METAVANTE TECHNOLOGIES, INC. STOCK PURCHASE RIGHT AGREEMENT
Execution Copy
METAVANTE TECHNOLOGIES, INC.
STOCK PURCHASE RIGHT AGREEMENT
STOCK PURCHASE RIGHT AGREEMENT
Stock Purchase Right Agreement, dated as of November 1, 2007, (as it may be amended from time
to time, this “Agreement”) between Metavante Technologies, Inc., a Wisconsin corporation
(the “Company”), and WPM, L.P., a Delaware limited partnership (“Investor”).
WHEREAS, pursuant to an Investment Agreement, dated as of April 3, 2007 (the “Investment
Agreement”) among the Company, Xxxxxxxx & Xxxxxx Corporation, a Wisconsin corporation (“MI
Corp”), Metavante Corporation, a Wisconsin corporation, Montana Merger Sub Inc., a Wisconsin
corporation, and Investor, Investor has agreed to acquire, on the terms and subject to the
conditions set forth in the Investment Agreement, newly issued shares of Class A common stock, par
value $0.01 per share, of the Company, which shares shall be converted into shares of common stock,
par value $0.01 per share, of the Company (the “Common Shares”); and
WHEREAS, the parties intend that on the terms and subject to the conditions hereof, Investor
will own 25% of the Common Shares, on a fully diluted basis, upon consummation of the Share
Issuance (as defined in the Investment Agreement) and the purchase of all the Subject Shares, and
are entering into this Agreement in furtherance of that connection;
WHEREAS, this Agreement shall be effective as of the Closing Date of the Investment Agreement
(the “Effective Time”).
1. Purchase Right Upon the terms and subject to the conditions set forth in this
Agreement, the Company hereby grants to the Investor the right to purchase from the Company (the
“Purchase Right”) the Subject Shares at the Purchase Prices; provided, however, that
notwithstanding anything to the contrary contained in this Agreement, the total number of Subject
Shares that may be purchased under this Agreement shall equal one third of the aggregate number of
Common Shares that may be issued under the Subject Employee Options as of immediately following the
Distribution, subject to reduction, if any, pursuant to Section 3.1(b) hereof. Immediately prior
to the Effective Time, there were (i) options to purchase 3,833,566 shares of common stock of MI
Corp. outstanding that will be converted into Subject Employee Options pursuant to Section 6.2(a)
of the Employee Matters Agreement and (ii) options to purchase 1,898,750 shares of common stock of
MI Corp. outstanding that will be converted into Subject Employee Options pursuant to Section
6.2(c) of the Employee Matters Agreement (the options referred to in clause (i) and (ii) being
referred to collectively herein as the “Applicable MI Options”). Within five business days
after the determination of the number of Subject Employee Options into which the Applicable MI
Options are convertible pursuant to the Employee Matters Agreement, the Company shall deliver to
Investor a schedule setting forth, with respect to each Subject Employee Option into which the
Applicable MI Options were
converted pursuant to the Employee Matters Agreement, the expiration date, exercise price and
number of Common Shares underlying such Subject Employee Option.
2. Expiration Date. In no event may the Purchase Right be exercised, in whole or in
part, after the earlier of (i) the date that is forty-five days after the Quarterly Notice (as
defined herein) is given in respect of the calendar quarter in which all Subject Employee Options
expire, (ii) the date that all Subject Shares (as they may have been reduced pursuant to Section
3.1(b)) have been purchased by the Investor or (iii) ten years from the date hereof, unless the
Board shall extend the expiration date of any of the Subject Employee Options beyond the end of
such ten-year period, in which case the Purchase Right shall be similarly extended (the
“Expiration Date”).
3. Exercise of Purchase Right.
3.1. Quarterly Notice and Reduction of Right
(a) No later than the last day of each month following the end of each calendar quarter
prior to the Expiration Date, the Company shall give the Investor a notice setting forth the
following: (i) the aggregate number of Common Shares issued during such quarter upon the
exercise of Subject Employee Options (ii) the aggregate exercise price of such Subject Employee
Options for such Common Shares, and (iii) the Subject Employee Options that expired unexercised
or were forfeited during such quarter (the “Quarterly Notice”). The Quarterly Notice
shall be accompanied by a schedule setting forth, in the form of tranches of the same exercise
dates and exercise prices, all unexercised Subject Employee Options as of the end of such
quarter.
(b) The Subject Shares shall be automatically reduced by a number equal to one third of the
Common Shares issuable (x) under Subject Employee Options that expire unexercised or are
forfeited and (y) under Out of the Money Options as provided in Sections 3.2(a) and 3.2(c).
3.2. Method of Exercise.
(a) The Purchase Right shall automatically be deemed exercised to purchase a whole number of
Subject Shares equal to one third of the aggregate number of Common Shares issued under the
Subject Employee Options during each calendar quarter the exercise prices of which equal or are
less than the Fair Market Value as of the date of exercise of the Purchase Right for such Subject
Shares (each such Subject Employee Option, an “In-the Money Option”) and for an aggregate
Purchase Price equal to one third of the aggregate exercise prices of such In-the-Money Options
for such Common Shares, in each case as specified in the Quarterly Notice with respect to such
quarter (it being understood that this number shall not be reduced for any such Common Shares
that are withheld from employees to pay the exercise price of such Subject Employee Options, or
any withholding taxes due, pursuant to net vesting settlement and similar provisions). Such
purchase shall take place 45 days following the date the Quarterly Notice is given (or the first
business day following such 45th day, if such day is not a business day). Following
the Quarterly Notice and prior to such date of purchase, the Investor may deliver to the Company
a notice (the “Cash Payment
Notice”) electing to pay such Purchase Price by a Cash Payment, in which case the
Cash Payment shall be made on the same date the Cash Payment Notice is delivered to the Company.
In the event the Cash Payment Notice is not given and/or such payment is not so
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made with respect
to any Quarterly Notice, such Purchase Price shall be paid by the Company withholding from the
number of Subject Shares to be delivered to the Investor a number of Subject Shares having an
aggregate Fair Market Value, determined as of the close of business on the business day
immediately before the date of purchase, equal to such Purchase Price, which date shall also be
deemed the date of exercise of the Purchase Right for purposes of determining the In-the Money
Options and Out of the Money Options. Any fraction of a Subject Share which would be required to
pay such Purchase Price shall be disregarded and the remaining amount due shall be paid in cash
by the Investor. Upon the purchase of any Subject Shares pursuant to this Section 3.2(a), the
number of Subject Shares remaining shall be reduced by the number of Subject Shares so purchased.
The Subject Shares shall also be reduced by a number equal to one third of the number of Common
Shares issued during each calendar quarter pursuant to Out of the Money Options.
(b) In the event the Investor sells, transfers, assigns or otherwise disposes of (whether by
operation of law or otherwise) (but only in the event that the Purchase Right is not accelerated
under Section 3.2(c) in connection with such event), to a third party that is not an affiliate of
the Investor or distributes to its limited partners (collectively, “Transfers”), any of
the Common Shares it acquired on the date of the Distribution, but not any Common Shares that it
thereafter acquired in excess of such Common Shares, it may exercise the Purchase Right for a
whole number of Subject Shares equal to the applicable Acceleration Subject Shares and for a
purchase price equal to the related Acceleration Purchase Price, by delivering to the Company an
irrevocable exercise notice within 10 days of such sale (the “Acceleration Notice”). The
Acceleration Notice shall set forth the number of Common Shares that have been sold by the
Investor, the dates of sales thereof, shall certify that such Notice is being given in accordance
with Section 3.2(b), and shall specify whether the Investor wishes to pay the Purchase Price by a
Cash Payment or through the Company withholding from the Subject Shares to be delivered to the
Investor a number of Subject Shares having an aggregate Fair Market Value, determined as of the
date the Acceleration Notice is given, equal to the aggregate Acceleration Purchase Price.
Within 10 business days of receiving the Acceleration Notice, the Company shall give the Investor
notice (the “Acceleration Details Notice”) of the Acceleration Purchase Price applicable
to the Acceleration Notice as well as of its calculation of the number of Acceleration Subject
Shares being purchased by the Investor pursuant to such Acceleration Notice. In the event that
Investor elected to pay the Acceleration Purchase Price in cash, it shall deliver the
Acceleration Purchase Price specified in the Acceleration Notice no later than three days
following the giving of such Acceleration Details Notice. Upon the purchase of any Acceleration
Subject Shares pursuant to this Section 3.2(b), the number of Subject Shares remaining shall be
reduced by the number of Acceleration Subject Shares so purchased.
(c) Immediately prior to (i) any event causing the simultaneous acceleration of the vesting,
or automatic exercise, of all the Subject Employee Options or (ii) a merger or other business
combination involving the Company in which the Common Shares are converted into the right to
receive cash in exchange for such Common Shares, the Purchase Right shall automatically be deemed
exercised for all Subject Shares then still subject to the
Purchase Right. The Purchase Price shall be an amount equal to the related Acceleration
Purchase Price. Such Purchase Price shall be paid by the Company withholding from the number of
Subject Shares to be delivered to the Investor a number of Subject Shares having
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an aggregate
Fair Market Value, determined as of three business days before the date of such acceleration,
equal to such Purchase Price. Any fraction of a Subject Share which would be required to pay
such Purchase Price shall be disregarded and the remaining amount due shall be paid in cash by
the Investor. The Subject Shares shall be reduced by a number equal to one third of the number
of Common Shares subject to Out of the Money Options as of the date of an acceleration pursuant
to this Section 3.2(c).
(d) The Purchase Right may be exercised by the Investor solely as and to the extent
expressly set forth in this Section 3.2. In no event may the Purchase Right be exercised after
it terminates as set forth in Section 2. No certificate representing a Subject Share shall be
delivered until the full purchase price therefore has been paid. Notwithstanding anything to the
contrary contained in this Agreement, the Company shall have no obligation to issue any fraction
of a Subject Share under this Agreement, all of which shall be disregarded.
4. Additional Terms and Conditions of Purchase Right.
4.1. Nontransferability of Purchase Right. The Purchase Right is exercisable only by
the Investor. The Purchase Right may not be sold, transferred, assigned, pledged, hypothecated,
encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to
execution, attachment or similar process. Any attempt to so sell, transfer, assign, pledge,
hypothecate, encumber or otherwise dispose of the Purchase Right, shall be null and void.
4.2. Investment Representation.
(a) The Investor hereby represents and warrants that (a) any Common Shares purchased upon
exercise of the Purchase Right will be purchased for investment and not with a view to the
distribution thereof within the meaning of the Securities Act of 1933, as amended (the
“Securities Act”), unless such purchase has been registered under the Securities Act and
any applicable state securities laws; (b) any subsequent sale of any such shares shall be made
either pursuant to an effective registration statement under the Securities Act and any
applicable state securities laws, or pursuant to an exemption from registration under the
Securities Act and such state securities laws; and (c) if requested by the Company, the Investor
shall submit a written statement, in form reasonably satisfactory to the Company, to the effect
that such representation (x) is true and correct as of the date of purchase of any shares
hereunder or (y) is true and correct as of the date of any sale of any such shares, as
applicable.
(b) All Subject Shares issued under this Agreement shall bear the legend specified in
Section 6.3 of the Shareholders Agreement.
4.3. Adjustment. In the event of any adjustment (i) in the Common Shares issuable
upon exercise of Subject Employee Options or (ii) the terms of any of the Subject Employee Options,
including the exercise prices, in each case including as a result of stock split,
stock dividend, recapitalization, reorganization, merger, consolidation, combination, exchange
of shares, liquidation, spin-off or other similar change in capitalization or event, the Subject
Shares
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and the terms and conditions thereof (including without limitation the Purchase Price
thereof) shall be equitably adjusted by the Board in the same manner as the Subject Employee
Options.
4.4. Compliance with Applicable Law. The Purchase Right is subject to the condition
that if the listing, registration or qualification of the Subject Shares upon any securities
exchange or under any law, or the consent or approval of any governmental body, or the taking of
any other action is necessary or reasonably desirable as a condition of, or in connection with, the
purchase or delivery of Subject Shares, the Purchase Right may not be exercised, in whole or in
part, unless such listing, registration, qualification, consent or approval shall have been
effected or obtained. The Company and the Investor agree to use reasonable efforts to effect or
obtain any such listing, registration, qualification, consent or approval.
4.5. Delivery of Certificates. Upon the exercise of the Purchase Right, in whole or
in part, the Company shall deliver or cause to be delivered one or more certificates representing
the number of shares purchased against full payment therefore, subject to Section 4.2(b).
4.6. Purchase Right Confers No Rights as Stockholder. The Investor shall not be
entitled to any privileges of ownership with respect to Subject Shares unless and until purchased
and delivered upon the exercise of the Purchase Right, in whole or in part, and the Investor
becomes a stockholder of record with respect to such delivered shares; and the Investor shall not
be considered a stockholder of the Company with respect to any such shares not so purchased and
delivered previously.
4.7. Company to Reserve Shares. The Company shall at all times prior to the
expiration or termination of the Purchase Right reserve and keep available, either in its treasury
or out of its authorized but unissued common shares, the full number of shares subject to the
Purchase Right from time to time.
4.8. Shareholders Agreement. Any Subject Shares issued upon exercise of the Purchase
Right shall be subject to the provisions of the Shareholders Agreement, and shall be shares of
“Common Stock” that are “Beneficially Owned” by Investor for purposes of the Shareholders
Agreement; provided, however, that no exercise of the Purchase Right shall in
itself constitute a violation of Section 3.2(a) of the Shareholders Agreement. Without limiting
the generality of the foregoing, such Subject Shares shall be subject to (i) the registration
rights provisions of Article II of the Shareholders Agreement, (ii) the transfer restriction
provisions of Section 3.1 of the Shareholders Agreement, and (iii) the provisions of Section 6.3.
4.9. Defined Terms. Capitalized terms used in this Agreement have the following
meanings:
“Acceleration Purchase Price” shall mean with respect to any Acceleration Subject
Shares, one third of the aggregate exercise price of the Subject Employee Options to the extent
used in determining such Acceleration Subject Shares.
“Acceleration Subject Shares” shall mean (x) in the case of Section 3.2(b) a number of
Subject Shares equal to one third of a percentage of the Reference Common Shares
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that is equal to
the percentage of the Common Shares transferred by the Investor and in respect of which an
Acceleration Notice had not been delivered previously, and (y) in the case of Section 3.2(c) a
number of Subject Shares equal to one third of all Common Shares subject to then outstanding
Subject Employee Options the exercise prices of which equal or are less than the Fair Market Value
as of the date of an acceleration pursuant to Section 3.2(c).
“Board” shall mean the Board of Directors of the Company, excluding any Investor
Designees (as defined in the Shareholders Agreement).
“Cash Payment” shall mean a wire transfer of immediately available funds to such
account as the Company may specify from time to time.
“Distribution” shall have the meaning ascribed thereto in the Employee Matters
Agreement.
“Employee Matters Agreement” shall mean that certain Employee Matters Agreement, dated
as of April 3, 2007, between the Company, New M&I Corporation, and the other parties thereto, as
amended.
“Fair Market Value” shall mean the closing transaction price of a Common Share as
reported in the New York Stock Exchange Composite Transactions (or the equivalent reporting system
for any other national securities exchange on which the Common Shares are primarily listed) on the
date as of which such value is being determined or, if there shall be no reported transactions for
such date, on the next preceding date for which transactions were reported; provided, however, that
if the Common Shares are not listed on any national securities exchange, the Fair Market Value may
be determined by the Board by whatever means or method as the Board, in the good faith exercise of
its discretion, shall at such time deem appropriate.
“MVT Option” shall have the meaning ascribed thereto in the Employee Matters Agreement
“Out of the Money Options” shall mean (x) in the case of Section 3.2(a), Subject
Employee Options the exercise prices of which are greater than the Fair Market Value as of the date
of exercise of the Purchase Right for such Common Shares, and (y) in the case of Section 3.2(c),
Subject Employee Options the exercise prices of which are greater than the Fair Market Value as of
the date of an acceleration pursuant to such Section 3.2(c).
“Purchase Prices” shall mean the purchase prices for which the Investor may purchase
Subject Shares hereunder.
“Reference Common Shares” shall mean, as of any time of determination, the Common
Shares subject to those Subject Employee Options (i) that are outstanding, unexercised and vested,
(ii) the exercise prices of which equal or are less than the Fair Market Value as of such date,
(iii) not previously used in determining the Acceleration Subject Shares in connection
with any Acceleration Notice, and (iv) have the earliest grant dates (when compared to other
Subject Employee Options that meet the specifications in clause (i) – (iii) immediately above).
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“Shareholders Agreement” shall mean that certain Shareholders Agreement, dated as of
November 1, 2007, among the Company, the Investor and any other Shareholders (as defined therein)
that become a party thereto, as amended from time to time.
“Subject Employee Options” shall mean the MVT Options outstanding effective
immediately after the Distribution.
“Subject Shares” shall mean the Common Shares issuable pursuant to Section 3 hereof.
5. Miscellaneous Provisions.
5.1. Successors. This Agreement shall be binding upon and inure to the benefit of the
Investor, the Company and the successors and assigns of the Company. The Investor may not assign
any of its rights or obligations under this Agreement, whether by operation of law or otherwise.
Nothing in this Agreement, express or implied, is intended to or shall confer upon any other person
any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement
5.2. Notices. All notices and other communications hereunder shall be in writing and
shall be deemed duly given (a) on the date of delivery if delivered personally, (b) upon
confirmation of receipt if delivered by telecopy or telefacsimile, (c) on the first business day
following the date of dispatch if delivered by a recognized next-day courier service, or (d) on the
date received if delivered by registered or certified mail, return receipt requested, postage
prepaid. All notices hereunder shall be delivered as set forth below, or pursuant to such other
instructions as may be designated in writing by the party to receive such notice:
if to the Company to:
Metavante Technologies, Inc.
0000 Xxxx Xxxxx Xxxx Xx.
Xxxxxxxxx, Xxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
0000 Xxxx Xxxxx Xxxx Xx.
Xxxxxxxxx, Xxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
with a copy to:
Xxxxxxx & Xxxxx LLP
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
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if to Investor, to:
WPM, L.P.
c/o Warburg Pincus & Co.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxx
c/o Warburg Pincus & Co.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxx
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxx, Esq.
Xxxx Xxxxxx, Esq.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxx, Esq.
Xxxx Xxxxxx, Esq.
or to such other persons or addresses as may be designated in writing by the party to receive such
notice as provided above.
5.3. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Wisconsin (without giving effect to choice of law principles
thereof).
5.4. Consent to Jurisdiction. Each of Investor and the Company irrevocably agrees
that any legal action or proceeding with respect to this Agreement, any provision hereof, the
breach, performance, validity or invalidity hereof or for recognition and enforcement of any
judgment in respect hereof brought by another party hereto or its successors or permitted assigns
may be brought and determined in any federal or state court located in the State of Wisconsin, and
each of Investor and the Company hereby irrevocably submits with regard to any such action or
proceeding for itself and in respect to its property, generally and unconditionally, to the
exclusive jurisdiction of the aforesaid courts. Each of Investor and the Company hereby irrevocably
waives, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any
action or proceeding with respect to this Agreement, any provision hereof or the breach,
performance, enforcement, validity or invalidity hereof, (i) any claim that it is not personally
subject to the jurisdiction of the above-named courts for any reason other than the failure to
lawfully serve process, (ii) that it or its property is exempt or immune from jurisdiction of any
such court or from any legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or
otherwise) and (iii) to the fullest extent permitted by applicable laws, that (A) the suit, action
or proceeding in any such court is brought in an inconvenient forum, (B) the venue of such suit,
action or proceeding is improper and (C) this Agreement, or the subject matter hereof, may not be
enforced in or by such courts.
5.5. Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE
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EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (a) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, TO IT THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER, (b) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF
THIS WAIVER, (c) EACH PARTY MAKES THIS WAIVER VOLUNTARILY AND (d) EACH PARTY HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 5.5.
5.6. Counterparts. This Agreement may be executed in two counterparts each of which
shall be deemed an original and both of which together shall constitute one and the same
instrument.
5.7. Descriptive Headings. The descriptive headings of this Agreement are inserted
for convenience only and do not constitute a part of this Agreement.
5.8. Amendments and Waivers. The provisions of this Agreement may be amended or
waived only upon the prior written consent of the Company (to the extent approved by a majority of
Independent Directors who are not Investor Designees, each as defined in the Shareholders
Agreement) and Investor .
5.9. Entire Agreement. This Agreement constitutes the entire agreement and supersedes
all prior agreements, understandings, representations and warranties, both written and oral, among
the parties with respect to the subject matter hereof and thereof.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement by their authorized
representatives as of the date first above written.
| METAVANTE TECHNOLOGIES, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxx | |||
| Title: | Vice President and Secretary | |||
| WPM, L.P. By: WPM GP, LLC, its general partner |
||||
| By: | /s/ Xxxxx Xxxxx | |||
| Name: | Xxxxx Xxxxx | |||
| Title: | Managing Director | |||
