Exhibit 4
September 8, 0000
Xxxxxxxxx & Xxxxx, LLC
Lazard Freres & Co., LLC
as Representative of the several
Underwriters to be named in the
within-mentioned Underwriting Agreement
x/x Xxxxxxxxx & Xxxxx, LLC
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
The undersigned understands that Xxxxxxxxx & Xxxxx, LLC (H&Q)
and Lazard Freres & Co., LLC, as representatives (Representatives) of
the several underwriters (the Underwriters), propose to enter into an
Underwriting Agreement (the Underwriting Agreement), with System
Software Associates, Inc. (the Company), providing for the public
offering by the Underwriters, including the Representatives, of
Convertible Subordinated Notes of the Company (the Public Offering) as
described in Amendment No. 3 to the Registration Statement on Form S-3
filed on September 3, 1997 (File No. 333-31271) (as amended, the
Registration Statement).
In consideration of the Underwriters agreement to make the Public
Offering and the Company s agreement (to be entered into concurrent
herewith) to file within five business days after the effective date of
the Registration Statement a registration statement with respect to the
Shares (as defined below) which are underlying the $12 Million Floating
Rate Convertible Note Due 2000 issued by the Company to Computer
Associates International, Inc. dated March 27, 1997 (the Convertible
Note), and to use its best efforts to cause such registration to be
declared effective by no later than forty-five (45) days after the
effective date of the Registration Statement, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the undersigned agrees that, with respect to the number of
Shares and for the number of days immediately following the effective
date of the Registration Statement specified in Schedule 1 hereto (the
Lock-up Period), the undersigned will not, without the prior written
consent of H&Q directly or indirectly:
(i) offer, sell, pledge, contract to sell (including any short
sale whether or not against the box), grant or sell any option
or other contract to purchase, purchase or otherwise acquire
any option or other contract to sell or otherwise dispose of
or transfer the shares of Common Stock of the Company (the
Shares) issuable upon the conversion of the Convertible
Note;
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(ii) enter into any Hedging Transaction (as defined below)
relating to any Shares; or
(iii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, the economic consequence
of ownership of any Shares.
The foregoing restrictions are expressly intended to be applicable
whether any such above-referenced transaction is settled by delivery of
Shares or other securities, in cash or otherwise. In addition, such
restrictions are expressly intended to preclude the undersigned from
entering into any Hedging Transaction or other transaction during the
Lock-up Period which is designed to or reasonably expected to lead to
or result in a disposition of any Shares during the Lock-up Period, even
if the Shares would be disposed of by someone other than the
undersigned. Hedging Transaction means any short sale (whether or not
against the box) or any purchase or other acquisition, sale or grant of
any right (including, without limitation, any put or call option or any
combination thereof) with respect to any security or other instrument
(other than broad-based market basket or index) that includes, relates
to or otherwise derives any significant part of its value from the
Shares.
Without limiting the restrictions herein, any disposition by the
undersigned shall remain at all times subject to applicable securities
laws, including, without limitation, the resale restrictions imposed by
Rule 144 promulgated under the Securities Act.
The undersigned agrees that the Company will, with respect to any
Shares for which the undersigned is the record or beneficial holder,
cause the transfer agent for the Company to note stop transfer
instructions with respect to such Shares on the transfer books and
records of the Company.
The undersigned understands that the Company, the Underwriters and
the Representatives will proceed with the Public Offering in reliance of
this Lock-up Agreement.
The undersigned hereby represents and warrants that the
undersigned has full power and authority to enter into this letter
agreement. Any obligations of the undersigned shall be binding upon the
successors and assigns of the undersigned.
Very truly yours,
Computer Associates International,Inc.
By: Xxxxxxx X. XxXxxx
Senior Vice President
Finance
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Schedule I
Shares Lock-up Period
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1,200,000 Shares issuable upon 45 days
conversion of the Convertible Note
Number of Shares issuable upon 90 days
conversion of the Convertible Note in
excess of 1,200,000
