1
Exhibit 1.1
2,400,000 SHARES
JDA SOFTWARE GROUP, INC.
COMMON STOCK, $0.01 PAR VALUE PER SHARE
UNDERWRITING AGREEMENT
____________, 1998
2
_____ ___, 1998
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Xxxxx LLC
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Xxxxx LLC
c/o Morgan Xxxxxxx & Co. International Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
England
Dear Sirs and Mesdames:
JDA Software Group, Inc., a Delaware corporation (the "COMPANY"), proposes
to issue and sell to the several Underwriters (as defined below), and certain
stockholders of the Company (the "SELLING STOCKHOLDERS") named in Schedule I
hereto severally propose to sell to the several Underwriters, an aggregate of
2,400,000 shares of the common stock, $0.01 par value per share of the Company
(the "FIRM SHARES"), of which 2,000,000 shares are to be issued and sold by the
Company and 400,000 shares are to be sold by the Selling Stockholders, each
Selling Stockholder selling the amount set forth opposite such Selling
Stockholder's name in Schedule I hereto.
It is understood that, subject to the conditions hereinafter stated,
1,920,000 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 480,000 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, Xxxxxxxxx, Lufkin &
Xxxxxxxx Securities Corporation and Xxxxxxxxx & Xxxxx LLC shall act as
representatives (the "U.S. REPRESENTATIVES") of the several U.S. Underwriters,
and Xxxxxx Xxxxxxx & Co. International Limited, Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation and
3
Xxxxxxxxx & Xxxxx LLC 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 Company also proposes to issue and sell to the several U.S.
Underwriters not more than an additional 360,000 shares of its common stock,
$0.01 par value per share (the "ADDITIONAL SHARES"), 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 shares of
common stock, $0.01 par value per share, of the Company to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to as
the "Common Stock". The Company and the Selling Stockholders are hereinafter
sometimes referred to individually as a "Seller" or collectively as the
"Sellers".
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement 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". 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 (including, in the case of all references to the Registration
Statement and the Prospectus, documents incorporated therein by reference).
1. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each of the Underwriters that:
(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) Each document, if any, filed or to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE Act"), and
incorporated by reference in the Prospectus complied or will comply when
so filed in all material respects with the Exchange Act and the applicable
rules and regulations of the Commission thereunder; (ii)
4
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; (iii) 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 (iv) 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 1(b) 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 jurisdiction of its
incorporation, has the corporate power and authority to own or lease its
property and to conduct its business as described in the Prospectus and is
duly qualified to transact business as a foreign corporation under the
corporation laws of, and is in good standing as such, 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.
(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 or lease 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 or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(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 incorporated by reference into the
Prospectus.
(g) The shares of Common Stock (including the Shares to be sold by
the Selling Stockholders) outstanding prior to the issuance of the Shares
have been duly
5
authorized and are validly issued, fully paid and non-assessable.
(h) The Shares to be sold by the Company have been duly authorized
and, when issued and delivered in accordance with the terms of this
Agreement, will be validly issued, fully paid and non-assessable, and the
issuance of such Shares will not be subject to any preemptive or similar
rights.
(i) 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 bylaws 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.
(j) 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).
(k) Except in each case as described in or contemplated by the
Prospectus, subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus: (i) the Company
and its subsidiaries have neither incurred any liability or obligation,
direct or contingent, nor entered into any transaction, in each case, not
in the ordinary course of business and material to the Company and its
subsidiaries as a whole; (ii) the Company has neither purchased any shares
of its outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of its capital stock of any kind; and (iii) there
has not been any material change in the capital stock, short-term debt or
long-term debt of the Company.
(l) The Company and its subsidiaries have good and marketable title
in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case, that is material to the
business of the Company and its subsidiaries, taken as a whole, in each
case free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially affect the
value of such property taken as a whole and do not interfere in any
material respect with the use made and proposed to be made of such
property by the Company and its subsidiaries, taken as a whole; and any
real property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere in
any material respect with the use made and proposed to be made of such
property and buildings by the Company and
6
its subsidiaries, taken as a whole, except as described in or contemplated
by the Prospectus.
(m) 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.
(n) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the business in
which each is engaged.
(o) There are no legal or governmental proceedings pending or, to
the Company's knowledge, 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 or any document incorporated
therein by reference and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or any document
incorporated therein by reference or to be filed as exhibits to the
Registration Statement or any document incorporated therein by reference
that are not described or filed as required.
(p) The Company and its subsidiaries have obtained all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and have made all declarations and filings with, all federal,
state, local and other governmental authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease, license
and use its properties and assets and to conduct its business in the
manner described in the Prospectus, except to the extent that the failure
to obtain such consents, authorizations, approvals, orders, certificates
or permits or to make such declarations or filings would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole; and neither the Company nor any of its subsidiaries has received
any notice of proceedings relating to the revocation or modification of
any such consent, authorization, approval, order, certificate or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would result in a 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, except
as described in or contemplated by the Prospectus.
(q) Each preliminary prospectus filed as part of the registration
statement 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.
(r) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as such
term is defined in the Investment Company Act of
7
1940, as amended.
(s) Except as described in the Prospectus: (i) the Company and its
subsidiaries own or possess or can acquire on reasonable terms adequate
licenses or other rights to use all 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 as currently
conducted by them, except to the extent that the failure to own, possess
or acquire any of the foregoing would not result in a material adverse
effect on the Company and its subsidiaries, taken as a whole and (ii)
neither the Company nor 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.
(t) 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 (iii) 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.
(u) 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.
(v) Except as disclosed or specifically contemplated by the
Prospectus, there are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company or to require the Company to
include such securities with the Shares registered pursuant to the
Registration Statement. All such rights arising in connection with the
filing of the Registration Statement have been effectively satisfied or
waived.
(w) The Company and its subsidiaries have complied with all
provisions of
8
Section 517.075, Florida Statutes relating to doing business with the
Government of Cuba or with any person or affiliate located in Cuba.
(x) The Company and its subsidiaries, taken as a whole, maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv)
the amounts reflected on the Company's balance sheet for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(y) The Shares have been authorized for listing on the NASDAQ
National Market upon official notice of issuance.
2. Representations and Warranties of the Selling Stockholders. Each
of the Selling Stockholders represents and warrants to and agrees with each
of the Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Stockholder.
(b) The execution and delivery by such Selling Stockholder of, and
the performance by such Selling Stockholder of its obligations under, this
Agreement, the Custody Agreement signed by such Selling Stockholder and
____________, as Custodian, relating to the deposit of the Shares to be
sold by such Selling Stockholder (the "CUSTODY AGREEMENT") and the Power
of Attorney appointing certain individuals as such Selling Stockholder's
attorneys-in-fact to the extent set forth therein, relating to the
transactions contemplated hereby and by the Registration Statement (the
"POWER OF ATTORNEY") will not contravene any provision of applicable law,
or the certificate of incorporation or bylaws of such Selling Stockholder
(if such Selling Stockholder is a corporation), or the equivalent
organization and governance instruments of such Selling Stockholder (if
such Selling Stockholder is other than a natural person or corporation),
or any agreement or other instrument binding upon and material to such
Selling Stockholder or any judgment, order or decree of any governmental
body, agency or court having jurisdiction over such Selling Stockholder,
and no consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the performance by
such Selling Stockholder of its obligations under this Agreement or the
Custody Agreement or Power of Attorney of such Selling Stockholder.
(c) Such Selling Stockholder has, and on the Closing Date will have,
valid title to the Shares to be sold by such Selling Stockholder and the
legal right and power, and all authorization and approval required by law,
to enter into this Agreement and the Custody Agreement and Power of
Attorney of such Selling Stockholder, and to sell, transfer and deliver
the Shares to be sold by such Selling Stockholder.
9
(d) The Shares to be sold by such Selling Stockholder pursuant to
this Agreement have been duly authorized and are validly issued, fully
paid and non-assessable.
(e) Such Selling Stockholder's Custody Agreement and Power of
Attorney have been duly authorized, executed and delivered by such Selling
Stockholder and are valid and binding agreements of such Selling
Stockholder.
(f) Delivery of the Shares to be sold by such Selling Stockholder
pursuant to this Agreement will pass title to such Shares free and clear
of any security interests, claims, liens, equities and other encumbrances.
(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 Section 2(g) apply only to statements or omissions in
the Registration Statement or the Prospectus based upon information
relating to such Selling Stockholder furnished to the Company in writing
by such Selling Stockholder expressly for use therein.
3. Agreements to Sell and Purchase. Each Seller, 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 Seller at U.S. $____ per share the
("PURCHASE PRICE") the respective numbers 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 Seller hereunder
as the number of Firm Shares set forth in Schedules II and 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, the Company agrees to sell
to the U.S. Underwriters up to 360,000 Additional Shares, and the U.S.
Underwriters shall have a one-time right to purchase, severally and not jointly,
up to 360,000 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 Company in writing not
later than 30 days after the date of the this Agreement, at 00000 Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxxx, Xxxxxxx, 00000, Attention: Chief Financial Officer, which
notice shall specify the number of Additional Shares to be purchased by the U.S.
Underwriters and the date on which such shares are to be purchased. Such date
may be the same as the Closing Date (as defined below) but not earlier than the
Closing Date nor later
10
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 the U.S. Representatives may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of U.S. Firm Shares set forth in Schedule
II hereto opposite the name of such U.S. Underwriter bears to the total number
of U.S. Firm Shares.
Each Seller 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 transfer of shares of Common
Stock or securities convertible into or exchangeable or exercisable for Common
Stock to immediate family members of a Selling Stockholder or a trust for the
benefit of such immediate family members or such Selling Stockholder, in each
case, pursuant only to a written agreement whereby such transferee shall agree
to receive and hold such shares or securities subject to the provisions of this
Section 3; (C) the issuance by the Company of shares of Common Stock upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof of which the Underwriters have been advised in writing; 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 Stockholder,
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 Sellers 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 Sellers are further
advised by you that the Shares are to be offered to the public initially at
U.S.$_____ per share (the "PUBLIC OFFERING PRICE") and to certain dealers
selected by you at a price that represents a concession not in excess of
U.S.$____ per share under the Public Offering Price, and that any Underwriter
may allow, and such dealers may reallow, a concession, not in excess of
U.S.$____ per share, to any Underwriter or to certain other dealers.
5. Payment and Delivery. Payment for the Firm Shares to be sold by each
Seller shall be made to such Seller in Federal or other funds immediately
available in New York City
11
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on ___ ____, 1998, or at such
other time on the same or such other date, not later than ___ ___, 1998, as
shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "Closing Date".
Payment for any Additional Shares shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several 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 ____ ___, 1998, as shall be designated in writing by the U.S.
Representatives. 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,
against payment of the Purchase Price therefor.
6. Conditions to the Underwriters' Obligations. The obligations of the
Sellers 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 __:00 _m. (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(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
12
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 shall have received on the Closing Date a
certificate, dated the Closing Date, and signed by the Chief 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 Chief Executive 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 Xxxx Xxxx Xxxx & Freidenrich LLP, 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 or lease its property and to conduct its business
as described in the Prospectus and is duly qualified to transact
business as a foreign corporation under the corporation laws of, and
is in good standing as such, 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;
(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, has the
corporate power and authority to own or lease its property and to
conduct its business as described in the Prospectus and is duly
qualified to transact business as a foreign corporation under the
corporation laws of, and is in good standing as such, 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 as
such, would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(iii) the authorized capital stock of the Company conforms as
to legal matters to the description thereof incorporated by
reference into the Prospectus;
(iv) the shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, and, to such counsel's knowledge, are fully paid and
non-assessable;
13
(v) the Shares (including the Shares to be sold by the Selling
Stockholders) have been duly authorized and are , or when issued and
delivered in accordance with the terms of this Agreement will be,
validly issued, fully paid and non-assessable; and the issuance of
such Shares will not be subject to any preemptive or similar rights;
(vi) 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 or
indirectly by the Company and, to such counsel's knowledge, free and
clear of all liens, encumbrances, equities or claims;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) 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 bylaws 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, to the best of 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 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 by the U.S. Underwriters;
(ix) the statements (A) in the Prospectus under the captions
"Risk Factors-Shares Eligible for Future Sale" and "-- Anti-Takeover
Provisions in Charter Documents and Delaware Law," "Certain United
States Federal Income Tax Considerations for Non-U.S. Holders of
Common Stock" and "Underwriters", (B) in the Registration Statement
in Item 15, and (C) regarding the description of capital stock of
the Company incorporated by reference into the Prospectus, in each
case insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly
present the information called for with respect to such legal
matters, documents and proceedings and fairly summarize the matters
referred to therein;
(x) 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 or in
any document incorporated therein by reference and are not so
described or of any statutes, regulations, contracts or other
14
documents that are required to be described in the Registration
Statement or the Prospectus or in any document incorporated therein
by reference or to be filed as exhibits to the Registration
Statement or any document incorporated therein by reference that are
not described or filed as required;
(xi) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as such term is defined in the Investment Company Act of
1940, as amended;
(xii) except as disclosed or specifically contemplated by the
Prospectus, to such counsel's knowledge, there is no owner of any
securities of the Company that has any rights, not effectively
satisfied or waived, to require registration of any shares of
capital stock of the Company in connection with the filing of the
Registration Statement;
(xiii) except as disclosed in or specifically contemplated by
the Prospectus, to such counsel's knowledge, there are not
outstanding any options, warrants or other rights calling for the
issuance of, and no commitments, current plans or arrangements
entered into by the Company to issue, any shares of capital stock of
the Company or any security convertible into or exchangeable for
capital stock of the Company; and
(xiv) such counsel (A) is of the opinion that each document
filed pursuant to the Exchange Act and incorporated by reference in
the Registration Statement and 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 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 as to which such counsel need not express any
belief) the Registration Statement and the 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 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.
15
With respect to the opinion set forth in subsection (ii) above, to the
extent that such opinion addresses questions of law other than those of the
State of California, the State of Texas or the General Corporation Law of the
State of Delaware, such counsel may deliver opinions of local counsel as to such
matters, provided that Xxxx Xxxx Xxxx & Freidenrich LLP shall state that they
believe that you are justified in relying upon such opinions.
(d) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxx Whetsine, Esq., counsel for the Selling Stockholders,
dated the Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of each of the Selling Stockholders;
(ii) the execution and delivery by each Selling Stockholder
of, and the performance by such Selling Stockholder of its
obligations under, this Agreement and the Custody Agreement and
Powers of Attorney of such Selling Stockholder will not contravene
any provision of applicable law, or any agreement or other
instrument binding upon such Selling Stockholder or, any judgment,
order or decree known to such counsel of any governmental body,
agency or court having jurisdiction over such Selling Stockholder,
and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for
the performance by such Selling Stockholder of its obligations under
this Agreement or the Custody Agreement or Power of Attorney of such
Selling Stockholder, except such as may be required by the
securities or Blue Sky laws of the various states in connection with
offer and sale of the Shares;
(iii) each of the Selling Stockholders has valid marketable
title to the Shares to be sold by such Selling Stockholder and the
legal right and power, and all authorization and approval required
by law, to enter into this Agreement, the Custody Agreement and
Power of Attorney of such Selling Stockholder and to sell, transfer
and deliver the Shares to be sold by such Selling Stockholder;
(iv) the Custody Agreement and the Power of Attorney of each
Selling Stockholder have been duly authorized, executed and
delivered by such Selling Stockholder and are valid and binding
agreements of such Selling Stockholder; and
(v) delivery of the Shares to be sold by each Selling
Stockholder pursuant to this Agreement will pass title to such
Shares free and clear of any security interests, claims, liens,
equities and other encumbrances assuming that the Underwriters
purchase the Shares in good faith without notice of any adverse
claim.
(e) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters,
dated the Closing Date,
16
covering the matters referred to in Sections 6(c)(v) (but only as to
Shares sold by the Company), 6(c)(vii), 6(c)(ix) (but only as to the
statements in the Prospectus under "Underwriters" and statements regarding
the description of the Company's capital stock incorporated by reference
into the Prospectus) and clauses (B), (C) and (D) of Section 6(c)(xiv)
above.
With respect to Section 6(c)(xiv) above, Xxxx Xxxx Xxxx &
Freidenrich LLP 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 documents
incorporated by reference and review and discussion of the contents
thereof, but are without independent check or verification except as
specified. With respect to clauses (B), (C) and (D) of Section 6 (c)(xiv)
above, Xxxxxxx, Phleger & Xxxxxxxx LLP 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 (other than the documents incorporated by reference) and upon
review and discussion of the contents thereof (including documents
incorporated by reference), but are without independent check or
verification except as specified.
The opinion of Xxxx Xxxx Xxxx & Freidenrich LLP described in
Sections 6(c) above (and any other opinions of counsel for any Selling
Stockholder referred to in Section 6(d) above) shall be rendered to the
Underwriters at the request of the Company and shall so state therein.
(f) The Underwriters 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 Deloitte & Touche 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, or
incorporated by reference into, 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 "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and certain stockholders, officers and
directors of the Company relating to sales and certain other dispositions
of shares of Common Stock or certain other securities, delivered to you on
or before the date hereof, shall be in full force and effect on the
Closing Date.
(h) The several obligations of the U.S. Underwriters to purchase
Additional Shares hereunder are subject to the delivery to the U.S.
Representatives on the Option Closing Date of such documents as they 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
17
Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) To furnish to you, without charge, five signed copies of the
Registration Statement (including exhibits thereto and documents
incorporated by reference) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto but including documents
incorporated by reference) and, during the period mentioned in Section
7(c) below, as many copies of the Prospectus, any documents incorporated
by reference, and any supplements and amendments thereto or to the
Registration Statement as you may reasonably request. 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 Exchange Act that are deemed to be incorporated
by reference in the Prospectus.
(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, at its own expense, 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 ____ ___, 1999 that satisfies the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
8. Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company agrees to
pay or cause to be paid all
18
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company's counsel and
the Company's accountants and counsel for the Selling Stockholders 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) all
expenses in connection with any offer and sale of the Shares outside of the
United States, including filing fees and the reasonable fees and disbursements
of counsel for the Underwriters in connection with offers and sales outside of
the United States; (iv) 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; (v) 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.; (vi) all costs
and expenses incident to listing the Shares on the Nasdaq National Market; (vii)
the cost of printing certificates representing the Shares; (viii) the costs and
charges of any transfer agent, registrar or depositary; (ix) the costs and
expenses of the Company 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
Company, travel and lodging expenses of the officers of the Company and one-half
the cost of any aircraft chartered in connection with the road show, it being
understood that the Underwriters will pay for their own expenses for any "road
show"; and (x) 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. It is understood, however, that except as provided in this
Section 8, 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.
Each Selling Stockholder, severally and not jointly, agrees to pay or
cause to be paid all taxes, if any, on the transfer and sale of the Shares being
sold by such Selling Stockholder.
The provisions of this Section shall not supersede or otherwise affect any
agreement that the Sellers may otherwise have for the allocation of such
expenses among themselves.
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
19
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, 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 Stockholder agrees, severally and not jointly, to
indemnify and hold harmless 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 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, but
only with reference to information relating to such Selling Stockholder
furnished in writing by or on behalf of such Selling Stockholder expressly
for use in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto. The liability of
each Selling Stockholder under the indemnity agreement contained in this
paragraph shall be limited to an amount equal to the net proceeds received
by such Selling Stockholder (after deducting underwriting discounts and
commissions) from the offering of the Shares by such Selling Stockholder.
(c) Notwithstanding subsections (a) and (b) above, the foregoing
indemnity with respect to any preliminary prospectus shall not inure to
the benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased Shares, or any person
controlling such Underwriter, if a copy of the Prospectus (as then amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Shares to such
person, and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such losses, claims, damages or
liabilities, unless such failure is the result of noncompliance by the
Company with Section 7(a) hereof.
20
(d) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Selling Stockholders, 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 Stockholder 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, 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.
(e) 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)
above, 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 (A) 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, (B) 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 (C) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Selling Stockholders and all
persons, if any, who control any Selling Stockholder within the meaning of
either such Section, and that all such fees and expenses shall be
reimbursed as they are incurred.
21
(f) 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
Stockholders and such control persons of any Selling Stockholders, such
firm shall be designated in writing by the persons named as
attorneys-in-fact for the Selling Stockholders 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.
(g) 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(f)(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(f)(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 the Sellers 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 net proceeds from the offering of the Shares (before
deducting expenses) received by each Seller and the total underwriting
discounts and commissions received by the
22
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. The
relative fault of the Sellers on the one hand and the Underwriters on the
other hand shall be determined by reference to, 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 Sellers or by 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.
(h) The Sellers 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(f). 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, 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. 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.
(i) The indemnity and contribution provisions contained in this
Section 9 and the representations, warranties and other statements of the
Company and the Selling Stockholders 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, any Selling
Stockholder or any person controlling any Selling Stockholder, or the
Company, its officers or directors or any person controlling the Company
and (iii) 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 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
23
Company shall have been suspended on any exchange or in any over-the-counter
market; (iii) 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 and
the Company 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 Stockholders. In
any such case either you or the relevant Sellers 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 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 any Seller to comply with the
terms or to fulfill any of the
24
conditions of this Agreement, or if for any reason any Seller shall be unable to
perform its obligations under this Agreement, the Sellers 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.
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.
25
Very truly yours,
JDA SOFTWARE GROUP, INC.
By:_______________________________________
Name, Title
The SELLING STOCKHOLDERS named in Schedule I
hereto, acting severally
By: _______________________________________
Attorney-in-Fact
Accepted as of the date hereof
XXXXXX XXXXXXX & CO.
INCORPORATED
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
XXXXXXXXX & XXXXX LLC
Acting severally on behalf of themselves
and the several U.S. Underwriters named
in Schedule II hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: ______________________________________
Name, Title:
26
Accepted as of the date hereof
XXXXXX XXXXXXX & CO.
INTERNATIONAL LIMITED
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
XXXXXXXXX & XXXXX LLC
Acting severally on behalf of themselves and
the several International Underwriters named
in Schedule III hereto.
By: Xxxxxx Xxxxxxx & Co. International
Limited
By: _________________________________________
Name, Title
27
SCHEDULE I
Number of
Firm Shares
Selling Stockholder To Be Sold
------------------- ----------
Xxxxx X. Xxxxxxxxx.............................................200,000
Xxxxxxxx X. Xxxxx..............................................200,000
-------
Total..........................................................400,000
=======
28
SCHEDULE II
U.S. UNDERWRITERS
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
Xxxxxx Xxxxxxx & Co. Incorporated...............................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation.............
Xxxxxxxxx & Xxxxx LLC...........................................
------------
Total U.S. Firm Shares ................................................1,920,000
=========
29
SCHEDULE III
INTERNATIONAL UNDERWRITERS
Number of
Firm Shares
Underwriter To Be Purchased
Xxxxxx Xxxxxxx & Co. International Limited........................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation...............
Xxxxxxxxx & Xxxxx LLC.............................................
-----------
Total International Firm Shares ................................480,000
===========
30
EXHIBIT A
JDA Software Group, Inc.
April ___, 1998
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Xxxxx LLC
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("XXXXXX XXXXXXX") proposes to enter into an Underwriting Agreement (the
"UNDERWRITING AGREEMENT") with JDA Software Group, Inc., a Delaware corporation
(the "COMPANY"), providing for the public offering (the "PUBLIC OFFERING") by
the several Underwriters, including Xxxxxx Xxxxxxx (the "UNDERWRITERS"), of
shares (the "SHARES") of common stock, $0.01 per value per share, of the Company
(the "COMMON STOCK").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 90 days after the date of the final prospectus relating
to the Public Offering (the "PROSPECTUS"), (1) 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 (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of Common Stock,
whether any such transaction described in clause (1) or (2) 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 sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement or (b) transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after the completion of the Public Offering. In addition, the
undersigned agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and 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.
Notwithstanding the foregoing, if the undersigned is an individual, he or
she may transfer
31
any shares of Common Stock or securities convertible into or exchangeable or
exercisable for Common Stock either during his or her lifetime or on death by
will or intestacy to his or her immediate family or to a trust the beneficiaries
of which are exclusively the undersigned or a member of his or her immediate
family; provided however, that prior to any such transfer pursuant to this
sentence, each transferee shall execute an agreement, satisfactory to Xxxxxx
Xxxxxxx pursuant to which each transferee shall agree to receive and hold such
shares of Common Stock subject to the provisions hereof, and there shall be no
further transfer except in accordance with the provisions hereof. For purposes
of this paragraph, "immediate family" shall mean spouse, lineal descendant,
father, mother, brother or sister of the transferor.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
-----------------------
(Name)
-----------------------
(Address)
