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Exhibit 2.2
PURCHASE AGREEMENT
BY AND AMONG
ZAI*NET SOFTWARE, INC.,
A DELAWARE CORPORATION,
ZAI*NET SOFTWARE, L.P.,
A DELAWARE LIMITED PARTNERSHIP,
GFI CAMINUS LLC
A DELAWARE LIMITED LIABILITY COMPANY,
AND
XXXXX X. XXXXXXX,
AN INDIVIDUAL
MAY 12, 1998
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TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS.....................................................................................................2
ARTICLE 2 PURCHASE AND SALE OF PARTNERSHIP INTEREST.......................................................................4
2.1 THE CLOSING; CLOSING DATE...............................................................................4
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2.2 SALE OF PARTNERSHIP INTEREST............................................................................4
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2.2.1 ZAI*NET........................................................................................4
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2.2.2 XXXXXXX........................................................................................4
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2.3 PAYMENT OF CASH AMOUNT..................................................................................4
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2.4 WORKING CAPITAL ADJUSTMENT..............................................................................4
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2.4.1 CLOSING ADJUSTMENT.............................................................................4
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2.4.1.1 LOAN FOR DISTRIBUTION...............................................................4
2.4.1.2 DECREASE IN PURCHASE PRICE..........................................................5
2.4.2 POST-CLOSING ADJUSTMENT........................................................................5
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2.5 ADDITIONAL PURCHASE PRICE...............................................................................5
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2.5.1 FIRST ADDITIONAL PAYMENT.......................................................................5
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2.5.2 SECOND ADDITIONAL PAYMENT......................................................................6
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2.5.3 CUMULATIVE REVENUES............................................................................6
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2.5.4 ACQUISITIONS...................................................................................6
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2.5.5 QUALIFIED PUBLIC OFFERING AND CHANGE IN CONTROL................................................7
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2.5.6 DISPUTE RESOLUTION.............................................................................7
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ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP, ZAI*NET AND XXXXXXX..........................................7
3.1 EXISTENCE AND GOOD STANDING.............................................................................8
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3.1.1 ZAI*NET........................................................................................8
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3.1.2 ORGANIZATIONAL DOCUMENTS.......................................................................8
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3.1.3 SUBSIDIARIES...................................................................................8
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3.2 AUTHORITY...............................................................................................8
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3.3 STOCKHOLDERS' MEETING...................................................................................9
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3.4 NO CONFLICTS............................................................................................9
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3.5 FINANCIAL STATEMENTS....................................................................................9
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3.6 TRANSACTION EXPENSES...................................................................................10
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3.7 MATERIAL CONTRACTS.....................................................................................10
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3.8 INTELLECTUAL PROPERTY..................................................................................10
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3.9 INSURANCE..............................................................................................10
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3.10 LABOR RELATIONS AND EMPLOYEE AGREEMENTS; ERISA MATTERS.................................................11
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3.10.1 COMPLIANCE....................................................................................11
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3.10.2 EMPLOYMENT AGREEMENTS.........................................................................11
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3.10.3 ERISA.........................................................................................11
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3.10.4 INCLUSION OF ZAI*NET..........................................................................11
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3.11 PAYMENT OF TAXES.......................................................................................11
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3.12 BOOKS OF ACCOUNT; BANK ACCOUNTS........................................................................12
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3.13 CONDITION OF TANGIBLE ASSETS...........................................................................12
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3.14 OWNERSHIP OF ASSETS....................................................................................12
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3.15 BROKERS................................................................................................13
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3.16 LITIGATION.............................................................................................13
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3.17 PERSONAL PROPERTY LEASES...............................................................................13
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3.18 REAL PROPERTY LEASES...................................................................................13
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3.19 COMPLIANCE WITH LAWS; PERMITS..........................................................................13
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3.20 CAPITALIZATION AND TITLE TO PARTNERSHIP INTERESTS......................................................14
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3.21 UNDISCLOSED LIABILITIES................................................................................14
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3.22 SCOPE OF REPRESENTATIONS AND WARRANTIES................................................................14
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ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF GFI CAMINUS..................................................................14
4.1 EXISTENCE AND GOOD STANDING............................................................................14
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4.2 AGREEMENT..............................................................................................15
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4.2.1 AGREEMENT AUTHORIZED..........................................................................15
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4.2.2 NO CONFLICT...................................................................................15
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4.3 BROKERS................................................................................................15
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4.4 LITIGATION.............................................................................................15
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ARTICLE 5 RELATED AGREEMENTS; ACKNOWLEDGEMENTS...........................................................................16
5.1 RELIANCE...............................................................................................16
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5.2 ACKNOWLEDGMENTS........................................................................................16
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5.3 DOCUMENT DELIVERY......................................................................................16
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5.4 NAME CHANGE............................................................................................17
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5.5 JOINDER TO PARTNERSHIP AGREEMENT.......................................................................17
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5.6 NEWCO LLC..............................................................................................17
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5.7 EMPLOYMENT POLICIES....................................................................................17
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ARTICLE 6 INDEMNITY......................................................................................................17
6.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS..................................................17
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6.1.1 SELLERS.......................................................................................17
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6.1.2 GFI CAMINUS...................................................................................18
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6.2 THE INDEMNITY OBLIGATION...............................................................................18
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6.3 CLAIMS.................................................................................................19
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6.3.1 NOTICE........................................................................................19
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6.3.2 THIRD PARTY CLAIM PROCEDURES..................................................................19
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6.4 LIMITATION ON THE INDEMNIFYING PARTIES' INDEMNIFICATION OBLIGATIONS....................................20
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6.5 OPTION TO REDUCE ADDITIONAL PAYMENTS...................................................................20
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6.6 SOLE AND EXCLUSIVE REMEDY..............................................................................20
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6.7 INDEMNITY LIMITATIONS..................................................................................20
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6.8 INSURANCE RECOVERIES...................................................................................21
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ARTICLE 7 MISCELLANEOUS..................................................................................................21
7.1 ENTIRE AGREEMENT.......................................................................................21
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7.2 FURTHER ASSURANCES.....................................................................................21
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7.3 NOTICES................................................................................................21
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7.4 EXPENSES...............................................................................................23
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7.5 GOVERNING LAW AND SUBMISSION TO JURISDICTION...........................................................23
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7.6 EXHIBITS AND SCHEDULES.................................................................................23
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7.7 CAPTIONS...............................................................................................23
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7.8 SEVERABILITY...........................................................................................23
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7.9 COUNTERPARTS...........................................................................................23
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7.10 SUCCESSORS AND ASSIGNS.................................................................................24
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7.11 WAIVERS STRICTLY CONSTRUED.............................................................................24
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7.12 NUMBER AND GENDER......................................................................................24
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7.13 SCHEDULE OMISSIONS.....................................................................................24
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PURCHASE AGREEMENT
This PURCHASE AGREEMENT (the "AGREEMENT") is entered into as of this 12th
day of May, 1998, by and among ZAI*NET SOFTWARE, INC., a Delaware corporation
("ZAI*NET"), ZAI*NET SOFTWARE, L.P., a Delaware limited partnership (the
"PARTNERSHIP"), GFI CAMINUS LLC, a Delaware limited liability company ("GFI
CAMINUS"), and XXXXX X. XXXXXXX, an individual ("XXXXXXX"), with reference to
the following facts and circumstances.
RECITALS
WHEREAS, ZAI*NET has transferred substantially all of its assets,
properties, claims, contracts, operations and businesses (including goodwill but
excluding cash) existing as of the Closing to the Partnership, and the
Partnership has assumed liabilities and obligations of ZAI*NET pursuant to an
Assignment and Assumption Agreement dated as of the date hereof (the "ASSIGNMENT
AND ASSUMPTION AGREEMENT");
WHEREAS, ZAI*NET is the owner of a ninety-nine percent (99%) limited
Partnership Interest and Xxxxxxx is the owner of the one percent (1%) general
Partnership Interest in the Partnership;
WHEREAS, ZAI*NET desires to sell, assign and transfer to GFI Caminus and
GFI Caminus desires to purchase and accept from ZAI*NET a limited Partnership
Interest constituting seventy percent (70%) of the aggregate Partnership
Interests in the Partnership;
WHEREAS, Xxxxxxx desires to sell, assign and transfer to GFI Caminus and
GFI Caminus desires to purchase and accept from Xxxxxxx a one percent (1%)
general Partnership Interest in the Partnership (the purchases of partnership
interests described above are collectively referred to herein as the
"PURCHASE");
WHEREAS, immediately after the closing of the Purchase, ZAI*NET intends
to assign and transfer its remaining twenty-nine percent (29%) limited
partnership interest in the Partnership to Rooney Software, L.L.C. ("NEWCO
LLC"), pursuant to an Assignment and Assumption of LP Agreement, dated the date
hereof (the "LP ASSIGNMENT") in exchange for a controlling membership interest
in Newco LLC;
NOW THEREFORE, in consideration of the premises and the respective
representations, warranties and agreements contained herein and in the Related
Agreements (as hereinafter defined), the parties hereto hereby agree as follows:
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ARTICLE 1
DEFINITIONS
"Assignment and Assumption Agreement" shall have the meaning as set forth in the
Recitals hereto.
"Basket" shall have the meaning as set forth in Section 6.4 hereof.
"Closing" shall have the meaning as set forth in Section 2.1 hereof.
"Closing Audit" shall mean an audit of ZAI*NET as of the close of business on
April 30, 1998 to be performed by ZAI*NET's independent public accountants (as
specified by GFI Caminus) not later than sixty (60) days following the Closing.
"Closing Date" shall have the meaning as set forth in Section 2.1 hereof.
"GAAP" shall mean generally accepted accounting principles applied on a
consistent basis (for purposes of determining consistency, in the case of the
Partnership, reference shall be made to the accounting principles of ZAI*NET,
its predecessor).
"Indemnifying Parties" shall have the meaning as set forth in Section 6.2.1
hereof.
"Indemnifying Party" shall have the meaning as set forth in Section 6.2.1
hereof.
"Knowledge" or "knowledge" shall mean, with respect to the Partnership, ZAI*NET
or GFI Caminus, actual knowledge or such knowledge as would have been acquired,
after due inquiry, of the officers and key employees of the Partnership, ZAI*NET
or GFI Caminus, as the case may be; provided, however, that only the following
individuals shall be deemed officers and key employees of ZAI*NET and the
Partnership for purposes of this definition: Xxxxx Xxxxxxx, Xxxxx Xxxxx, Xxxxx
Xxxxxxxxx and Xxxxxxx Xxxxx.
"Lien" shall mean any claim, security interest, charge, restriction, equity or
encumbrance of any kind of any party and of any nature whatsoever.
"LP Assignment" shall have the meaning in the fifth Whereas clause hereof.
"Material Adverse Effect" means for all purposes of this Agreement any change or
effect that individually or when taken together with all other changes or
effects that have occurred during any relevant period of time prior to the date
of determination of the occurrence of the Material Adverse Effect, is or is
reasonably likely to be materially adverse to the business, assets (including
intangible assets), financial condition or results of operation or prospects of
such person or entity, or does or is reasonably likely to materially adversely
affect the ability of such person or entity to perform its obligations under
this Agreement or the Related Agreements or to consummate the transactions
contemplated hereby or thereby, or materially adversely affects the ability of
such person or entity to conduct its business after the Closing Date
substantially as such business is being conducted as of the date hereof.
"Newco LLC" shall have the meaning set forth in the fifth Whereas clause hereof.
"Newco LLC Agreement" shall mean that certain Limited Liability Company
Agreement of Newco LLC, dated the date hereof.
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"Partnership" shall have the meaning as set forth in the introductory paragraph
of this Agreement.
"Partnership Agreement" shall mean that certain Amended and Restated Limited
Partnership Agreement of the Partnership, dated the date hereof, by and between
ZAI*NET and GFI Caminus.
"Partnership Interests" shall mean the undivided partnership interests of the
Partnership.
"Permits" shall have the meaning as set forth in Section 3.19 hereof.
"Permitted Lien" shall have the meaning as set forth in Section 3.14 hereof.
"Person" shall have the meaning as set forth in Section 7.5 hereof.
"Personal Property Leases" shall have the meaning as set forth in Section 3.17
hereof.
"Purchase" shall have the meaning as set forth in the fourth Whereas clause
hereto.
"Purchase Price" means the aggregate payments by GFI Caminus to ZAI*NET pursuant
to Sections 2.3, 2.4 and 2.5 hereof (as adjusted as provided therein).
"Real Property Leases" shall have the meaning as set forth in Section 3.18
hereof.
"Related Agreements" shall mean (i) the employment agreement and associated
covenant not to compete entered into between the Partnership and Xxxxx X.
Xxxxxxx dated as of the date hereof, (ii) the employment agreement and
associated covenant not to compete entered into between the Partnership and
Xxxxx Xxxxx dated as of the date hereof (a form of said employment agreements
and associated covenants not to compete is set forth at EXHIBIT A hereto), (iii)
the Assignment and Assumption Agreement, (iv) the LP Assignment, (v) the Newco
LLC Agreement and (vi) the Partnership Agreement.
"Sellers" shall mean, with respect to this Agreement and the transactions
contemplated hereby, the Partnership, ZAI*NET and Xxxxxxx, and with respect to
the remaining Related Agreements and the transactions contemplated thereby, the
Partnership, ZAI*NET and Xxxxxxx (to the extent each of which is a party
thereto).
"Stub Period" shall mean that period of calendar year 1998 commencing as of May
1, 1998 and continuing through December 31, 1998.
"Target Working Capital" shall mean One Million Dollars ($1,000,000).
"Tax" and "Taxes" shall have the meanings as set forth in Section 3.11 hereof.
"Tax Return" shall have the meaning as set forth in Section 3.11 hereof.
"Third Party Claims" shall have the meaning as set forth in Section 6.3.2
hereof.
"Working Capital" shall mean ZAI*NET's current assets (excluding cash in an
amount equal to Six Hundred Thousand Dollars ($600,000)) less its current
liabilities, determined in accordance with GAAP as of the close of business on
April 30, 1998 and as determined pursuant to the Closing Audit.
"ZAI*NET Cash Amount" shall mean Seven Million Three Hundred Thirty-Nine
Thousand Nine Hundred Ninety Dollars ($7,339,990.00) subject to the provisions
of Section 2.4.1.2.
"ZAI*NET Financial Statements" shall have the meaning as set forth in Section
3.5 hereof.
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ARTICLE 2
PURCHASE AND SALE OF PARTNERSHIP INTEREST
2.1 THE CLOSING; CLOSING DATE. The signing of this Agreement, the
Related Agreements, and the closing of the transactions contemplated hereby and
thereby (the "Closing") shall take place (i) at the offices of Irell & Xxxxxxx
LLP, 000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx on the date
hereof, or (ii) at such other place, time and/or date as the parties hereto may
unanimously agree in writing. The date upon which the Closing occurs is referred
to herein as the "Closing Date."
2.2 SALE OF PARTNERSHIP INTEREST.
2.2.1 ZAI*NET. Subject to the terms and conditions set forth
herein and in the Related Agreements, at the Closing ZAI*NET shall sell, assign,
transfer and deliver to GFI Caminus, and GFI Caminus shall purchase and accept
from ZAI*NET, seventy percent (70%) of the aggregate Partnership Interests of
the Partnership. At the Closing, GFI Caminus and ZAI*NET shall execute and
deliver the Partnership Agreement.
2.2.2 XXXXXXX. Subject to the terms and conditions set forth
herein and in the Related Agreements, at the Closing Xxxxxxx shall sell, assign,
transfer and deliver to GFI Caminus, and GFI Caminus shall purchase and accept
from Xxxxxxx, the one percent (1%) general Partnership Interest of the
Partnership in consideration of Ten Dollars ($10), the receipt and sufficiency
of which is acknowledged by Xxxxxxx.
2.3 PAYMENT OF CASH AMOUNT. Subject to the terms and conditions set
forth herein and in the Related Agreements, at the Closing GFI Caminus shall pay
to ZAI*NET the ZAI*NET Cash Amount.
2.4 WORKING CAPITAL ADJUSTMENT. The parties acknowledge that ZAI*NET
has delivered to GFI Caminus its projection of Working Capital as of the close
of business on April 30, 1998 of One Million Four Hundred Thousand Dollars
($1,400,000) (the "ESTIMATED WORKING CAPITAL"). The Estimated Working Capital
shall be used at the Closing to compute the initial Working Capital adjustment,
if any, which shall be subject to further adjustment based upon the Closing
Audit. For purposes of calculating the Estimated Working Capital and the Working
Capital reflected in the Closing Audit as provided in this Section 2.4, the
parties hereto acknowledge and agree that the method and procedures of revenue
recognition shall be in accordance with the methods and procedures implemented
by ZAI*NET's independent auditors in the financial statements for the fiscal
year ended December 31, 1997. Notwithstanding anything herein to the contrary,
any distribution, dividend or similar payment by ZAI*NET or the Partnership
which is not fully reflected in the computation of Working Capital (e.g., any
such payment on or after May 1, 1998 and prior to or on the Closing Date,
including as applicable any payment(s) in connection with the settlement of the
Tsigutkin litigation) other than as provided for in Section 2.4.1.1 below shall
be deducted in computing Working Capital.
2.4.1 CLOSING ADJUSTMENT
2.4.1.1 LOAN FOR DISTRIBUTION. In the event that Estimated
Working Capital exceeds One Million Dollars ($1,000,000.00) (the "TARGET WORKING
CAPITAL"), in addition to the payment to be made pursuant to Section 2.3 hereof,
GFI Caminus shall loan to the Partnership at the
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Closing the amount by which Estimated Working Capital exceeds Target Working
Capital (the "EXCESS WORKING CAPITAL"), and the same amount shall be paid by the
Partnership to ZAI*NET as a cash distribution. To evidence such loan, there
shall be issued to GFI Caminus at the Closing a promissory note ("NOTE") payable
by the Partnership in the initial principal amount equal to the Excess Working
Capital. The Note shall have a maturity date of one year (subject to customary
events of acceleration) and shall accrue interest at the rate of eight percent
(8%) per annum, payable at maturity. Based on the One Million Four Hundred
Thousand Dollars ($1,400,000) Estimated Working Capital figure, the Excess
Working Capital and thus the principal amount of the Note (subject to adjustment
as provided in Section 2.4.2) shall be Four Hundred Thousand Dollars ($400,000).
2.4.1.2 DECREASE IN PURCHASE PRICE. In the event that
Estimated Working Capital is less than Target Working Capital (the "WORKING
CAPITAL SHORTFALL"), at Closing the ZAI*NET Cash Amount shall be reduced by the
result of multiplying (i) the amount by which Target Working Capital exceeds
Estimated Working Capital by (ii) 0.71.
2.4.2 POST-CLOSING ADJUSTMENT. Within sixty (60) days after the
Closing, the Partnership shall cause to be conducted the Closing Audit at the
expense of the Partnership. Based upon the actual amount of Working Capital as
reflected in the Closing Audit, the provisions of Section 2.4.1 shall again be
applied, substituting actual Working Capital for Estimated Working Capital; and,
based upon such application, not later than thirty (30) days following the
completion of the Closing Audit, GFI Caminus, the Partnership and ZAI*NET, as
applicable, shall be obligated to make payment(s) to the other party(ies), as
applicable, in order to "true up" the payments and transactions effected at the
Closing pursuant to Section 2.4.1. After receipt of the Closing Audit, GFI
Caminus and ZAI*NET shall have twenty (20) days to object in writing to any or
all of the amounts presented therein and to the calculation of the "true up"
payment(s).
(i) If GFI Caminus and ZAI*NET do not so object, the Closing Audit and
the "true up" amounts, if any, shall become final and binding on the
parties and the appropriate "true up" amounts shall be payable not later
than thirty (30) days following receipt of the Closing Audit.
(ii) If either GFI Caminus or ZAI*NET do so object to any portion of
the Closing Audit or the "true up" amounts, if any, and within thirty
(30) days of notification of such dispute the parties and their
respective accounting advisers are unable to resolve such dispute, then
GFI Caminus and ZAI*NET shall jointly appoint a different accounting firm
to review the Closing Audit and the "true up" amounts and the
determination by such different accounting firm shall be final and
binding on GFI Caminus and ZAI*NET.
2.5 ADDITIONAL PURCHASE PRICE.
2.5.1 FIRST ADDITIONAL PAYMENT. As additional consideration for
the sale and transfer of the Partnership Interests pursuant hereto, in the event
that the revenues earned by the Partnership (the "FIRST AUDIT CYCLE REVENUES")
determined in accordance with GAAP (except as hereinafter provided) and as
reflected in the financial statements delivered in connection with the audit of
the Partnership for its fiscal year ending December 31, 1998 (the "FIRST AUDIT
CYCLE AUDIT") equal or exceed the result of multiplying (i) Six Million Four
Hundred Seventy Thousand Dollars ($6,470,000.00) by (ii) a fraction, the
numerator of which is the number of whole calendar days in the Stub Period and
the denominator of which is three hundred sixty-five (365) (such result being
the "FIRST
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AUDIT CYCLE TARGET REVENUES"), GFI Caminus will pay to ZAI*NET, within thirty
(30) days after the completion of the First Audit Cycle Audit, an additional
payment of Two Million One Hundred Eighty-Seven Thousand Five Hundred Dollars
($2,187,500.00). For purposes of determining the amount of the First Audit Cycle
Revenues and Second Audit Cycle Revenues (as hereinafter defined) in connection
with a determination of whether an additional payment is required pursuant to
this Section 2.5, any indemnity obligation for which GFI Caminus is reimbursed
or otherwise paid or entitled to reimbursement or payment in accordance with
Article 6 of this Agreement shall be included in such revenue calculation solely
to the extent that such indemnity obligation relates to unrealized or lost
revenues in the business of the Partnership and provides an equivalent economic
benefit for GFI Caminus's allocable share of such revenues not otherwise
included in the revenue computation, and shall otherwise be disregarded.
Notwithstanding anything to the contrary herein, for purposes of calculating the
First Audit Cycle Revenues and the Second Audit Cycle Revenues as provided in
Sections 2.5.1, 2.5.2 and 2.5.3 of this Agreement, the parties agree that the
following methods shall be employed: (i) with respect to all revenue items other
than software license revenues, revenues shall be recognized in accordance with
GAAP in a manner consistent with past practices, for work completed or services
rendered or products delivered; and (ii) with respect to software license
revenues, revenues shall be credited based upon invoice date, consistent with
ZAI*NET's past practice in its interim internal accounts, for work completed or
services rendered or products delivered; provided that, for the purposes of
calculating software license revenues, there will be excluded from a particular
revenue period any invoice that is not collected within 60 days beyond the
revenue period ending December 31, 1998 or December 31, 1999, respectively.
These methods will be employed on a consistent basis during the relevant revenue
periods. Notwithstanding the foregoing, (a) to the extent that an amount of
revenue is included in computing Working Capital, such amount of revenue shall
be excluded for purposes of computing First Audit Cycle Revenues and Second
Audit Cycle Revenues (to avoid duplication), and (b) any revenue deferred and
not included in computing Working Capital shall be credited for the period in
which it is paid.
2.5.2 SECOND ADDITIONAL PAYMENT. As additional consideration for
the sale and transfer of the Partnership Interests pursuant hereto, in the event
that the sum of (i) the revenues of the Partnership (the "SECOND AUDIT CYCLE
REVENUES") determined in accordance with GAAP (except as provided above) and as
reflected in the financial statements delivered in connection with the audit of
the Partnership for its fiscal year ending December 31, 1999 (the "SECOND AUDIT
CYCLE AUDIT") and (ii) the First Audit Cycle Revenues equals or exceeds the sum
of (i) Ten Million One Hundred Thirty-Six Thousand Dollars ($10,136,000.00) and
(ii) the First Audit Cycle Target Revenues, GFI Caminus will pay to ZAI*NET,
within thirty (30) days after the completion of the Second Audit Cycle Audit, an
additional payment of Two Million One Hundred Eighty-Seven Thousand Five Hundred
Dollars ($2,187,500.00).
2.5.3 CUMULATIVE REVENUES. As additional consideration for the
sale and transfer of the Partnership Interests pursuant hereto, in the event
that (a) an additional payment is not earned pursuant to Section 2.5.1 hereof,
but (b) an additional payment is earned pursuant to Section 2.5.2 hereof, GFI
Caminus will pay to ZAI*NET, within thirty (30) days after the completion of the
Second Audit Cycle Audit, an additional payment of Two Million One Hundred
Eighty-Seven Thousand Five Hundred Dollars ($2,187,500.00) (i.e., in addition to
the payment pursuant to Section 2.5.2).
2.5.4 ACQUISITIONS. Notwithstanding the foregoing, in the event
that, prior to
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December 31, 1999, the Partnership completes one or more acquisitions (excluding
transactions in the ordinary course of business), then, in each instance the
revenues of the Partnership shall be determined without giving effect to the
revenues (whether positive or negative) and expenses of any entity acquired
(whether pursuant to merger, equity or asset acquisition or otherwise) by the
Partnership after the Closing Date.
2.5.5 QUALIFIED PUBLIC OFFERING AND CHANGE IN CONTROL. In the
event that prior to December 31, 1999, (i) GFI Caminus or the Partnership (or
their respective successors-in-interest) successfully completes a Qualified
Public Offering, (ii) GFI Caminus or the Partnership, or at least 50% of the
equity therein, is acquired by a third party which is not (x) as of the date of
this Agreement, a direct or indirect investor in GFI Caminus or the Partnership
or (y) an affiliate thereof (whether pursuant to merger, equity or asset
acquisition or otherwise) or (iii) Xxxxxxx or Xxxxx Xxxxx is terminated without
Cause pursuant to the provisions set forth in their respective Employment
Agreement prior to December 31, 1999, as the case may be (provided, however,
that in the event of a termination of Xxxxx Xxxxx, Xxxxxxx must in good faith
disagree and object to such termination to constitute a Change in Control) ((ii)
or (iii) subject to the proviso above hereinafter referred to as a "CHANGE IN
CONTROL"), GFI Caminus will pay to ZAI*NET, within thirty (30) days after the
completion of such Qualified Public Offering or the occurrence of a Change in
Control, Four Million Three Hundred Seventy Five Thousand Dollars
($4,375,000.00) minus any additional payments previously made or to be made
pursuant to Sections 2.5.1, 2.5.2 or 2.5.3 hereof. For purposes of this Section
2.5.5, "QUALIFIED PUBLIC OFFERING" means an underwritten public offering of
equity securities, pursuant to an effective registration statement under the
Securities Act.
2.5.6 DISPUTE RESOLUTION. In the event that either GFI Caminus or
ZAI*NET object to any aspect of the First Audit Cycle Audit or the Second Audit
Cycle Audit or to any other calculation required by this Section 2.5, and the
dispute is not resolved within thirty (30) days of either party's written
objection, the parties agree to promptly subject the matter to a proceeding
conducted in the same manner as the proceeding described in Section 2.4.2 (ii)
hereof. Any party prevailing in a dispute arising under this Section 2.5.6 shall
be entitled to reasonable attorneys' fees and costs. From the Closing Date until
December 31, 1999, the parties agree that the business of the Partnership shall
continue to be conducted substantially in the same manner and with respect to
the same services and products as the business of ZAI*NET prior to the date
hereof, subject to the reasonable discretion of the Management Committee of the
Partnership to conduct Partnership affairs in the best interests of the
Partnership and its owners. The Management Committee shall conduct the affairs
of the Partnership reasonably and in good faith in view of the provisions of
this Section 2.5, consistent with the overall objective of maximizing the value
of the Partnership for the benefit of all of its owners and to maximize the
revenues of the Partnership, subject to the reasonable and good faith discretion
of the Management Committee seeking to maximize profitability and based on its
business judgment as to the management of the Partnership's business.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP,
ZAI*NET AND XXXXXXX
As an inducement for GFI Caminus to enter into and consummate the
transactions contemplated by this Agreement (including the Related Agreements),
each of Xxxxxxx, XXX*NET and
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the Partnership, jointly and severally, represents and warrants that each of the
following statements is true, correct and complete as of the date hereof, which
representations and warranties shall survive the Closing as provided in Section
6.1 hereof. Except as the context otherwise requires, all representations and
warranties in this Article 3 with respect to ZAI*NET as of or with respect to
any period prior to the Closing shall be deemed made equally with respect to the
Partnership as of the Closing, and vice versa.
3.1 EXISTENCE AND GOOD STANDING.
3.1.1 ZAI*NET. ZAI*NET 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. ZAI*NET is duly qualified to transact business and is in good
standing in each jurisdiction in which the operation of its business and the
ownership of its assets and properties requires it to be so qualified, except
where the failure to so qualify is not reasonably likely to have a Material
Adverse Effect. The Partnership is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware. Newco LLC
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware.
3.1.2 ORGANIZATIONAL DOCUMENTS. Copies of the articles of
incorporation and by-laws of ZAI*NET, effective prior to the date hereof, have
been delivered to GFI Caminus and as delivered are true and complete. A copy of
the original partnership agreement of the Partnership has been delivered to GFI
Caminus and as delivered was true and complete. A copy of the Newco LLC
Agreement, effective as of the date hereof, has been delivered to GFI Caminus
and as delivered is true and complete.
3.1.3 SUBSIDIARIES. ZAI*NET does not own or have any
subsidiaries, or own any interest in a partnership, joint venture or other
business entity except for the Partnership Interests. The Partnership does not
own or have any subsidiaries, or own any interest in a partnership, joint
venture or other business entity. Newco LLC does not own or have any
subsidiaries, or own any interest in a partnership, joint venture or other
business entity, except for the Partnership Interests following consummation of
the LP Assignment.
3.2 AUTHORITY. Each of the Sellers has the requisite power and
authority to execute and deliver this Agreement and the Related Agreements, and
perform its or his obligations herein and therein, and consummate the
transactions contemplated hereby and thereby. Each of the Sellers has duly
executed and delivered this Agreement and the Related Agreements to which such
Seller is a party and has obtained the necessary authorization in accordance
with all applicable laws and its organizational documents to execute and deliver
this Agreement and the Related Agreements, and to perform its respective
obligations herein and therein and consummate the transactions contemplated
hereby and thereby, and such matters do not require notice to, or consent or
approval of, any other third party, governmental authority or regulatory agency,
except as set forth on SCHEDULE 3.2 attached hereto. Each of this Agreement and
the Related Agreements to which such Seller is a party is a valid, legal and
binding obligation of such Seller enforceable against such Seller in accordance
with its 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 at equity). The person executing this Agreement and any Related
Agreements on behalf of the Sellers has been specifically authorized to do so by
all necessary corporate or other action. No other action will be necessary by
any of the Sellers to authorize the execution and delivery of this Agreement and
the Related Agreements and
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the consummation of the transactions contemplated hereby and thereby.
3.3 STOCKHOLDERS' MEETING. ZAI*NET has duly convened a meeting of its
stockholders (unless the requirement of such meeting has been waived or
otherwise satisfied under applicable law) to approve this Agreement, the Related
Agreements (to the extent ZAI*NET is a party), and the transactions contemplated
hereby and thereby, and such agreements and transactions have been duly approved
and become effective in accordance with applicable law.
3.4 NO CONFLICTS. Except as set forth in SCHEDULE 3.4 attached hereto,
neither the execution and delivery of this Agreement or the Related Agreements,
nor the consummation of the transactions contemplated hereby or thereby, (i)
violates or conflicts with any provision of the Partnership Agreement or other
organizational documents of the Partnership or the articles of incorporation,
by-laws or other organizational documents of ZAI*NET; (ii) conflicts with or
violates any material provision of any foreign, federal, state or local law,
statute, treaty, ordinance, rule, regulation or any order, writ, judgment or
decree of any court or other governmental authority to which any of the Sellers
or any of their respective properties or assets may be bound or affected; or
(iii) breaches or constitutes grounds for a default (or an event, with notice or
lapse of time or both would become a default) under, or gives to others a right
of termination, amendment, acceleration, modification or cancellation of, or
results in the creation or imposition of (or the obligation to create or impose)
any Lien on any of the properties or assets of any of the Sellers pursuant to
any note, mortgage, indenture, bond, lease, license, permit, franchise,
agreement, contract, undertaking or other instrument to which any of the Sellers
is a party or by which any of the Sellers or any of their respective properties
or assets may be bound or affected, in each case which is reasonably likely to
have a Material Adverse Effect on any of the Sellers. The execution, delivery
and performance of this Agreement and the Related Agreements by each and all of
the Sellers does not require the notice to, filing with, consent approval or
action of, any governmental authority or any other third party whatsoever,
except as disclosed on SCHEDULE 3.4.
3.5 FINANCIAL STATEMENTS. ZAI*NET has delivered to GFI Caminus true
and complete copies of the (i) audited balance sheets of ZAI*NET, for the fiscal
year ended December 31, 1996 and (ii) unaudited balance sheets of ZAI*NET for
the fiscal year ended December 31, 1997 (provided, however, that should an
audited balance sheet have become available for fiscal year 1997 prior to
Closing, ZAI*NET will have delivered such to GFI Caminus), and the related
statements of income, cash flow and changes in stockholders' equity (the
"ZAI*NET FINANCIAL STATEMENTS"), all of which have been prepared in accordance
with GAAP. Such balance sheets, including the related notes thereto, are true
and correct as of their respective dates, and fairly present the financial
position, assets and liabilities (whether accrued, absolute, contingent or
otherwise) of ZAI*NET, at the dates indicated and such statements of income, and
cash flow and changes in stockholders' equity, are true and correct as of their
respective dates, and fairly present the results of operations, and cash flow
and changes of stockholders' equity of ZAI*NET, for the periods indicated. There
are no claims, obligations or liabilities of ZAI*NET or the Partnership accrued
and owing other than those set forth in the ZAI*NET Financial Statements or on
SCHEDULE 3.5 attached hereto. The ZAI*NET Financial Statements reflect adequate
and sufficient reserves, in accordance with GAAP, in respect of all claims,
obligations and liabilities asserted or potentially assertable relating to
warranties provided to customers or to actual or potential product returns based
upon claims of defect, infringement or otherwise, except as set forth in
SCHEDULE 3.5 attached hereto. Since the date of the most recent ZAI*NET
Financial Statements, (i) no event or circumstance has occurred or come into
existence that may reasonably be expected to have or constitute
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a Material Adverse Effect with respect to the Partnership, and (ii) ZAI*NET has
made no distributions, dividends or similar payments to its stockholders or
other third parties, except as set forth on Schedule 3.5 or other than pursuant
to Section 2.4.1.1.
3.6 TRANSACTION EXPENSES. If any of the expenses incurred by any of
the Sellers in connection with the transactions contemplated by this Agreement
and the Related Agreements are to be paid by the Partnership, all of such
expenses will be accrued on the balance sheet prepared in connection with the
Closing Audit.
3.7 MATERIAL CONTRACTS. Set forth on SCHEDULE 3.7 attached hereto is a
complete and accurate list of all material contracts and agreements, oral or
written, to which the Partnership or ZAI*NET is a party or by which any of its
assets, properties or business is bound. With respect to each of the material
contracts set forth on SCHEDULE 3.7, a true and correct copy, or if a copy is
not available, a true and correct summary of the contractual obligation, has
been provided to GFI Caminus, each is in full force and effect, without material
breach or default by the Partnership or ZAI*NET, as applicable, and to the
Knowledge of ZAI*NET and the Partnership, without material breach or default by
any other party thereto, and no written notice has been received regarding
termination, suspension, alteration, modification or amendment thereof.
3.8 INTELLECTUAL PROPERTY. Set forth on SCHEDULE 3.8 attached hereto
is a list of all trade names, trademarks, service names, service marks, logos,
patents, copyrights, licenses, formulas, trade secrets, programs, computer
software (excluding commercially available general office computer software
licensed from unrelated third-parties), technology and other intellectual
property rights (the "INTELLECTUAL PROPERTY") owned by the Partnership or used
or required by the Partnership in the operation of its businesses. Except as set
forth on SCHEDULE 3.8, the Partnership holds all of its right, title and
interest in and to the Intellectual Property, free and clear of all Liens. The
Partnership owns or has the right to use, without the making of any payment or
the granting of any rights to others, all Intellectual Property necessary to
conduct its business as presently being conducted. Except as set forth on
SCHEDULE 3.8, to the Knowledge of the Partnership the conduct of the businesses
of the Partnership as now conducted does not infringe or conflict with any
Intellectual Property rights of others. Except as set forth on SCHEDULE 3.8, the
Partnership has, as of the date hereof, satisfied all material requirements
necessary to maintain the validity of all Intellectual Property, and the right
to use such Intellectual Property. Except as set forth on SCHEDULE 3.8 attached
hereto, no infringement by others of any Intellectual Property is pending, or to
the Knowledge of ZAI*NET, threatened by any third party who has asserted a claim
of infringement of any such Intellectual Property rights. All licenses, rights
and other agreements pertaining to the Intellectual Property are in material
compliance with all applicable laws, rules and regulations in all jurisdictions
in which the Partnership conducts any business, including without limitation,
those pertaining to remittance of foreign exchange and taxation. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby will not alter or impair the rights and interests of the
Partnership in any of the Intellectual Property and the Partnership will have
the same rights and interests in such items at and after the Closing Date as it
has had immediately prior to the Closing Date.
3.9 INSURANCE. The assets, properties and operations of the
Partnership are insured under various policies of general liability and other
forms of insurance, copies of which have been provided to GFI Caminus. SCHEDULE
3.9 discloses for each policy the outstanding claims thereunder. All such
policies are in full force and effect in accordance with their terms, no notice
of cancellation has been
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received, and to the Knowledge of the Partnership there is no existing breach or
default (or event which with the giving of notice or lapse of time or both)
would constitute a breach or default thereunder. All premiums to date have been
paid in full.
3.10 LABOR RELATIONS AND EMPLOYEE AGREEMENTS; ERISA MATTERS.
3.10.1 COMPLIANCE. Except as disclosed on SCHEDULE 3.10.1 attached
hereto, ZAI*NET was, and the Partnership is, in compliance with all material
applicable federal, state and local laws, rules, regulations and ordinances
relating to the employment of labor and those other applicable laws, rules,
regulations and ordinances relating to wages, hours, occupational health and
safety, anti-discrimination, collective bargaining, equal employment opportunity
and employment of labor in general, and to the payment of social security and
similar taxes.
3.10.2 EMPLOYMENT AGREEMENTS. Except as disclosed on SCHEDULE
3.10.2 attached hereto, ZAI*NET was not, and the Partnership is not, a party to
any employment contract with any employee, collective bargaining agreement,
"employees pension plan" or retirement plan, "employees profit sharing plan",
bonus plan, severance agreement, termination agreement, or any other similar
agreement or plan. There are no material labor controversies pending between
either of ZAI*NET or the Partnership and any of its employees.
3.10.3 ERISA. SCHEDULE 3.10.3 attached hereto, contains a list of
all "employee pension benefit plans" (as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) (sometimes
referred to herein as "Pension Plans"), "employee welfare benefit plans" (as
defined in Section 3(1) of ERISA) and all other benefit plans maintained or
contributed to by ZAI*NET or the Partnership or any other person or entity that,
together with ZAI*NET or the Partnership, is treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code for the benefit of any current or
former employees, officers or directors of the Partnership or dependents of any
such person (collectively, "Benefit Plans"). ZAI*NET and the Partnership have
delivered or made available to GFI Caminus, its counsel, representatives or
advisors, true, complete and correct copies of each Benefit Plan (or, in the
case of any unwritten Benefit Plans, descriptions thereof), the most recent
annual report on Form 5500 filed with the Internal Revenue Service with respect
to each Benefit Plan (if any such report was required), the most recent summary
plan description for each Benefit Plan for which such summary plan description
is required and each trust agreement and group annuity contract relating to any
Benefit Plan. Each and every of the Partnership's Benefit Plans are in material
compliance with all federal, state and local laws, rules, regulations and
ordinances applicable thereto.
3.10.4 INCLUSION OF ZAI*NET. All representations and warranties in
this Section 3.10 with respect to the Partnership shall be deemed made equally
with respect to ZAI*NET in relation to the operation of its business prior to
giving effect to the Assignment and Assumption Agreement unless expressly stated
otherwise herein.
3.11 PAYMENT OF TAXES. ZAI*NET has timely filed all Tax Returns
required to have been filed by it and has paid or accrued all Taxes due to any
taxing authority with respect to all taxing periods ending on or prior to the
date hereof, and all such Tax Returns are true, correct and complete in all
material respects. ZAI*NET has provided copies of such Tax Returns to GFI
Caminus for its taxable years ending December 31, 1995, 1996 and 1997. The
ZAI*NET Financial Statements include an adequate reserve for all Taxes not yet
due or with respect to which Tax Returns are not required to have
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been filed, in each case to reflect the operations of ZAI*NET through the
Closing. Except as set forth in SCHEDULE 3.11 attached hereto, there is no Tax
audit, investigation or other proceeding pending or, to the Knowledge of
ZAI*NET, threatened by a governmental authority against or affecting ZAI*NET or
the Partnership. For purposes of this Agreement, "TAX" and "TAXES" shall mean
and refer to all taxes imposed of any nature including federal, state,
commonwealth, local or foreign net income tax, alternative or add-on minimum
tax, profits or excess profits tax, franchise tax, gross income, adjusted gross
income or gross receipts tax, employment related tax, real and personal property
tax or ad valorem tax, sales or use tax, excise tax, stamp tax or duty, any
withholding or back up withholding tax, value added tax, severance tax,
prohibited transaction tax, premiums tax, occupation tax, together with any
interest or any penalty, in addition to any tax or additional amount imposed by
any governmental authority (domestic or foreign) responsible for the imposition
of such tax. "TAX RETURN" means all returns, reports, forms or other information
required to be filed with respect to any Taxes.
3.12 BOOKS OF ACCOUNT; BANK ACCOUNTS. The books, records and accounts
of ZAI*NET accurately and fairly reflect, in reasonable detail, the transactions
and the assets and liabilities of ZAI*NET with respect to its businesses.
ZAI*NET has not engaged in any material transaction with respect to its
businesses, maintained any bank account for its businesses or used any of its
funds, except for transactions, bank accounts and funds which have been and are
reflected in the normally maintained books, records and accounts of ZAI*NET.
SCHEDULE 3.12 attached hereto sets forth a list of all bank accounts, bank boxes
and other depositories of ZAI*NET or the Partnership identifying bank, branch
and account number, as well as the authorized signatories thereto. ZAI*NET has
maintained a system of internal accounting control sufficient to provide
reasonable assurances that transactions are executed in accordance with
management's general or specific authorization, transactions are recorded as
necessary to permit preparation of financial statements in conformity with GAAP,
access to assets, properties, books, records and accounts is permitted only in
accordance with management's general or specific authorization, and the recorded
accounting for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
3.13 CONDITION OF TANGIBLE ASSETS. SCHEDULE 3.13 attached hereto sets
forth a complete and accurate list of all items of machinery, equipment,
furniture, motor vehicles and other tangible assets owned or held under lease
agreements by ZAI*NET immediately prior to or by the Partnership on the Closing
Date and which are capitalized by the Partnership and which have a present per
item book value of at least Twenty-Five Thousand Dollars ($25,000) or which, for
reasons other than value, are material to the Partnership. To the Knowledge of
ZAI*NET and the Partnership, such machinery, equipment, furniture, motor
vehicles and other tangible assets necessary or appropriate for the conduct of
the Partnership's business and operations are in good operating condition and
repair, subject to ordinary wear and tear.
3.14 OWNERSHIP OF ASSETS. Except as described in SCHEDULE 3.14 attached
hereto, ZAI*NET had, and the Partnership has, good and marketable title to, or
holds under valid leases, all of its assets and properties, free and clear of
all Liens except for Permitted Liens. For purposes of this Agreement, "PERMITTED
LIENS" shall mean Liens that do not materially detract from the value of, or
materially interfere with, the present use or the marketability of the property
affected thereby; mechanic's, carrier's, worker's, repairman's or other
statutory liens arising or incurred in the ordinary course of business; Liens
for taxes, assessment and other governmental charges which are not yet due and
payable or which may thereafter be paid without penalty or are being contested
in good faith pursuant to appropriate
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proceedings and fully reserved on the ZAI*NET Financial Statements; easements,
covenants, rights-of-way and other encumbrances or restrictions of record that
do not materially detract from the value of, or materially interfere with, the
present use or the marketability of the property affected thereby; and zoning,
building, restrictions and other governmental ordinances. The assets of the
Partnership as a result of completion of the Assignment and Assumption Agreement
constitute all of the assets and properties needed for the Partnership to
continue to conduct the businesses conducted by ZAI*NET immediately prior to the
date hereof.
3.15 BROKERS. No amount is payable by the Partnership, Xxxxxxx or
ZAI*NET by way of brokerage fees, finder's commissions or otherwise to any party
on account of this Agreement or the Related Agreements or the transactions
contemplated hereby or thereby, except for a fee payable to Advest, Inc., which
shall be paid by ZAI*NET or Xxxxxxx.
3.16 LITIGATION. Except as disclosed on SCHEDULE 3.16 attached hereto,
there is no material claim, action, suit, litigation, arbitration, investigation
or other legal proceeding which is pending before any court or governmental
authority, or arbitrator or board of arbitrators to which ZAI*NET, the
Partnership, or Xxxxxxx to the extent such matter relates in any way to ZAI*NET
or the Partnership was or is a party, or to which any of the assets or
properties of ZAI*NET or the Partnership was or is subject. None of ZAI*NET, the
Partnership or Xxxxxxx (to the extent such matter relates in any way to ZAI*NET
or the Partnership) is in default with respect to any order, writ, injunction,
decree or demand of any court or other governmental or regulatory authority.
3.17 PERSONAL PROPERTY LEASES. SCHEDULE 3.17 attached hereto sets forth
a list of all material personal property leases ("PERSONAL PROPERTY LEASES") to
which the Partnership is a party. Each of the Personal Property Leases is a
valid and binding obligation of the respective parties thereto and enforceable
in accordance with its respective terms. ZAI*NET was not, and the Partnership is
not, in breach or default of any of such Personal Property Leases. Except as
disclosed on SCHEDULE 3.17, no consent or approval is required for the
assignment or transfer of any of the Personal Property Leases in connection with
this Agreement or the Related Agreements or the transactions contemplated hereby
or thereby.
3.18 REAL PROPERTY LEASES. SCHEDULE 3.18 attached hereto sets forth a
list of all real property leases ("REAL PROPERTY LEASES") to which the
Partnership is a party. Each of the Real Property Leases is a valid and binding
obligation of the respective parties thereto and enforceable in accordance with
its respective terms. ZAI*NET was not, and the Partnership is not, in breach or
default of any of such Real Property Leases. Except as disclosed on SCHEDULE
3.18, no consent or approval is required for the assignment or transfer of any
of the Real Property Leases in connection with this Agreement or the Related
Agreements or the transactions contemplated hereby or thereby.
3.19 COMPLIANCE WITH LAWS; PERMITS. Each of ZAI*NET, the Partnership
and Xxxxxxx with respect to the business of the Partnership has complied with
and is in compliance with all federal, state, local and foreign statutes, laws,
ordinances, regulations, rules, permits, judgments, orders and decrees
applicable to it or any of its properties, assets, operations and businesses,
except where the failure so to comply would not reasonably be expected to result
in a Material Adverse Effect. ZAI*NET held, and the Partnership holds, all
permits, licenses, easements, variances, exemptions, consents, certificates,
orders and approvals from governmental authorities the failure of which to hold
might reasonably be expected to result in a Material Adverse Effect
(collectively, the "PERMITS") and all such Permits are
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listed on SCHEDULE 3.19 attached hereto. ZAI*NET was, and the Partnership is, in
compliance with the terms of the Permits applicable to it, except where the
failure so to comply would not reasonably be expected to result in a Material
Adverse Effect.
3.20 CAPITALIZATION AND TITLE TO PARTNERSHIP INTERESTS. Prior to giving
effect to the purchase and sale contemplated by this Agreement, the authorized
Partnership Interests of the Partnership and the number of such Partnership
Interests held by each holder thereof is set forth on SCHEDULE 3.20 attached
hereto. Each of ZAI*NET and Xxxxxxx has good and marketable title to the
Partnership Interests held by it or him, and owns beneficially and of record,
free and clear of any Liens, and has full power and authority to sell, assign,
transfer, vote and convey free and clear of any Liens, the Partnership
Interests, and such Partnership Interests constitute all of the ownership
interests in the Partnership owned by each of ZAI*NET and Xxxxxxx. Except as set
forth on SCHEDULE 3.20, there are no outstanding options, convertible
securities, warrants, agreements, rights, contracts, calls, commitments or
demands of any character that either (a) obligates the Partnership to issue,
redeem, sell, convert or purchase any of the Partnership Interests or any other
ownership interest, or restricts or relates in any way to the voting of any such
securities, or (b) restricts the transfer of, or otherwise relates to
transactions in, the ownership interests of ZAI*NET or Xxxxxxx in the
Partnership. The Partnership Interests sold and transferred pursuant hereto are
nonassessable and are not subject to any preemptive rights.
3.21 UNDISCLOSED LIABILITIES. Except as set forth in the ZAI*NET
Financial Statements or in SCHEDULE 3.21 attached hereto, there is no claim,
liability or obligation of any nature, whether absolute, accrued, known or
unknown, contingent or otherwise, affecting the ZAI*NET, the Partnership or its
business, other than obligations incurred in the ordinary course of the business
consistent with ZAI*NET's past practice, none of which is reasonably likely to
have a Material Adverse Effect.
3.22 SCOPE OF REPRESENTATIONS AND WARRANTIES. This Agreement (including
any Exhibit or Schedule), the Related Agreements (including any Exhibit or
Schedule) and each other document and certificate prepared or delivered by or on
behalf of ZAI*NET, Xxxxxxx and the Partnership and furnished or to be furnished
to GFI Caminus in connection herewith, as of the date hereof, do not contain any
untrue statement of a material fact, or omit to state a material fact necessary
in order to make the statements contained herein and therein not misleading.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF GFI CAMINUS
As an inducement for the Partnership, ZAI*NET and Xxxxxxx to enter into
and consummate the transactions contemplated by this Agreement and the Related
Agreements, GFI Caminus represents and warrants that each of the following
statements is true, correct and complete as of the date hereof which
representations and warranties shall survive the Closing, as provided in Section
6.1.
4.1 EXISTENCE AND GOOD STANDING. GFI Caminus 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. GFI Caminus is duly qualified to transact
business and is in good standing in each jurisdiction in which the operation of
its business and the ownership of its assets requires it to be so qualified.
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4.2 AGREEMENT.
4.2.1 AGREEMENT AUTHORIZED. GFI Caminus has the requisite power
and authority to execute and deliver this Agreement and the Related Agreements,
as applicable, and perform its obligations herein and therein, and consummate
the transactions contemplated hereby and thereby. GFI Caminus has duly executed
and delivered this Agreement and the Related Agreements to which it is a party,
and has obtained the necessary authorization in accordance with all applicable
laws and its organizational documents to execute and deliver this Agreement and
the Related Agreements to which it is a party, and perform its obligations
herein and therein and consummate the transactions contemplated hereby and
thereby, and such matters do not require notice to, or consent or approval of,
any other third party, governmental authority or regulatory agency, except as
set forth on SCHEDULE 4.2.1 attached hereto. Each of this Agreement and the
Related Agreements to which it is a party is a valid, legal and binding
obligation of GFI Caminus enforceable against GFI Caminus in accordance with its
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 at equity). The
person executing this Agreement and the Related Agreements to which it is a
party on behalf of GFI Caminus has been specifically authorized to do so by all
necessary action. No other action will be necessary by GFI Caminus to authorize
the execution and delivery of this Agreement and the Related Agreements to which
it is a party and the consummation of the transactions contemplated hereby and
thereby.
4.2.2 NO CONFLICT. Except as set forth in SCHEDULE 4.2.2 attached
hereto, neither the execution and delivery of this Agreement or the Related
Agreements to which it is a party, nor the consummation of the transactions
contemplated hereby or thereby, (i) violates or conflicts with any provision of
the limited partnership agreement or other organizational documents of GFI
Caminus; (ii) conflicts with or violates any provision of any foreign, federal,
state or local law, statute, treaty, ordinance, rule, regulation or any order,
writ, judgment or decree of any court or other governmental authority to which
GFI Caminus or any of its properties or assets may be bound or affected; or
(iii) breaches or constitutes grounds for a default (or an event, with notice or
lapse of time or both would become a default) under, or gives to others a right
of termination, amendment, acceleration, modification or cancellation of, or
results in the creation or imposition of (or the obligation to create or impose)
any Lien on any of the properties or assets of GFI Caminus pursuant to any note,
mortgage, indenture, bond, lease, license, permit, franchise, agreement,
contract, undertaking or other instrument to which GFI Caminus is a party or by
which GFI Caminus or any of its properties or assets may be bound or affected,
in each case which is reasonably likely to have a Material Adverse Effect on GFI
Caminus. The execution, delivery and performance of this Agreement and the
Related Agreements by GFI Caminus does not require the notice to, filing with,
consent, approval or action of, any governmental authority or any other third
party whatsoever, except as disclosed on SCHEDULE 4.2.2 which is reasonably
likely to have a Material Adverse Effect.
4.3 BROKERS. No amount is payable by GFI Caminus by way of brokerage
fees, finder's commissions or otherwise to any party on account of this
Agreement or the Related Agreements or the transactions contemplated hereby or
thereby.
4.4 LITIGATION. There is no material claim, action, suit, litigation,
arbitration, investigation or other legal proceeding which is pending before
any court or governmental authority, or arbitrator or
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board of arbitrators to which GFI Caminus was or is a party, or to which any of
the assets or properties of GFI Caminus was or is subject. GFI Caminus is not
in default with respect to any order, writ, injunction, decree or demand of any
court or other governmental or regulatory authority.
ARTICLE 5
RELATED AGREEMENTS; ACKNOWLEDGEMENTS
5.1 RELIANCE. The parties acknowledge that the Related Agreements are
being executed and delivered simultaneously with this Agreement, and that GFI
Caminus would not have agreed to execute, deliver or perform this Agreement in
the absence thereof.
5.2 ACKNOWLEDGMENTS. The parties acknowledge that, as a result of the
transactions contemplated hereby, (i) GFI Caminus has become the General Partner
of the Partnership, (ii) GFI Caminus is the owner of seventy-one percent (71%)
of the Partnership Interests in the Partnership (which includes the one percent
(1%) general Partnership Interest) and (iii) ZAI*NET is the owner of a
twenty-nine percent (29%) limited Partnership Interest in the Partnership
(subject to the consummation of the LP Assignment).
5.3 DOCUMENT DELIVERY. The parties acknowledge that the following
documents are being delivered in connection with the Closing (except as provided
in clause (vii) below):
(i) the Partnership Agreement, duly executed by GFI
Caminus and ZAI*NET;
(ii) the Related Agreements, duly executed by the
respective parties thereto;
(iii) an opinion from Xxxxxxxx Xxxx & Brandeis, LLP,
counsel to ZAI*NET and Xxxxxxx, in the form attached
hereto as EXHIBIT B.
(iv) an opinion from Irell & Xxxxxxx LLP, counsel to GFI
Caminus, in the form attached hereto as EXHIBIT C;
(v) certificates from ZAI*NET and Xxxxxxx, dated the
Closing Date, in form and substance reasonably
satisfactory to GFI Caminus;
(vi) such other documents, instruments, certifications
and further assurances as GFI Caminus or its counsel
may have reasonably requested; and
(vii) a schedule reflecting the parties' agreement on the
tax basis and GAAP book value of the assets and
properties of the Partnership immediately after
giving effect to the Assignment and Assumption
Agreement, this Agreement and the other transactions
contemplated hereby to occur on the Closing Date
(the "AGREED VALUATIONS"). Such schedule shall be
prepared by GFI Caminus or the Partnership (such to
the approval of ZAI*NET and Xxxxxxx, which approval
will not be unreasonably withheld) within 30 days
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following the Closing Date, and shall thereupon be
attached to this Agreement and become a part hereof.
Each of the parties hereto agrees that it shall not at any time take any
position in any Tax filing or otherwise that is inconsistent with the Agreed
Valuations (except solely for any adjustments to the Agreed Valuations resulting
from the completion of the Closing Audit).
5.4 NAME CHANGE. ZAI*NET agrees to change its name (and any of its
subsidiary's names as required) to eliminate any use of the word "ZAINET",
"ZAI-NET" or "ZAI*NET" (including derivatives in upper or lower case spelling),
and will thereafter refrain from using any of those words or any confusingly
similar words in its and any of its subsidiary's names; provided, however, that
ZAI*NET or Xxxxxxx shall be permitted to use the ZAI*XXX.xxx Internet address in
the event that the Partnership ever abandons the ZAI*NET trade name.
5.5 JOINDER TO PARTNERSHIP AGREEMENT. ZAI*NET and Xxxxxxx acknowledge
and agree to be bound by the provisions of Section 3.5.1 to the Partnership
Agreement, and agree to cause Newco LLC to execute and deliver the Partnership
Agreement, at the time that Newco LLC first owns any interest in the
Partnership. Further, ZAI*NET and Xxxxxxx agree to cause Newco LLC and each
equityholder of ZAI*NET (other than Xxxxxxx) or Newco LLC at any time to execute
and deliver the Joinder Agreement, attached as Appendix C to the Partnership
Agreement in order to bind such equityholder (including any successor or
assignee) to Section 3.5.1 to the Partnership Agreement.
5.6 NEWCO LLC. ZAI*NET and Xxxxxxx acknowledge and agree that: (i)
Newco LLC shall not engage in any business operations, (ii) the only activity of
Newco LLC is to act as a holding company for the twenty-nine percent (29%)
Partnership Interest being retained by ZAI*NET and assigned to Newco LLC
immediately subsequent to the Closing, (iii) ZAI*NET and/or Xxxxxxx shall
maintain a majority interest and voting control of Newco LLC and (iv) Newco LLC
shall not engage in any activity or fail to perform any activity that would
constitute a breach or default under this Agreement if such activity or omission
were engaged in by ZAI*NET.
5.7 EMPLOYMENT POLICIES. As of the Closing Date, the Partnership shall
honor the terms and conditions of any employment agreements set forth on
SCHEDULE 3.10.2 attached hereto and to honor the employment policies and
procedures of the Partnership in effect as of the Closing Date. The employees of
ZAI*NET as of the Closing Date shall continue their employment relationship with
the Partnership "at will" or otherwise, subject to the amendment or termination
thereof in accordance with the applicable labor and employment laws and subject
to the discretion of the Management Committee to determine the employment
policies and requirements of the Partnership.
ARTICLE 6
INDEMNITY
6.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
6.1.1 SELLERS. Except for the representations and warranties set
forth in each of Sections 3.1, 3.2 and 3.20 of this Agreement (as to which
survival shall be indefinite) and in Section 3.11 of this Agreement (as to which
survival shall extend for the applicable statute of limitations with respect to
any Tax matters that are the subject of an indemnity claim), all
representations,
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warranties and covenants of ZAI*NET and Xxxxxxx made hereunder or in connection
with the transactions contemplated by this Agreement (including the Exhibits and
Schedules attached hereto) shall survive the Closing for a period of ninety (90)
days following the completion of the First Audit Cycle Audit, regardless of any
investigation made at any time by or on behalf of any party or of any
information any party may have, after which time they shall be null and void and
of no effect whatsoever (except as to bona fide claims asserted prior to the end
of such period, in which case the pertinent representations and warranties shall
remain in effect until such claims are fully and finally resolved).
6.1.2 GFI CAMINUS. Except for the representations and warranties
set forth in each of Sections 4.1 and 4.2.1 (as to which survival shall be
indefinite), all representations, warranties and covenants of GFI Caminus made
hereunder or in connection with the transactions contemplated by this Agreement
(including the Exhibits and Schedules attached hereto) shall survive the Closing
for a period of ninety (90) days following the completion of the First Audit
Cycle Audit, regardless of any investigation made at any time by or on behalf of
any party or of any information any party may have, after which time they shall
be null and void and of no effect whatsoever (except as to claims asserted prior
to the end of such period, in which case the pertinent representations and
warranties shall remain in effect until such claims are fully and finally
resolved).
6.2 THE INDEMNITY OBLIGATION. (a) Subject to the provisions of
Sections 6.4 and 6.7 hereof, ZAI*NET and Xxxxxxx, jointly and severally, shall
indemnify, hold harmless and reimburse GFI Caminus for any and all losses,
liabilities, damages, costs and expenses (including, without limitation,
reasonable legal fees) (hereinafter "Losses"), actually suffered or incurred by
GFI Caminus, or any affiliate thereof or any assignee or successor thereof, and
each officer, director, and trustee of any of the foregoing (the "GFI Group"),
which is incurred as a result of any breach of any representation, warranty or
agreement made by ZAI*NET or Xxxxxxx in this Agreement (including all Schedules
and Exhibits hereto and all instruments and undertakings delivered or made in
connection herewith) or any certificate delivered pursuant to this Agreement,
and any third party claim arising as a result thereof.
(b) Subject to the provisions of Section 6.4 hereof, GFI Caminus shall
indemnify, hold harmless and reimburse ZAI*NET and Xxxxxxx for any and all
Losses incurred by ZAI*NET or Xxxxxxx as a result of any breach of any
representation, warranty or agreement made by GFI Caminus in this Agreement
(including all Schedules and Exhibits hereto and all instruments and
undertakings delivered or made in connection herewith) or any certificates
delivered pursuant to this Agreement, and any third party claim arising as a
result thereof.
(c) Subject to the provisions of Section 6.4 and 6.7 hereof, ZAI*NET
and Xxxxxxx acknowledge and agree, to jointly and severally, indemnify and hold
harmless GFI Caminus from any and all claims or Losses in connection with or
arising from the Tsigutkin litigation or any derivative thereof, arising or
incurred before or after the Closing Date (including but not limited to any fees
and costs incurred in the defense or resolution of such matter), without
duplication for purposes hereof for (i) any Losses or expenses reflected in the
historical financial statements of ZAI*NET or (ii) any settlement the costs of
which is reflected in the Closing Audit and subject to the Closing adjustments
set forth in Section 2.4 of hereof. Subject to the complete indemnification of
GFI Caminus, the parties hereto acknowledge and agree that ZAI*NET and Xxxxxxx
shall be entitled to assume and control all aspects of the defense of the
Tsigutkin litigation, at their expense and through counsel of their choice. The
Tsigutkin litigation shall not be settled without the prior written consent of
GFI Caminus, unless such settlement thereof involves only the payment of money
to which GFI Caminus is totally indemnified and
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the unconditional release from any and all related liability of GFI Caminus.
6.3 CLAIMS.
6.3.1 NOTICE. Subject to the provisions of this Section 6.3, any
party entitled to indemnification hereunder (the "Indemnified Party") shall
promptly give the party from which indemnification is sought (the "Indemnifying
Party") written notice of any matter which the Indemnified Party has determined
has given rise to a right of indemnification under this Agreement, stating the
details of the claim, so far as is known, the amount of the Loss, if known, and
method of computation thereof, all with reasonable particularity; provided,
however, that the failure of the Indemnified Party to give any notice required
to be given hereunder shall not affect the Indemnified Party's right to
indemnification hereunder except to the extent any of the Indemnifying Parties
from whom such indemnity is sought shall have been actually and materially
prejudiced in its ability to defend the claim or action for which such
indemnification is sought by reason of such failure.
6.3.2 THIRD PARTY CLAIM PROCEDURES. The obligations and
liabilities of any party under this Section 6.3.2 with respect to Losses arising
from claims, assertions, events or proceedings of any third party (including,
without limitation, claims by any assignee or successor of the Indemnified Party
or any governmental agency), which are subject to the indemnification provided
for in this Article 6 ("Third Party Claims") shall be governed by and be subject
to the following additional terms and conditions: If the Indemnified Party shall
receive written notice of any Third Party Claim, the Indemnified Party shall
give the Indemnifying Parties prompt written notice of such Third Party Claim
(subject to the proviso in Section 6.3.1 above) and shall permit any of such
Indemnifying Parties, at its option, to participate in the defense of such Third
Party Claim by counsel of its own choosing and at its expense. If any of the
Indemnifying Parties acknowledges in writing its obligation to indemnify the
Indemnified Party hereunder against any Loss (without limitation) that may
result from such Third Party Claim, then such Indemnifying Party shall be
entitled, at its option, to assume and control the defense against such Third
Party Claim at its expense and through counsel of its choice if it gives prompt
written notice of its intention to do so to the Indemnified Party unless, in the
reasonable opinion of counsel for the Indemnified Party, there is a conflict or
a potential conflict of interest between the Indemnified Party and such
Indemnifying Party in such action, suit or proceeding, in which event the
Indemnified Party shall be entitled to direct the defense with respect to, but
only with respect to, those issues as to which such conflict exists. In the
event any of the Indemnifying Parties exercises its right to undertake the
defense against any such Third Party Claim as provided above, the Indemnified
Party shall, and it shall cause its affiliates to, cooperate with such
Indemnifying Party in such defense and make available to such Indemnifying Party
all pertinent records, materials and information in their possession or under
their control relating thereto as is required by such Indemnifying Party. No
Third Party Claim, except the settlement thereof which involves the payment of
money only for which the Indemnified Party is totally indemnified (without
limitation) by any of the Indemnifying Parties and the unconditional release
from all related liability of the Indemnified Party, may be settled by any of
the Indemnifying Parties without the written consent of the Indemnified Party.
Any settlement of a Third Party Claim by the Indemnified Party without the
written consent of any of the Indemnifying Parties shall discharge such
Indemnifying Parties from all liability hereunder with respect to the subject
matter of such Third Party Claim. With written notice to the Indemnified Party,
an Indemnifying Person shall be entitled, at its own cost and expense, to
rectify any breach of a representation or warranty within a reasonable period of
time and to the reasonable satisfaction of the Indemnified Party.
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6.4 LIMITATION ON THE INDEMNIFYING PARTIES' INDEMNIFICATION
OBLIGATIONS. The Indemnifying Parties shall have no obligation to provide
indemnification pursuant to Section 6.2 hereof except to the extent that the
aggregate amount of indemnification to which GFI Caminus, but for this Section
6.4, otherwise shall have become entitled hereunder shall exceed One Hundred
Thousand Dollars ($100,000.00) (the "Basket"), in which event the Indemnifying
Parties shall be obligated to provide indemnification with respect to all Losses
in excess of the Basket. Notwithstanding the foregoing provisions of this
Section 6.4, the Indemnifying Parties are obligated to provide indemnification
pursuant to Section 6.2 hereof for all Losses incurred as a result of any breach
of or any Third Party Claim arising directly or indirectly with respect to or in
connection with the matters referred to in Sections 3.1, 3.2. 3.11, 3.20 and
6.2(c) of this Agreement. Losses referred to in the immediately preceding
sentence will be neither subject to nor counted against the Basket.
6.5 OPTION TO REDUCE ADDITIONAL PAYMENTS. With respect to any
indemnification obligation for Losses determined pursuant to this Article 6 to
be owing to GFI Caminus from ZAI*NET, GFI Caminus may, at its option, deduct any
or all (if possible) of such Losses from any additional payments to be made by
GFI Caminus to ZAI*NET pursuant to Section 2.5. In the event that ZAI*NET shall
dispute the validity or amount of any such deduction, ZAI*NET shall notify GFI
Caminus in writing within ten (10) days of ZAI*NET receiving notice of such
deduction, specifying in reasonable detail the basis of such dispute. In the
event such dispute is not resolved within twenty (20) days, the parties agree to
promptly submit the matter to binding arbitration to be resolved on an expedited
basis. If the parties are unable to resolve such dispute within the twenty (20)
days, GFI Caminus agrees to place the full amount of the additional payment(s)
into a third party escrow account pending resolution of the arbitration. The
escrow account shall be subject to an escrow agreement to be entered into by the
parties hereto and an escrow agent (who shall be selected by GFI Caminus), and
the form of such escrow agreement shall be mutually agreed to by the parties.
Such arbitration shall be commenced and conducted in accordance with the then
applicable rules of commercial arbitration of the American Arbitration
Association, held before a panel of three (3) arbitrators, one selected by each
of ZAI*NET and GFI Caminus and the third arbitrator selected jointly by each of
the designated arbitrators. Notwithstanding the arbitration procedure set forth
in this Section 6.5, in the event the dispute involves an accounting issue, the
procedures set forth in Section 2.4.2(ii) shall govern. Judgment upon any award
rendered by the panel of arbitrators or accounting firm may be entered in any
court having jurisdiction thereof. The arbitration shall be held in New York,
New York. In the event that an award is entered in favor of ZAI*NET, such award
shall include an amount of interest (calculated at the rate of eight percent
(8%) on the principal amount of the award for the period from the date that the
additional payment would otherwise have been due to be paid pursuant to Section
2.5 through the date that payment of the award by GFI Caminus is actually made.
The cost of the arbitration procedure shall be borne equally by GFI Caminus and
ZAI*NET, or as otherwise determined by the arbitrators or accounting firm.
6.6 SOLE AND EXCLUSIVE REMEDY. The indemnification obligations
specified under this Article 6 shall constitute the sole and exclusive remedies
of GFI Caminus with respect to the matters described in Section 6.2 and 6.3,
respectively.
6.7 INDEMNITY LIMITATIONS. Notwithstanding anything contained in this
Agreement to the contrary, ZAI*NET and Xxxxxxx, on a joint and several basis,
shall not be required to indemnify GFI Caminus pursuant to this Agreement for
any amounts in excess of the aggregate amount of the Purchase
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Price theretofore received.
6.8 INSURANCE RECOVERIES. In computing the amount of any Indemnified
Party's Losses with respect to an indemnifiable claim, there shall be deducted
the amount of any insurance proceeds actually received, directly or indirectly,
by such Indemnified Party with respect to the same facts and circumstances
giving rise to the Loss.
ARTICLE 7
MISCELLANEOUS
7.1 ENTIRE AGREEMENT. This Agreement (including the Exhibits and
Schedules attached hereto) together with the Related Agreements and the
certificates and other instruments delivered in connection herewith constitute
the entire agreement among the parties and supersedes all prior agreements,
representations, warranties, statements and understandings, whether oral or
written, with respect to the subject matter hereof, except as specifically set
forth in any document signed by all the parties hereto which expressly amends
this Agreement.
7.2 FURTHER ASSURANCES. Each party hereto shall at any time and from
time to time following the Closing promptly execute and deliver, or cause to be
executed and delivered, to the other parties all such further instruments and
take all such further action as may be reasonably necessary or appropriate to
confirm or carry out the provisions and intent of this Agreement and the
Related Agreements.
7.3 NOTICES. Any notices or other communications required or permitted
hereunder shall be in writing and shall be delivered by personal service,
telecopy or certified mail (postage prepaid), to such address as may be
designated from time to time by the relevant party, and which initially shall
be:
If to the Partnership:
ZAI*NET Software, L.P.
c/o ZAI*NET Software, Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: 000-000-0000
Attention: Xxxxx X. Xxxxxxx
With a copy to:
GFI Caminus LLC
c/o GFI Energy Ventures LLC
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: 000-000-0000
Attention: Xxxxxxxx X. Xxxxxx
If to ZAI*NET:
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ZAI*NET Software, Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: 000-000-0000
Attention: Xxxxx X. Xxxxxxx
With a copy to:
Xxxxxxxx Xxxx & Brandeis, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: 212-223-6433
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
If to Xxxxxxx:
Xxxxx X. Xxxxxxx
c/o ZAI*NET Software, Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: 000-000-0000
With a copy to:
Xxxxxxxx Xxxx & Brandeis, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: 212-223-6433
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
If to GFI Caminus:
GFI Caminus LLC
c/o GFI Energy Ventures LLC
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: 000-000-0000
Attention: Xxxxxxxx X. Xxxxxx
With a copy to:
Irell & Xxxxxxx LLP
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: 000-000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
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With a copy to:
Oaktree Capital Management LLC
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: 213-614-0900
Attention: Xxxxxxxxxxx X. Brothers
Any notice sent by certified mail shall be deemed to have been given
three (3) days after the date on which it is mailed. If notice is given by
telecopy, notice shall be deemed given when such notice is transmitted to the
appropriate telecopy numbers specified in this Section 7.3. Notice by personal
service shall be deemed given when received.
7.4 EXPENSES. Each of the parties to this Agreement and to any of the
Related Agreements shall bear its own expenses in connection herewith or
therewith.
7.5 GOVERNING LAW AND SUBMISSION TO JURISDICTION. This Agreement shall
be governed by the laws of New York applicable to contracts executed and wholly
performed therein, without giving effect to the conflict of laws provisions
thereof. Each of the parties hereby consents to the jurisdiction of any state or
federal court located within the New York and irrevocably agrees that all
actions or proceedings relating to this Agreement shall be instituted and heard
by the courts of such jurisdiction. Each party hereby waives any objection that
it may have based on improper venue or forum non conveniens to the conduct of
any proceeding in any such court and to personal service of any and all process
upon it, and consents to any such service of process made in the manner provided
herein for the giving of notices under this Agreement.
7.6 EXHIBITS AND SCHEDULES. All Exhibits annexed hereto, and all
Schedules referred to herein, are hereby incorporated in and made a part of this
Agreement as if set forth in full herein.
7.7 CAPTIONS. All section titles or captions contained in this
Agreement or in any Schedule or Exhibit annexed hereto or referred to herein are
for convenience only, shall not be deemed a part of this Agreement and shall not
affect the meaning or interpretation of this Agreement. All references herein to
Sections shall be deemed references to such parts of this Agreement, unless the
context shall otherwise require.
7.8 SEVERABILITY. The validity, legality or enforceability of the
remainder of this Agreement shall not be affected even if one or more of the
provisions of this Agreement shall be held to be invalid, illegal or
unenforceable in any respect; provided, however, that if such invalidity,
illegality or unenforceability shall have material adverse effect on the
transactions contemplated by this Agreement such that the intent of this
Agreement will not be achieved, the aggrieved party which shall be materially
and adversely affected thereby may terminate this Agreement and abandon the
transactions contemplated hereby by giving notice to the other parties at any
time prior to the Closing Date.
7.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts which together shall be one and the same instrument.
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7.10 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties, their respective successors and permitted
assigns.
7.11 WAIVERS STRICTLY CONSTRUED. With regard to any power, remedy or
right provided herein or otherwise available to any party hereunder no waiver or
extension of time shall be effective unless expressly contained in a writing
signed by the waiving party; and no alteration, modification or impairment shall
be implied by reason of any previous waiver, extension of time, delay or
omission in exercise, or other indulgence.
7.12 NUMBER AND GENDER. Throughout this Agreement, as the context may
require, the masculine gender includes the feminine and the neuter gender
includes the masculine and the feminine; the singular tense and number includes
the plural, and the plural tense and number includes the singular; the past
tense includes the present, and the present tense includes the past; references
to parties, sections, paragraphs and exhibits mean the parties, sections,
paragraphs and exhibits of and to this Agreement; and periods of days, weeks or
month mean calendar days, weeks or months.
7.13 SCHEDULE OMISSIONS. The omission of an item from any Schedule
annexed hereto shall not constitute a breach of any other representation and
warranty in this Agreement if such item is disclosed in another Schedule annexed
hereto, provided such disclosure reasonably identifies the item and its
relevance to such other representation and warranty.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.
ZAI*NET Software, L.P.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
--------------------------------------------
Its: General Partner
--------------------------------------------
ZAI*NET Software, Inc.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
--------------------------------------------
Its: President
--------------------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxx
----------------------------------------------------
GFI Caminus LLC
By: /s/ Xxxxxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxxxxx X. Xxxxxx
--------------------------------------------
Its: President
--------------------------------------------
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