EXHIBIT 1.01
3,498,700 Shares
CSG SYSTEMS INTERNATIONAL, INC.
COMMON STOCK, PAR VALUE $0.01 PER SHARE
UNDERWRITING AGREEMENT
April __, 1998
April __, 1998
Xxxxxx Xxxxxxx & Co. Incorporated
BT Alex. Xxxxx Incorporated
c/o Morgan Xxxxxxx & Co.
Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
BT Alex. Xxxxx International,
a division of Bankers Trust International PLC
c/o Morgan Xxxxxxx & Co. International Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
England
Dear Sirs and Mesdames:
Certain shareholders (the "SELLING SHAREHOLDERS") of CSG SYSTEMS
INTERNATIONAL, INC., a Delaware corporation (the "COMPANY"), as named in
Schedule I hereto, severally propose to sell to the several Underwriters (as
defined below) an aggregate of 3,498,700 shares (the "FIRM SHARES") of the
Company's Common Stock, par value $.01 per share (the "COMMON STOCK"), with each
Selling Shareholder selling the number of shares set forth opposite such Selling
Shareholder's name in Schedule I hereto under the heading "Number of Firm Shares
To Be Sold." It is understood that, subject to the conditions hereinafter
stated, 2,798,960 Firm Shares (the "U.S. FIRM SHARES") will be sold to the
several U.S. Underwriters named in Schedule II hereto (the "U.S. UNDERWRITERS")
in connection with the offering and sale of such U.S. Firm Shares in the United
States and Canada to United States and Canadian Persons (as such terms are
defined in the Agreement Between U.S. and International Underwriters of even
date herewith), and 699,740 Firm Shares (the "INTERNATIONAL SHARES") will be
sold to the several International Underwriters named in Schedule III hereto (the
"INTERNATIONAL UNDERWRITERS") in connection with the offering and sale of such
International Shares outside the United States and Canada to persons other than
United States and Canadian Persons. Xxxxxx Xxxxxxx & Co. Incorporated and BT
Alex. Xxxxx Incorporated shall act as representatives (the "U.S.
REPRESENTATIVES") of the several U.S. Underwriters, and Xxxxxx Xxxxxxx & Co.
International Limited, and BT Alex. Xxxxx International, a division of Bankers
Trust International PLC, shall act as
representatives (the "INTERNATIONAL REPRESENTATIVES") of the several
International Underwriters. The U.S. Underwriters and the International
Underwriters are hereinafter collectively referred to as the "UNDERWRITERS."
The Selling Shareholders also severally propose to sell to the several U.S.
Underwriters not more than an aggregate of 524,805 additional shares of the
Company's Common Stock (the "ADDITIONAL SHARES"), with each Selling Shareholder
proposing to sell the number of Additional Shares set forth opposite such
Selling Shareholder's name in Schedule I hereto under the heading "Number of
Additional Shares To Be Sold," if and to the extent that the U.S.
Representatives shall have determined to exercise, on behalf of the U.S.
Underwriters, the right to purchase such shares of Common Stock granted to the
U.S. Underwriters in Section 3 hereof. The Firm Shares and the Additional
Shares are hereinafter collectively referred to as the "SHARES."
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement on Form S-3 (File No. 333-48135) relating
to the Shares. The registration statement contains two prospectuses to be used
in connection with the offering and sale of the Shares: the U.S. prospectus, to
be used in connection with the offering and sale of Shares in the United States
and Canada to United States and Canadian Persons, and the international
prospectus, to be used in connection with the offering and sale of Shares
outside the United States and Canada to persons other than United States and
Canadian Persons. The international prospectus is identical to the U.S.
prospectus except for the outside front cover page. The registration statement
as amended at the time it becomes effective, including the information (if any)
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), is hereinafter referred to as the "REGISTRATION STATEMENT";
the U.S. prospectus and the international prospectus in the respective forms
first used to confirm sales of Shares are hereinafter collectively referred to
as the "PROSPECTUS" (including, in the case of all references to the
Registration Statement or the Prospectus, unless the context requires otherwise,
documents incorporated by reference therein). The terms "supplement" and
"amendment" or "amend" as used in this Agreement shall include all documents
subsequently filed by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), that are deemed to be
incorporated by reference in the Prospectus. If the Company has filed an
abbreviated registration statement to register additional shares of Common Stock
pursuant to Rule 462(b) under the Securities Act (the "RULE 462 REGISTRATION
STATEMENT"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement.
1. Representations and Warranties. The Company represents and warrants to
and agrees with each Selling Shareholder and each Underwriter that:
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(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or threatened by the
Commission.
(b) (i) The Registration Statement, when it became effective, did
not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, (ii the Registration Statement and the Prospectus
comply and, as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (ii the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the representations
and warranties set forth in this paragraph do not apply to statements or
omissions in the Registration Statement or the Prospectus based upon
information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware, has
the corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not, individually or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(d) Each subsidiary of the Company has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole; all of the issued shares of capital stock of each subsidiary of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and are owned directly by the Company, free and clear of
all liens, encumbrances, equities or claims, except that such shares are
pledged as collateral under the Company's "1997 Debt" credit facility (as
more fully described in Note 6 to the Consolidated Financial Statements in
the Prospectus).
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(e) This Agreement has been duly authorized, executed and delivered
by the Company.
(f) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(g) The outstanding shares of Common Stock (including the Shares to
be sold by the Selling Shareholders) have been duly authorized and are
validly issued, fully paid and non-assessable.
(h) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene
any provision of applicable law or the certificate of incorporation or by-
laws of the Company or any agreement or other instrument binding upon the
Company or any of its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or
any subsidiary, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares.
(i) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement).
(j) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or
the Prospectus and are not so described or any contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement that are not described, filed or incorporated by
reference as required.
(k) Each preliminary prospectus filed as part of the Registration
Statement relating to the Shares as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act and
the applicable rules and regulations of the Commission thereunder.
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(l) The Company is not an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended.
(m) The Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("ENVIRONMENTAL LAWS"), (ii have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (ii are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and
conditions of such permits, licenses or approvals would not, singly or in
the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(n) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would singly or in the aggregate, have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
(o) There are no contracts, agreements or understandings between the
Company and any person granting such person the right (i) to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company, other than the Registration
Rights Agreement dated as of September 19, 1997 by and between the Company
and TCI Technology Ventures, Inc. and as described in the proviso below, or
(ii to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement, other than any such
rights which have been waived or satisfied or which have expired in
accordance with their terms; provided that no representation or warranty is
made with respect to the Registration Rights Agreement dated November 30,
1994 by and among CSG Holdings, Inc. and the entities and individuals
listed on the Schedule of Purchasers attached thereto as Exhibit A. The
Company has not received or given any notice from or to, or received any
request of, any holder of securities of the Company, other than from any
Selling Shareholder, with respect to the registration of such securities.
(p) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or
with any person or affiliate located in Cuba.
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(q) The Company and its subsidiaries own or possess, or can acquire
on reasonable terms, all material patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks and trade names currently
employed by them in connection with the business now operated by them, and
neither the Company nor any of its subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect to
any of the foregoing which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would result in any material
adverse change in the condition, financial or otherwise, or in the
earnings, business or operations of the Company and its subsidiaries, taken
as a whole.
(r) No material labor dispute with the employees of the Company or
any of its subsidiaries exists, except as described in or contemplated by
the Prospectus, or, to the knowledge of the Company, is imminent; and the
Company is not aware of any existing, threatened or imminent labor
disturbance by the employees of any of its principal suppliers,
manufacturers or contractors that could result in any material adverse
change in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries, taken as a
whole.
(s) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (1) transactions are executed in accordance with management's general
or specific authorizations; (2) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (3)
access to assets is permitted only in accordance with management's general
or specific authorization; and (4) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(t) Xxxxxx Xxxxxxxx LLP, who have certified certain of the financial
statements included or incorporated by reference in the Registration
Statement, are independent public accountants as required by the Securities
Act and the applicable rules and regulations of the Commission thereunder.
2. Representations and Warranties of the Selling Shareholders. Each of
the Selling Shareholders, severally and not jointly with the other Selling
Shareholders, represents and warrants to and agrees with each of the
Underwriters and the Company that:
(a) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Shareholder.
(b) The execution and delivery by such Selling Shareholder of, and
the performance by such Selling Shareholder of its obligations under, this
Agreement and, if such Selling Shareholder is a party to the Commitment
Agreement dated March 17, 1998 among certain of the Selling Shareholders
(the "COMMITMENT AGREEMENT"), the Commitment Agreement will not contravene
any provision of applicable law, or the certificate of incorporation or by-
laws of such Selling Shareholder (if such Selling Shareholder is a
corporation), or any agreement or other instrument binding upon such
Selling Shareholder or any judgment, order or decree of any governmental
body, agency or court having jurisdiction over such Selling Shareholder,
and no consent, approval, authorization or order of, or qualification with,
any governmental body or agency is required by or on behalf of such Selling
Shareholder for the performance by such Selling Shareholder of its
obligations under this Agreement or, if such Selling Shareholder is a party
to the Commitment Agreement, the Commitment Agreement except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares.
(c) Such Selling Shareholder has, and on the Closing Date will have,
valid title to the Shares (or security entitlements in respect thereof) to
be sold by such Selling Shareholder and the legal right and power, and all
authorization and approval required by law, to enter into this Agreement,
and if such Selling Shareholder is a party to the Commitment Agreement, the
Commitment Agreement and to sell, transfer and deliver the Shares (or
security entitlements in respect thereof) to be sold by such Selling
Shareholder.
(d) The Shares to be sold by such Selling Shareholder pursuant to
this Agreement have been duly authorized and are validly issued, fully paid
and non-assessable.
(e) If such Selling Shareholder is a party to the Commitment
Agreement, the Commitment Agreement has been duly authorized, executed and
delivered by such Selling Shareholder and are valid and binding agreements
of such Selling Shareholder.
(f) Upon payment for the Shares to be sold by such Selling
Shareholder as provided herein, delivery of such Shares, as directed by the
Underwriters, to Cede & Co. ("Cede") or such other nominee as may be
designated by the Depository Trust Company ("DTC"), registration of such
Shares in the name of Cede or such other nominee and the crediting of such
Shares on the books of DTC to securities accounts of the Underwriters, (A)
DTC shall be a "protected purchaser" of such Shares within the meaning of
8-303 of the Uniform Commercial Code as in effect in the State of New York
(the "UCC"), (B) under Section 8-501 of the UCC, the Underwriters will
acquire a valid security entitlement in respect of such Shares and (C) no
action based
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on any "adverse claim" (as defined in Section 8-102 of the UCC) (other than
any adverse claim arising through the Underwriters) to such Shares may be
asserted against the Underwriters with respect to such security
entitlement; it being understood that for the purpose of this
representation and warranty, each Selling Shareholder may assume that when
such payment, delivery and crediting occur, (i) such Shares will have been
registered in the name of Cede or another nominee designated by DTC, in
each case on the Company's share registry in accordance with its
certificate of incorporation, bylaws and applicable law, (ii) DTC will be
registered as a "clearing corporation" within the meaning of Section 8-102
of the UCC, and (iii) appropriate entries to the accounts of the several
Underwriters on the records of DTC will have been made pursuant to the UCC.
(g) (i) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading and (ii the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set
forth in this paragraph 2(G) only apply to statements or omissions in the
----
Registration Statement or the Prospectus based upon information relating to
such Selling Shareholder furnished to the Company in writing by such
Selling Shareholder expressly for use therein.
3. Agreements to Sell and Purchase. Each Selling Shareholder, severally
and not jointly, hereby agrees to sell to the several Underwriters, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally
and not jointly, to purchase from such Selling Shareholder at $______ a share
(the "PURCHASE PRICE") the number of Firm Shares (subject to such adjustments to
eliminate fractional shares as you may determine) that bears the same proportion
to the number of Firm Shares to be sold by such Selling Shareholder as the
number of Firm Shares set forth in Schedule II or Schedule III hereto opposite
the name of such Underwriter bears to the total number of Firm Shares.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, each Selling Shareholder
agrees, severally and not jointly, to sell to the U.S. Underwriters the number
of Additional Shares set forth opposite such Selling Shareholder's name in
Schedule I hereto under the heading "Number of Additional Shares To Be Sold,"
and the U.S. Underwriters shall have a one-time right to purchase, severally and
not jointly, up to 524,805 Additional Shares at the Purchase Price. If the U.S.
Representatives, on behalf of the U.S. Underwriters, elect to exercise such
option, the U.S. Representatives shall so notify the Selling Shareholders in
writing not later than 30 days after the date of this Agreement, which notice
shall specify the number of Additional Shares to
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be purchased by the U.S. Underwriters and the date on which such shares are to
be purchased which date shall be subject to the approval of the Selling
Shareholders, such approval not to be unreasonably withheld. Such date may be
the same as the Closing Date (as defined below) but not earlier than the Closing
Date nor later than ten business days after the date of such notice. Additional
Shares may be purchased as provided in Section 5 hereof solely for the purpose
of covering over-allotments made in connection with the offering of the Firm
Shares. If any Additional Shares are to be purchased, each U.S. Underwriter
agrees, severally and not jointly, to purchase the number of Additional Shares
(subject to such adjustments to eliminate fractional shares as you may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of Firm Shares set forth in Schedule II
hereto opposite the name of such Underwriter bears to the total number of Firm
Shares. The Additional Shares to be purchased by the U.S. Underwriters hereunder
and the U.S. Firm Shares are hereinafter referred to as the "U.S. SHARES."
The Company and each Selling Shareholder (other than Xxxx X. Xxxxxx and
Xxxxxx X. Xxxxxx) hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters, it will not,
during the period ending 90 days after the date of the Prospectus, (i) 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 Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Shares to be sold hereunder, (B) the issuance by the Company of
shares of Common Stock upon the exercise of an option or a warrant or the
conversion of a security outstanding on the date hereof of which the
Underwriters have been advised in writing, issuances pursuant to the Company's
Employee Stock Purchase Plan (as filed as Exhibit 10.02 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1997) or the issuance by the
Company of options, warrants or convertible securities which are not exercisable
or convertible within such 90 day period, (C) distributions by MSCP III, L.P. to
its partners pursuant to its limited partnership agreement; provided that each
distributee agrees to be bound by the provisions of this paragraph as if it were
a Selling Shareholder (other than Xxxx X. Xxxxxx or Xxxxxx X. Xxxxxx) or (D)
transactions by any person other than the Company relating to shares of Common
Stock or other securities acquired in open market transactions after the
completion of the offering of the Shares. In addition, each Selling Shareholder
(other than Xxxx X. Xxxxxx and Xxxxxx X. Xxxxxx) agrees that, without the prior
written consent of Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the
Underwriters, it will not, during the period ending 90 days after the date of
the Prospectus, make any demand for, or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock.
4. Terms of Public Offering. The Company and the Selling Shareholders are
advised by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement and
this Agreement have become effective as in your judgment is advisable. The
Company and the Selling Shareholders are further advised by you that the Shares
are to be offered to the public initially
9
at $______ a share (the "PUBLIC OFFERING PRICE") and to certain dealers selected
by you at a price that represents a concession not in excess of $______ a share
under the Public Offering Price, and that any Underwriter may allow, and such
dealers may reallow, a concession, not in excess of $______ a share, to any
Underwriter or to certain other dealers.
5. Payment and Delivery. Payment for the Firm Shares to be sold by each
Selling Shareholder shall be made to such Selling Shareholder in Federal or
other funds immediately available in New York City against delivery of such Firm
Shares for the respective accounts of the several Underwriters at 10:00 A.M.,
New York City time, on April __, 1998, or at such other time on the same or such
other date, not later than April __, 1998, as shall be designated in writing by
you. The time and date of each such payment are hereinafter referred to as the
"CLOSING DATE."
Payment for any Additional Shares to be sold by each Selling Shareholder
shall be made to such Selling Shareholder in Federal or other funds immediately
available in New York City against delivery of such Additional Shares for the
respective accounts of the several U.S. Underwriters at 10:00 A.M., New York
City time, on the date specified in the notice described in Section 3 or at such
other time on the same or on such other date, in any event not later than May
___, 1998, as shall be designated in writing by you. The time and date of such
payment are hereinafter referred to as the "OPTION CLOSING DATE."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid by
the applicable Selling Shareholder, against payment of the Purchase Price
therefor.
6. Conditions to the Underwriters' and the Selling Shareholders'
Obligations. The obligations of the Selling Shareholders to sell the Shares to
the Underwriters and the several obligations of the Underwriters to purchase and
pay for the Shares on the Closing Date are subject to the condition that the
Registration Statement shall have become effective not later than 2:00 P.M. (New
York City time) on the date hereof.
The several obligations of the Underwriters and, to the extent provided
herein, of the Selling Shareholders, are subject to the following further
conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
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(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations of
the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your judgment,
impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
(b) The Underwriters and the Selling Shareholders shall have received
on the Closing Date a certificate, dated the Closing Date and signed by an
executive officer of the Company, to the effect set forth in Section
6(a)(i) above and to the effect that the representations and warranties of
the Company contained in this Agreement are true and correct as of the
Closing Date and that the Company has complied with all of the agreements
and satisfied all of the conditions on its part to be performed or
satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the best
of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Xxxxx & XxXxxxxx, outside counsel for the Company, dated the
Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction
of its incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in
each of Colorado and Nebraska;
(ii) each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation and has the corporate power
and authority to own its property and to conduct its business as
described in the Prospectus; and CSG Systems, Inc. is duly qualified
to transact business and is in good standing in each jurisdiction
included on a schedule previously provided to the Underwriters;
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(iii) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
(iv) the outstanding shares of Common Stock (including the
Shares to be sold by the Selling Shareholders) have been duly
authorized and are validly issued, fully paid and non-assessable;
(v) all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and, to such counsel's
knowledge, are owned directly by the Company, free and clear of all
liens, encumbrances, equities or claims, except that such shares are
pledged as collateral under the Company's "1997 Debt" credit facility
(as more fully described in Note 6 to the Consolidated Financial
Statements in the Prospectus);
(vi) this Agreement has been duly authorized, executed and
delivered by the Company;
(vii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or, to such counsel's
knowledge, any agreement or other instrument binding upon the Company
or any of its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or, to such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or qualification with,
any governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except the
registration under the Securities Act of the Shares or such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares;
(viii) the statements (A) in the Prospectus under the captions
"Description of Capital Stock," "Certain United States Federal Tax
Consequences for Non-U.S. Holders," and "Underwriters" (but only as to
the terms of this Agreement) and (B) in the Registration Statement in
Item 15, in each case insofar as such statements constitute summaries
of the legal matters, documents or proceedings referred to therein,
fairly present the
12
information called for with respect to such legal matters, documents
and proceedings and fairly summarize the matters referred to therein
in all material respects;
(ix) such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and are not
so described or of any contracts or other documents that are required
to be described in the Registration Statement or the Prospectus or to
be filed or incorporated by reference as exhibits to the Registration
Statement that are not described, filed or incorporated as required;
(x) the Company is not an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended;
(xi) to such counsel's knowledge, no record owner or beneficial
owner of any security of the Company has any right, not effectively
satisfied or waived, to require inclusion of shares of Common Stock or
any other security of the Company in the Registration Statement or to
require the Company to file a registration statement under the
Securities Act as a result of the filing of the Registration
Statement; provided that such counsel need not express any opinion
with respect to the Registration Rights Agreement dated November 30,
1994 by and among CSG Holdings, Inc. and the entities and individuals
listed on the Schedule of Purchasers attached thereto as Exhibit A;
and
(xii) such counsel (A) is of the opinion that each document, if
any, filed pursuant to the Exchange Act and incorporated by reference
in the Prospectus (except for financial statements and schedules and
other financial and statistical data included therein as to which such
counsel need not express any opinion) complied when so filed as to
form in all material respects with the Exchange Act and the applicable
rules and regulations of the Commission thereunder, (B) is of the
opinion that the Registration Statement and Prospectus (except for
financial statements and schedules and other financial and statistical
data included or incorporated by reference therein as to which such
counsel need not express any opinion) comply as to form in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder, (C) has no reason to believe
that (except for financial statements and schedules and other
financial and statistical data included or incorporated by reference
therein as to which such counsel need not express any belief) the
Registration Statement and the
13
prospectus included therein at the time the Registration Statement
became effective contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (D) has no
reason to believe that (except for financial statements and schedules
and other financial and statistical data included or incorporated by
reference therein, as to which such counsel need not express any
belief) the Prospectus contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
(d) The Underwriters shall have received on the Closing Date an
opinion of counsel for each of the Selling Shareholders, which counsel or
counsels shall be reasonably acceptable to counsel for the U.S.
Underwriters, dated the Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Shareholder;
(ii) the execution and delivery by such Selling Shareholder of,
and the performance by such Selling Shareholder of its obligations
under, this Agreement and, if such Selling Shareholder is a party to
the Commitment Agreement, the Commitment Agreement will not contravene
any provision of applicable law, or the certificate of incorporation
or by-laws of such Selling Shareholder (if such Selling Shareholder is
a corporation), or, to such counsel's knowledge, any agreement or
other instrument binding upon such Selling Shareholder or, to such
counsel's knowledge, any judgment, order or decree of any governmental
body, agency or court having jurisdiction over such Selling
Shareholder, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required by or
on behalf of such Selling Shareholder for the performance by such
Selling Shareholder of its obligations under this Agreement or, if
such Selling Shareholder is a party to the Commitment Agreement, the
Commitment Agreement, except the registration under the Securities Act
of the Shares or
14
such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Shares;
(iii) if such Selling Shareholder is a party to the Commitment
Agreement, the Commitment Agreement has been duly authorized, executed
and delivered by such Selling Shareholder and is a valid and binding
agreement of such Selling Shareholder; and
(iv) upon payment for the Shares to be sold by such Selling
Shareholder as provided herein, delivery of such Shares, as directed
by the Underwriters, to Cede or such other nominee as may be
designated by DTC, registration of such Shares in the name of Cede or
such other nominee and the crediting of such Shares on the books of
DTC to securities accounts of the Underwriters (assuming that neither
DTC nor any such Underwriter has notice of any adverse claim (as such
phrase is defined in Section 8-105 of the UCC) to such Shares)), (A)
DTC shall be a "protected purchaser" of such Shares within the meaning
of 8-303 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of
such Shares and (C) no action based on any "adverse claim" (as defined
in Section 8-102 of the UCC) to such Shares may be asserted against
the Underwriters with respect to such security entitlement; it being
understood that for the purpose of this opinion, such counsel may
assume that when such payment, delivery and crediting occur, (x) such
Shares will have been registered in the name of Cede or another
nominee designated by DTC, in each case on the Company's share
registry in accordance with its certificate of incorporation, bylaws
and applicable law, (y) DTC will be registered as a "clearing
corporation" within the meaning of Section 8-102 of the UCC, and (z)
appropriate entries to the accounts of the several Underwriters on the
records of DTC will have been made pursuant to the UCC.
Notwithstanding the introduction to this Section 6, the several obligations
of the Selling Shareholders are not subject to the condition set forth in
this Section 6(d).
(e) The Underwriters shall have received on the Closing Date an
opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections 6(c)(vi), 6(c)
(viii) (but only as to the statements in the Prospectus under "Description
of Capital Stock" and "Underwriters") and 6(c)(xii)(B), (C) and (D) above.
With respect to Section 6(c)(xii) above, Xxxxx & XxXxxxxx and Xxxxx Xxxx &
Xxxxxxxx may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are
15
without independent check or verification, except as specified. The
opinions of Xxxxx & XxXxxxxx and Xxxxx Xxxx & Xxxxxxxx set forth in Section
6(c)(xii) above shall also be delivered to the Selling Shareholders, and
such delivery shall be a condition to the Selling Shareholders' obligations
hereunder.
The opinions of Xxxxx & XxXxxxxx and each of the counsel to the
Selling Shareholders described in Sections 6(c) and 6(d) above shall
be rendered to the Underwriters at the request of the Company or the
Selling Shareholder or Selling Shareholders on whose behalf the respective
opinion is being given, as the case may be, and shall so state therein.
(f) The Underwriters and the Selling Shareholders shall have
received, on each of the date hereof and the Closing Date, a letter dated
the date hereof or the Closing Date, as the case may be, in form and
substance satisfactory to the Underwriters, from Xxxxxx Xxxxxxxx LLP,
independent public accountants, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus;
provided that the letter delivered on the Closing Date shall use a "cut-off
date" not earlier than the date hereof.
(g) The Underwriters and the Company shall have received on the
Closing Date a certificate, dated the Closing Date and signed by or on
behalf of each Selling Shareholder, to the effect that the representations
and warranties of such Selling Shareholder contained in this Agreement are
true and correct as of the Closing Date and that such Selling Shareholder
has complied with all of the agreements and satisfied all of the conditions
on its part to be performed or satisfied hereunder on or before the Closing
Date. Such certificate shall be addressed to the Company as well as the
Underwriters. Notwithstanding the introduction to this Section 6, the
several obligations of the Selling Shareholders are not subject to the
condition set forth in this Section 6(g).
The several obligations of the Underwriters to purchase Additional Shares,
and the Selling Shareholders to sell Additional Shares, hereunder are subject to
the delivery to you on the Option Closing Date of such documents as you or the
Selling Shareholders, as the case may be, may reasonably request with respect to
the good standing of the Company, the due authorization and issuance of the
Additional Shares and other matters related to the issuance of the Additional
Shares.
7. Covenants of the Company. In further consideration of the agreements
of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
16
(a) To furnish to you four signed copies of the Registration
Statement (including exhibits and documents incorporated therein by
reference) and for delivery to each other Underwriter a conformed copy of
the Registration Statement (without exhibits but including documents
incorporated therein by reference) and to furnish to you in New York City
prior to 10:00 A.M., New York City time on the business day next succeeding
the date of this Agreement and during the period mentioned in Section 7(c)
below, as many copies of the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement or
the Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with sales
by an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish to the Underwriters and to
the dealers (whose names and addresses you will furnish to the Company) to
which Shares may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request.
(e) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the twelve-
month period ending June 30, 1999 that satisfies the provisions of Section
11(a) of the Securities Act and the rules and regulations of the Commission
thereunder.
8. Expenses. If the transactions contemplated in this Agreement are
consummated, each Underwriter agrees, severally and not jointly, to pay or cause
to be paid, in proportion to the number of Shares purchased pursuant to this
Agreement by each such Underwriter, all
17
expenses incident to the performance of the Company's and the Selling
Shareholders' obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Company's counsel, the Company's accountants
and counsel for the Selling Shareholders in connection with the registration and
delivery of the Shares under the Securities Act and all other fees or expenses
in connection with the preparation and filing of the Registration Statement, any
preliminary prospectus, the Prospectus and amendments and supplements to any of
the foregoing, including all printing costs associated therewith, and the
mailing and delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to the
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) the cost of printing or producing any Blue
Sky or Legal Investment memorandum in connection with the offer and sale of the
Shares under state securities laws and all expenses in connection with the
qualification of the Shares for offer and sale under state securities laws as
provided in Section 7(d) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or Legal Investment
memorandum, (iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Shares by the National Association of
Securities Dealers, Inc., (v) all costs and expenses incident to listing the
Shares on the Nasdaq National Market, (vi) the cost of printing certificates
representing the Shares, (vii) the costs and charges of any transfer agent,
registrar or depositary, (viii) the costs and expenses relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the offering of the Shares, including, without limitation, expenses associated
with the production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with the
prior approval of the U.S. Representatives, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and the
cost of any aircraft chartered in connection with the road show, and (ix) all
other costs and expenses incident to the performance of the obligations of the
Company hereunder for which provision is not otherwise made in this Section. In
the event of the failure of any Underwriter to perform its obligations pursuant
to this Section 8, each of the Representatives agrees to use its reasonable
efforts to assist the Company and the Selling Shareholders in their efforts to
compel any such Underwriter to perform its obligations under this Section 8. It
is understood that except as provided in this Section, Section 9 entitled
"Indemnity and Contribution," and the last paragraph of Section 11 below, the
Underwriters will pay all of their costs and expenses, including fees and
disbursements of their counsel, stock transfer taxes payable on resale of any of
the Shares by them and any advertising expenses connected with any offers they
may make. Notwithstanding the foregoing, the Underwriters shall not be liable
for any allocation of internal costs by the Company or any Selling Shareholder,
all such costs to be for the account of such party.
The provisions of this Section shall not supersede or otherwise affect any
agreement that the Selling Shareholders and the Company may otherwise have for
the allocation of such expenses among themselves.
18
9. Indemnity and Contribution. (a) The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"), from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use therein.
(b) Each Selling Shareholder agrees, severally and not jointly, to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, any preliminary prospectus or the Prospectus
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, to the extent and only to the extent that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) in reliance
upon, and in conformity with, information relating to such Selling Shareholder
furnished to the Company in writing by or on behalf of such Selling Shareholder
expressly for use in the Registration Statement, any preliminary prospectus or
the Prospectus. Notwithstanding any other provision of this Section 9, the
liability of each Selling Shareholder to all such indemnified parties (as
defined below) shall not exceed the net amount received by each such Selling
Shareholder (after deducting any underwriting discount) from the sale of the
Shares pursuant to this Agreement.
(c) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, the Selling Shareholders, the directors of the
Company, the officers of the Company who sign the Registration Statement and
each person, if any, who controls the Company or any Selling Shareholder within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act from and against any and all losses, claims,
19
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto.
(d) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 9(a), 9(b) or 9(c), such person (the "INDEMNIFIED
PARTY") shall promptly notify the person against whom such indemnity may be
sought (the "INDEMNIFYING PARTY") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (i) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, (ii) the fees and expenses of
more than one separate firm (in addition to any local counsel) for the Company,
its directors, its officers who sign the Registration Statement and each person,
if any, who controls the Company within the meaning of either such Section and
(iii) the fees and expenses of more than one separate firm (in addition to any
local counsel) for all Selling Shareholders and all persons, if any, who control
any Selling Shareholder within the meaning of either such Section, and that all
such fees and expenses shall be reimbursed as they are incurred. In the case of
any such separate firm for the Underwriters and such control persons of any
Underwriters, such firm shall be designated in writing by Xxxxxx Xxxxxxx & Co.
Incorporated. In the case of any such separate firm for the Company, and such
directors, officers and control persons of the Company, such firm shall be
designated in writing by the Company. In the case of any such separate firm for
the Selling Shareholders and such control persons of any Selling Shareholders,
such firm shall
20
be designated in writing by the persons named as attorneys-in-fact for the
Selling Shareholders under the Powers of Attorney. The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(e) To the extent the indemnification provided for in Section 9(a), 9(b)
or 9(c) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause 9(e)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 9(e)(i) above but also the relative
fault of the indemnifying party or parties on the one hand and of the
indemnified party or parties on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by each Selling Shareholder and the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the Shares
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Shares received by the Selling Shareholders
(after deducting any underwriting discounts but before deducting expenses) and
the total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate Public Offering Price of the Shares; provided that for the purpose
of this Section 9(e), the Company's benefit shall be deemed to be the net amount
received (after deducting any underwriting discounts but before deducting
expenses) by all Selling Shareholders. The relative fault of each Selling
Shareholder and the Company, on the one hand, and the Underwriters, on the other
hand, shall be determined by reference to,
21
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company, each such Selling Shareholder or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Underwriters' respective obligations to contribute pursuant to this Section 9
are several in proportion to the respective number of Shares they have purchased
hereunder, and not joint.
(f) The Company, the Selling Shareholders and the Underwriters agree that
it would not be just or equitable if contribution pursuant to this Section 9
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in Section 9(d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 9, (i) no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission and (ii no Selling Shareholder shall
be required to contribute any amount in excess of the amount by which the net
amount received by such Selling Shareholder (after deducting any underwriting
discount) from the sale of the Shares pursuant to this Agreement exceeds the
amount of any damages that such Selling Shareholder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 9 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(g) The indemnity and contribution provisions contained in this Section 9
and the representations, warranties and other statements of the Company and the
Selling Shareholders contained in this Agreement shall remain operative and in
full force and effect regardless of (i) any termination of this Agreement, (ii
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, by or on behalf of any Selling Shareholder or any
person controlling any Selling Shareholder or by or on behalf of the Company,
its officers or directors or any person controlling the Company and (ii
acceptance of and payment for any of the Shares.
10. Termination. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior
22
to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board of Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (ii trading of any securities of the
Company shall have been suspended on any exchange or in any over-the-counter
market, (ii a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities or (iv
there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in your judgment, is
material and adverse and (b) in the case of any of the events specified in
clauses 10(a)(i) through 10(a)(iv), such event, singly or together with any
other such event, makes it, in your judgment, impracticable to market the Shares
on the terms and in the manner contemplated in the Prospectus.
11. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule II or Schedule III bears to the
aggregate number of Firm Shares set forth opposite the names of all such non-
defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided that in no event shall the
number of Shares that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 11 by an amount in excess of
one-ninth of such number of Shares without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares
with respect to which such default occurs is more than one-tenth of the
aggregate number of Firm Shares to be purchased, and arrangements satisfactory
to you, the Company and the Selling Shareholders for the purchase of such Firm
Shares are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter, the
Company or the Selling Shareholders. In any such case either you or the
relevant Selling Shareholders shall have the right to postpone the Closing Date,
but in no event for longer than seven days, in order that the required changes,
if any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. If, on the Option Closing Date, any
Underwriter or Underwriters shall fail or refuse to purchase Additional Shares
and the aggregate number of Additional Shares with respect to which such default
occurs is more than one-tenth of the aggregate number of Additional Shares to be
purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their
23
obligation hereunder to purchase Additional Shares or (ii) purchase not less
than the number of Additional Shares that such non-defaulting Underwriters would
have been obligated to purchase in the absence of such default. Any action taken
under this paragraph shall not relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company or any Selling
Shareholder to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Company or any Selling Shareholder shall be
unable to perform its obligations under this Agreement, the Selling
Shareholders, each in proportion to the number of Shares to be sold by such
Selling Shareholder, will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
12. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
24
14. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
Very truly yours,
CSG SYSTEMS INTERNATIONAL, INC.
By:____________________________
Name:
Title:
FIRST PLAZA GROUP TRUST
By: Mellon Bank, N.A., solely in its capacity as
Trustee for First Plaza Group Trust (as directed
by General Motors Investment Management
Corporation) and not in its individual capacity
By:____________________________
Name:
Title:
GENERAL MOTORS HOURLY-RATE EMPLOYES PENSION TRUST
By: Mellon Bank, N.A., solely in its capacity as
Trustee for General Motors Hourly-Rate Employes
Pension Trust (as directed by General Motors
Investment Management Corporation) and not in its
individual capacity
By:____________________________
Name:
Title:
25
GENERAL MOTORS SALARIED
EMPLOYES PENSION TRUST
By: Mellon Bank, N.A., solely in its capacity as
Trustee for General Motors Salaried Employes
Pension Trust (as directed by General Motors
Investment Management Corporation) and not in its
individual capacity
By:____________________________
Name:
Title:
MSCP III, L.P.
By:____________________________
Name:
Title:
MSCP III HOLDINGS, INC.
By:____________________________
Name:
Title:
XXXXXX XXXXXXX VENTURE
CAPITAL II, INC.
By:____________________________
Name:
Title:
26
XXXXXX XXXXXXX
ADMINISTRATOR, N.V.
By:____________________________
Name:
Title:
____________________________
Xxxxx Xxxxxxx
____________________________
Xxxx X. Xxxxxx
____________________________
Xxxxxx X. Xxxxxx
27
Accepted as of the date hereof:
XXXXXX XXXXXXX & CO. INCORPORATED
BT ALEX. XXXXX INCORPORATED
Acting severally on behalf
of themselves and the
several U.S. Underwriters named
in Schedule II attached hereto.
By Xxxxxx Xxxxxxx & Co.
Incorporated
By:____________________________
Name:
Title:
XXXXXX XXXXXXX & CO. INTERNATIONAL
LIMITED
BT ALEX. XXXXX INTERNATIONAL,
A DIVISION OF BANKERS TRUST
INTERNATIONAL PLC
Acting severally on behalf
of themselves and the several
International Underwriters named
in Schedule III attached hereto.
By Xxxxxx Xxxxxxx & Co.
International Limited
By:____________________________
Name:
Title:
28
SCHEDULE I
Number of
Number of Additional
Firm Shares Shares To Be
Selling Shareholder To Be Sold Sold
------------------- ----------- -------------
First Plaza Group Trust.................................. 1,196,383 186,247
General Motors Hourly-Rate Employes Pension Trust........ 523,541 81,503
General Motors Salaried Employes Pension Trust........... 523,540 81,502
MSCP III, L.P............................................ 527,535 82,124
MSCP III Holdings, Inc................................... 500,114 77,855
Xxxxxx Xxxxxxx Venture Capital II, Inc................... 90,765 14,130
Xxxxxx Xxxxxxx Administrator, N.V........................ 3,091 481
Xxxxx Xxxxxxx............................................ 6,187 963
Xxxx X. Xxxxxx........................................... 70,044 0
Xxxxxx X. Xxxxxx......................................... 57,500 0
---------- ----------
Total 3,498,700 524,805
========== ==========
SCHEDULE II
Number of
Firm Shares
To Be
U.S. Underwriter Purchased
---------------- -----------
Xxxxxx Xxxxxxx & Co. Incorporated..........
BT Alex. Xxxxx Incorporated................
---------
Total 2,798,960
=========
SCHEDULE III
Number of
Firm Shares
To Be
International Underwriter Purchased
------------------------- -----------
Xxxxxx Xxxxxxx & Co. International Limited.................
BT Alex. Xxxxx International, a division of Bankers Trust
International PLC.........................................
-------
Total 699,740
=======
