EXHIBIT 10.3
Execution Copy
AMENDED AND RESTATED
BUSINESS OPPORTUNITY ALLOCATION
AND MISCELLANEOUS SERVICES AGREEMENT
THIS AGREEMENT (the "AGREEMENT"), made as of the 10th day of
November, 2000, by and between Change Technology Partners, Inc., a Delaware
corporation (the "COMPANY"), and XX XX Ventures, LLC, a Delaware limited
liability company (formerly known as XX XX Management Company, LLC) ("XX XX").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Company, formerly known as Arinco Computer
Systems Inc. and Pangea Internet Advisors LLC ("Pangea"), a Delaware limited
liability company and affiliate of XX XX, have entered into an agreement, dated
March 28, 2000, relating to (i) the allocation to the Company of certain
investment opportunities identified by Pangea and XX XX and their affiliates
(together, "XX XX AFFILIATES") and (ii) the reimbursement by the Company of
certain amounts that may be incurred, paid or payable by Pangea with respect to
corporate headquarters expenses (the "PRIOR AGREEMENT");
WHEREAS, XX XX, the Company and Pangea have agreed that XX XX
will be substituted for Pangea in the Prior Agreement and will assume all of
Pangea's obligations and benefit from all of Pangea's rights under the Prior
Agreement;
WHEREAS, the Company has agreed to exclude certain investment
opportunities from the Referral Requirements (as hereinafter defined); and
WHEREAS, the Company, Pangea and XX XX have agreed to amend
and restate the Prior Agreement to reflect their new understanding with respect
to the matters described above.
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein, the parties hereto agree as follows:
1. Investments in Target Businesses.
(a) REFERRAL OF DEALS. XX XX will refer to the
Company all opportunities outside of Europe, the Middle East and Africa for the
Company to acquire interests in business enterprises that are or propose to be
engaged in businesses relating primarily to the internet, e-commerce and related
technologies ("TARGET BUSINESSES") that any XX XX Affiliate may investigate or
otherwise pursue for its own account or for funds with which they are affiliated
or other clients where either (i) the minimum amount
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required to be allocated to the Company pursuant to Section 1(b) would be
$1,000,000 or more or (ii) where 50% of the amount of such opportunity could be
acquired for no less than $500,000 and such an acquisition would give the
Company "CONTROL" of the Target Business for purposes of Rule 3a-1(a)(4) under
the Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY ACT"),
or any successor rule thereto ("RULE 3A-1(A)(4)"). The referral requirements of
this Section 1(a) (the "REFERRAL REQUIREMENTS") shall not apply to investments
in publicly traded securities not offered in a private placement. Any
opportunity for the Company to acquire interests in Target Businesses that any
XX XX Affiliate may so investigate and that do not fall within the Referral
Requirements is referred to as an "OTHER OPPORTUNITY". The Company hereby
renounces any interest it may have in any Other Opportunity and renounces any
expectancy that any Other Opportunity be offered to it, such that, as a result
of such renunciation, any XX XX Affiliate or any officer, director, member or
affiliate of any XX XX Affiliate who is also an officer or direction of the
Company (A) shall have no duty to communicate or present such Other Opportunity
to the Company, shall have the right to hold such Other Opportunity for its or
its affiliates' (and the respective officers, directors, agents, shareholders,
members, partners, or subsidiaries of such affiliates) own account, or to
recommend, assign or transfer such Other Opportunity to persons other than the
Company and (B) shall not breach any duty it may have to the Company by reason
of the fact that such person pursues or acquires such Other Opportunity for
itself, directs, assigns or transfers such Other Opportunity to another person,
or does not communicate information regarding such Other Opportunity to the
Company.
(b) ALLOCATION OF INVESTMENT OPPORTUNITIES. If
an opportunity to acquire a Target Business (or an interest therein) is
presented to a XX XX Affiliate which is within the Referral Requirements, XX XX
will refer such opportunity to the Company, and if one or more XX XX Affiliates
or clients or affiliates of such XX XX Affiliates (collectively, the "XX XX
GROUP") wishes to participate in such acquisition, XX XX shall allocate such
opportunity between the Company and the XX XX Group on an equitable basis which
recognizes the objective of the Company to avoid being classified as an
investment company; PROVIDED, HOWEVER, that not less than 50% of the value of
the opportunity available to the XX XX Group and the Company shall be offered to
the Company. Any portion of such opportunity allocated to the XX XX Group shall
be deemed to be an "OTHER OPPORTUNITY" for purposes of Section 1(a). XX XX shall
disclose in advance all such proposed allocations to the Company and, to the
extent necessary for the Company to avoid classification as an investment
company, use good faith efforts to cause the members of the XX XX Group to whom
any allocation has been made to assign their voting rights to the Company. For
purposes of this Section 3(b), the term "XX XX GROUP" shall not include persons
who were solicited by any member of the XX XX Group to invest in a Target
Business but who are not clients or affiliates of any XX XX Affiliate.
(c) FAILURE TO APPROVE ACQUISITIONS. If XX XX
refers to the Company an opportunity to acquire a Target Business (or an
interest therein) which is within the Referral Requirements and the Company does
not make such acquisition (whether based on the merits of the opportunity, a
disagreement with the portion of the
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opportunity allocated to the Company or other factors), then XX XX and the XX XX
Group shall be free to pursue such Target Business for their own account and
such opportunity shall be deemed to be an "OTHER OPPORTUNITY" for purposes of
Section 1(a).
2. OFFICE SERVICES. Subject to the terms and conditions
hereof, during the term of this Agreement, XX XX will provide the Company with
office space in FG II's offices in Greenwich, Connecticut for use by the
Company's staff. XX XX will also provide the Company's staff with access to
secretarial support services and to such communications, computer, photocopying
and similar office equipment as is located at such offices from time to time and
will provide such staff with reasonable office supplies, postage, overnight
express courier and similar services. (The foregoing provision of space,
secretarial support, access to office equipment and provision of office supplies
is referred to herein as "Office Services".) At least monthly the Company shall
reimburse XX XX for the cost of such Office Services, such reimbursement to be
in such amounts as the Company and XX XX may reasonably agree upon from time to
time based upon an estimate of FG II's actual costs for providing such Office
Services.
3. LEGAL EXPENSES. The Company shall also reimburse XX
XX for all reasonable legal fees and expenses incurred by XX XX in connection
with the transactions contemplated by the Securities Purchase Agreement by and
between the Company and Pangea dated as of March 28, 2000, including, without
limitation, those relating to the procreation of this Agreement, the Securities
Purchase Agreement, the Transaction Documents (as defined in the Securities
Purchase Agreement), and the private placement memorandum relating to the
Securities Purchase Agreement.
4. TERM. Section 1 of this Agreement shall remain in
full force and effect for so long as any XX XX Affiliate is serving as a
director or as a senior executive officer of the Company. Either party may
terminate Section 2 of this Agreement upon 990 days prior written notice to the
other party. The provisions of Section 3 and 5 hereof shall survive
indefinitely.
5. LIABILITY; INDEMNIFICATION.
(a) LIABILITY. None of XX XX, the XX XX
Affiliates, or any of their respective principals, shareholders, members,
directors, officers, employees or agents (all of the foregoing, except for XX XX
are collectively, the "XX XX PARTIES") shall be liable to the Company or any of
its shareholders, directors, officers, employees or agents for any losses,
damages, costs or expenses, including attorneys' fees, judgments, fines and
amounts paid in settlement (collectively, "LOSSES"), in any way arising out of a
referral made pursuant to Section 1 or the pursuit by any XX XX Party of any
Other Opportunity, except that XX XX may be liable to the Company to the extent
that any such Losses are directly caused by the gross negligence or willful
misconduct of XX XX or any of the XX XX Parties in the performance of their
duties hereunder during the term of this Agreement.
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(b) INDEMNIFICATION. The Company shall indemnify
in the manner and to the fullest extent permitted by applicable law and the
bylaws of the Company, each XX XX Party in the event that the XX XX Party (or
his or her estate, as the case may be), was or is a party to, or is threatened
to be made a party to, any threatened, pending or completed action, suit or
proceeding, whether or not by or in the right of the Company, and whether civil,
criminal, administrative, investigative or otherwise, by reason of the
performance or alleged lack of performance of any obligation in Sections 1 or 2,
against Losses actually and reasonably incurred by such person in connection
with such action, suit or proceeding (including, without limitation, in
connection with the defense or settlement of such action, suit or proceeding).
To the extent and in the manner provided by applicable law, any expenses
(including attorneys' fees) shall be paid by the Company in advance of the final
disposition of such action, suit or proceedings, even if the XX XX Party is
alleged to have not met any applicable standard of conduct or is alleged to have
committed conduct so that, if true, the XX XX Party (or the XX XX Party's
estate) would not be entitled to indemnification under this Section 5, upon
receipt of an undertaking, which need not be secured, by or on behalf of such
person to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Company as authorized in this Section 5. The
Company's obligations under this Section 5 shall survive any termination of this
Agreement.
(c) NONEXCLUSIVE REMEDY. The indemnification
remedy contained in this Agreement shall not be deemed to be the exclusive
remedy of the Indemnified Party in connection with or arising from any failure
by the Company to perform any of its covenants or obligations in this Agreement,
nor shall such indemnification remedy be deemed to prejudice or to operate as a
waiver of any remedy to which the Indemnified Party may be entitled at law or
equity.
6. MISCELLANEOUS.
(a) NOTICES. Any notice, payment, demand or
communication required or permitted to be given by any provision of this
Agreement shall be in writing and shall be deemed to have been delivered, given
and received for all purposes (i) if delivered personally, with a copy
transmitted by telephonic facsimile, to the party or to an officer of the party
to whom the same is directed or (ii) whether or not the same is actually
received, if sent by registered or certified mail, postage and charges prepaid,
with a copy transmitted by telephonic facsimile address as follows:
If to the Company:
Change Technology Partners, Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Chief Executive Officer
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With a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Telephone: 000-000-0000
Facsimile: 212-757-3990
Attention: Xxxxx Xxxxx, Esq.
If to XX XX:
XX XX Ventures, LLC
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxx X. Xxxxxxx
Any such notice shall be deemed to be delivered, given and received as of the
date so delivered, if delivered personally, or as of the date on which the same
was deposited in a regularly maintained receptacle for the deposit of United
States mail, addressed and sent as aforesaid.
(b) GOVERNING LAW. This Agreement shall be
governed by, and interpreted in accordance with, the laws of the State of New
York applicable to agreements made and to be performed entirely within such
State.
(c) COUNTERPART EXECUTION. This Agreement may be
executed in any number of counterparts with the same effect as if all of the
parties hereto had signed the same document. All counterparts shall be construed
together and shall constitute one agreement.
(d) AMENDMENTS. This Agreement may only be
amended upon the written consent of all of the parties hereto.
(e) ENTIRE UNDERSTANDING; NO THIRD PARTY
BENEFICIARIES. This Agreement and the Transaction Documents represent the entire
understanding of the parties hereto with reference to the transactions
contemplated hereby and supersedes any and all other oral or written agreements
heretofore made. Except as provided in Section 1 with respect to the XX XX
Group, and Section 5 with respect to the XX XX Parties, nothing in this
Agreement, expressed or implied, is intended to confer upon any person, other
than the parties hereto or their respective successors, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
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(f) ASSIGNMENT. Neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties hereto and any purported assignment in
violation of this Section 6(f) shall be void. Subject to the preceding sentence,
this Assignment shall be binding upon, inure to the benefit of and be
enforceable by the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns.
(g) SPECIFIC PERFORMANCE. The parties hereto
agree that their respective rights and obligations under this Agreement shall be
enforceable in a court of equity by decree of specific performance and that
appropriate injunctive relief may be applied for and granted in connection
therewith. Such remedies shall, however, be cumulative and nonexclusive and
shall be in addition to any other remedies which any party hereto may have under
this Agreement or otherwise.
(h) NO PARTNERSHIP RELATIONSHIP. Nothing
contained herein shall be construed or deemed to create any partnership
relationship between the Company, on the one hand, and XX XX or any of its
Affiliates, on the other hand.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
CHANGE TECHNOLOGY PARTNERS, INC.
By: /s/ Xxxxxxx Xxxx
---------------------------------------
Name: Xxxxxxx Xxxx
Title: Chief Eexecutive Officer
XX XX VENTURES, LLC
By: /s/ Xxxxxxxx Xxxxxxxxx
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Name: Xxxxxxxx Xxxxxxxxx
Title: Managing Director
PANGEA INTERNET ADVISORS, LLC
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Managing Director
