Delaware | 71-0987913 | |
(State or other jurisdiction
of
incorporation or organization) |
(I.R.S. Employer
Identification Number) |
John A. Burgess, Esq. | Stuart M. Cable, Esq. | |
James R. Burke, Esq.
Justin L. Ochs, Esq. Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 (617) 526-6000 |
Mark T. Bettencourt, Esq.
Michael J. Minahan, Esq. Goodwin Procter LLP Exchange Place Boston, Massachusetts 02109 (617) 570-1000 |
Large accelerated filer
|
o | Accelerated filer | o | |||
Non-accelerated filer
|
þ (Do not check if a smaller reporting company) | Smaller reporting company | o |
The
information contained in this prospectus is not complete and may
be changed. Neither we nor the selling stockholders may sell
these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and it is not
soliciting offers to buy these securities in any state where the
offer or sale is not permitted.
|
|
||||||||
Per Share | Total | |||||||
|
||||||||
Price to Public
|
$ | $ | ||||||
Underwriting Discounts and Commissions
|
$ | $ | ||||||
Proceeds to SS&C Holdings
|
$ | $ | ||||||
Proceeds to Selling Stockholders
|
$ | $ | ||||||
J.P. Morgan |
Credit Suisse |
Morgan Stanley |
Deutsche Bank Securities |
Jefferies & Company |
Raymond James |
Wells Fargo Securities |
Page | ||||||||
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156 | ||||||||
F-1 | ||||||||
EX-3.1 | ||||||||
EX-3.3 | ||||||||
EX-3.4 | ||||||||
EX-5.1 | ||||||||
EX-10.26 | ||||||||
EX-10.27 | ||||||||
EX-10.35 | ||||||||
EX-23.2 |
Portfolio Management/Accounting
|
Fund Administration Services | |
Financial Modeling
|
Loan Management/Accounting | |
Trading/Treasury Operations
|
Money Market Processing | |
Property Management
|
1
2
3
4
5
| Our business is greatly affected by changes in the state of the general economy and the financial markets, and a prolonged downturn in the general economy or the financial services industry could disproportionately affect demand for our products and services. |
| We face significant competition with respect to our products and services, which may result in price reductions, reduced gross margins or loss of market share. |
| If we cannot attract, train and retain qualified managerial, technical and sales personnel, we may not be able to provide adequate technical expertise and customer service to our clients or maintain focus on our business strategy. |
| Our substantial indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations under our 11 3 / 4 % senior subordinated notes due 2013 and our senior credit facilities. |
6
| Carlyle capitalized SS&C Holdings with an aggregate equity contribution of $381.0 million; |
| William C. Stone, SS&Cs Chairman of the Board and Chief Executive Officer, contributed $165.0 million of equity in the form of stock and rollover options, and certain other management and employee option holders contributed approximately $9.0 million of additional equity in the form of rollover options, to SS&C Holdings; |
| SS&C entered into senior secured credit facilities consisting of: |
| a $75.0 million revolving credit facility, of which $10.0 million was drawn at closing; and | |
| a $275.0 million term loan B facility, which was fully drawn at closing and of which the equivalent of $75.0 million was drawn in Canadian dollars by one of SS&Cs Canadian subsidiaries; |
| SS&C issued and sold $205.0 million in aggregate principal amount of 11 3 / 4 % senior subordinated notes due 2013; |
| all outstanding options to purchase shares of SS&Cs common stock became fully vested and immediately exercisable, and each outstanding option (other than options held by (1) non-employee directors, (2) certain individuals identified in a schedule to the Merger Agreement and (3) individuals who held options that were exercisable for fewer than 100 shares of SS&Cs common stock) were, subject to certain conditions, assumed by SS&C Holdings and converted into an option to acquire common stock of SS&C Holdings; and |
| all in-the-money warrants to purchase shares of SS&Cs common stock were cancelled in exchange for cash equal to the excess of the transaction price over the exercise price of the warrants. |
|
||||
Time of
|
Time of
|
|||
Transaction | this offering | |||
|
||||
Per share
|
$8.64 | $14.00 | ||
Aggregate
|
$555.0 million | $889.6 million | ||
7
8
Common stock offered by SS&C Technologies Holdings,
Inc.
|
8,225,000 shares |
Common stock offered by the selling stockholders
|
2,500,000 shares |
Total
|
10,725,000 shares |
Common stock to be outstanding after this offering
|
69,191,228 shares (70,799,978 shares if the over-allotment option is exercised in full) |
Over-allotment option offered by SS&C Technologies
Holdings, Inc.
|
We have granted the underwriters a 30-day option to purchase up to 1,608,750 shares of our common stock. |
Use of proceeds
|
We estimate that we will receive approximately $104.7 million in net proceeds from the 8,225,000 shares of common stock that we are offering based upon an assumed initial public offering price of $14.00 per share (which represents the midpoint of the estimated price range shown on the cover page of this prospectus) and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use a majority of our net proceeds of this offering to redeem up to $71.75 million in principal amount of our outstanding 11 3 / 4 % senior subordinated notes due 2013 at a redemption price of 105.875% of the principal amount, plus accrued and unpaid interest, and the balance of our net proceeds for working capital and other general corporate purposes, including potential acquisitions. We will not receive any proceeds from the sale of shares by the selling stockholders, except for the aggregate exercise price of options held by certain selling stockholders. See Use of proceeds for additional information. |
Proposed NASDAQ Global Market symbol
|
SSNC |
| 12,171,383 shares of common stock issuable upon the exercise of stock options outstanding as of December 31, 2009 at a weighted average exercise price of $6.91 per share; |
9
| 1,874,258 shares of common stock reserved as of December 31, 2009 for future issuance under our 2006 equity incentive plan; and |
| 2,623,661 shares of common stock reserved as of December 31, 2009 for future issuance under our 2008 stock incentive plan. |
| no exercise of outstanding options after December 31, 2009; |
| an 8.5-for-1 stock split of our common stock that was effected on March 10, 2010; |
| the effectiveness upon the closing of this offering of our restated certificate of incorporation and our amended and restated bylaws, which contain provisions customary for public companies, as more fully described below under Description of capital stock; and |
| no exercise by the underwriters of their over-allotment option. |
10
11
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|||||||||||||||||||||||||||||
Predecessor | Successor | Combined 1 | Successor | ||||||||||||||||||||||||||
January 1
|
November 23
|
Year
|
Year
|
Year
|
Year
|
Year
|
|||||||||||||||||||||||
through
|
through
|
ended
|
ended
|
ended
|
ended
|
ended
|
|||||||||||||||||||||||
(In thousands,
|
November 22,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
||||||||||||||||||||||
except per share data) | 2005 | 2005 | 2005 | 2006 | 2007 | 2008 | 2009 | ||||||||||||||||||||||
|
|||||||||||||||||||||||||||||
Statement of operations data:
|
|||||||||||||||||||||||||||||
Revenues:
|
|||||||||||||||||||||||||||||
Software licenses
|
$ | 20,147 | $ | 3,587 | $ | 23,734 | $ | 22,925 | $ | 27,514 | $ | 24,844 | $ | 20,661 | |||||||||||||||
Maintenance
|
44,064 | 3,701 | 47,765 | 55,222 | 61,910 | 65,178 | 66,099 | ||||||||||||||||||||||
Professional services
|
12,565 | 2,520 | 15,085 | 19,582 | 17,491 | 24,352 | 20,889 | ||||||||||||||||||||||
Software-enabled services
|
67,193 | 7,857 | 75,050 | 107,740 | 141,253 | 165,632 | 163,266 | ||||||||||||||||||||||
Total revenues
|
143,969 | 17,665 | 161,634 | 205,469 | 248,168 | 280,006 | 270,915 | ||||||||||||||||||||||
Total cost of revenues
|
59,004 | 7,627 | 66,631 | 100,016 | 128,882 | 142,433 | 137,740 | ||||||||||||||||||||||
Gross profit
|
84,965 | 10,038 | 95,003 | 105,453 | 119,286 | 137,573 | 133,175 | ||||||||||||||||||||||
Operating expenses:
|
|||||||||||||||||||||||||||||
Selling, marketing, general and administrative
|
25,078 | 2,504 | 27,582 | 37,964 | 44,274 | 45,686 | 39,559 | ||||||||||||||||||||||
Research and development
|
19,199 | 2,071 | 21,270 | 23,620 | 26,282 | 26,804 | 26,513 | ||||||||||||||||||||||
Merger costs
|
36,912 | | 36,912 | | | | | ||||||||||||||||||||||
Total operating expenses
|
81,189 | 4,575 | 85,764 | 61,584 | 70,556 | 72,490 | 66,072 | ||||||||||||||||||||||
Operating income
|
3,776 | 5,463 | 9,239 | 43,869 | 48,730 | 65,083 | 67,103 | ||||||||||||||||||||||
Interest income
|
1,031 | 30 | 1,061 | 388 | 939 | 409 | 28 | ||||||||||||||||||||||
Interest expense
|
(2,092 | ) | (4,920 | ) | (7,012 | ) | (47,427 | ) | (45,463 | ) | (41,539 | ) | (36,891 | ) | |||||||||||||||
Other (expense) income, net
|
655 | 258 | 913 | 456 | 1,911 | 1,994 | (1,418 | ) | |||||||||||||||||||||
Income (loss) before income taxes
|
3,370 | 831 | 4,201 | (2,714 | ) | 6,117 | 25,947 | 28,822 | |||||||||||||||||||||
Provision (benefit) for income taxes
|
2,658 | | 2,658 | (3,789 | ) | (458 | ) | 7,146 | 9,804 | ||||||||||||||||||||
Net income
|
$ | 712 | $ | 831 | $ | 1,543 | $ | 1,075 | $ | 6,575 | $ | 18,801 | $ | 19,018 | |||||||||||||||
Earnings per
share
2
|
|||||||||||||||||||||||||||||
Basic
|
$ | 0.03 | $ | 0.01 | $ | 0.02 | $ | 0.11 | $ | 0.31 | $ | 0.31 | |||||||||||||||||
Diluted
|
$ | 0.03 | $ | 0.01 | $ | 0.02 | $ | 0.10 | $ | 0.30 | $ | 0.30 | |||||||||||||||||
Weighted average shares
outstanding
2
|
|||||||||||||||||||||||||||||
Basic
|
23,300 | 60,138 | 60,172 | 60,245 | 60,284 | 60,381 | |||||||||||||||||||||||
Diluted
|
24,478 | 62,167 | 62,182 | 63,382 | 63,700 | 63,653 | |||||||||||||||||||||||
Other financial data:
|
|||||||||||||||||||||||||||||
Recurring revenue
percentage
3
|
77.3% | 65.4% | 76.0% | 79.3% | 81.9% | 82.4% | 84.7% | ||||||||||||||||||||||
Consolidated
EBITDA
4
|
$ | 64,989 | $ | 8,588 | $ | 73,577 | $ | 83,998 | $ | 98,667 | $ | 115,566 | $ | 119,266 | |||||||||||||||
12
|
||||||||
As of December 31, 2009 | ||||||||
(In thousands) | Actual | As adjusted | ||||||
|
||||||||
Balance sheet data:
|
||||||||
Cash and cash equivalents
|
$ | 19,055 | $ | 49,586 | ||||
Working capital (deficit)
|
(14,610 | ) | 18,388 | |||||
Total assets
|
1,185,641 | 1,217,314 | ||||||
11
3
/
4
% senior
subordinated notes due 2013
|
205,000 | 133,250 | ||||||
Senior credit facility, including current portion
|
192,032 | 192,032 | ||||||
Total stockholders equity
|
645,987 | 750,400 | ||||||
(1) | Our combined results for the year ended December 31, 2005 represent the addition of the Predecessor period from January 1, 2005 through November 22, 2005 and the Successor period from November 23, 2005 through December 31, 2005. This combination does not comply with generally accepted accounting principles (GAAP) or with the rules for pro forma presentation, but is presented because we believe it provides the most meaningful comparison of our results. | |
(2) | Amounts for the Predecessor period are computed based upon the capital structure in existence prior to the Acquisition. Amounts for the Successor periods are computed based upon the capital structure in existence subsequent to the Acquisition. | |
(3) | Recurring revenue percentage represents software-enabled services revenues and maintenance revenues as a percentage of total revenues. We do not believe that the recurring revenue percentage for the Successor period of 2005 is meaningful because such period is only five weeks in duration and not indicative of our overall trends. | |
(4) | Consolidated EBITDA is a non-GAAP financial measure used in key financial covenants contained in our senior credit facilities, which are material facilities supporting our capital structure and providing liquidity to our business. Consolidated EBITDA is defined as earnings before interest, taxes, depreciation and amortization (EBITDA), further adjusted to exclude unusual items and other adjustments permitted in calculating covenant compliance under our senior credit facilities. We believe that the inclusion of supplementary adjustments to EBITDA applied in presenting Consolidated EBITDA is appropriate to provide additional information to investors to demonstrate compliance with the specified financial ratios and other financial condition tests contained in our senior credit facilities. | |
Management uses Consolidated EBITDA to gauge the costs of our capital structure on a day-to-day basis when full financial statements are unavailable. Management further believes that providing this information allows our investors greater transparency and a better understanding of our ability to meet our debt service obligations and make capital expenditures. | ||
Any breach of covenants in our senior credit facilities that are tied to ratios based on Consolidated EBITDA could result in a default under that agreement, in which case the lenders could elect to declare all amounts borrowed due and payable and to terminate any commitments they have to provide further borrowings. Any such acceleration would also result in a default under our indenture. Any default and subsequent acceleration of payments under our debt agreements would have a material adverse effect on our results of operations, financial position and cash flows. Additionally, under our debt agreements, our ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is also tied to ratios based on Consolidated EBITDA. | ||
Consolidated EBITDA does not represent net income or cash flow from operations as those terms are defined by GAAP and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. Further, our senior credit facilities require that Consolidated EBITDA be calculated for the most recent four fiscal quarters. As a result, the measure can be disproportionately affected by a particularly strong or weak quarter. Further, it may not be comparable to the measure for any subsequent four-quarter period or any complete fiscal year. | ||
Consolidated EBITDA is not a recognized measurement under GAAP, and investors should not consider Consolidated EBITDA as a substitute for measures of our financial performance and liquidity as determined in accordance with GAAP, such as net income, operating income or net cash provided by operating activities. Because other companies may calculate Consolidated EBITDA differently than we do, Consolidated EBITDA may not be comparable to similarly titled measures reported by other companies. Consolidated EBITDA has other limitations as an analytical tool, when compared to the use of net income, which is the most directly comparable GAAP financial measure, including: | ||
Consolidated EBITDA
does not reflect the provision of income tax expense in our
various jurisdictions;
|
||
Consolidated EBITDA
does not reflect the significant interest expense we incur as a
result of our debt leverage;
|
13
Consolidated EBITDA
does not reflect any attribution of costs to our operations
related to our investments and capital expenditures through
depreciation and amortization charges;
|
||
Consolidated EBITDA
does not reflect the cost of compensation we provide to our
employees in the form of stock option awards; and
|
||
Consolidated EBITDA
excludes expenses that we believe are unusual or non-recurring,
but which others may believe are normal expenses for the
operation of a business.
|
|
|||||||||||||||||||||||||||||
Predecessor | Successor | Combined a | Successor | ||||||||||||||||||||||||||
Period
|
|||||||||||||||||||||||||||||
Period
|
from
|
||||||||||||||||||||||||||||
from
|
November 23,
|
||||||||||||||||||||||||||||
January 1
|
2005
|
Year
|
Year
|
Year
|
Year
|
Year
|
|||||||||||||||||||||||
through
|
through
|
ended
|
ended
|
ended
|
ended
|
ended
|
|||||||||||||||||||||||
November 22,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
|||||||||||||||||||||||
(In thousands) | 2005 | 2005 | 2005 | 2006 | 2007 | 2008 | 2009 | ||||||||||||||||||||||
|
|||||||||||||||||||||||||||||
Net income
|
$ | 712 | $ | 831 | $ | 1,543 | $ | 1,075 | $ | 6,575 | $ | 18,801 | $ | 19,018 | |||||||||||||||
Interest expense, net
|
1,061 | 4,890 | 5,951 | 47,039 | 44,524 | 41,130 | 36,863 | ||||||||||||||||||||||
Income taxes
|
2,658 | | 2,658 | (3,789 | ) | (458 | ) | 7,146 | 9,804 | ||||||||||||||||||||
Depreciation and amortization
|
9,575 | 2,301 | 11,876 | 27,128 | 35,047 | 35,038 | 36,028 | ||||||||||||||||||||||
EBITDA
|
14,006 | 8,022 | 22,028 | 71,453 | 85,668 | 102,115 | 101,713 | ||||||||||||||||||||||
Purchase accounting
adjustments
b
|
| 616 | 616 | 3,017 | (296 | ) | (289 | ) | (93 | ) | |||||||||||||||||||
Merger costs
|
36,912 | | 36,912 | | | | | ||||||||||||||||||||||
Capital-based taxes
|
| | | 1,841 | 1,721 | 1,212 | 795 | ||||||||||||||||||||||
Unusual or non-recurring charges
(income)
c
|
(737 | ) | (242 | ) | (979 | ) | 1,485 | (1,718 | ) | 1,480 | 1,990 | ||||||||||||||||||
Acquired EBITDA and cost
savings
d
|
14,808 | 85 | 14,893 | 1,147 | 135 | 2,379 | 8,053 | ||||||||||||||||||||||
Stock-based compensation
|
| | | 3,871 | 10,979 | 7,323 | 5,607 | ||||||||||||||||||||||
Other
e
|
| 107 | 107 | 1,184 | 2,158 | 1,346 | 1,201 | ||||||||||||||||||||||
Consolidated EBITDA
|
$ | 64,989 | $ | 8,588 | $ | 73,577 | $ | 83,998 | $ | 98,667 | $ | 115,566 | $ | 119,266 | |||||||||||||||
(a) | Our combined results for the year ended December 31, 2005 represent the addition of the Predecessor period from January 1, 2005 through November 22, 2005 and the Successor period from November 23, 2005 through December 31, 2005. This combination does not comply with GAAP or with the rules for pro forma presentation, but is presented because we believe it provides the most meaningful comparison of our results. | |
(b) | Purchase accounting adjustments include (1) an adjustment to increase revenues by the amount that would have been recognized if deferred revenue were not adjusted to fair value at the date of the Transaction and (2) an adjustment to increase rent expense by the amount that would have been recognized if lease obligations were not adjusted to fair value at the date of the Transaction. | |
(c) | Unusual or non-recurring charges include foreign currency transaction gains and losses, expenses related to our prior proposed public offering, severance expenses associated with workforce reduction, gains and losses on the sales of marketable securities, equity earnings and losses on investments, proceeds and payments associated with legal and other settlements, costs associated with the closing of a regional office and other one-time gains and expenses. | |
(d) | Acquired EBITDA and cost savings reflects the EBITDA impact of significant businesses that were acquired during the period as if the acquisition occurred at the beginning of the period and cost savings to be realized from such acquisitions. | |
(e) | Other includes management fees and related expenses paid to Carlyle and the non-cash portion of straight-line rent expense. |
14
|
||||||||||||||||||||||||
Combined 1 | Successor | |||||||||||||||||||||||
Twelve months
|
||||||||||||||||||||||||
Twelve months
|
Twelve months
|
Twelve months
|
Twelve months
|
Twelve months
|
ended
|
|||||||||||||||||||
ended
|
ended
|
ended
|
ended
|
ended
|
December 31, 2009
|
|||||||||||||||||||
(In thousands, except ratio data) | December 31, 2005 | December 31, 2006 | December 31, 2007 | December 31, 2008 | December 31, 2009 | (As adjusted) 6 | ||||||||||||||||||
|
||||||||||||||||||||||||
Consolidated
EBITDA
2
|
$ | 73,577 | $ | 83,998 | $ | 98,667 | $ | 115,566 | $ | 119,266 | $ | 119,266 | ||||||||||||
Consolidated total leverage to Consolidated EBITDA ratio
(current maximum covenant level:
5.50)
3
|
6.43 | 5.48 | 4.30 | 3.28 | 3.17 | 2.48 | ||||||||||||||||||
Consolidated EBITDA to consolidated net interest coverage ratio
(current minimum covenant
level: 2.25)
4
|
10.87 | 5 | 1.88 | 2.34 | 2.98 | 3.45 | 4.56 | |||||||||||||||||
(1) | Our combined results for the year ended December 31, 2005 represent the addition of the Predecessor period from January 1, 2005 through November 22, 2005 and the Successor period from November 23, 2005 through December 31, 2005. This combination does not comply with GAAP or with the rules for pro forma presentation, but is presented because we believe it provides the most meaningful comparison of our results. | |
(2) | We reconcile our Consolidated EBITDA for the trailing four quarters to net income for the same period using the same methods set forth above. | |
(3) | Consolidated total leverage ratio is defined in our senior credit facilities at the last day of any period of four consecutive fiscal quarters, as the ratio of (a) the principal amount of all debt at such date, minus the amount, up to a maximum amount of $30.0 million, of cash and cash equivalents to (b) Consolidated EBITDA. The current maximum consolidated total leverage ratio is 5.50. The maximum consolidated total leverage ratio for 2009 was 5.50, for 2008 was 6.00, for 2007 was 6.75 and for 2006 was 7.50. There was no maximum consolidated total leverage ratio covenant prior to June 30, 2006. | |
(4) | Consolidated net interest coverage ratio is defined in our senior credit facilities as for any period, the ratio of (a) Consolidated EBITDA for such period to (b) total cash interest expense for such period with respect to all outstanding indebtedness minus total cash interest income for such period. The current minimum consolidated net interest coverage ratio is 2.25. The minimum consolidated net interest coverage ratio for 2009 was 2.00, for 2008 was 1.70, for 2007 was 1.50 and for 2006 was 1.40. There was no minimum consolidated net interest coverage ratio covenant prior to June 30, 2006. | |
(5) | This ratio is not comparable because we did not incur debt under our existing senior credit facilities until November 2005 in connection with the Transaction. |
(6) | As adjusted to give effect to the sale by us of 8,225,000 shares of our common stock in this offering at an assumed initial public offering price of $14.00 per share (which represents the midpoint of the estimated price range shown on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us, and the use of a majority of the net proceeds thereof to redeem $71.75 million in original principal amount of our outstanding 11 3 / 4 % senior subordinated notes at a redemption price of 105.875% of the principal amount, plus accrued and unpaid interest. The as adjusted data also give effect to our receipt of the aggregate exercise price for the 551,726 shares of common stock to be acquired by certain of the selling stockholders upon exercise of options in connection with this offering and the 14,450 shares which were acquired by certain of the selling stockholders upon exercise of options in 2010. |
15
| cancel or reduce planned expenditures for our products and services; |
| process fewer transactions through our software-enabled services; |
| seek to lower their costs by renegotiating their contracts with us; |
| move their IT solutions in-house; |
| switch to lower-priced solutions provided by our competitors; or |
| exit the industry. |
16
| the level of demand for our products and services; |
| the level of client spending for information technology; |
| the level of competition from internal client solutions and from other vendors; |
| the quality of our client service; |
| our ability to update our products and services and develop new products and services needed by clients; |
| our ability to understand the organization and processes of our clients; and |
| our ability to integrate and manage acquired businesses. |
17
18
| combine operations, facilities and differing firm cultures; |
| retain the clients or employees of acquired entities; |
| generate market demand for new products and services; |
| coordinate geographically dispersed operations and successfully adapt to the complexities of international operations; |
| integrate the technical teams of these companies with our engineering organization; |
| incorporate acquired technologies and products into our current and future product lines; and |
| integrate the products and services of these companies with our business, where we do not have distribution, marketing or support experience for these products and services. |
| the timing of the introduction and the market acceptance of new products, product enhancements or services by us or our competitors; |
| the lengthy and often unpredictable sales cycles of large client engagements; |
| the amount and timing of our operating costs and other expenses; |
| the financial health of our clients; |
| changes in the value of assets under our clients management; |
19
| cancellations of maintenance and/or software-enabled services arrangements by our clients; |
| changes in local, national and international regulatory requirements; |
| changes in our personnel; |
| implementation of our licensing contracts and software-enabled services arrangements; |
| changes in economic and financial market conditions; and |
| changes in the mix in the types of products and services we provide. |
20
21
| we may find it difficult or costly to update our services and software and to develop new products and services quickly enough to meet our clients needs; |
| we may find it difficult or costly to make some features of our software work effectively and securely over the Internet or with new or changed operating systems; |
| we may find it difficult or costly to update our software and services to keep pace with business, evolving industry standards, regulatory and other developments in the industries where our clients operate; and |
| we may be exposed to liability for security breaches that allow unauthorized persons to gain access to confidential information stored on our computers or transmitted over our network. |
22
| changes in a specific countrys or regions political or economic condition; |
| difficulties in obtaining U.S. export licenses; |
| potentially longer payment cycles; |
| increased costs associated with maintaining international marketing efforts; |
| foreign currency fluctuations; |
| the introduction of non-tariff barriers and higher duty rates; |
| foreign regulatory compliance; and |
| difficulties in enforcement of third-party contractual obligations and intellectual property rights. |
23
| make it more difficult for us to satisfy our obligations with respect to our notes and our senior credit facilities; |
| require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund acquisitions, working capital, capital expenditures, research and development efforts and other general corporate purposes; |
| increase our vulnerability to and limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; |
| expose us to the risk of increased interest rates as borrowings under our senior credit facilities are subject to variable rates of interest; |
| place us at a competitive disadvantage compared to our competitors that have less debt; and |
| limit our ability to borrow additional funds. |
24
| incur additional indebtedness; |
| sell assets, including capital stock of restricted subsidiaries; |
| agree to payment restrictions affecting SS&Cs restricted subsidiaries; |
| pay dividends; |
| consolidate, merge, sell or otherwise dispose of all or substantially all of SS&Cs assets; |
| make strategic acquisitions; |
| enter into transactions with SS&Cs affiliates; |
| incur liens; and |
| designate any of SS&Cs subsidiaries as unrestricted subsidiaries. |
25
| declare all borrowings outstanding, together with accrued interest and other fees, to be immediately due and payable; or |
| prevent us from making payments on the notes, |
26
| fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; |
| changes in estimates of our financial results or recommendations by securities analysts; |
| failure of any of our products to achieve or maintain market acceptance; |
| changes in market valuations of similar companies; |
| success of competitive products; |
| changes in our capital structure, such as future issuances of securities or the incurrence of additional debt; |
| announcements by us or our competitors of significant products, contracts, acquisitions or strategic alliances; |
| regulatory developments in the United States, foreign countries or both; |
| litigation involving our company, our general industry or both; |
| additions or departures of key personnel; |
27
| investors general perception of us; and |
| changes in general economic, industry and market conditions. |
|
||
Number of shares | Date available for sale into public market | |
|
||
222,323 shares
|
On the date of this prospectus. | |
19,472 shares
|
90 days after the date of this prospectus. | |
58,224,433 shares
|
180 days after the date of this prospectus, subject to extension in specified instances, due to lock-up agreements between the holders of these shares and the underwriters. However, the underwriters can waive the provisions of these lock-up agreements and allow these stockholders to sell their shares at any time. | |
28
29
| limitations on the removal of directors; |
| a classified board of directors so that not all members of our board are elected at one time; |
| advance notice requirements for stockholder proposals and nominations; |
| the inability of stockholders to call special meetings; |
| the ability of our board of directors to make, alter or repeal our bylaws; |
| the ability of our board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used to institute a rights plan, or a poison pill, that would work to dilute the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors; and |
| a prohibition on stockholders from acting by written consent if William C. Stone, investment funds affiliated with Carlyle, and certain transferees of Carlyle cease to collectively hold a majority of our outstanding common stock. |
30
31
| the effect of a prolonged downturn in the general economy or the financial services industry; |
| the effect of any further or accelerated consolidations in the financial services industry; |
| our ability to retain and attract clients and key personnel; |
| the integration of acquired businesses; |
| our ability to continue to derive substantial revenues from the licensing of, or provision of software-enabled services relating to, certain of our licensed software, and the provision of maintenance and professional services in support of such licensed software; |
| our ability to adapt to rapidly changing technology and evolving industry standards, and our ability to introduce new products and services; |
| challenges in maintaining and expanding our international operations; |
| the effects of war, terrorism and other catastrophic events; |
| the risk of increased interest rates due to the variable rates of interest on certain of our indebtedness; and |
| other risks and uncertainties, including those listed under the caption Risk factors. |
32
| a majority of our net proceeds from this offering to redeem up to $71.75 million in principal amount of our outstanding 11 3 / 4 % senior subordinated notes due 2013, at a redemption price of 105.875% of the principal amount, plus accrued and unpaid interest; and |
| the balance of our net proceeds from this offering for working capital and other general corporate purposes, including potential acquisitions. |
33
34
36
on a pro forma basis giving effect to the 8.5-for-1 stock split
of our common stock effected as of March 10, 2010 and the
filing of our restated certificate of incorporation as of the
closing date of this offering, which will reflect the creation
of our Class A
non-voting
common stock described below; and
on a pro forma as adjusted basis to reflect:
(1)
the sale of 8,225,000 shares of common stock that we are
offering at an assumed initial public offering price of $14.00
per share, the midpoint of the estimated price range shown on
the cover page of this prospectus, after deducting estimated
underwriting discounts and commissions and estimated offering
expenses payable by us, the use of a majority of the net
proceeds thereof to redeem $71.75 million in original
principal amount of our outstanding
11
3
/
4
% senior
subordinated notes due 2013 at a redemption price of 105.875% of
the principal amount, plus accrued and unpaid interest, a loss
on extinguishment of debt of approximately $5.5 million,
including a $4.2 million redemption premium and a non-cash
charge of approximately $1.3 million relating to the
write-off of deferred financing fees attributable to the
redeemed notes and the related tax effect of the loss on
extinguishment of debt; and
(2)
the issuance of 551,726 shares of common stock upon the
exercise of options held by certain selling stockholders in
connection with this offering, the issuance of 14,450 shares of
common stock upon the exercise of options by certain selling
stockholders in 2010 and the receipt of the aggregate exercise
price for such options and the associated tax effect of the
exercises.
35
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December 31, 2009
Pro forma
(In thousands, except per share
data)
Pro forma
as adjusted
$
19,055
$
49,586
$
192,032
$
192,032
205,000
133,250
227
227
397,259
325,509
608
696
587,293
694,845
16,436
16,436
46,300
43,073
(4,650
)
(4,650
)
645,987
750,400
$
1,043,246
$
1,075,909
12,171,383 shares of common stock issuable upon the
exercise of stock options outstanding as of December 31,
2009 at a weighted average exercise price of $6.91 per
share;
1,874,258 shares of common stock reserved as of
December 31, 2009 for future issuance under our 2006 equity
incentive plan; and
2,623,661 shares of common stock reserved as of
December 31, 2009 for future issuance under our 2008 stock
incentive plan.
Table of Contents
40
$
14.00
$
(7.51
)
2.53
(4.98
)
$
18.98
37
Table of Contents
Shares purchased
Total consideration
Average price
Number
Percent
Amount
Percent
per share
60,966,228
88.1
%
$
530.1 million
82.2
%
$
8.69
8,225,000
11.9
$
115.2 million
17.8
$
14.00
69,191,228
100.0
%
$
645.3 million
100.0
%
38
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39
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Predecessor
Successor
Period from
Period from
Combined
Successor
January 1,
November 23,
Year
Year
Year
Year
Year
2005 through
2005 through
Ended
Ended
Ended
Ended
Ended
November 22,
December 31,
December 31,
December 31,
December 31,
December 31,
December 31,
(In thousands, except per share and percentage data)
2005
2005
2005
2006
2007
2008
2009
$
20,147
$
3,587
$
23,734
$
22,925
$
27,514
$
24,844
$
20,661
44,064
3,701
47,765
55,222
61,910
65,178
66,099
12,565
2,520
15,085
19,582
17,491
24,352
20,889
67,193
7,857
75,050
107,740
141,253
165,632
163,266
143,969
17,665
161,634
205,469
248,168
280,006
270,915
2,963
856
3,819
9,216
9,616
9,198
8,499
10,393
1,499
11,892
20,415
26,038
26,854
27,559
7,849
861
8,710
12,575
14,277
16,118
14,154
37,799
4,411
42,210
57,810
78,951
90,263
87,528
59,004
7,627
66,631
100,016
128,882
142,433
137,740
84,965
10,038
95,003
105,453
119,286
137,573
133,175
13,134
1,364
14,498
17,598
19,701
19,566
20,362
19,199
2,071
21,270
23,620
26,282
26,804
26,513
11,944
1,140
13,084
20,366
24,573
26,120
19,197
36,912
36,912
81,189
4,575
85,764
61,584
70,556
72,490
66,072
3,776
5,463
9,239
43,869
48,730
65,083
67,103
1,031
30
1,061
388
939
409
28
(2,092
)
(4,920
)
(7,012
)
(47,427
)
(45,463
)
(41,539
)
(36,891
)
655
258
913
456
1,911
1,994
(1,418
)
3,370
831
4,201
(2,714
)
6,117
25,947
28,822
2,658
2,658
(3,789
)
(458
)
7,146
9,804
$
712
$
831
$
1,543
$
1,075
$
6,575
$
18,801
$
19,018
$
0.03
$
0.01
$
0.02
$
0.11
$
0.31
$
0.31
$
0.03
$
0.01
$
0.02
$
0.10
$
0.30
$
0.30
23,300
60,138
60,172
60,245
60,284
60,381
24,478
62,167
62,182
63,382
63,700
63,653
$
0.36
$
0.35
66,216
69,488
$
32,116
$
4,915
$
30,709
$
57,057
$
61,655
$
59,852
(110,495
)
(877,261
)
(18,626
)
(12,839
)
(24,608
)
(54,134
)
69,161
868,655
(16,427
)
(37,408
)
(25,532
)
(17,896
)
77.3%
65.4%
76.0%
79.3%
81.9%
82.4%
84.7%
$
64,989
$
8,588
$
73,577
$
83,998
$
98,667
$
115,566
$
119,266
$
15,584
$
11,718
$
19,175
$
29,299
$
19,055
7,283
(1,312
)
5,668
10,835
(14,610
)
1,176,371
1,152,521
1,190,495
1,127,353
1,185,641
478,143
466,235
440,580
406,625
392,989
557,133
563,132
612,593
587,253
645,987
(1)
Amounts for the Predecessor periods
are computed based upon the capital structure in existence prior
to the Acquisition. Amounts for the Successor periods are
computed based upon the capital structure in existence
subsequent to the Acquisition.
Table of Contents
(2)
Pro forma basic and diluted
earnings per share for the year ended December 31, 2009
give effect to the issuance of 5,834,509 shares by us in
this offering whose proceeds will be used to redeem
$71.75 million in principal amount of the notes, for
$76.0 million in cash. As a result of this redemption, the
Companys aggregate annual interest expense in respect of
the notes, net of tax will decrease by approximately
$5.1 million. See Use of proceeds.
(3)
Recurring revenue percentage
represents software-enabled services revenues and maintenance
revenues as a percentage of total revenues. We do not believe
that the recurring revenue percentage for the Successor period
of 2005 is meaningful because such period is only five weeks in
duration and not indicative of our overall trends.
(4)
Consolidated EBITDA is a non-GAAP
financial measure used in key financial covenants contained in
our senior credit facilities, which are material facilities
supporting our capital structure and providing liquidity to our
business. Consolidated EBITDA is defined as earnings before
interest, taxes, depreciation and amortization (EBITDA), further
adjusted to exclude unusual items and other adjustments
permitted in calculating covenant compliance under our senior
credit facilities. We believe that the inclusion of
supplementary adjustments to EBITDA applied in presenting
Consolidated EBITDA is appropriate to provide additional
information to investors to demonstrate compliance with the
specified financial ratios and other financial condition tests
contained in our senior credit facilities.
Management uses Consolidated EBITDA
to gauge the costs of our capital structure on a day-to-day
basis when full financial statements are unavailable. Management
further believes that providing this information allows our
investors greater transparency and a better understanding of our
ability to meet our debt service obligations and make capital
expenditures.
Any breach of covenants in our
senior credit facilities that are tied to ratios based on
Consolidated EBITDA could result in a default under that
agreement, in which case the lenders could elect to declare all
amounts borrowed due and payable and to terminate any
commitments they have to provide further borrowings. Any such
acceleration would also result in a default under our indenture.
Any default and subsequent acceleration of payments under our
debt agreements would have a material adverse effect on our
results of operations, financial position and cash flows.
Additionally, under our debt agreements, our ability to engage
in activities such as incurring additional indebtedness, making
investments and paying dividends is also tied to ratios based on
Consolidated EBITDA.
Consolidated EBITDA does not
represent net income or cash flow from operations as those terms
are defined by GAAP and does not necessarily indicate whether
cash flows will be sufficient to fund cash needs. Further, our
senior credit facilities require that Consolidated EBITDA be
calculated for the most recent four fiscal quarters. As a
result, the measure can be disproportionately affected by a
particularly strong or weak quarter. Further, it may not be
comparable to the measure for any subsequent four-quarter period
or any complete fiscal year.
Consolidated EBITDA is not a
recognized measurement under GAAP, and investors should not
consider Consolidated EBITDA as a substitute for measures of our
financial performance and liquidity as determined in accordance
with GAAP, such as net income, operating income or net cash
provided by operating activities. Because other companies may
calculate Consolidated EBITDA differently than we do,
Consolidated EBITDA may not be comparable to similarly titled
measures reported by other companies. Consolidated EBITDA has
other limitations as an analytical tool, when compared to the
use of net income, which is the most directly comparable GAAP
financial measure, including:
41
Table of Contents
The following is a reconciliation
of net income to Consolidated EBITDA as defined in our senior
credit facilities.
Predecessor
Successor
Combined
Successor
Period
Period
from
from
November 23,
January 1
2005
Year
Year
Year
Year
Year
through
through
Ended
Ended
Ended
Ended
Ended
November 22,
December 31,
December 31,
December 31,
December 31,
December 31,
December 31,
(In thousands)
2005
2005
2005
2006
2007
2008
2009
$
712
$
831
$
1,543
$
1,075
$
6,575
$
18,801
$
19,018
1,061
4,890
5,951
47,039
44,524
41,130
36,863
2,658
2,658
(3,789
)
(458
)
7,146
9,804
9,575
2,301
11,876
27,128
35,047
35,038
36,028
14,006
8,022
22,028
71,453
85,668
102,115
101,713
616
616
3,017
(296
)
(289
)
(93
)
36,912
36,912
1,841
1,721
1,212
795
(737
)
(242
)
(979
)
1,485
(1,718
)
1,480
1,990
14,808
85
14,893
1,147
135
2,379
8,053
3,871
10,979
7,323
5,607
107
107
1,184
2,158
1,346
1,201
$
64,989
$
8,588
$
73,577
$
83,998
$
98,667
$
115,566
$
119,266
(a)
Purchase accounting adjustments
include (1) an adjustment to increase revenues by the
amount that would have been recognized if deferred revenue were
not adjusted to fair value at the date of the Transaction and
(2) an adjustment to increase rent expense by the amount
that would have been recognized if lease obligations were not
adjusted to fair value at the date of the Transaction.
(b)
Unusual or non-recurring charges
include foreign currency transaction gains and losses, expenses
related to our prior proposed public offering, severance
expenses associated with workforce reduction, gains and losses
on the sales of marketable securities, equity earnings and
losses on investments, proceeds and payments associated with
legal and other settlements, costs associated with the closing
of a regional office and other one-time gains and expenses.
(c)
Acquired EBITDA and cost savings
reflects the EBITDA impact of significant businesses that were
acquired during the period as if the acquisition occurred at the
beginning of the period and cost savings to be realized from
such acquisitions.
(d)
Other includes management fees and
related expenses paid to Carlyle and the non-cash portion of
straight-line rent expense.
42
Table of Contents
Successor
Combined
1
Twelve Months
Twelve Months
Twelve Months
Twelve Months
Twelve Months
Twelve Months
Ended
Ended
Ended
Ended
Ended
Ended
December 31,
December 31,
December 31,
December 31,
December 31,
December 31,
2009
(In thousands, except ratio data)
2005
2006
2007
2008
2009
(As
adjusted)
6
$
73,577
$
83,998
$
98,667
$
115,566
$
119,266
$
119,266
6.43
5.48
4.30
3.28
3.17
2.48
10.87
5
1.88
2.34
2.98
3.45
4.56
(1)
Our combined results for the year
ended December 31, 2005 represent the addition of the
Predecessor period from January 1, 2005 through
November 22, 2005 and the Successor period from
November 23, 2005 through December 31, 2005. This
combination does not comply with GAAP or with the rules for pro
forma presentation, but is presented because we believe it
provides the most meaningful comparison of our results.
(2)
We reconcile our Consolidated
EBITDA for the trailing four quarters to net income for the same
period using the same methods set forth above.
(3)
Consolidated total leverage ratio
is defined in our senior credit facilities at the last day of
any period of four consecutive fiscal quarters, as the ratio of
(a) the principal amount of all debt at such date, minus
the amount, up to a maximum amount of $30.0 million of cash
and cash equivalents to (b) Consolidated EBITDA. The
current maximum consolidated total leverage ratio is 5.50. The
maximum consolidated total leverage ratio for 2009 was 5.50, for
2008 was 6.00, for 2007 was 6.75 and for 2006 was 7.50. There
was no maximum consolidated total leverage ratio covenant prior
to June 30, 2006.
(4)
Consolidated net interest coverage
ratio is defined in our senior credit facilities as for any
period, the ratio of (a) Consolidated EBITDA for such
period to (b) total cash interest expense for such period
with respect to all outstanding indebtedness minus total cash
interest income for such period. The current minimum
consolidated net interest coverage ratio is 2.25. The minimum
consolidated net interest coverage ratio for 2009 was 2.00, for
2008 was 1.70, for 2007 was 1.50 and for 2006 was 1.40. There
was no minimum consolidated net interest coverage ratio covenant
prior to June 30, 2006.
(5)
This ratio is not comparable
because we did not incur debt under our existing senior credit
facilities until November 2005 in connection with the
Transaction.
(6)
As adjusted to give effect to the
sale by us of 8,225,000 shares of our common stock in this
offering at an assumed initial public offering price of $14.00
per share (which represents the midpoint of the estimated price
range shown on the cover page of this prospectus), after
deducting estimated underwriting discounts and commissions and
estimated offering expenses payable by us, and the use of a
majority of the net proceeds thereof to redeem
$71.75 million in original principal amount of our
outstanding
11
3
/
4
% senior
subordinated notes at a redemption price of 105.875% of the
principal amount, plus accrued and unpaid interest. The as
adjusted data also give effect to our receipt of the aggregate
exercise price for the 551,726 shares of common stock to be
acquired by certain of the selling stockholders upon exercise of
options in connection with this offering and the
14,450 shares which were acquired by certain of the selling
stockholders upon exercise of options in 2010.
43
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financial condition and results of operations
44
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45
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Acquired business
Acquisition date
Acquired capabilities, products
and services
February 2010
Expanded fund administration services to private equity market
December 2009
Added electronic trading offering in broker/ dealer market
November 2009
Expanded private equity client base with TNR Solution product
May 2009
Expanded institutional footprint and provided new cross-selling
opportunities
March 2009
Expanded institutional middle- and back-office outsourcing
services with financial data acquisition, transformation and
delivery services
October 2008
Added real-time, mission-critical order routing and execution
services with ACA, BlockTalk and MarketLook products
March 2007
Expanded fund administration services to private equity market
46
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47
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significant underperformance relative to historical or projected
future operating results;
significant changes in the manner of our use of the acquired
assets or the strategy for our overall business; and
significant negative industry or economic trends.
48
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the value of our business as determined at arms length in
connection with the Transaction;
significant business milestones that may have affected the value
of our business subsequent to the Transaction;
the continued risks associated with our business;
the economic outlook in general and the condition and outlook of
our industry;
our financial condition and expected operating results;
our level of outstanding indebtedness;
the market price of stocks of publicly traded corporations
engaged in the same or similar lines of business;
as of July 31, 2006, March 31, 2007 and March 1,
2008, analyses using a weighted average of three generally
accepted valuation procedures: the income approach, the market
approachpublicly traded guideline company method and the
market approachtransaction method; and
49
Table of Contents
as of November 15, 2008, April 1, 2009 and
November 30, 2009, analyses using a weighted average of two
generally accepted valuation procedures: the income approach and
the market approach-publicly traded guideline company method.
The market approachtransaction method was not utilized due
to the lack of comparable transactions in the evaluation period.
Fair value
Weighted-average grant date fair value of options by vesting
type
1
:
Shares
of
Change
under
Exercise
underlying
in
Grant date
option
price
stock
Time
Performance
control
9,909,555
$
8.77
$
8.77
$
3.66
$
3.88
$
2.50
89,250
8.77
8.77
3.62
3.84
2.50
195,500
8.77
8.77
3.61
3.83
0.87
148,750
11.64
11.64
4.81
5.10
1.07
25,500
11.64
11.64
4.87
5.16
1.02
255,041
10.08
10.08
2.86
102,000
14.53
14.53
4.54
4,250
14.53
14.53
4.49
400,350
14.53
14.53
4.48
(1)
The weighted-average fair value of
options by vesting type represents the value at the grant date.
These fair values do not reflect the re-valuation of certain
options related to modifications effected in February 2009,
March 2008 and April 2007, or the resolutions approved by our
board and compensation committee in February 2010 relating to
performance-based and superior options, as more fully described
in notes 10, 16 and 17 to the consolidated financial
statements included elsewhere in this prospectus.
50
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51
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52
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53
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Options
Intrinsic value
2,682,077
$13,009,543
10,055,482
$79,417,635
the conversion of the outstanding superior options granted under
the 2006 equity incentive plan into performance-based options
that vest based on our EBITDA performance in 2010 and 2011,
which affects 1,680,868 outstanding options, of which 701,497
are held by our named executive officers;
the elimination of pre-determined EBITDA targets from the option
agreements and provision for the annual proposal of EBITDA
ranges by management, subject to approval by our board, which
EBITDA target range for 2010 was established by our board in a
subsequent meeting described below; and
54
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the rolling over of performance-based options that
do not vest (in whole or in part) in any given year into
performance-based options for the following year, except as
otherwise provided by our board of directors. Under the 2006
equity incentive plan, our board has the authority to amend the
options to effect such a rollover and, generally,
has the authority to amend, suspend or terminate any option,
provided that, except with respect to specified corporate
events, neither the amendment, suspension nor termination of the
option shall, without the consent of the optionee, alter or
impair any rights or obligations under the option. The rollover
affects 689,007 outstanding unvested performance-based options,
of which 280,600 are held by our named executive officers, and
would affect 1,680,868 outstanding superior options, of which
701,497 are held by our named executive officers, that will be
converted to performance-based options upon the closing of this
offering.
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Percent change
Year ended December 31,
from prior period
2009
2008
2007
2009
2008
$
20,661
$
24,844
$
27,514
(16.8
)%
(9.7
)%
66,099
65,178
61,910
1.4
5.3
20,889
24,352
17,491
(14.2
)
39.2
163,266
165,632
141,253
(1.4
)
17.3
$
270,915
$
280,006
$
248,168
(3.2
)
12.8
Year ended December 31,
2009
2008
2007
7.6
%
8.9
%
11.1
%
24.4
23.3
25.0
7.7
8.7
7.0
60.3
59.1
56.9
100.0
%
100.0
%
100.0
%
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Less than
More than
Contractual
obligations
Total
1 Year
1-3 Years
3-5 Years
5 Years
All other
$
397,259
$
4,270
$187,989
$
205,000
$
$
113,935
33,200
56,648
24,087
33,959
9,486
13,490
7,132
3,851
8,322
5,556
1,879
770
117
8,238
8,238
$
561,713
$
52,512
$260,006
$
236,989
$
3,968
$
8,238
(1)
Reflects interest payments on our
term loan facility and associated interest rate swap agreement
at an assumed interest rate of three-month LIBOR of 0.26% plus
2.0% for U.S. dollar loans and CDOR of 0.38% plus 2.5% for
Canadian dollar loans, and required interest payments on our
senior subordinated notes of 11.75%.
(2)
We are obligated under
noncancelable operating leases for office space and office
equipment. The lease for the corporate facility in Windsor,
Connecticut expires in 2016. We sublease office space under
noncancelable leases. We received rental income under these
leases of $1.3 million, $1.4 million and
$1.5 million for the years ended December 31, 2009,
2008 and 2007, respectively. The effect of the rental income to
be received in the future has not been included in the table
above.
(3)
Purchase obligations include the
minimum amounts committed under contracts for goods and services.
(4)
As of December 31, 2009, our
liability for uncertain tax positions and related net interest
payable were $7.0 million and $1.3 million,
respectively. We are unable to reasonably estimate the timing of
such liability and interest payments in individual years beyond
12 months due to uncertainties in the timing of the
effective settlement of tax positions.
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Consolidated EBITDA does not reflect the provision of income tax
expense in our various jurisdictions;
Consolidated EBITDA does not reflect the significant interest
expense we incur as a result of our debt leverage;
Consolidated EBITDA does not reflect any attribution of costs to
our operations related to our investments and capital
expenditures through depreciation and amortization charges;
Consolidated EBITDA does not reflect the cost of compensation we
provide to our employees in the form of stock option
awards; and
Consolidated EBITDA excludes expenses that we believe are
unusual or non-recurring, but which others may believe are
normal expenses for the operation of a business.
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Year ended December 31,
(In thousands)
2009
2008
2007
$
19,018
$
18,801
$
6,575
36,863
41,130
44,524
9,804
7,146
(458
)
36,028
35,038
35,047
101,713
102,115
85,688
(93
)
(289
)
(296
)
795
1,212
1,721
1,990
1,480
(1,718
)
8,053
2,379
135
5,607
7,323
10,979
1,201
1,346
2,158
$
119,266
$
115,566
$
98,667
(1)
Purchase accounting adjustments
include (a) an adjustment to increase revenues by the
amount that would have been recognized if deferred revenue were
not adjusted to fair value at the date of acquisitions and
(b) an adjustment to increase rent expense by the amount
that would have been recognized if lease obligations were not
adjusted to fair value at the date of the Transaction.
(2)
Unusual or non-recurring charges
include foreign currency transaction gains and losses, expenses
related to our prior proposed public offering, severance
expenses associated with workforce reduction, equity earnings
and losses on investments, proceeds and payments from legal and
other settlements, costs associated with the closing of a
regional office and other one-time gains and expenses.
(3)
Acquired EBITDA and cost savings
reflects the EBITDA impact of significant businesses that were
acquired during the period as if the acquisition occurred at the
beginning of the period and cost savings to be realized from
such acquisitions.
(4)
Other includes management fees and
related expenses paid to Carlyle and the non-cash portion of
straight-line rent expense.
Covenant
Actual
requirements
ratios
5.50
x
3.17
x
2.00
x
3.45
x
67
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78
79
81
Treasury,
Real
Alternative
banks &
Institutional
Insurance &
Municipal
estate
investment
Financial
credit
asset
pension
Commercial
finance
property
Selected functionality
managers
markets
unions
managers
funds
lenders
groups
managers
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
ü
70
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71
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provide complementary products or services in the financial
services industry;
possess proven technology and an established client base that
will provide a source of ongoing revenue and to whom we may be
able to sell existing products and services;
expand our intellectual property portfolio to complement our
business;
address a highly specialized problem or a market niche in the
financial services industry;
expand our global reach into strategic geographic
markets; and
have solutions that lend themselves to being delivered as
software-enabled services.
Acquisition
date
Acquired business
Contract purchase price*
Acquired capabilities, products and services
Chalke
$10,000,000
Expanded insurance footprint with PTS actuarial product
Mabel Systems
$850,000 and 109,224 shares
Entered Benelux market with investment accounting product
Shepro Braun Systems
1,500,000 shares
Entered hedge fund and family office markets with Total Return
product
Quantra
$2,269,800 and 819,028 shares
Entered the real estate property management market with SKYLINE
product
The Savid Group
$821,500
Expanded debt and derivative product offerings
HedgeWare
1,028,524 shares
Expanded product offerings for the hedge fund and family office
markets
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Acquisition
date
Acquired business
Contract purchase price*
Acquired capabilities, products and services
Brookside
41,400 shares
Expanded our consulting services capabilities
Digital Visions
$1,350,000
Entered financial institutions market with BANC Mall, PALMS and
PortPro products
Real-Time USA
$4,000,000
Expanded financial institutions offering with Lightning and
Real-Time products
DBC
$4,500,000
Added municipal finance structuring products for underwriters,
investment banks, municipal issuers and financial advisors
Amicorp Fund Services
$1,800,000
Entered offshore fund administration services market
Investment Advisory Network
$3,000,000
Expanded wealth management capabilities with Compass and
Portfolio Manager products
NeoVision Hypersystems
$1,600,000
Added data visualization dashboard capabilities with Heatmaps
product
OMR Systems
$19,671,000
Added integrated, global product offering for financial
institutions and hedge funds with TradeThru product
Achievement Technologies
$470,000
Enhanced real estate property management offering with SamTrak
facilities management product
Eisnerfast
$25,300,000
Expanded fund administration services to the hedge fund and
private equity markets
Financial Models Company
$159,000,000
Expanded front-, middle- and back-office products and services
to the investment management industry including Pacer, Pages,
Recon and Sylvan products
Financial Interactive
358,424 shares and warrants to purchase 50,000 shares
Expanded alternative investment fund offerings with
Fund
Runner
CRM product
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Acquisition
date
Acquired business
Contract purchase price*
Acquired capabilities, products and services
MarginMan
$5,600,000
Expanded depth in foreign currency exchange market with
MarginMan product
Open Information Systems
$24,000,000
Entered money market, custody and security lending market with
Global Debt Manager, Information Manager and Money Market
Manager products
Cogent Management
$12,250,000
Expanded fund administration services to hedge fund and private
equity markets
Zoologic
$3,000,000
Added education and training courseware offerings for financial
institutions
Northport
$5,000,000
Expanded fund administration services to private equity market
Micro Design Services
$17,200,000
Added real-time, mission-critical order routing and execution
services with ACA, BlockTalk and MarketLook products
Evare
$3,514,500
Expanded institutional middle- and back-office outsourcing
services with financial data acquisition, transformation and
delivery services
MAXIMIS
$7,700,000
Expanded institutional footprint and provided new cross-selling
opportunities
TheNextRound
$21,000,000
Expanded private equity client base with TNR Solution product
Tradeware
$22,500,000
Added electronic trading offering in broker/dealer market
GIPS
$12,000,000
Expanded fund administration services to private equity market
*
Share references are to shares of
SS&C common stock after giving effect to SS&Cs
three-for-two common stock split in the form of a stock dividend
effective as of March 2004, but do not reflect the capital
structure of SS&C Holdings.
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Products
Typical users
Vertical markets served
Portfolio managers
Alternative investment managers
Asset managers
Financial markets
Fund administrators
Institutional asset managers
Investment advisors
Insurance & pension funds
Auditors
Treasury, banks & credit unions
Alternative investment managers
Broker/dealers
Securities traders
Alternative investment managers
Financial institutions
Financial markets
Risk managers
Institutional asset managers
Foreign exchange traders
Insurance & pension funds
Asset managers
Treasury, banks & credit unions
Brokers/dealers
Corporate treasuries
Financial exchanges
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Products
Typical users
Vertical markets served
CEO/CFOs
Insurance & pension funds
Risk managers
Municipal finance groups
Actuarial professionals
Treasury, banks & credit unions
Bank asset/liability managers
Investment bankers
State/local treasury staff
Financial advisors
Mortgage originators
Commercial lenders
Commercial lenders
Insurance & pension funds
Mortgage loan servicers
Treasury, banks & credit unions
Mortgage loan portfolio managers
Real estate investment managers
Bank/credit union loan officers
Real estate investment managers
Real estate leasing/property
Real estate leasing agents
managers
Real estate property managers
Facility managers
Financial Institutions
Treasury, banks & credit unions
Custodians
Security lenders
Cash managers
Financial institutions
All verticals
Asset managers
Hedge fund managers
Investment bankers
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Services
Typical users
Vertical markets served
Portfolio managers
Alternative investment managers
Asset managers
Financial markets
Financial exchanges
Institutional asset managers
Fund administrators
Insurance & pension funds
Investment advisors
Treasury, banks & credit unions
Alternative investment managers
Securities traders
Broker/dealers
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general bond structures,
revenue bonds,
housing bonds,
student loans, and
Federal Housing Administration insured revenue bonds
and securitizations.
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retirement communities
universities
hospitals
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full BPO investment accounting and investment operations
services,
hosting of a companys application software,
automated workflow integration,
automated quality control mechanisms, and
extensive interface and connectivity services to custodian
banks, data service providers, depositories and other external
entities.
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investment managers
commodity pool operators
proprietary traders
private equity groups
separate managed accounts
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content-rich, periodic software and services
eBriefings
targeted at clients and prospects in each of our vertical
and geographic markets,
regular product-focused webinars,
seminars and symposiums,
trade shows and conferences, and
e-marketing
campaigns.
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241 employees in research and development,
729 employees in consulting and services,
88 employees in sales and marketing,
91 employees in client support, and
104 employees in finance and administration.
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130
Name
Age
Position
54
Chairman of the Board and Chief Executive Officer
47
President, Chief Operating Officer and Director
58
Senior Vice President and Chief Financial Officer
62
Senior Vice President, General Counsel and Secretary
36
Director
68
Director
57
Director
48
Director
55
Director Designee
(1)
Member of our Audit Committee.
(2)
Member of our Compensation
Committee.
(3)
Member of our Nominating Committee
as of the closing of this offering.
(4)
Mr. Michael will become a
director upon the closing of this offering and replace
Mr. Watts on our Audit Committee.
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appointing, approving the compensation of, and assessing the
independence of our independent registered public accounting
firm;
overseeing the work of our independent registered public
accounting firm, including through the receipt and consideration
of reports from our independent registered public accounting
firm;
reviewing and discussing with management and our independent
registered public accounting firm our annual and quarterly
financial statements and related disclosures;
coordinating our board of directors oversight of internal
control over financial reporting, disclosure controls and
procedures and our code of business conduct and ethics;
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establishing procedures for the receipt and retention of
accounting related complaints and concerns;
approving any related person transactions; and
preparing the audit committee report required by the rules of
the Securities and Exchange Commission.
reviewing and approving, or making recommendations to our board
of directors with respect to, the compensation of our chief
executive officer and our other executive officers;
overseeing and administering our cash and equity incentive plans;
reviewing and making recommendations to our board with respect
to director compensation; and
preparing the compensation committee report required by
Securities and Exchange Commission rules.
identifying individuals qualified to become members of our board
of directors; and
recommending to our board of directors the persons to be
nominated for election as directors and to each of the
boards committees.
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attract, retain and motivate the best possible executive talent;
reward successful performance by the named executive officers
and the company; and
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align the interests of the named executive officers with those
of our stockholders by providing long-term equity compensation.
base salary;
discretionary annual cash bonuses;
stock option awards;
perquisites; and
severance and
change-of-control
benefits.
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40% of the options are time-based options that
vested as to 25% of the number of shares underlying the option
on November 23, 2006 and as to
1
/
36
of the number of shares underlying the option each month
thereafter until fully vested on November 23, 2009. The
time-based options become fully vested and exercisable
immediately prior to the effective date of a liquidity event, as
defined in the stock option agreement (the consummation of this
offering will not constitute a liquidity event under such
definition);
40% of the options are performance-based options
that vest based on the determination by our board of directors
or compensation committee as to whether our EBITDA for each
fiscal year 2006 through 2010 falls within the targeted EBITDA
range for such year. If our EBITDA for a particular year is at
the low end of the targeted EBITDA range, 50% of the
performance-based option for that year vests, and if our EBITDA
is at or above the high end of the targeted EBITDA range, 100%
of the performance-based option for that year vests. If our
EBITDA is below the targeted EBITDA range, the performance-based
option does not vest, and if our EBITDA is within the targeted
EBITDA range, between 50% and 100% of the performance-based
option vests, based on linear interpolation. A certain
percentage of performance-based options will also vest
immediately prior to the effective date of a liquidity event if
proceeds from the liquidity event equal or exceed specified
returns on investments in SS&C Holdings made by investment
funds affiliated with Carlyle; and
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20% of the options are superior options, which upon
the closing of this offering will become performance-based
options, as described below.
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the conversion of the outstanding superior options granted under
the 2006 equity incentive plan into performance-based options
that vest based on our EBITDA performance in 2010 and 2011,
which affects 1,680,868 outstanding options, of which 701,497
are held by our named executive officers;
the elimination of pre-determined EBITDA ranges from the option
agreements and provision for the annual proposal of EBITDA
ranges by management, subject to approval by our board, which
EBITDA target range for 2010 was established by our board in a
subsequent meeting described below; and
the rolling over of performance-based options that
do not vest (in whole or in part) in any given year into
performance-based options for the following year, except as
otherwise provided by our board of directors. Under our 2006
equity incentive plan, our board has the authority to amend the
options to effect such a rollover and, generally,
has the authority to amend, suspend or terminate any option,
provided that, except with respect to specified corporate
events, neither the amendment, suspension nor termination of the
option shall, without the consent of the optionee, alter or
impair any rights or obligations under the option. The rollover
affects 689,007 outstanding unvested performance-based options,
of which 280,600 are held by our named executive officers, and
would affect 1,680,868 outstanding superior options, of which
701,497 are held by our named executive officers, that will be
converted to performance-based options upon the closing of this
offering.
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Name and
All other
principal position
Year
Salary($)
Bonus($)
compensation($)
Total($)
2009
$
750,000
$
1,750,000
$
3,552
1
$
2,503,552
2008
737,500
1,500,000
3,552
2,241,052
2007
591,667
1,175,000
3,552
1,770,219
2009
450,000
800,000
3,360
2
1,253,360
2008
445,833
750,000
3,360
1,199,193
2007
395,833
600,000
3,360
999,193
2009
260,000
340,000
4,032
3
604,032
2008
257,083
300,000
4,011
561,094
2007
222,917
225,000
3,887
451,804
2009
225,000
225,000
4,386
4
454,386
2008
223,333
200,000
4,360
427,693
2007
203,750
150,000
4,213
357,963
(1)
Consists of our contribution of
$3,000 to Mr. Stones account under the SS&C
401(k) savings plan and our payment of $552 of group term life
premiums for the benefit of Mr. Stone.
(2)
Consists of our contribution of
$3,000 to Mr. Boulangers account under the SS&C
401(k) savings plan and our payment of $360 of group term life
premiums for the benefit of Mr. Boulanger.
(3)
Consists of our contribution of
$3,000 to Mr. Pedontis account under the SS&C
401(k) savings plan and our payment of $1,032 of group term life
premiums for the benefit of Mr. Pedonti.
(4)
Consists of our contribution of
$3,000 to Mr. Whitmans account under the SS&C
401(k) savings plan and our payment of $1,386 of group term life
premiums for the benefit of Mr. Whitman.
The employment of Mr. Stone as the chief executive officer
of SS&C Holdings and SS&C;
An initial term through March 11, 2013 with automatic
one-year renewals until terminated either by Mr. Stone or
us;
An annual base salary of at least $750,000;
An opportunity to receive an annual bonus in an amount to be
established by our board of directors based on achieving
individual and company performance goals as determined by our
compensation committee. If Mr. Stone is employed at the end
of any calendar year, his annual bonus will not be less than
$500,000 for that year;
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A grant of 153,846 shares of our restricted Class A
non-voting
stock that vests over a period of three years from the first
board meeting after the March 2010 amendment and restatement of
the employment agreement;
Certain severance payments and benefits. If we terminate
Mr. Stones employment without cause, if
Mr. Stone resigns for good reason (including, under certain
circumstances, following a change of control as defined in the
employment agreement) prior to the end of the term of the
employment agreement, or if Mr. Stone receives a notice of
non-renewal of the employment term by us, Mr. Stone will be
entitled to receive (1) an amount equal to 200% of his base
salary and 200% of his minimum annual bonus, (2) vesting
acceleration with respect to 50% of his then unvested options
and 100% of his shares of restricted stock, and (3) three
years of coverage under SS&Cs medical, dental and
vision benefit plans. In the event of Mr. Stones
death or a termination of Mr. Stones employment due
to any disability that renders Mr. Stone unable to perform
his duties under the agreement for six consecutive months,
Mr. Stone or his representative or heirs, as applicable,
will be entitled to receive (1) vesting acceleration with
respect to 50% of his then unvested options and 100% of his
shares of restricted stock, and (2) a pro-rated amount of
his most recent annual bonus. In the event payments to
Mr. Stone under his employment agreement (or the management
agreement entered into in connection with the Transaction) cause
Mr. Stone to incur a 20% excise tax under Section 4999
of the Internal Revenue Code, Mr. Stone will be entitled to
an additional payment sufficient to cover such excise tax and
any taxes associated with such payments; and
Certain restrictive covenants, including a non-competition
covenant pursuant to which Mr. Stone will be prohibited
from competing with SS&C and its affiliates during his
employment and for a period equal to the later of (1) four
years following the March 2010 amendment and restatement of the
agreement, in the case of a termination by us for cause or a
resignation by Mr. Stone without good reason, and
(2) two years following Mr. Stones termination
of employment for any reason.
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the then-outstanding shares of our common stock or the common
stock of SS&C, or
the combined voting power of our then-outstanding voting
securities or the then-outstanding voting securities of
SS&C entitled to vote generally in the election of
directors (in each case, other than any acquisition by us,
Carlyle Partners IV, L.P. (an investment fund affiliated with
Carlyle), Mr. Stone, any employee or group of employees of
ours, or affiliates of any of the foregoing, or by any employee
benefit plan (or related trust) sponsored or maintained by us or
any of our affiliates); or
individuals whose election, or nomination for election by our
stockholders, was approved by at least a majority of the
directors comprising the board of directors on the effective
date of Mr. Stones employment agreement and any
individuals subsequently elected to our board of directors
pursuant to the stockholders agreement or
individuals nominated or designated for election by Carlyle
Partners IV, L.P.
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to prescribe, amend and rescind rules and regulations relating
to our 2006 equity incentive plan;
to determine the type or types of awards to be granted under our
2006 equity incentive plan;
to select the persons to whom awards may be granted under our
2006 equity incentive plan;
to grant awards and to determine the terms and conditions of
such awards;
to construe and interpret our 2006 equity incentive
plan; and
to amend, suspend or terminate our 2006 equity incentive plan.
each option will vest, depending on the classification of the
option as a time option, performance option or superior option,
as follows:
Time options will vest as to 25% of the number of shares
underlying the option on a date certain (November 23, 2006
for the first tranche of options awarded under the plan in
August 2006, but generally the first anniversary of either the
date of grant or the start date for a new employee) and will
continue to vest as to 1/36 of the number of shares underlying
the option on the day of the month of the date of grant each
month thereafter until such options are fully vested. Time
options will become fully vested and exercisable immediately
prior to the effective date of a liquidity event as defined in
the stock option agreement.
A certain percentage of the performance options will vest based
on the administrators determination as to whether our
EBITDA for each fiscal year 2006 through 2010 (2007 through 2011
for options awarded in 2007) falls within the targeted
EBITDA range for such year. If our EBITDA is at or above the
high end of the targeted EBITDA range, 100% of the
performance-based option for that year vests. If our EBITDA is
below the targeted EBITDA range, the performance-based option
does not vest, and if our EBITDA is within the targeted EBITDA
range, between 50% and 100% of the performance-based option
vests, based on linear interpolation. In February 2009, our
board of directors approved the immediate vesting of the 2006,
2007 and 2008 performance-based options that did not otherwise
vest during 2006, 2007 or 2008. A certain percentage of
performance options will also vest immediately prior to the
effective date of a liquidity event if proceeds from the
liquidity event equal or exceed a certain target.
The superior options will become performance-based options upon
the closing of this offering that vest based on our EBITDA
performance in 2010 and 2011.
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any portion of an option that is unvested at the time of a
participants termination of service with us will be
forfeited to us; and
any portion of an option that is vested but unexercised at the
time of a participants termination of service with us may
not be exercised after the first to occur of the following:
the expiration date of the option, which will be no later than
ten years from the date of grant;
90 days following the date of the termination of service
for any reason other than cause, death or disability;
the date of the termination of service for cause; and
twelve months following the termination of service by reason of
the participants death or disability.
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to adopt, amend and repeal rules and regulations relating to our
2008 stock incentive plan;
to determine the type or types of awards to be granted under our
2008 stock incentive plan;
to select the persons to whom awards may be granted under our
2008 stock incentive plan;
to grant awards and to determine the terms and conditions of
such awards;
to delegate to one or more of our officers the power to grant
awards under our 2008 stock incentive plan to our employees or
officers (other than executive officers);
to construe and interpret our 2008 stock incentive plan; and
to amend, suspend or terminate our 2008 stock incentive plan,
subject in certain instances to stockholder approval.
each option will vest as to 25% of the number of shares
underlying the option on the first anniversary of the date of
grant and will continue to vest as to an additional 1/36 of the
remaining number of shares underlying the option on the day of
the month of the date of grant each month thereafter until the
fourth anniversary of the date of grant;
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options will become fully vested and exercisable immediately
prior to the effective date of a change in control as defined in
the stock option agreement;
any portion of an option that is unvested at the time of a
participants termination of service with us will be
forfeited to us; and
any portion of an option that is vested but unexercised at the
time of a participants termination of service with us may
not be exercised after the first to occur of the following:
the expiration date of the option, which will be no later than
ten years from the date of grant,
90 days following the date of the termination of service
for any reason other than cause, death or disability,
the date of the termination of service for cause, and
twelve months following the termination of service by reason of
the participants death or disability.
provide that awards shall be assumed, or substantially
equivalent awards shall be distributed, by the acquiring or
succeeding corporation;
upon written notice to a participant, provide that the
participants unexercised awards will terminate immediately
prior to the consummation of such corporate event unless
exercised by the participant within a specified period following
the date of notice;
provide that outstanding awards shall become exercisable,
realizable or deliverable, or restrictions applicable to an
award shall lapse, in whole or in part prior to or upon such
corporate event;
in the event of a corporate event under the terms of which
holders of our common stock will receive a cash payment for each
share surrendered in connection with the corporate event, make
or provide for a cash payment to participants in exchange for
the termination of all such awards;
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provide that, in connection with our liquidation or dissolution,
awards shall convert into the right to receive liquidation
proceedings (net of any applicable exercise price or tax
withholdings); and
any combination of the foregoing.
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Equity
Incentive
Plan Awards:
Number of
Number of
Number of
Securities
Securities
Securities
Underlying
Underlying
Underlying
Unexercised
Unexercised
Unexercised
Unearned
Option
Option
Options (#)
Options (#)
Options
Exercise
Expiration
Name
Exercisable
Unexercisable
(#)
4
Price($)
Date
637,500
1,2
$
0.87
2/17/2010
637,500
1
0.78
5/31/2011
1,275,000
1
1.89
4/8/2013
603,439
3
8.77
8/9/2016
482,751
4
120,688
4
8.77
8/9/2016
301,719
5
8.77
8/9/2016
212,500
1
4.20
10/18/2014
318,750
1
1.77
2/6/2013
452,581
3
8.77
8/9/2016
362,064
4
90,517
4
8.77
8/9/2016
226,290
5
8.77
8/9/2016
127,491
1
1.95
8/1/2012
226,290
3
8.77
8/9/2016
181,032
4
45,258
4
8.77
8/9/2016
113,145
5
8.77
8/9/2016
63,418
1
1.77
2/6/2013
120,686
3
8.77
8/9/2016
96,549
4
24,137
4
8.77
8/9/2016
60,343
5
8.77
8/9/2016
(1)
These options were granted under
our 1998 stock incentive plan and are fully vested.
(2)
On February 16, 2010, we
entered into an amended and restated stock option agreement with
Mr. Stone, pursuant to which this option was amended to make it
an option to purchase 637,500 shares of our Class A
non-voting common stock. Mr. Stone exercised the option on
February 17, 2010 and purchased 637,500 shares of our
Class A non-voting common stock.
(3)
This option is a time-based option
awarded under our 2006 equity incentive plan that vested as to
25% of the number of shares underlying the option on
November 23, 2006 and as to 1/36 of the number of shares
underlying the option each month thereafter until fully vested
on November 23, 2009. The time-based options will become
fully vested and exercisable immediately prior to the effective
date of a liquidity event, as defined in the stock option
agreement.
(4)
This option is a performance-based
option awarded under our 2006 equity incentive plan that vests
based on the determination by our board of directors or
compensation committee as to whether our EBITDA for each fiscal
year 2006 through 2010 falls within the targeted EBITDA range
for such year. If our EBITDA for a particular year is at the low
end of the targeted EBITDA range, 50% of the performance-based
option for that year vests, and if our EBITDA is at or above the
high end of the targeted EBITDA range, 100% of the
performance-based option for that year vests. If our EBITDA is
below the targeted EBITDA range, the performance-based option
does not vest, and if our EBITDA is within the targeted EBITDA
range, between 50% and 100%
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of the performance-based option
vests, based on linear interpolation. In February 2009, our
board of directors approved the immediate vesting of the 2006,
2007 and 2008 performance-based options that did not otherwise
vest during 2006, 2007 or 2008. In addition, a certain
percentage of this option will vest immediately prior to the
effective date of a liquidity event if proceeds from the
liquidity event equal or exceed specified returns on investments
in us made by investment funds affiliated with Carlyle.
(5)
This option was a superior option
at the time of grant and will become a performance-based option
that vests based on the determination by our board of directors
or compensation committee as to whether our EBITDA for fiscal
years 2010 and 2011 falls within the targeted EBITDA ranges for
such years.
Without cause, for
good reason
(including certain
Payments to
changes of
William C. Stone
control) or
For cause or
upon termination
upon notice of
without
Liquidity
or liquidity event
non-renewal
good
reason
1
event
2
Disability
Death
$
1,500,000
3
$
$
$
$
1,000,000
4
500,000
5
500,000
5
1,104,592
7
2,209,189
1,104,592
7
1,104,592
7
36,836
8
3,292,649
9
$
6,934,077
$
$
2,209,189
$
1,604,592
$
1,604,592
(1)
In the event that
Mr. Stones employment is terminated for cause or
without good reason, he will be entitled to unpaid base salary
through the date of the termination, payment of any annual bonus
earned with respect to a completed fiscal year of SS&C that
is unpaid as of the date of termination and any benefits due to
him under any employee benefit plan, policy, program,
arrangement or agreement.
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(2)
Liquidity event is defined in Mr.
Stones option agreements governing options granted under
our 2006 equity incentive plan. The consummation of this
offering will not constitute a liquidity event under this
definition. Time-based options will become fully vested and
exercisable immediately prior to the effective date of a
liquidity event. Performance-based options, including superior
options that will become performance-based options upon the
closing of this offering, will vest in whole or in part
immediately prior to the effective date of a liquidity event if
proceeds from the liquidity event equal or exceed a certain
target. The payments in this column assume the liquidity event
will generate sufficient proceeds to accelerate in full the
performance-based options.
(3)
Consists of 200% of 2009 base
salary payable promptly upon termination.
(4)
Consists of 200% of 2009 annual
bonus payable promptly upon termination. The compensation
committee did not set a formal 2009 annual bonus for
Mr. Stone. The figure used for the 2009 annual bonus is
$500,000, the minimum annual bonus specified for Mr. Stone
in his employment agreement.
(5)
Consists of a cash payment equal to
the amount of Mr. Stones annual bonus for 2009,
payable within 30 business days of termination. The compensation
committee did not set a formal 2009 annual bonus for
Mr. Stone. The figure used for the 2009 annual bonus is
$500,000, the minimum annual bonus specified for Mr. Stone
in his employment agreement.
(6)
Based upon an exercise price of
$8.77 per share and $14.00 (which represents the midpoint
of the estimated price range shown on the cover page of this
prospectus).
(7)
Vesting acceleration with respect
to unvested options to purchase an aggregate of
211,203 shares of our common stock, which is equal to 50%
of all unvested options held by Mr. Stone on
December 31, 2009.
(8)
Represents three years of coverage
under SS&Cs medical, dental and vision benefit plans.
(9)
In the event that the severance and
other benefits provided for in Mr. Stones employment
agreement or otherwise payable to him in connection with a
change in control constitute parachute payments
within the meaning of Section 280G of the Internal Revenue
Code and will be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code, then
Mr. Stone shall receive (a) a payment from us
sufficient to pay such excise tax, and (b) an additional
payment from us sufficient to pay the excise tax and U.S.
federal and state income taxes arising from the payments made by
us to Mr. Stone pursuant to this sentence.
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Number of shares
underlying
Value of unvested
Name
unvested
options (#)
options
1
316,807
$
1,656,901
158,403
828,448
84,480
441,830
(1)
The value of unvested options was
calculated by multiplying the number of shares underlying
unvested options by $14.00 (which represents the midpoint of the
estimated price range shown on the cover page of this
prospectus) and then deducting the aggregate exercise price for
these options.
Fees Earned
or Paid in
Name
Cash
1
Options
Awards
2
Total
$
37,500
$
37,500
(1)
For his service as a director,
Mr. Etherington is paid an annual retainer fee of $25,000
for each board meeting attended in person. Mr. Etherington
was paid an aggregate of $32,500 for his service as a director
in 2009.
(2)
Upon his election to the board of
directors in 2006, Mr. Etherington was granted an option to
purchase 21,250 shares of our common stock at an exercise
price per share of $8.77. Such option was 100% vested on the
date of grant.
any breach of the directors duty of loyalty to us or our
stockholders;
any act or omission not in good faith or that involves
intentional misconduct or a knowing violation of law;
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voting or assenting to any unlawful payments related to
dividends or unlawful stock repurchases, redemptions or other
distributions; or
any transaction from which the director derived an improper
personal benefit.
we will indemnify our directors and officers to the fullest
extent permitted by law;
we may indemnify our other employees and other agents to the
same extent that we indemnify our officers and directors, unless
otherwise determined by the board of directors; and
we will advance expenses to our directors and executive officers
in connection with legal proceedings in connection with a legal
proceeding to the fullest extent permitted by law.
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the related persons interest in the related person
transaction;
the approximate dollar value of the amount involved in the
related person transaction;
the approximate dollar value of the amount of the related
persons interest in the transaction without regard to the
amount of any profit or loss;
whether the transaction was undertaken in the ordinary course of
our business;
whether the terms of the transaction are no less favorable to us
than terms that could have been reached with an unrelated third
party;
the purpose of, and the potential benefits to us of, the
transaction; and
any other information regarding the related person transaction
or the related person in the context of the proposed transaction
that would be material to investors in light of the
circumstances of the particular transaction.
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interests arising solely from the related persons position
as an executive officer of another entity (whether or not the
person is also a director of such entity), that is a participant
in the transaction, where (a) the related person and all
other related persons own in the aggregate less than a 10%
equity interest in such entity and (b) the related person
and his or her immediate family members are not involved in the
negotiation of the terms of the transaction and do not receive
any special benefits as a result of the transaction, and
(c) the amount involved in the transaction equals less than
the greater of $200,000 or 5% of the annual gross revenues of
the company receiving payment under the transaction; and
a transaction that is specifically contemplated by provisions of
our charter or bylaws.
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each person we know to be the beneficial owner of more than 5%
of the outstanding shares of common stock;
each of our directors, director nominees and named executive
officers;
all of our directors and executive officers as a group; and
each of our other selling stockholders.
Shares beneficially
Shares beneficially
owned prior to the
owned after the
offering
offering
Number
Percent
Shares Offered
Number
Percent
43,469,799
71.3%
43,469,799
62.8%
20,304,503
31.4%
1,933,824
18,370,679
25.2%
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Shares beneficially
Shares beneficially
owned prior to the
owned after the
offering
offering
Number
Percent
Shares Offered
Number
Percent
1,345,895
2.2%
269,178
1,076,717
1.5%
21,250
*
21,250
*
534,813
*
63,750
471,063
*
280,653
*
56,125
224,528
*
22,487,114
33.7%
2,322,877
20,164,237
27.0%
45,900
*
5,950
39,950
*
124,474
*
10,200
114,274
*
45,900
*
9,180
36,720
*
48,960
*
9,792
39,168
*
207,400
*
41,480
165,920
*
61,200
*
12,240
48,960
*
37,655
*
7,531
30,124
*
105,825
*
21,165
84,660
*
42,840
*
8,500
34,340
*
164,050
*
32,810
131,240
*
36,286
*
7,225
29,061
*
70,975
*
4,250
66,725
*
37,655
*
6,800
30,855
*
*
Represents less than one percent of
the outstanding shares of common stock.
(1)
TC Group IV, L.P. is the sole
general partner of Carlyle Partners IV, L.P. and CP IV
Coinvestment, L.P., the record holders of 41,782,345 and
1,687,454 shares of our common stock, respectively. TC
Group IV Managing GP, L.L.C. is the sole general partner of
TC Group IV, L.P. TC Group, L.L.C. is the sole managing member
of TC Group IV Managing GP, L.L.C. TCG Holdings, L.L.C. is
the sole managing member of TC Group, L.L.C. Accordingly, TC
Group IV, L.P., TC Group IV Managing GP, L.L.C., TC Group,
L.L.C. and TCG Holdings, L.L.C. each may be deemed owners of
shares of our common stock owned of record by each of Carlyle
Partners IV, L.P. and CP IV Coinvestment, L.P. William E.
Conway, Jr., Daniel A. DAniello and David M. Rubenstein
are managing members of TCG Holdings, L.L.C. and, in such
capacity, may be deemed to share beneficial ownership of shares
of our common stock beneficially owned by TCG Holdings, L.L.C.
Such individuals expressly disclaim any such beneficial
ownership. The principal address and principal offices of TCG
Holdings, L.L.C. and certain affiliates is
c/o The
Carlyle Group, 1001 Pennsylvania Avenue, N.W., Suite 220
South, Washington, D.C.
20004-2505.
(2)
Includes 3,636,190 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(3)
Consists of 1,345,895 shares
of our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(4)
Consists of 21,250 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(5)
Does not include
43,469,799 shares of our common stock held by investment
funds associated with or designated by Carlyle.
Messrs. Holt, Watts and Dyer are executives of Carlyle.
They disclaim beneficial ownership of the shares held by
investment funds associated with or designated by Carlyle.
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(6)
Consists of 534,813 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(7)
Consists of 280,653 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(8)
Includes 5,818,801 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
(9)
Consists of 45,900 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Ashbury is one
of our employees.
(10)
Consists of 124,474 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009, 10,200 of which have
been exercised and will be sold in this offering. Mr. Doyle
is one of our employees.
(11)
Consists of 45,900 shares of
our common stock subject to outstanding stock options
exercisable on or within the 60-day period following
December 31, 2009. Ms. Harris is one of our employees.
(12)
Consists of 48,960 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Johnson is one
of our employees.
(13)
Consists of 207,400 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Kanwar is one
of our employees.
(14)
Consists of 61,200 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. McMackin is
one of our employees.
(15)
Consists of 37,655 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Megaw is one
of our employees.
(16)
Consists of 105,825 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Ms. Mooney is one
of our employees.
(17)
Consists of 42,840 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Nassereddine
is one of our employees.
(18)
Consists of 164,050 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009.
Ms. OConnor-Nelsen is one of our employees.
(19)
Consists of 36,286 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Sibert is one
of our employees.
(20)
Consists of 70,975 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009, 4,250 of which have
been exercised and will be sold in this offering. Mr. Stone
is one of our employees and a brother of William C. Stone, our
chief executive officer.
(21)
Consists of 37,655 shares of
our common stock subject to outstanding stock options
exercisable on or within the
60-day
period following December 31, 2009. Mr. Yee is one of
our employees.
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liens;
sale-leaseback transactions;
debt;
dividends and other restricted payments;
redemptions and stock repurchases;
consolidations, mergers and acquisitions;
asset dispositions;
investments, loans and advances;
changes in line of business;
changes in fiscal year;
restrictive agreements with subsidiaries;
transactions with affiliates;
amendments or prepayments of subordinated indebtedness; and
speculative hedging agreements.
delivery of financial and other information to the
administrative agent;
notice to the administrative agent upon the occurrence of
certain events of default, litigation and other material events;
conduct of business and maintenance of existence;
payment of material taxes and other governmental charges;
maintenance of properties, licenses and insurance;
access to books and records by the lenders;
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compliance with applicable laws and regulations; and
further assurances and maintenance of collateral.
Redemption Period
Price
105.8750%
102.9375%
100.0%
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incur additional indebtedness;
sell assets, including capital stock of restricted subsidiaries;
agree to payment restrictions affecting SS&Cs
restricted subsidiaries;
pay dividends;
make certain investments;
consolidate, merge, sell or otherwise dispose of all or
substantially all of SS&Cs assets;
enter into transactions with SS&Cs affiliates;
incur liens; and
designate any of SS&Cs subsidiaries as unrestricted
subsidiaries.
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137
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138
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139
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140
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Shares Eligible
Date Available for Sale
for Sale
Comment
222,323
Shares saleable under Rule 144 that are not subject to a
lock-up
90 Days after Date of Prospectus
19,472
Shares saleable under Rules 144 and 701 that are not subject to
a lock-up
180 Days after Date of Prospectus
58,224,433
Lock-up released; shares saleable under Rules 144 and 701
offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase, lend or
otherwise
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transfer or dispose of, directly or indirectly, any shares of
our common stock or any securities convertible into or
exercisable or exchangeable for common stock; or
enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences
of ownership of our common stock,
1% of the number of shares of our common stock then outstanding,
which will equal approximately 691,912 shares immediately
after this offering; or
the average weekly trading volume in our common stock on the
NASDAQ Global Market during the four calendar weeks preceding
the filing of a notice on Form 144 with respect to such
sale.
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insurance companies;
tax-exempt organizations;
financial institutions;
brokers or dealers in securities;
regulated investment companies;
pension plans;
controlled foreign corporations;
passive foreign investment companies;
owners that hold our common stock as part of a straddle, hedge,
conversion transaction, synthetic security or other integrated
investment; and
certain U.S. expatriates.
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the gain is effectively connected with a U.S. trade or
business and, if an applicable income tax treaty so provides, is
attributable to a permanent establishment or a fixed base
maintained by such
non-U.S. holder,
in which case the
non-U.S. holder
generally will be taxed at the graduated U.S. federal
income tax rates applicable to U.S. persons (as defined in
the Internal Revenue Code) and, if the
non-U.S. holder
is a foreign corporation, the branch profits tax described above
in Distributions on our common stock also may apply;
the
non-U.S. holder
is a nonresident alien individual who is present in the United
States for 183 days or more in the taxable year of the
disposition and certain other conditions are met, in which case
the
non-U.S. holder
will be subject to a 30% tax (or such lower rate as may be
specified by an applicable income tax treaty between the United
States and such holders country of residence) on the net
gain derived from the disposition, which may be offset by
U.S. source capital losses of the
non-U.S. holder,
if any; or
we are or have been, at any time during the five-year period
preceding such disposition (or the
non-U.S. holders
holding period, if shorter), a U.S. real property
holding corporation unless our common stock is regularly
traded on an established securities market and the
non-U.S. holder
holds no more than 5% of our outstanding common stock, directly
or indirectly, during the shorter of the
five-year
period ending on the date of the disposition or the period that
the
non-U.S. holder
held our common stock. If we are determined to be a
U.S. real property holding corporation and the foregoing
exception does not apply, then a purchaser will generally
withhold 10% of the proceeds payable to a
non-U.S. holder
from a sale of our common stock and the
non-U.S. holder
generally will be taxed on its net gain derived from the
disposition at the graduated U.S. federal income tax rates
applicable to U.S. persons (as defined in the Internal
Revenue Code). Generally, a corporation is a U.S. real
property holding corporation only if the fair market value of
its U.S. real property interests equals or exceeds 50% of
the sum of the fair market value of its worldwide real property
interests plus its other assets used or held for use in a trade
or business. Although there can be no assurance, we do not
believe that we are, or have been, a U.S. real property
holding corporation, or that we are likely to become one in the
future. No assurance can be provided that our common stock will
be regularly traded on an established securities market for
purposes of the rules described above.
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F-26
II-5
II-6
II-7
II-8
II-9
Number of
Name
shares
10,725,000
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Total
Per share
No exercise
Full exercise
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase, lend or
otherwise transfer or dispose of, directly or indirectly, any
shares of our common stock or any securities convertible into or
exercisable or exchangeable for common stock; or
enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences
of ownership of our common stock,
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the sale of shares to the underwriters;
transactions by any person other than us relating to shares of
common stock or other securities acquired in open market
transactions after the completion of the offering of the shares;
transfers of shares of common stock or any security convertible
into our common stock as a bona fide gift;
transfers to family members or to trusts for the benefit of the
stockholder or family members of the stockholder, in each case,
for estate planning purposes;
distributions of shares of common stock or any security
convertible into or exercisable for common stock to partners,
members or equityholders of the stockholder;
a stockholders entry into a written trading plan designed
to comply with Rule 10b5-1 under the Exchange Act, provided
that no sales are made pursuant to such trading plan during the
restricted period and that the establishment of such plan will
not result in any public filing or other public announcement of
such plan by the locked-up party or us during the restricted
period; or
the exercise of an option to purchase shares of common stock
granted under a stock incentive plan or stock purchase plan
described in this prospectus or the acceptance of restricted
stock awards from us and the disposition of shares of restricted
stock to us pursuant to the terms of such plan.
during the last 17 days of the
180-day
restricted period we issue an earnings release or a material
news event relating to us occurs; or
prior to the expiration of the
180-day
restricted period, we announce that we will release earnings
results during the
16-day
period beginning on the last day of the
180-day
restricted period,
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the information set forth in this prospectus and otherwise
available to the representatives;
our prospects and the history and prospects for the industry in
which we compete;
an assessment of our management;
our prospects for future earnings;
the general condition of the securities markets at the time of
this offering;
the recent market prices of, and demand for, publicly traded
common stock of generally comparable companies; and
other factors deemed relevant by the underwriters and us.
153
Table of Contents
to legal entities which are authorized or regulated to operate
in the financial markets or, if not so authorized or regulated,
whose corporate purpose is solely to invest in securities;
to any legal entity which has two or more of (1) an average
of at least 250 employees during the last financial year;
(2) a total balance sheet of more than 43,000,000 and
(3) an annual net turnover of more than 50,000,000,
as shown in its last annual or consolidated accounts;
to fewer than 100 natural or legal persons (other than qualified
investors as defined in the EU Prospectus Directive) subject to
obtaining the prior consent of the book-running
manager(s)
for any such offer; or
in any other circumstances which do not require the publication
by the Issuer of a prospectus pursuant to Article 3 of the
Prospectus Directive.
154
Table of Contents
155
Table of Contents
156
Table of Contents
Table of Contents
F-2
Table of Contents
Consolidated balance
sheets
F-3
Table of Contents
Consolidated statements of
operations
Year ended December 31,
(in thousands)
2009
2008
2007
$
20,661
$
24,844
$
27,514
66,099
65,178
61,910
20,889
24,352
17,491
163,266
165,632
141,253
270,915
280,006
248,168
8,499
9,198
9,616
27,559
26,854
26,038
14,154
16,118
14,277
87,528
90,263
78,951
137,740
142,433
128,882
133,175
137,573
119,286
20,362
19,566
19,701
26,513
26,804
26,282
19,197
26,120
24,573
66,072
72,490
70,556
67,103
65,083
48,730
28
409
939
(36,891
)
(41,539
)
(45,463
)
(1,418
)
1,994
1,911
28,822
25,947
6,117
9,804
7,146
(458
)
$
19,018
$
18,801
$
6,575
$
0.31
$
0.31
$
0.11
60,381
60,284
60,245
$
0.30
$
0.30
$
0.10
63,653
63,700
63,382
F-4
Table of Contents
Consolidated statements of cash
flows
F-5
Table of Contents
Consolidated statements of changes
in stockholders equity
For the years ended December 31, 2009, 2008 and
2007
Common Stock
Accumulated
Number
Additional
Other
Total
Total
of Issued
Paid-in
Retained
Comprehensive
Treasury
Stockholders
Comprehensive
(in thousands)
Shares
Amount
Capital
Earnings
Income (loss)
Stock
Equity
Income (Loss)
60,252
$
603
$
558,992
$
1,906
$
1,699
$
(68
)
$
563,132
6,575
6,575
$
6,575
34,490
34,490
34,490
(2,574
)
(2,574
)
(2,574
)
$
38,491
10,979
10,979
2
1
1
(10
)
(10
)
60,254
603
569,972
8,481
33,615
(78
)
612,593
18,801
18,801
$
18,801
(49,078
)
(49,078
)
(49,078
)
(2,427
)
(2,427
)
(2,427
)
$
(32,704
)
7,323
7,323
291
2
2,396
2,398
(2,357
)
(2,357
)
60,545
605
579,691
27,282
(17,890
)
(2,435
)
587,253
19,018
19,018
$
19,018
32,879
32,879
32,879
1,447
1,447
1,447
$
53,344
5,607
5,607
262
3
1,995
1,998
(2,215
)
(2,215
)
60,807
$
608
$
587,293
$
46,300
$
16,436
$
(4,650
)
$
645,987
F-6
Table of Contents
Notes to consolidated financial
statements
1.
Organization
2.
Summary of
significant accounting policies
F-7
Table of Contents
Notes to consolidated financial
statements(continued)
F-8
Table of Contents
Notes to consolidated financial
statements(continued)
F-9
Table of Contents
Notes to consolidated financial
statements(continued)
F-10
Table of Contents
Notes to consolidated financial
statements(continued)
F-11
Table of Contents
Notes to consolidated financial
statements(continued)
Description
Useful life
3-5 years
7-10 years
Shorter of lease
term or estimated useful life
F-12
Table of Contents
Notes to consolidated financial
statements(continued)
$
860,690
8,937
2
(578
)
(46,642
)
822,409
30,123
(147
)
(118
)
33,250
$
885,517
December 31,
2009
2008
$
233,505
$
207,757
68,166
58,046
18,276
17,391
2,299
2,016
322,246
285,210
(116,245
)
(82,236
)
$
206,001
$
202,974
F-13
Table of Contents
Notes to consolidated financial
statements(continued)
Year ending December
31,
$
34,123
32,345
29,877
27,263
24,792
$
148,400
F-14
Table of Contents
Notes to consolidated financial
statements(continued)
F-15
Table of Contents
Notes to consolidated financial
statements(continued)
F-16
Table of Contents
Notes to consolidated financial
statements(continued)
Year ended December 31,
2009
2008
2007
60,381
60,284
60,245
3,272
3,416
3,137
63,653
63,700
63,382
3.
Accounts
receivable
December 31,
2009
2008
$
30,838
$
28,785
12,187
10,977
(1,425
)
(1,444
)
$
41,600
$
38,318
F-17
Table of Contents
Notes to consolidated financial
statements(continued)
Year ended December 31,
Allowance for doubtful
accounts:
2009
2008
2007
$
1,444
$
1,223
$
1,638
213
865
336
(313
)
(524
)
(812
)
81
(120
)
61
$
1,425
$
1,444
$
1,223
4.
Stockholders
equity
5.
Income
taxes
Year ended December 31,
2009
2008
2007
$
9,749
$
6,671
$
(11,417
)
19,073
19,276
17,534
$
28,822
$
25,947
$
6,117
F-18
Table of Contents
Notes to consolidated financial
statements(continued)
Year ended December 31,
2009
2008
2007
$
8,334
$
6,580
$
460
8,727
7,746
4,406
1,559
94
99
18,620
14,420
4,965
(8,063
)
(7,129
)
(6,262
)
(1,902
)
(1,602
)
441
1,149
1,457
398
(8,816
)
(7,274
)
(5,423
)
$
9,804
$
7,146
$
(458
)
Year ended December 31,
2009
2008
2007
$
10,087
$
9,081
$
2,141
1,775
1,008
321
(2,258
)
(2,333
)
(1,883
)
(581
)
(1,536
)
466
702
646
(266
)
(731
)
(147
)
$
9,804
$
7,146
$
(458
)
F-19
Table of Contents
Notes to consolidated financial
statements(continued)
2009
2008
Deferred
Deferred
Deferred
Deferred
tax
tax
tax
tax
assets
liabilities
assets
liabilities
$
9,186
$
$
6,327
$
1,736
2,382
1,720
898
1,449
5,512
1,333
237
1,002
1,251
860
738
454
345
126
691
932
468
5,004
4,750
6,316
8,122
54,156
51,232
17,866
66,408
17,345
65,608
(1,202
)
(4,572
)
$
16,664
$
66,408
$
12,773
$
65,608
F-20
Table of Contents
Notes to consolidated financial
statements(continued)
$
6,457
375
(19
)
(1,020
)
5,793
759
(262
)
(30
)
723
$
6,983
F-21
Table of Contents
Notes to consolidated financial
statements(continued)
6.
Debt, derivative
instruments, and capital leases
2009
2008
$
2,000
$
190,032
203,726
205,000
205,000
227
397,259
408,726
(4,270
)
(2,101
)
$
392,989
$
406,625
(A)
Senior credit
facilities
F-22
Table of Contents
Notes to consolidated financial
statements(continued)
F-23
Table of Contents
Notes to consolidated financial
statements(continued)
(B)
11
3
/
4
% Senior
subordinated notes due 2013
F-24
Table of Contents
Notes to consolidated financial
statements(continued)
Year ending December
31,
$
4,270
2,022
185,967
205,000
$
397,259
7.
Fair value
measurements
Fair values at December 31,
2009
Level 1
Level 2
Level 3
$
$
$
$
$
4,159
$
1,000
$
$
4,159
$
1,000
F-25
Table of Contents
Notes to consolidated financial
statements(continued)
Fair values at December 31,
2008
Level 1
Level 2
Level 3
$
$
$
$
$
6,644
$
8.
Leases
Table of Contents
Notes to consolidated financial
statements(continued)
Year ending
December 31,
$
9,486
7,482
6,008
4,537
2,595
3,851
$
33,959
Year ending
December 31,
$
1,257
1,257
1,257
1,257
210
$
5,238
9.
Defined
contribution plans
F-27
Table of Contents
Notes to consolidated financial
statements(continued)
10.
Stock Option and
Purchase Plans
F-28
Table of Contents
Notes to consolidated financial
statements(continued)
F-29
Table of Contents
Notes to consolidated financial
statements(continued)
Performance-based
Time-based awards
awards
2009
2007
2007
4.0
4.0
4.5
34.24%
45.85%
45.85%
1.89%
4.57%
4.57%
0%
0%
0%
F-30
Table of Contents
Notes to consolidated financial
statements(continued)
Statement of operations
classification
2009
2008
2007
$
114
$
142
$
257
208
240
343
1,133
1,621
2,452
1,455
2,003
3,052
954
1,184
1,803
600
777
1,146
2,598
3,359
4,978
4,152
5,320
7,927
$
5,607
$
7,323
$
10,979
F-31
Table of Contents
Notes to consolidated financial
statements(continued)
Weighted average
Shares
exercise price
13,714,251
$
6.76
369,750
10.12
(306,425
)
8.70
(1,912
)
0.87
13,775,664
6.80
(622,360
)
8.88
(291,184
)
8.24
12,862,120
6.67
357,041
11.35
(219,010
)
8.91
(262,592
)
7.62
12,737,559
6.74
Weighted
Weighted
average
average
Weighted
Aggregate
remaining
Weighted
Aggregate
remaining
average
intrinsic
contractual
average
intrinsic
contractual
Shares
exercise price
value
term (years)
Shares
exercise price
value
term (years)
(in thousands)
(in thousands)
$
6.10
$
84,741
5.0
312,202
$
11.54
$
934
9.1
11.
Acquisitions
F-32
Table of Contents
Notes to consolidated financial
statements(continued)
F-33
Table of Contents
Notes to consolidated financial
statements(continued)
F-34
Table of Contents
Notes to consolidated financial
statements(continued)
F-35
Table of Contents
Notes to consolidated financial
statements(continued)
TheNext
Micro
Tradeware
Round
MAXIMIS
Evare
Design
Northport
$
1,795
$
1,155
$
143
$
1,090
$
1,216
$
708
1,212
3,362
928
2,700
3,200
1,485
2,300
300
200
110
150
155
8,300
4,800
5,420
1,720
5,370
1,500
100
15,727
13,075
821
500
8,790
3,303
(2
)
(3,172
)
(965
)
(28
)
(114
)
(350
)
(3,344
)
(4,259
)
(3,999
)
(108
)
(810
)
(18
)
(31
)
$
22,429
$
18,721
$
6,906
$
3,550
$
17,699
$
5,130
2009
2008
$
300,269
$
331,161
23,913
27,208
12.
Related party
transactions
F-36
Table of Contents
Notes to consolidated financial
statements(continued)
13.
Commitments and
contingencies
14.
Product and
geographic sales information
F-37
Table of Contents
Notes to consolidated financial
statements(continued)
2009
2008
2007
$
172,323
$
169,749
$
147,104
41,708
44,112
40,892
7,393
4,448
4,672
42,152
53,860
49,612
7,339
7,837
5,888
$
270,915
$
280,006
$
248,168
2009
2008
$
18,146
$
20,107
4,906
5,132
100
141
460
300
650
444
$
24,262
$
26,124
2009
2008
2007
$
222,208
$
225,567
$
193,858
22,952
27,664
28,100
8,475
8,685
8,919
4,608
5,189
5,120
5,343
5,874
5,514
4,514
4,032
4,498
2,815
2,995
2,159
$
270,915
$
280,006
$
248,168
F-38
Table of Contents
Notes to consolidated financial
statements(continued)
15.
Selected
quarterly financial data (unaudited)
First
Second
Third
Fourth
(in thousands)
quarter
quarter
quarter
quarter
$
63,722
$
67,251
$
68,897
$
71,045
30,650
32,730
34,096
35,699
14,473
15,835
17,663
19,132
3,898
3,491
5,607
6,022
First
Second
Third
Fourth
(In thousands)
quarter
quarter
quarter
quarter
$
68,523
$
72,195
$
71,001
$
68,287
33,600
35,779
35,029
33,165
15,822
17,276
15,579
16,406
3,736
3,786
4,810
6,469
16.
Subsequent
events
the conversion of the outstanding superior options granted under
the 2006 equity incentive plan into performance-based options
that vest based on EBITDA performance in 2010 and 2011, which
affects 1,680,868 outstanding options;
the elimination of pre-determined EBITDA ranges from the option
agreements and provision for the annual proposal of EBITDA
ranges by management, subject to approval by the
F-39
Table of Contents
Notes to consolidated financial
statements(continued)
the rolling over of performance-based options that
do not vest (in whole or in part) in any given year into
performance-based options for the following year, except as
otherwise provided by the Companys board of directors,
which affects 689,007 unvested performance-based options
outstanding, and would affect 1,680,868 outstanding superior
options, of which 701,497 are held by the Companys named
executive officers, that will be converted to performance-based
options upon the closing of this offering.
17.
Subsequent
events
F-40
Table of Contents
SS&C Technologies Holdings, Inc.
Parent company balance sheets
F-41
Table of Contents
Parent company statements of operations
Year ended December 31,
(in thousands)
2009
2008
2007
$
$
$
19,018
18,801
6,575
$
19,018
$
18,801
$
6,575
F-42
Table of Contents
Parent company statements of cash flows
Year ended December 31,
(in thousands)
2009
2008
2007
$
19,018
$
18,801
$
6,575
(19,018
)
(18,801
)
(6,575
)
$
$
$
$
$
$
$
$
$
$
$
$
F-43
Table of Contents
Parent company statements of changes in stockholders
equity
For the years ended December 31, 2007, 2008 and
2009
Accumulated
Number
Additional
Other
Total
Total
of Issued
Paid-in
Retained
Comprehensive
Treasury
Stockholders
Comprehensive
(in thousands)
Shares
Amount
Capital
Earnings
Income (loss)
Stock
Equity
Income (Loss)
60,252
$
603
$
558,992
$
1,906
$
1,699
$
(68
)
$
563,132
6,575
6,575
$
6,575
34,490
34,490
34,490
(2,574
)
(2,574
)
(2,574
)
$
38,491
10,979
10,979
2
1
1
(10
)
(10
)
60,254
603
569,972
8,481
33,615
(78
)
612,593
18,801
18,801
$
18,801
(49,078
)
(49,078
)
(49,078
)
(2,427
)
(2,427
)
(2,427
)
$
(32,704
)
7,323
7,323
291
2
2,396
2,398
(2,357
)
(2,357
)
60,545
605
579,691
27,282
(17,890
)
(2,435
)
587,253
19,018
19,018
$
19,018
32,879
32,879
32,879
1,447
1,447
1,447
$
53,344
5,607
5,607
262
3
1,995
1,998
(2,215
)
(2,215
)
60,807
$
608
$
587,293
$
46,300
$
16,436
$
(4,650
)
$
645,987
F-44
Table of Contents
Notes to parent company financial statements
1.
Background and
basis of presentation
2.
Debt
3.
Commitments and
contingencies
F-45
Table of Contents
Table of Contents
Information not required in prospectus
Item 13.
Other expenses of
issuance and distribution.
$
21,390
30,500
125,000
450,000
800,000
800,000
100,000
10,000
10,000
42,610
$
2,389,500
Item 14.
Indemnification
of directors and officers.
II-1
Table of Contents
II-2
Table of Contents
Item 15.
Recent sales of
unregistered securities.
(a)
Issuances of
capital stock.
(b)
Stock option
grants.
II-3
Table of Contents
Item 16.
Exhibits and
financial statement schedules.
Number
Description
1
.1**
Form of Underwriting Agreement
2
.1
Agreement and Plan of Merger, dated as of July 28, 2005, by
and among the Registrant, Sunshine Merger Corporation and
SS&C Technologies, Inc. is incorporated herein by reference
to Exhibit 2.1 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on July 28, 2005
(File No. 000-28430)
2
.2
Amendment No. 1 to Agreement and Plan of Merger, dated as
of August 25, 2005, by among the Registrant, Sunshine
Merger Corporation and SS&C Technologies, Inc. is
incorporated herein by reference to Exhibit 2.1 to
SS&C Technologies, Inc.s Current Report on
Form 8-K,
filed on August 30, 2005 (File
No. 000-28430)
2
.3
Asset Purchase Agreement, dated September 30, 2008, by and
among SS&C Technologies New Jersey, Inc., Micro Design
Services, LLC and, for the limited purposes stated therein,
Roman J. Szymansky and Xavier F. Gonzales is incorporated
herein by reference to Exhibit 2.1 to SS&C
Technologies, Inc.s Current Report on
Form 8-K,
filed on October 2, 2008 (File
No. 333-135139)
3
.1
Certificate of Incorporation of the Registrant, as amended
3
.2
Bylaws of the Registrant, as amended, are incorporated herein by
reference to Exhibit 3.2 to the Registrants
Registration Statement on
Form S-1,
as amended (File
No. 333-143719)
(the
Form S-1)
3
.3
Form of Restated Certificate of Incorporation of the Registrant
(to be effective upon the closing of this offering)
3
.4
Form of Amended and Restated Bylaws of the Registrant (to be
effective upon the closing of this offering)
II-4
Table of Contents
Number
Description
4
.1
Indenture, dated as of November 23, 2005, among Sunshine
Acquisition II, Inc., SS&C Technologies, Inc., the
Guarantors named on the signature pages thereto, and Wells Fargo
Bank, National Association, as Trustee, relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, including the form of
11
3
/
4
% Senior
Subordinated Note due 2013, is incorporated herein by reference
to Exhibit 4.1 to SS&C Technologies, Incs
Registration Statement on
Form S-4,
as amended (File
No. 333-135139)
(the
Form S-4)
4
.2
First Supplemental Indenture, dated as of April 27, 2006,
among Cogent Management Inc., SS&C Technologies, Inc.
and Wells Fargo Bank, National Association, as Trustee, relating
to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 4.2 to the
Form S-4
4
.3
Second Supplemental Indenture, dated as of September 1,
2009, among SS&C Technologies Connecticut, LLC, SS&C
Technologies, Inc. and Wells Fargo Bank, National Association,
as Trustee, relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 10.3 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on September 4, 2009 (File
No. 000-28430)
(the September 4, 2009
8-K)
4
.4
Third Supplemental Indenture, dated as of December 22,
2009, among TheNextRound, Inc., SS&C Technologies,
Inc. and Wells Fargo Bank, National Association, as Trustee,
relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 10.2 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on December 23, 2009 (File
No. 000-28430)
(the December 23, 2009
8-K)
4
.5
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by Financial Models Company Ltd.,
Financial Models Holdings Inc., SS&C
Fund Administration Services LLC, OMR Systems Corporation
and Open Information Systems, Inc. is incorporated herein by
reference to Exhibit 4.3 to the
Form S-4
4
.6
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by Cogent Management Inc. is
incorporated herein by reference to Exhibit 4.4 to the
Form S-4
4
.7
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by SS&C Technologies
Connecticut, LLC is incorporated herein by reference to
Exhibit 10.4 to the September 4, 2009
8-K
4
.8
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by TheNextRound, Inc. is
incorporated herein by reference to Exhibit 10.3 to the
December 23, 2009
8-K
4
.9
Registration Rights Agreement, dated as of November 23,
2005, among Sunshine Acquisition II, Inc., SS&C
Technologies, Inc. and the Guarantors named therein, as Issuers,
and Wachovia Capital Markets, LLC, J.P. Morgan Securities
Inc. and Banc of America Securities LLC, as Initial Purchasers,
is incorporated herein by reference to Exhibit 4.5 to the
Form S-4
4
.10
Purchase Agreement, dated as of November 17, 2005, between
Sunshine Acquisition II, Inc. and the Initial Purchasers named
in Schedule I thereto is incorporated herein by reference
to Exhibit 4.6 to the
Form S-4
4
.11
Joinder Agreement, dated as of November 23, 2005, executed
by SS&C Technologies, Inc., Financial Models Company Ltd.,
Financial Models Holdings Inc., SS&C
Fund Administration Services LLC, OMR Systems Corporation
and Open Information Systems, Inc. is incorporated herein by
reference to Exhibit 4.7 to the
Form S-4
Table of Contents
Number
Description
4
.12
Joinder Agreement, dated as of April 27, 2006, executed by
Cogent Management Inc. is incorporated herein by reference to
Exhibit 4.8 to the
Form S-4
4
.13
Joinder Agreement, dated as of September 1, 2009, executed by
SS&C Technologies Connecticut, LLC is incorporated herein
by reference to Exhibit 10.5 to the September 4, 2009
8-K
4
.14
Joinder Agreement, dated as of December 22, 2009, executed
by TheNextRound, Inc. is incorporated herein by reference to
Exhibit 10.4 to the December 23, 2009
8-K
4
.15
Specimen certificate evidencing shares of common stock is
incorporated herein by reference to Exhibit 4.9 to the
Form S-1
5
.1
Opinion of Wilmer Cutler Pickering Hale and Dorr LLP
10
.1
Credit Agreement, dated as of November 23, 2005, among
Sunshine Acquisition II, Inc., SS&C Technologies, Inc.,
SS&C Technologies Canada Corp., the several lenders from
time to time parties thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch,
as Canadian Administrative Agent, Wachovia Bank, National
Association, as Syndication Agent, and Bank of America, N.A., as
Documentation Agent, is incorporated herein by reference to
Exhibit 10.1 to the
Form S-4
10
.2
First Amendment, dated as of March 6, 2007, to the Credit
Agreement, dated as of November 23, 2005, among SS&C
Technologies, Inc., SS&C Technologies Canada Corp., as CDN
Borrower, the several banks and other financial institutions or
entities from time to time parties to the Credit Agreement as
lenders, Wachovia Bank, National Association, as Syndication
Agent, JPMorgan Chase Bank, N.A., as Administrative Agent and
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, is incorporated herein by reference to
Exhibit 10.1 to SS&C Technologies, Inc.s Current
Report on
Form 8-K,
filed on March 9, 2007 (File
No. 333-135139)
10
.3
Guarantee and Collateral Agreement, dated as of
November 23, 2005, made by the Registrant, Sunshine
Acquisition II, Inc., SS&C Technologies, Inc. and certain
of its subsidiaries in favor of JPMorgan Chase Bank, N.A., as
Administrative Agent, is incorporated herein by reference to
Exhibit 10.2 to the
Form S-4
10
.4
CDN Guarantee and Collateral Agreement, dated as of
November 23, 2005, made by SS&C Technologies Canada
Corp. and 3105198 Nova Scotia Company in favor of JPMorgan Chase
Bank, N.A., Toronto Branch, as Canadian Administrative Agent, is
incorporated herein by reference to Exhibit 10.3 to the
Form S-4
10
.5
Assumption Agreement, dated as of April 27, 2006, made by
Cogent Management Inc., in favor of JPMorgan Chase Bank, N.A.,
as Administrative Agent, is incorporated herein by reference to
Exhibit 10.4 to the
Form S-4
10
.6
Assumption Agreement, dated as of August 31, 2009, made by
SS&C Technologies Connecticut, LLC, in favor of JPMorgan
Chase Bank, N.A., as Administrative Agent, is incorporated
herein by reference to Exhibit 10.1 to the
September 4, 2009
8-K
10
.7
Assumption Agreement, dated as of December 22, 2009, made
by TheNextRound, Inc., in favor of JPMorgan Chase Bank, N.A., as
Administrative Agent, is incorporated herein by reference to
Exhibit 10.1 to the December 23, 2009
8-K
Table of Contents
Number
Description
10
.8
Acknowledgment and Confirmation Agreement, dated as of
August 31, 2009, among SS&C Technologies Canada Corp.,
JPMorgan Chase Bank, N.A. and JPMorgan Chase Bank, N.A., Toronto
Branch, is incorporated herein by reference to Exhibit 10.2
to the September 4, 2009
8-K
10
.9
Stockholders Agreement, dated as of November 23, 2005, by
and among the Registrant, Carlyle Partners IV, L.P., CP IV
Coinvestment, L.P., William C. Stone and Other Executive
Stockholders (as defined therein) is incorporated herein by
reference to Exhibit 10.5 to the
Form S-4
10
.10
Amendment No. 1, dated April 22, 2008, to the
Stockholders Agreement dated as of November 23, 2005, by
and among the Registrant, Carlyle Partners IV, L.P., CP IV
Coinvestment, L.P. and William C. Stone is incorporated herein
by reference to Exhibit 10.28 to the
Form S-1
10
.11
Amendment No. 2, dated March 2, 2010, to the
Stockholders Agreement dated as of November 23, 2005, as
amended by Amendment No. 1 to the Stockholders Agreement dated
April 22, 2008, by and among the Registrant, Carlyle
Partners IV, L.P., CP IV Coinvestment, L.P. and William C. Stone
is incorporated herein by reference to Exhibit 10.1 to
SS&C Technologies, Inc.s Current Report on Form 8-K,
filed on March 2, 2010 (File No. 000-28430) (the
March 2, 2010 8-K)
10
.12
Registration Rights Agreement, dated as of November 23,
2005, by and among the Registrant, Carlyle Partners IV, L.P., CP
IV Coinvestment, L.P., William C. Stone and Other Executive
Investors (as defined therein) is incorporated herein by
reference to Exhibit 10.6 to the
Form S-4
10
.13
Form of Service Provider Stockholders Agreement by and among the
Registrant, Carlyle Partners IV, L.P., CP IV Coinvestment, L.P.
and the Service Provider Stockholders (as defined therein) is
incorporated herein by reference to Exhibit 10.7 to the
Form S-4
10
.14
Amendment No. 1, dated April 22, 2008, to the Service
Provider Stockholders Agreement dated as of November 23,
2005, by and among the Registrant, Carlyle Partners IV, L.P. and
CP IV Coinvestment, L.P. is incorporated herein by reference to
Exhibit 10.29 to the
Form S-1
10
.15
Management Agreement, dated as of November 23, 2005,
between the Registrant, William C. Stone and TC Group, L.L.C. is
incorporated herein by reference to Exhibit 10.8 to the
Form S-4
10
.16
Amendment No. 1, dated April 22, 2008, to the
Management Agreement dated as of November 23, 2005, by and
among the Registrant, William C. Stone and TC Group, L.L.C. is
incorporated herein by reference to Exhibit 10.30 to the
Form S-1
10
.17
SS&C Technologies, Inc. Management Rights Agreement, dated
as of November 23, 2005, by and among Carlyle Partners IV,
L.P., CP IV Coinvestment, L.P., the Registrant and SS&C
Technologies, Inc. is incorporated herein by reference to
Exhibit 10.9 to the
Form S-4
10
.18
1998 Stock Incentive Plan, including form of stock option
agreement, is incorporated herein by reference to
Exhibit 10.10 to the
Form S-4
10
.19
1999 Non-Officer Employee Stock Incentive Plan, including form
of stock option agreement, is incorporated herein by reference
to Exhibit 10.11 to the
Form S-4
Table of Contents
Number
Description
10
.20
Form of Option Assumption Notice for 1998 Stock Incentive Plan
and 1999 Non-Officer Employee Stock Incentive Plan is
incorporated herein by reference to Exhibit 10.12 to the
Form S-4
10
.21
2006 Equity Incentive Plan is incorporated herein by reference
to Exhibit 10.1 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on August 15, 2006 (File
No. 333-135139)
(the August 15, 2006
8-K)
10
.22
Forms of 2006 Equity Incentive Plan Amended and Restated Stock
Option Grant Notice and Amended and Restated Stock Option
Agreement are incorporated herein by reference to Exhibit 10.2
to the March 2, 2010 8-K
10
.23
Form of Dividend Equivalent Agreement is incorporated herein by
reference to Exhibit 10.3 to the August 15, 2006
8-K
10
.24
Form of Stock Award Agreement is incorporated herein by
reference to Exhibit 10.4 to the August 15, 2006
8-K
10
.25
2008 Stock Incentive Plan is incorporated herein by reference to
Exhibit 10.26 to the
Form S-1
10
.26
Form of 2008 Stock Incentive Plan Stock Option Grant Notice and
Stock Option Agreement
10
.27
Employment Agreement, dated as of March 11, 2010, by and
among William C. Stone, the Registrant and SS&C
Technologies, Inc.
10
.28
Lease Agreement, dated September 23, 1997, by and between
SS&C Technologies, Inc. and Monarch Life Insurance Company,
as amended by First Amendment to Lease dated as of
November 18, 1997, is incorporated herein by reference to
Exhibit 10.15 to SS&C Technologies, Inc.s Annual
Report on
Form 10-K
for the year ended December 31, 1997 (File
No. 000-28430)
10
.29
Second Amendment to Lease, dated as of April 1999, between
SS&C Technologies, Inc. and New Boston Lamberton Limited
Partnership is incorporated herein by reference to
Exhibit 10.12 to SS&C Technologies, Inc.s Annual
Report on
Form 10-K
for the year ended December 31, 2004 (File
No. 000-28430)
(the 2004
10-K)
10
.30
Third Amendment to Lease, effective as of July 1, 1999,
between SS&C Technologies, Inc. and New Boston Lamberton
Limited Partnership is incorporated herein by reference to
Exhibit 10.13 to the 2004
10-K
10
.31
Fourth Amendment to Lease, effective as of June 7, 2005,
between SS&C Technologies, Inc. and New Boston Lamberton
Limited Partnership, is incorporated herein by reference to
Exhibit 10.5 to SS&C Technologies, Inc.s
Quarterly Report on
Form 10-Q
for the quarterly period ended June 30, 2005 (File
No. 000-28430)
(the Q2 2005
10-Q)
10
.32
Fifth Amendment to Lease, dated as of November 1, 2006, by
and between SS&C Technologies, Inc. and New Boston
Lamberton Limited Partnership is incorporated herein by
reference to Exhibit 10.25 to the
Form S-1
10
.33
Lease Agreement, dated January 6, 1998, by and between
Financial Models Company Inc. and Polaris Realty (Canada)
Limited, as amended by First Amendment of Lease, dated as of
June 24, 1998, and as amended by Second Lease Amending
Agreement, dated as of November 13, 1998, is incorporated
herein by reference to Exhibit 10.6 to the Q2 2005
10-Q
Table of Contents
Number
Description
10
.34
Amended and Restated Stock Option Agreement, dated
February 16, 2010, between the Registrant and William C.
Stone is incorporated herein by reference to Exhibit 10.33
to SS&C Technologies, Inc.s Annual Report on Form
10-K, filed on February 26, 2010 (File No. 000-28430)
10
.35
Form of Director Indemnification Agreement
21
**
Subsidiaries of the Registrant
23
.1
Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included
in Exhibit 5.1)
23
.2
Consent of PricewaterhouseCoopers LLP
24
**
Powers of Attorney (included in the signature pages to this
registration statement)
99
.1**
Consent of Jonathan E. Michael
*
To be filed by amendment.
**
Previously filed.
The Registrant hereby agrees to
furnish supplementally a copy of any omitted schedules to this
agreement to the Securities and Exchange Commission upon its
request.
Table of Contents
Item 17.
Undertakings.
II-10
Table of Contents
II-11
Table of Contents
By:
Chairman of the Board and
Chief Executive Officer
(Principal Executive Officer)
March 12, 2010
Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
By:
Attorney-in-fact
II-12
Table of Contents
Number
Description
1
.1**
Form of Underwriting Agreement
2
.1
Agreement and Plan of Merger, dated as of July 28, 2005, by
and among the Registrant, Sunshine Merger Corporation and
SS&C Technologies, Inc. is incorporated herein by reference
to Exhibit 2.1 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on July 28, 2005 (File
No. 000-28430)
2
.2
Amendment No. 1 to Agreement and Plan of Merger, dated as
of August 25, 2005, by among the Registrant, Sunshine
Merger Corporation and SS&C Technologies, Inc. is
incorporated herein by reference to Exhibit 2.1 to
SS&C Technologies, Inc.s Current Report on
Form 8-K,
filed on August 30, 2005 (File
No. 000-28430)
2
.3
Asset Purchase Agreement, dated September 30, 2008, by and
among SS&C Technologies New Jersey, Inc., Micro Design
Services, LLC and, for the limited purposes stated therein,
Roman J. Szymansky and Xavier F. Gonzales is incorporated
herein by reference to Exhibit 2.1 to SS&C
Technologies, Inc.s Current Report on
Form 8-K,
filed on October 2, 2008 (File
No. 333-135139)
3
.1
Certificate of Incorporation of the Registrant, as amended
3
.2
Bylaws of the Registrant, as amended, are incorporated herein by
reference to Exhibit 3.2 to the Registrants
Registration Statement on
Form S-1,
as amended (File
No. 333-143719)
(the
Form S-1)
3
.3
Form of Restated Certificate of Incorporation of the Registrant
(to be effective upon the closing of this offering)
3
.4
Form of Amended and Restated Bylaws of the Registrant (to be
effective upon the closing of this offering)
4
.1
Indenture, dated as of November 23, 2005, among Sunshine
Acquisition II, Inc., SS&C Technologies, Inc., the
Guarantors named on the signature pages thereto, and Wells Fargo
Bank, National Association, as Trustee, relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, including the form of
11
3
/
4
% Senior
Subordinated Note due 2013, is incorporated herein by reference
to Exhibit 4.1 to SS&C Technologies, Incs
Registration Statement on
Form S-4,
as amended (File
No. 333-135139)
(the
Form S-4)
4
.2
First Supplemental Indenture, dated as of April 27, 2006,
among Cogent Management Inc., SS&C Technologies, Inc.
and Wells Fargo Bank, National Association, as Trustee, relating
to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 4.2 to the
Form S-4
4
.3
Second Supplemental Indenture, dated as of September 1,
2009, among SS&C Technologies Connecticut, LLC, SS&C
Technologies, Inc. and Wells Fargo Bank, National Association,
as Trustee, relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 10.3 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on September 4, 2009 (File
No. 000-28430)
(the September 4, 2009
8-K)
Table of Contents
Number
Description
4
.4
Third Supplemental Indenture, dated as of December 22,
2009, among TheNextRound, Inc., SS&C Technologies,
Inc. and Wells Fargo Bank, National Association, as Trustee,
relating to the
11
3
/
4
% Senior
Subordinated Notes due 2013, is incorporated herein by reference
to Exhibit 10.2 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on December 23, 2009 (File
No. 000-28430)
(the December 23, 2009
8-K)
4
.5
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by Financial Models Company Ltd.,
Financial Models Holdings Inc., SS&C
Fund Administration Services LLC, OMR Systems Corporation
and Open Information Systems, Inc. is incorporated herein by
reference to Exhibit 4.3 to the
Form S-4
4
.6
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by Cogent Management Inc. is
incorporated herein by reference to Exhibit 4.4 to the
Form S-4
4
.7
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by SS&C Technologies
Connecticut, LLC is incorporated herein by reference to
Exhibit 10.4 to the September 4, 2009
8-K
4
.8
Guarantee of
11
3
/
4
% Senior
Subordinated Notes due 2013 by TheNextRound, Inc. is
incorporated herein by reference to Exhibit 10.3 to the
December 23, 2009
8-K
4
.9
Registration Rights Agreement, dated as of November 23,
2005, among Sunshine Acquisition II, Inc., SS&C
Technologies, Inc. and the Guarantors named therein, as Issuers,
and Wachovia Capital Markets, LLC, J.P. Morgan Securities
Inc. and Banc of America Securities LLC, as Initial Purchasers,
is incorporated herein by reference to Exhibit 4.5 to the
Form S-4
4
.10
Purchase Agreement, dated as of November 17, 2005, between
Sunshine Acquisition II, Inc. and the Initial Purchasers named
in Schedule I thereto is incorporated herein by reference
to Exhibit 4.6 to the
Form S-4
4
.11
Joinder Agreement, dated as of November 23, 2005, executed
by SS&C Technologies, Inc., Financial Models Company Ltd.,
Financial Models Holdings Inc., SS&C
Fund Administration Services LLC, OMR Systems Corporation
and Open Information Systems, Inc. is incorporated herein by
reference to Exhibit 4.7 to the
Form S-4
4
.12
Joinder Agreement, dated as of April 27, 2006, executed by
Cogent Management Inc. is incorporated herein by reference to
Exhibit 4.8 to the
Form S-4
4
.13
Joinder Agreement, dated as of September 1, 2009, executed by
SS&C Technologies Connecticut, LLC is incorporated herein
by reference to Exhibit 10.5 to the September 4, 2009
8-K
4
.14
Joinder Agreement, dated as of December 22, 2009, executed
by TheNextRound, Inc. is incorporated herein by reference to
Exhibit 10.4 to the December 23, 2009
8-K
4
.15
Specimen certificate evidencing shares of common stock is
incorporated herein by reference to Exhibit 4.9 to the
Form S-1
5
.1
Opinion of Wilmer Cutler Pickering Hale and Dorr LLP
Table of Contents
Number
Description
10
.1
Credit Agreement, dated as of November 23, 2005, among
Sunshine Acquisition II, Inc., SS&C Technologies, Inc.,
SS&C Technologies Canada Corp., the several lenders from
time to time parties thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, JPMorgan Chase Bank, N.A., Toronto Branch,
as Canadian Administrative Agent, Wachovia Bank, National
Association, as Syndication Agent, and Bank of America, N.A., as
Documentation Agent, is incorporated herein by reference to
Exhibit 10.1 to the
Form S-4
10
.2
First Amendment, dated as of March 6, 2007, to the Credit
Agreement, dated as of November 23, 2005, among SS&C
Technologies, Inc., SS&C Technologies Canada Corp., as CDN
Borrower, the several banks and other financial institutions or
entities from time to time parties to the Credit Agreement as
lenders, Wachovia Bank, National Association, as Syndication
Agent, JPMorgan Chase Bank, N.A., as Administrative Agent and
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian
Administrative Agent, is incorporated herein by reference to
Exhibit 10.1 to SS&C Technologies, Inc.s Current
Report on
Form 8-K,
filed on March 9, 2007 (File
No. 333-135139)
10
.3
Guarantee and Collateral Agreement, dated as of
November 23, 2005, made by the Registrant, Sunshine
Acquisition II, Inc., SS&C Technologies, Inc. and certain
of its subsidiaries in favor of JPMorgan Chase Bank, N.A., as
Administrative Agent, is incorporated herein by reference to
Exhibit 10.2 to the
Form S-4
10
.4
CDN Guarantee and Collateral Agreement, dated as of
November 23, 2005, made by SS&C Technologies Canada
Corp. and 3105198 Nova Scotia Company in favor of JPMorgan Chase
Bank, N.A., Toronto Branch, as Canadian Administrative Agent, is
incorporated herein by reference to Exhibit 10.3 to the
Form S-4
10
.5
Assumption Agreement, dated as of April 27, 2006, made by
Cogent Management Inc., in favor of JPMorgan Chase Bank, N.A.,
as Administrative Agent, is incorporated herein by reference to
Exhibit 10.4 to the
Form S-4
10
.6
Assumption Agreement, dated as of August 31, 2009, made by
SS&C Technologies Connecticut, LLC, in favor of JPMorgan
Chase Bank, N.A., as Administrative Agent, is incorporated
herein by reference to Exhibit 10.1 to the
September 4, 2009
8-K
10
.7
Assumption Agreement, dated as of December 22, 2009, made
by TheNextRound, Inc., in favor of JPMorgan Chase Bank, N.A., as
Administrative Agent, is incorporated herein by reference to
Exhibit 10.1 to the December 23, 2009
8-K
10
.8
Acknowledgment and Confirmation Agreement, dated as of
August 31, 2009, among SS&C Technologies Canada Corp.,
JPMorgan Chase Bank, N.A. and JPMorgan Chase Bank, N.A.,
Toronto Branch, is incorporated herein by reference to
Exhibit 10.2 to the September 4, 2009
8-K
10
.9
Stockholders Agreement, dated as of November 23, 2005, by
and among the Registrant, Carlyle Partners IV, L.P., CP IV
Coinvestment, L.P., William C. Stone and Other Executive
Stockholders (as defined therein) is incorporated herein by
reference to Exhibit 10.5 to the
Form S-4
Table of Contents
Number
Description
10
.10
Amendment No. 1, dated April 22, 2008, to the
Stockholders Agreement dated as of November 23, 2005, by
and among the Registrant, Carlyle Partners IV, L.P., CP IV
Coinvestment, L.P. and William C. Stone is incorporated herein
by reference to Exhibit 10.28 to the
Form S-1
10
.11
Amendment No. 2, dated March 2, 2010, to the
Stockholders Agreement dated as of November 23, 2005, as
amended by Amendment No. 1 to the Stockholders Agreement
dated April 22, 2008, by and among the Registrant, Carlyle
Partners IV, L.P., CP IV Coinvestment, L.P. and William C. Stone
is incorporated herein by reference to Exhibit 10.1 to
SS&C Technologies, Inc.s Current Report on Form 8-K,
filed on March 2, 2010 (File No.
000-28430)
(the March 2, 2010 8-K)
10
.12
Registration Rights Agreement, dated as of November 23,
2005, by and among the Registrant, Carlyle Partners IV, L.P., CP
IV Coinvestment, L.P., William C. Stone and Other Executive
Investors (as defined therein) is incorporated herein by
reference to Exhibit 10.6 to the
Form S-4
10
.13
Form of Service Provider Stockholders Agreement by and among the
Registrant, Carlyle Partners IV, L.P., CP IV Coinvestment, L.P.
and the Service Provider Stockholders (as defined therein) is
incorporated herein by reference to Exhibit 10.7 to the
Form S-4
10
.14
Amendment No. 1, dated April 22, 2008, to the Service
Provider Stockholders Agreement dated as of November 23,
2005, by and among the Registrant, Carlyle Partners IV, L.P. and
CP IV Coinvestment, L.P. is incorporated herein by reference to
Exhibit 10.29 to the
Form S-1
10
.15
Management Agreement, dated as of November 23, 2005,
between the Registrant, William C. Stone and TC Group, L.L.C. is
incorporated herein by reference to Exhibit 10.8 to the
Form S-4
10
.16
Amendment No. 1, dated April 22, 2008, to the
Management Agreement dated as of November 23, 2005, by and
among the Registrant, William C. Stone and TC Group, L.L.C. is
incorporated herein by reference to Exhibit 10.30 to the
Form S-1
10
.17
SS&C Technologies, Inc. Management Rights Agreement, dated
as of November 23, 2005, by and among Carlyle Partners IV,
L.P., CP IV Coinvestment, L.P., the Registrant and SS&C
Technologies, Inc. is incorporated herein by reference to
Exhibit 10.9 to the
Form S-4
10
.18
1998 Stock Incentive Plan, including form of stock option
agreement, is incorporated herein by reference to
Exhibit 10.10 to the
Form S-4
10
.19
1999 Non-Officer Employee Stock Incentive Plan, including form
of stock option agreement, is incorporated herein by reference
to Exhibit 10.11 to the
Form S-4
10
.20
Form of Option Assumption Notice for 1998 Stock Incentive Plan
and 1999 Non-Officer Employee Stock Incentive Plan is
incorporated herein by reference to Exhibit 10.12 to the
Form S-4
10
.21
2006 Equity Incentive Plan is incorporated herein by reference
to Exhibit 10.1 to SS&C Technologies, Inc.s
Current Report on
Form 8-K,
filed on August 15, 2006 (File
No. 333-135139)
(the August 15, 2006
8-K)
Table of Contents
Number
Description
10
.22
Forms of 2006 Equity Incentive Plan Amended and Restated Stock
Option Grant Notice and Amended and Restated Stock Option
Agreement are incorporated herein by reference to Exhibit 10.2
to the March 2, 2010 8-K
10
.23
Form of Dividend Equivalent Agreement is incorporated herein by
reference to Exhibit 10.3 to the August 15, 2006
8-K
10
.24
Form of Stock Award Agreement is incorporated herein by
reference to Exhibit 10.4 to the August 15, 2006
8-K
10
.25
2008 Stock Incentive Plan is incorporated herein by reference to
Exhibit 10.26 to the
Form S-1
10
.26
Form of 2008 Stock Incentive Plan Stock Option Grant Notice and
Stock Option Agreement
10
.27
Employment Agreement, dated as of March 11, 2010, by and
among William C. Stone, the Registrant and SS&C
Technologies, Inc.
10
.28
Lease Agreement, dated September 23, 1997, by and between
SS&C Technologies, Inc. and Monarch Life Insurance Company,
as amended by First Amendment to Lease dated as of
November 18, 1997, is incorporated herein by reference to
Exhibit 10.15 to SS&C Technologies, Inc.s Annual
Report on
Form 10-K
for the year ended December 31, 1997 (File
No. 000-28430)
10
.29
Second Amendment to Lease, dated as of April 1999, between
SS&C Technologies, Inc. and New Boston Lamberton Limited
Partnership is incorporated herein by reference to
Exhibit 10.12 to SS&C Technologies, Inc.s Annual
Report on
Form 10-K
for the year ended December 31, 2004 (File
No. 000-28430)
(the 2004
10-K)
10
.30
Third Amendment to Lease, effective as of July 1, 1999,
between SS&C Technologies, Inc. and New Boston Lamberton
Limited Partnership is incorporated herein by reference to
Exhibit 10.13 to the 2004
10-K
10
.31
Fourth Amendment to Lease, effective as of June 7, 2005,
between SS&C Technologies, Inc. and New Boston Lamberton
Limited Partnership, is incorporated herein by reference to
Exhibit 10.5 to SS&C Technologies, Inc.s
Quarterly Report on
Form 10-Q
for the quarterly period ended June 30, 2005 (File
No. 000-28430)
(the Q2 2005
10-Q)
10
.32
Fifth Amendment to Lease, dated as of November 1, 2006, by
and between SS&C Technologies, Inc. and New Boston
Lamberton Limited Partnership is incorporated herein by
reference to Exhibit 10.25 to the
Form S-1
10
.33
Lease Agreement, dated January 6, 1998, by and between
Financial Models Company Inc. and Polaris Realty (Canada)
Limited, as amended by First Amendment of Lease, dated as of
June 24, 1998, and as amended by Second Lease Amending
Agreement, dated as of November 13, 1998, is incorporated
herein by reference to Exhibit 10.6 to the Q2 2005
10-Q
10
.34
Amended and Restated Stock Option Agreement, dated
February 10, 2010, between the Registrant and William C.
Stone is incorporated herein by reference to Exhibit 10.33
to SS&C Technologies, Inc.s Annual Report on Form
10-K, filed on February 26, 2010 (File No. 000-28430)
10
.35
Form of Director Indemnification Agreement
Table of Contents
Number
Description
21
**
Subsidiaries of the Registrant
23
.1
Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included
in Exhibit 5.1)
23
.2
Consent of PricewaterhouseCoopers LLP
24
**
Powers of Attorney (included in the signature pages to this
registration statement)
99
.1**
Consent of Jonathan E. Michael
*
To be filed by amendment.
**
Previously filed.
The Registrant hereby agrees to
furnish supplementally a copy of any omitted schedules to this
agreement to the Securities and Exchange Commission upon its
request.
2
3
/s/ Eleanor Romanelli | ||||
Eleanor Romanelli | ||||
Incorporator |
4
/s/ Claudius E. Watts IV | ||||
Name: | Claudius E. Watts IV | |||
Title: | President |
/s/ Claudius E. Watts IV | ||||
Name: | Claudius E. Watts IV | |||
Title: | President |
/s/ William C. Stone | ||||
Name: | William C. Stone | |||
Title: | Chairman of the Board and Chief Executive Officer |
/s/ William C. Stone | ||||
Name: | William C. Stone | |||
Title: | Chairman of the Board and Chief Executive Officer | |||
FOURTH. That, effective on the filing of this Certificate of Amendment of Certificate of Incorporation (the Effective Time), a one-for-seven and one half reverse stock split of the Corporations Common Stock shall become effective, pursuant to which each seven and one half shares of Common Stock outstanding and held of record by each stockholder of the Corporation (including treasury shares) immediately prior to the Effective Time shall be reclassified and combined into one share of Common Stock automatically and without any action by the holder thereof upon the Effective Time and shall represent one share of Common Stock from and after the Effective Time (such reclassification and combination of shares designated as the Reverse Stock Split). No fractional shares of Common Stock shall be issued as a result of the Reverse Stock Split. In lieu of any fractional shares to which the stockholder would otherwise be entitled, the Corporation shall pay cash equal to such fraction multiplied by the then fair market value of the Common Stock as determined by the Board of Directors of the Corporation. |
Each stock certificate that, immediately prior to the Effective Time, represented shares of Common Stock that were issued and outstanding immediately prior to the Effective Time shall, from and after the Effective Time, automatically and without the necessity of presenting the same for exchange, represent that number of whole shares of Common Stock after the Effective Time into which the shares formerly represented by such certificate have |
been reclassified (as well as the right to receive cash in lieu of fractional shares of Common Stock after the Effective Time); provided, however, that each person of record holding a certificate that represented shares of Common Stock that were issued and outstanding immediately prior to the Effective Time shall receive, upon surrender of such certificate, a new certificate evidencing and representing the number of whole shares of Common Stock after the Effective Time into which the shares of Common Stock formerly represented by such certificate shall have been reclassified. |
The aggregate number of all classes of shares which the Corporation shall have the authority to issue is ten million (10,000,000) having a par value of $0.01 per share. All such shares are Common Stock. |
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/s/ William C. Stone | ||||
Name: | William C. Stone | |||
Title: | Chairman of the Board and Chief Executive Officer | |||
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FOURTH. The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 10,500,000, consisting of (i) 10,000,000 shares of Common Stock, $0.01 par value per share (Common Stock), and (ii) 500,000 shares of Class A Non-Voting Common Stock, $0.01 par value per share (the Class A Common Stock). | ||||
FIFTH. Except as set forth in this Article FIFTH, the Common Stock and the Class A Common Stock shall have the same rights, preferences, privileges and restrictions and shall rank equally, share ratably and be identical in all respects as to all matters. The rights, preferences, privileges and restrictions granted or imposed upon each class of capital stock of the Corporation are as follows: | ||||
1. Dividends . The holders of Common Stock and Class A Common Stock shall be entitled to the payment of dividends when and as declared by the Board out of funds legally available therefore and to receive other distributions from the Corporation, including distributions of contributed capital, when and as declared by the Board. Any dividends declared by the Board to the holders of the then outstanding shares of Common Stock or Class A Common Stock, as applicable, shall be paid to the holders thereof pro rata in accordance with the number of shares of Common Stock or Class A Common Stock, as applicable, held by each such holder as of the record date of such dividend. The Common Stock shall not be changed into a different number of shares of Common Stock or the same or different number of shares of any class or classes of stock, whether by capital reorganization, reclassification, recapitalization, stock dividend or otherwise, unless there is a simultaneous and proportionate change to the outstanding shares of Class A Common Stock. The Class A Common Stock shall not be changed into a different number of shares of Class A Common Stock or |
the same or different number of shares of any class or classes of stock, whether by capital reorganization, reclassification, recapitalization, stock dividend or otherwise, unless there is a simultaneous and proportionate change to the outstanding shares of Common Stock. | ||||
2. Liquidation, Dissolution or Winding Up . Subject to the rights of any holders of any class of preferred stock which may from time-to-time come into existence and which are then outstanding, in the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the funds and assets of the Corporation that may be legally distributed to the Corporations shareholders shall be distributed among the holders of the then outstanding shares of Common Stock and Class A Common Stock, pro rata based on the number of shares held by each such holder, treating for this purpose all shares of Class A Common Stock as if they had been converted to Common Stock pursuant to the terms of the Certificate of Incorporation immediately prior to such dissolution, liquidation or winding up of the Corporation. |
3. Voting . Each holder of Common Stock shall be entitled to one (1) vote for each share of Common Stock held by such holder. Each holder of Common Stock shall be entitled to notice of any stockholders meeting in accordance with the bylaws of the Corporation (as in effect at the time in question) and applicable law, on all matters put to a vote of the stockholders of the Corporation. The Class A Common Stock shall not be entitled to vote except as otherwise specifically required by law. |
4. Automatic Conversion of Class A Common Stock . Each share of Class A Common Stock shall automatically be converted into one share of Common Stock upon (i) the expiration, with respect to a holder of Class A Common Stock, of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act) such that such holder could acquire shares of Common Stock issuable upon conversion of such holders shares of Class A Common Stock in compliance with the HSR Act, (ii) any other event, the occurrence of which results in the ability of a holder of Class A Common Stock to acquire the shares of Common Stock issuable upon conversion of the Class A Common Stock pursuant to this Section 4 in compliance with the HSR Act or (iii) the Sale (as defined below) of such share of Class A Common Stock. A Sale shall mean any sale, assignment, transfer or other disposition, by operation of law or otherwise, of a share of Class A Common Stock, or any interest therein, to a person or entity (x) that would not be required to make a filing under the HSR Act to acquire an equal number of shares of Common Stock or (y) for which the waiting period under the HSR Act applicable to such person acquiring an equal number of shares of Common Stock has expired. |
5. Mechanics of Conversion . In the event of an automatic conversion pursuant to Section 4 above, the outstanding shares of Class A Common Stock shall be converted automatically without any further action by the holder of such shares and whether or not the certificates representing such shares are surrendered to the Corporation or its transfer agent; provided , that the Corporation shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such automatic conversion unless either the certificates evidencing such shares of Class A Common Stock are surrendered, duly endorsed, to the Corporation or its transfer agent with |
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written notice that such shares have been converted, or the holder notifies the Corporation or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation (but shall not be required to provide a bond) to indemnify the Corporation from any loss incurred by it in connection with such certificates. |
No fractional shares of Common Stock shall be issued upon conversion of the Class A Common Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of a share of Common Stock as determined in good faith by the Board. Any shares of Class A Common Stock that are converted to Common Stock shall be retired and cancelled and may not be reissued as shares of Class A Common Stock, and the Corporation may thereafter take such appropriate action (without the need for stockholder action) as may be necessary to reduce the authorized number of shares of Class A Common Stock accordingly. |
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/s/ William C. Stone | ||||
Name: | William C. Stone | |||
Title: | Chairman of the Board and Chief Executive Officer | |||
FOURTH. The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 105,000,000, consisting of (i) 100,000,000 shares of Common Stock, $0.01 par value per share (Common Stock), and (ii) 5,000,000 shares of Class A Non-Voting Common Stock, $0.01 par value per share (the Class A Common Stock). |
/s/ William C. Stone | ||||
Name: | William C. Stone | |||
Title: | Chairman of the Board and Chief Executive Officer | |||
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SS&C TECHNOLOGIES HOLDINGS, INC.
|
||||
By: | ||||
William C. Stone | ||||
Chairman of the Board and Chief Executive Officer | ||||
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Page | ||||
ARTICLE I
|
||||
STOCKHOLDERS
|
||||
1.1 Place of Meetings
|
1 | |||
1.2 Annual Meeting
|
1 | |||
1.3 Special Meetings
|
1 | |||
1.4 Notice of Meetings
|
1 | |||
1.5 Voting List
|
1 | |||
1.6 Quorum
|
2 | |||
1.7 Adjournments
|
2 | |||
1.8 Voting and Proxies
|
2 | |||
1.9 Action at Meeting
|
2 | |||
1.10 Nomination of Directors
|
3 | |||
1.11 Notice of Business at Annual Meetings
|
5 | |||
1.12 Conduct of Meetings
|
7 | |||
1.13 Stockholder Action by Written Consent
|
8 | |||
|
||||
ARTICLE II
|
||||
DIRECTORS
|
||||
2.1 General Powers
|
9 | |||
2.2 Number, Election and Qualification
|
9 | |||
2.3 Chairman of the Board; Vice Chairman of the Board
|
9 | |||
2.4 Classes of Directors
|
10 | |||
2.5 Terms of Office
|
10 | |||
2.6 Quorum
|
10 | |||
2.7 Action at Meeting
|
10 | |||
2.8 Removal
|
10 | |||
2.9 Vacancies
|
10 | |||
2.10 Resignation
|
11 | |||
2.11 Regular Meetings
|
11 | |||
2.12 Special Meetings
|
11 | |||
2.13 Notice of Special Meetings
|
11 | |||
2.14 Meetings by Conference Communications Equipment
|
11 | |||
2.15 Action by Consent
|
11 | |||
2.16 Committees
|
12 | |||
2.17 Compensation of Directors
|
12 | |||
|
||||
ARTICLE III
|
||||
OFFICERS
|
||||
3.1 Titles
|
12 | |||
3.2 Election
|
12 |
i
Page | ||||
3.3 Qualification
|
12 | |||
3.4 Tenure
|
13 | |||
3.5 Resignation and Removal
|
13 | |||
3.6 Vacancies
|
13 | |||
3.7 President; Chief Executive Officer
|
13 | |||
3.8 Vice Presidents
|
13 | |||
3.9 Secretary and Assistant Secretaries
|
13 | |||
3.10 Treasurer and Assistant Treasurers
|
14 | |||
3.11 Salaries
|
14 | |||
3.12 Delegation of Authority
|
14 | |||
|
||||
ARTICLE IV
|
||||
CAPITAL STOCK
|
||||
4.1 Issuance of Stock
|
14 | |||
4.2 Stock Certificates; Uncertificated Shares
|
15 | |||
4.3 Transfers
|
15 | |||
4.4 Lost, Stolen or Destroyed Certificates
|
16 | |||
4.5 Record Date
|
16 | |||
4.6 Regulations
|
16 | |||
|
||||
ARTICLE V
|
||||
GENERAL PROVISIONS
|
||||
5.1 Fiscal Year
|
16 | |||
5.2 Corporate Seal
|
17 | |||
5.3 Waiver of Notice
|
17 | |||
5.4 Voting of Securities
|
17 | |||
5.5 Evidence of Authority
|
17 | |||
5.6 Certificate of Incorporation
|
17 | |||
5.7 Severability
|
17 | |||
5.8 Pronouns
|
17 | |||
|
||||
ARTICLE VI
|
||||
AMENDMENTS
|
17 |
ii
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
By:
|
/s/ James R. Burke | |||
|
||||
|
James R. Burke, a Partner |
Vesting Schedule:
|
This option will vest and become exercisable in accordance with the vesting schedule set forth in Section 2 of the Stock Option Agreement. |
SS&C TECHNOLOGIES HOLDINGS, INC. | |||
|
|||
By
|
|||
|
|||
|
Title: |
1. | Grant of Option . |
2. | Vesting Schedule . |
3. | Exercise of Option . |
1 | Non-employee directors who are not affiliated with The Carlyle Group will receive options that are fully vested as of the grant date. |
(c) | Expiration of Option . |
4. | Tax Matters . |
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5. | Nontransferability of Option . |
6. | Provisions of the Plan and Stockholders Agreement . |
7. | Definitions . |
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SS&C TECHNOLOGIES HOLDINGS, INC.
|
||||
By: | /s/ Normand A. Boulanger | |||
Its: | President and COO | |||
SS&C TECHNOLOGIES, INC.
|
||||
By: | /s/ Normand A. Boulanger | |||
Its: | President and COO | |||
WILLIAM C. STONE | ||||
/s/ William C. Stone | ||||
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1 | Bracketed provisions throughout agreement are applicable only to the three Carlyle directors. |
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2 | Applicable only to the three Carlyle directors. |
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