percent shall be paid to the party
entitled to receive the disputed amounts to compensate for the lapsed time
between the date such disputed amount originally was to have been paid (or was
paid) through the date amounts are paid (or credited) in settlement of the
dispute.
4.2 Claims Procedures. If either ALLTEL, Eclipsys, or Optionor
shall have any dispute with respect to the terms and conditions of this
Agreement or any subject matter referred to in or governed by this Agreement,
such party shall provide written notice to the other party in the form of a
claim identifying the issue or amount disputed and including a detailed reason
for such claim. The party against whom the claim is made shall respond in
writing within 30 days from the date of receipt of the notice of such claim. The
party filing the claim shall have an additional 30 days after the receipt of the
response to either accept the resolution offered by the other party or request
implementation of the procedures set forth in Section 4.3 (the "Escalation
Procedures"). Failure to meet the time limitations set forth in this Section 4.2
may result in the implementation of the Escalation Procedures.
4.3 Escalation Procedure.
(a) Each of ALLTEL, Eclipsys and Optionor agrees to
negotiate, in good faith, any claim or dispute that has not been satisfactorily
resolved following the claim resolution procedures described in Section 4.2. To
this end, each party agrees to escalate any and all disputes or claims in
accordance with Section 4.3(b) before taking further action.
(b) If the negotiations conducted pursuant to Section
4.2 do not result in a resolution of the underlying dispute or claim to the
satisfaction of a party involved in such negotiations, then either party may
notify the other in writing that it desires to elevate the dispute or claim to
the President of ALLTEL and the Chairman and Chief Executive Officer, or
equivalent thereof, of Optionor or Eclipsys for resolution. Upon receipt by the
other party of such written notice, the dispute or claim shall be so elevated
and the President of ALLTEL and the Chairman and Chief Executive Officer, or
equivalent thereof, of Optionor or Eclipsys shall negotiate in good faith and
each use its reasonable best efforts to resolve such dispute or claim. The
location, format, frequency, duration and conclusion of these elevated
discussions shall be left to the discretion of the representatives involved.
Upon mutual agreement, the representatives may utilize other alternative dispute
resolution procedures to assist in the negotiations. Discussions and
correspondence among the
8
representatives for purposes of these negotiations shall be treated as
confidential information developed for purposes of settlement, exempt from
discovery and production, which shall not be admissible in subsequent
proceedings between the parties. Documents identified in or provided with such
communications, which are not prepared for purposes of the negotiations, are not
so exempted and may, if otherwise admissible, be admitted in evidence in such
subsequent proceeding.
4.4 Arbitration Procedures.
(a) In the event that a claim, controversy or dispute
between the parties with respect to the terms and conditions of this Agreement,
or any subject matter governed by this Agreement, which is subject to
arbitration hereunder and which has not been resolved by use of the claims
procedure described in Section 4.2 or the Escalation Procedures described in
Section 4.3(b), either party may, within 30 days after the representatives have
met to address such claim, controversy or dispute, request binding arbitration
with respect thereto in accordance with the following procedures.
(b) Either party may request arbitration by giving
the other involved party written notice to such effect, which notice shall
describe, in reasonable detail, the nature of dispute, controversy or claim.
Such arbitration shall be governed by the Commercial Arbitration Rules of the
American Arbitration Association, 0000 Xxxxx Xxxxxx Xxxxxx, X.X., Xxxxx 000,
Xxxxxxxxxx, X.X. 00000 ("AAA"), as amended by this Agreement.
(c) Upon either party's request for arbitration, an
arbitrator shall be selected by mutual agreement of the parties to hear the
dispute in accordance with AAA rules. If the parties are unable to agree upon an
arbitrator then either party may request that the AAA select an arbitrator and
such arbitrator shall hear the dispute in accordance with AAA rules. For
disputes amounting to $10,000,000 or more or in connection with property with a
fair market value of $10,000,000 or more, a panel of three arbitrators shall be
selected to hear the dispute. In such case, each party shall select one
arbitrator who shall be unaffiliated with such party, and the two arbitrators
shall select a third arbitrator. If the two arbitrators are unable to agree upon
a third arbitrator, the AAA shall select the third arbitrator. In the case of a
three arbitrator panel, the decision of a majority of the arbitrators shall
control. The arbitration shall be held in Atlanta, Georgia, at such location as
may be mutually acceptable to the parties.
(d) Each of the parties shall bear its own fees,
costs and expenses of the arbitration and its own legal expenses, attorneys'
fees and costs of all experts and witnesses. Unless the award provides
otherwise, the fees and expenses of the arbitration procedures, including the
fees of the arbitrator or arbitrators, will be shared equally by the involved
parties.
9
(e) Any award rendered pursuant to such arbitration
shall be final, conclusive and binding upon the parties, and any judgment
thereon may be entered and enforced in any court of competent jurisdiction.
(f) No claims to be resolved under this Section 4 may
be made more than six months after the date by which the fault or failure should
reasonably have been discovered and failure to make such a claim within the six
month period shall forever bar the claim.
(g) Each of ALLTEL, Eclipsys and Optionor shall
continue to perform its obligations under this Agreement during the period of
any dispute and the resolution thereof pursuant to this Section 4.
5. Representations, Warranties and Covenants of Optionor and Eclipsys.
5.1 Ownership of Option Shares; No Conflicts. Optionor
represents and warrants as of this date and as of any Closing Date, and
covenants for the period beginning on this date and ending on the Termination
Date of this Agreement, that except for the required waivers of compliance with
provisions contained in Section 16.2(b) of the Amended and Restated Stockholders
Agreement, dated January 24, 1997 (the "Eclipsys Stockholders Agreement"), among
Eclipsys, GAP 38, GAP 28, GAP Coinvestment, Partners HealthCare System, Inc.,
Xxxxxx X. Xxxxxx, Wilfam, ALLTEL, First Union, BT, Brean Murray, Manolovici, St.
Xxxx and Karmanos, (i) Optionor owns its respective Option Shares and will
continue to own such Option Shares until the Termination Date; (ii) Optionor has
and will have the right to enter into this Agreement, and to transfer to ALLTEL
all or any part of Optionor's respective Option Shares, Distributions and
Auxiliary Securities, in each case, free and clear of any lien, claim,
encumbrance or restriction of any type or nature whatsoever (other than
restrictions on resale that may arise under applicable federal and state
securities laws); (iii) Optionor's respective Option Shares, Distributions and
Auxiliary Securities are not and will not be subject to any right of first
refusal, right of repurchase or any similar right granted to, or retained by,
Eclipsys, any stockholder of Eclipsys or any other person; and (iv) there is no
provision of any existing agreement, and Optionor will not enter into an
agreement, by which Optionor is or would be bound (or to which Optionor is or
would become subject) that conflicts or would conflict with this Agreement or
the performance of Optionor's obligations under this Agreement other than any
such conflicts that have been waived. Optionor and Eclipsys will endeavor to
obtain any waivers or consents required under Section 16.2(b) of the Eclipsys
Stockholders Agreement, and any other documents or agreements, that may be
necessary to effect this Agreement, but in any case Optionor will indemnify
ALLTEL for any failure to receive such waivers or consents, including the sale
of additional shares if necessary so that ALLTEL receives the full benefit of
this Agreement.
5.2 Authorization; No Contravention. Each of Optionor and
Eclipsys represents and warrants (severally and not jointly in all cases in
which they
10
are making representative hereunder) that as of this date and as of the Closing
Date the execution, delivery and performance by Optionor of this Agreement and
the transactions contemplated hereby (a) have been duly authorized by all
necessary action of Optionor and Eclipsys; (b) do not contravene the terms of
any organizational documents, or any amendment thereof, of the Optionor or
Eclipsys; (c) do not violate, conflict with or result in any breach or
contravention of, or the creation of any lien under, any contractual obligation
of Optionor or Eclipsys, except for the Eclipsys Stockholders Agreement, or any
requirement of law applicable to Optionor or Eclipsys; and (d) do not violate
any judgment, injunction, writ, award, decree or order of any nature
(collectively, "Orders") of any governmental authority against, or binding upon,
Optionor or Eclipsys. Except for the Eclipsys Stockholders Agreement, Optionor
and Eclipsys have not previously entered into any contractual obligation which
is currently in effect or by which Optionor or Eclipsys are currently bound,
granting any rights to any person which are in conflict with the rights to be
granted by Optionor or Eclipsys in this Agreement.
5.3 Governmental Authorization; Third Party Consents. Each of
Optionor and Eclipsys represents and warrants that as of this date and as of the
Closing Date other than those required under Section 16 of the Securities
Exchange Act of 1934, as amended, and Rule 144 promulgated under the Securities
Act of 1933, as amended (the "Act"), if applicable, no approval, consent,
compliance, exemption, authorization or other action by, or notice to, or filing
with, any govern mental authority or any other person in respect of any
requirement of law, and no lapse of a waiting period under a requirement of law,
is necessary or required in connection with the execution, delivery or
performance by, or enforcement against, Optionor and Eclipsys of this Agreement
or the transactions contemplated hereby.
5.4 Binding Effect. Each of Optionor and Eclipsys represents
and warrants that as of this date this Agreement and as of the Closing Date has
been duly executed and delivered by it and constitutes its legal, valid and
binding obligations enforceable against it in accordance with their terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity relating to enforceability (regardless of whether
considered in a proceeding at law or in equity).
5.5 Litigation. Each of Optionor and Eclipsys represents and
warrants that as of this date and as of the Closing Date there are no legal
actions, suits, proceedings, claims, complaints, disputes or investigations
pending or, to the knowledge of Optionor and Eclipsys, threatened, at law, in
equity, in arbitration or before any governmental authority against Optionor or
Eclipsys which would, if adversely determined, have a material adverse effect on
the ability of Optionor or Eclipsys to perform its obligations under this
Agreement. No Order has been issued by any court or other governmental authority
against Optionor or Eclipsys purporting to enjoin or restrain the execution,
delivery or performance of this Agreement.
11
5.6 Notice of Exercise of Warrants. Eclipsys shall provide
written notice to ALLTEL of any exercise of the Warrants as described in Section
1.3 above within 30 days of such exercise and of the termination date of the
Warrants as described in Section 1.3 above within 30 days of such termination.
5.7 Further Assurances. Upon the reasonable request of
Escrowholder, Eclipsys or ALLTEL, Optionor will prepare, execute and deliver any
further instruments and do any further acts that may be necessary to carry out
more effectively the purpose of this Agreement.
6. Representations and Covenants of ALLTEL.
6.1 Investment Representations. ALLTEL represents, and shall
confirm such representations on any Closing Date, that:
(a) the securities are being acquired (i) for
ALLTEL's own account, not for the account of any other person and (ii) for
investment and not with a view to distribution or resale except in compliance
with applicable laws regulating securities;
(b) ALLTEL is capable of evaluating the merits and
risks of its investment in the securities and the amount of such investment is
within ALLTEL's risk capital means;
(c) ALLTEL understands and acknowledges that an
investment in Eclipsys as represented by the Option Shares is highly speculative
in nature and is subject to a high degree of risk of loss in whole or in part;
(d) ALLTEL understands and acknowledges that it must
bear the economic risk of investment for an indefinite period of time because
the transfer to ALLTEL of the Option Shares and the Distribution and Auxiliary
Securities has not been registered under the Act, and the Option Shares and the
Distributions and Auxiliary Securities cannot be transferred by ALLTEL unless
such transfer is registered under the Act or registration is not required in
connection with such transfer.
7. Miscellaneous.
7.1 Amendment. This Agreement may only be amended by a writing
signed by Optionor and ALLTEL, and where applicable, by Eclipsys and/or
Escrowholder.
7.2 Transfer of Option and Option Shares. The sale, transfer,
assignment, hypothecation or other disposition by ALLTEL of this Agreement, the
Option or the Option Shares, Distributions or Auxiliary Securities are subject
to (a) applicable restrictions on transfer thereof under federal and state
securities laws
12
and (b) the Eclipsys Stockholders Agreement. Except as permitted by the Eclipsys
Shareholders Agreement, any attempt by any party to this Agreement to assign
this Agreement, any Option Shares, Distributions or Auxiliary Securities and any
levy of execution, attachment, or similar process on such securities or property
shall be null and void. Subject to the foregoing, this Agreement shall be
binding on and inure to the benefit of the successors and assigns of Optionor.
7.3 Entire Agreement; Controlling Document. This Agreement
constitutes the entire agreement of the parties with respect to the subject
matter hereof and supersedes any and all prior negotiations, correspondence and
understandings between the parties with respect to the subject matter hereof,
whether oral or in writing.
7.4 Governing Law, Consent to Jurisdiction. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Delaware applicable to contracts entered into by Delaware residents and to be
performed wholly in the State of Delaware. Each party hereto hereby agrees that
any action which, in whole or in part, in any way arises under this Agreement
shall be brought in the Delaware Court or the United States District Court for
the District of Delaware. Each party hereby submits to the exclusive
jurisdiction and venue of such Courts for purposes of any such action and agrees
that any notice, document or complaint in any such action may be served on it by
delivery in the manner provided for the delivery of notices under this
Agreement.
7.5 Notices. All notices and other communications under this
Agreement shall be in writing, shall be effective when received, and shall in
any event be deemed to have been received on the date of delivery if delivered
personally or by telecopier; on the third business day after the business day of
deposit with the U.S. Postal Service for delivery by first class mail,
registered or certified, postage prepaid; or on the first business day after the
business day of deposit with Federal Express or similar courier for overnight
delivery, freight prepaid; in each such case, addressed as follows (until any
such address is changed by notice duly given):
To Optionor at the address set forth on Schedule 2.
To ALLTEL at: ALLTEL Information Services, Inc.
0000 Xxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: President
with a copy to General Counsel
To Eclipsys at: Eclipsys Corporation
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxxx, Xxxxxxx 00000
13
To Escrowholder at: Eclipsys Corporation
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxxx, Xxxxxxx 00000
7.6 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.7 Severability. If any provision of this Agreement shall be
determined to be invalid or unenforceable, the remainder shall be valid and
enforceable to the maximum extent possible.
7.8 Headings. The section headings used in this Agreement are
intended principally for convenience and shall not by themselves determine the
rights and obligations of the parties to this Agreement.
7.9 Delay and Waiver. No delay on the part of any party in
exercising any right under this Agreement shall operate as a waiver of such
right. The waiver by any party of any other term or condition of this Agreement
shall not be construed as a waiver of a subsequent breach or failure of the same
term or condition or a waiver of any other term or condition contained in this
Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement the
day and year first above written.
GAP COINVESTMENT PARTNERS, L.P.
By:
Name:
Title:
ALLTEL INFORMATION SERVICES, INC.
By:
Name:
Title:
14
ECLIPSYS CORPORATION
(solely with respect to Sections 1.3, 2.2, 3.2,
3.4 and 4.2)
By:
Name:
Title:
XXXXXX XXXXXXX
as Senior Vice President of Administration,
Chief Financial Officer and Treasurer of
Eclipsys Corporation
as Escrowholder
(solely with respect to Section 3 hereof)
Schedule 1
GAP Coinvestment Partners, L.P.
Number of Shares of Series D
Convertible Preferred Stock Stock Certificate
--------------------------- -----------------
10,463 D-2
Schedule 2
Optionor Percentage Address
-------- ---------- -------
General Atlantic Partners 38, L.P. 58.14108 c/o General Atlantic Service
Corporation
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
GAP Coinvestment Partners, L.P. 10.09912 c/o General Atlantic Service
Corporation
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Wilfam Ltd. 31.759803 000 Xxxxx Xxxxx Xxxxxxxxx
(guaranteed by Xxxxxx X. Xxxxxx) _________ Xxxxxx Xxxxx, Xxxxxxx 00000
100.000%
Exhibit A
Warrant Exercise Notice
[Date]
ALLTEL Information Services, Inc.
0000 Xxxxxx Xxxxxx Xxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attn: President
This is to inform you that on [date] First Union Corporation ("First
Union") exercised its rights under the Warrant, dated January 24, 1997, numbered
1, granted by Eclipsys Corporation to First Union, to purchase __________ shares
of Non-Voting Common Stock, par value $.01,
and/or
on [date] BT Investment Partners, Inc. ("BT") exercised its rights
under the Warrant, dated January 24, 1997, numbered 2, granted by Eclipsys
Corporation to BT, to purchase __________ shares of Non-Voting Common Stock, par
value $.01.
By virtue of the above-mentioned Warrant exercise, you are hereby
notified that you may exercise your rights under the Eclipsys Option Agreements,
dated as of March 13, 1998.
ECLIPSYS CORPORATION
By:
Name:
Title:
Exhibit B
Option Exercise Notice
[Date]
Eclipsys Corporation
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxxx, Xxxxxxx 00000
Attn: Corporate Secretary
1. Exercise of Option. Effective as of the above date, the undersigned
hereby exercises its option to purchase ___________ shares of Series D
Convertible Preferred Stock, par value $.01 per share, of Eclipsys Corporation
("Eclipsys") pursuant to the Eclipsys Option Agreement, dated as of March 13,
1998 between GAP Coinvestment Partners, L.P. ("Optionor") and ALLTEL Information
Services, Inc. (the "Agreement"). The exercise price per share is $.01 for an
aggregate purchase price of $__________.
2. Closing Date. The Closing Date shall be _________, as specified by
the undersigned, which date is not less than 30 days from the date of this
Option Exercise Notice.
3. Delivery of Payment. The undersigned shall deliver by check or wire
transfer the above aggregate purchase price to Optionor and provide a
confirmation of such transfer on the Closing Date.
4. Confirmation of Exercise of Warrants. The undersigned confirms that
it has received notice of the exercise of the Warrants (as defined in the
above-mentioned Agreement).
5. Delivery of Certificates. You are instructed to deliver the
Certificates to the undersigned as required by the Agreement on the Closing
Date.
Submitted by: Accepted by:
ALLTEL Information Services, Inc. Xxxxxx X. Xxxxxxxxx
as Escrowholder
By:
Title:
EXHIBIT C
STOCK POWER
FOR VALUE RECEIVED and pursuant to the Eclipsys Option Agreement, dated
as of March 13, 1998 the undersigned hereby sells, assigns and transfers unto
__________________ (________) shares, par value $.01 per share, of Series D
Convertible Preferred Stock of Eclipsys Corporation, a Delaware corporation,
standing in the undersigned's name on the books of said corporation represented
by certificate number _____ delivered herewith, and does hereby irrevocably
constitute and appoint ___________ as attorney-in-fact, with full power of
substitution, to transfer said stock on the books of said corporation.
Dated: _______________, 19__
--------------------------
(Signature)
--------------------------
(Type or Print Name)
--------------------------
(Spouse's Signature, if any)
--------------------------
(Type of Print Name)
This Stock Power was executed in conjunction with the terms of an Option
Agreement between the above assignor and ALLTEL Information Services, Inc.,
dated as of March 13, 1998, and may be utilized only in connection with the
terms of such agreement.
INSTRUCTION: PLEASE DO NOT FILL IN ANY BLANKS OTHER THAN THE SIGNATURE LINE.
