Exhibit 4.3
TSW AFFILIATE AGREEMENT
This Affiliate Agreement (this "Affiliate Agreement") is made and entered
into as of June 5, 1997 (the "Effective Date") among The Indus Group, Inc., a
California corporation ("INDUS"), Newco Group, Inc., a Delaware corporation
("Newco"), TSW International, Inc., a Georgia corporation ("TSW"), and
______________ ("Stockholder").
RECITALS
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A. This Affiliate Agreement is entered into pursuant to that certain
Agreement and Plan of Merger and Reorganization dated as of June 5, 1997, as
such may be amended (the "Plan of Reorganization"), entered into by and among
INDUS, Newco and TSW. The Plan of Reorganization provides for the formation of
one California corporation and one Georgia corporation (collectively, the
"Subs"), as wholly-owned subsidiaries of Newco, and the statutory merger of one
Sub with and into INDUS (the "INDUS Merger") and the other Sub with and into TSW
(the "TSW Merger") (collectively, the "Merger"), all pursuant to the terms and
conditions of the Plan of Reorganization and the Agreements of Merger to be
entered into between the one Sub and INDUS and the other Sub and TSW
(collectively, the "Agreements of Merger"). The Plan of Reorganization and the
Agreements of Merger are collectively referred to herein as the "Merger
Agreements." Capitalized terms used herein and not defined herein shall have
the meanings that such terms have in the Plan of Reorganization.
B. The Merger Agreements provide for the conversion of all of the issued
and outstanding stock of INDUS and TSW at the Effective Time of the Merger into
shares of Newco's Common Stock, all as more particularly set forth in the Plan
of Reorganization.
C. As a condition to the willingness of INDUS to enter into the Plan of
Reorganization, INDUS has required that Stockholder agree, and in order to
induce INDUS to enter into the Plan of Reorganization Stockholder has agreed, to
enter into this Affiliate Agreement.
D. Stockholder understands that because (i) the Merger is intended by the
parties to qualify for "pooling-of-interests" accounting treatment and
Stockholder may be deemed to be an "affiliate" of TSW within the meaning of the
Securities Act of 1933, as amended (the "1933 Act"), and (ii) the Merger will be
treated as a "reorganization" within the meaning of Section 368 of the Internal
Revenue Code, the shares of TSW Common Stock or TSW Preferred Stock which
Stockholder owns, any shares of TSW Common Stock or TSW Preferred Stock which
Stockholder may hereafter acquire, and any shares of Newco Common Stock (the
"Newco Common Stock") acquired by Stockholder pursuant to the Merger may be
disposed of only in conformity with the limitations described herein.
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. TSW SECURITIES
Attachment 1 hereto sets forth all shares of TSW capital stock and any
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other securities of TSW owned by Stockholder, including all securities of TSW as
to which Stockholder has sole or shared voting or investment power, and all
rights, options and warrants to acquire shares of capital stock or other
securities of TSW granted to or held by Stockholder (such shares of TSW capital
stock, other securities of TSW and rights, options and warrants to acquire
shares of TSW capital stock and other securities of TSW are hereinafter
collectively referred to as "TSW Stock"). As used herein, the term "New TSW
Securities" means, collectively, any and all shares of TSW capital stock, other
securities of TSW and rights, options and warrants to acquire shares of TSW
capital stock and other securities of TSW that Stockholder may purchase or
otherwise acquire any interest in (whether of record or beneficially), on and
after the Effective Date of this Affiliate Agreement and prior to the Expiration
Date (as defined below). All New TSW Securities will be subject to the terms of
this Affiliate Agreement to the same extent and in the same manner as if they
were TSW Stock. The TSW Stock and the New TSW Securities shall be collectively
referred to herein as the "TSW Securities". As used herein, the term
"Expiration Date" means the earliest to occur of (i) the Effective Time of the
Merger, or (ii) such time as the Plan of Reorganization may be terminated in
accordance with its terms.
SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF STOCKHOLDER
2.1 Reliance Upon Representations, Warranties and Covenants. Stockholder
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understands that the representations, warranties and covenants of Stockholder
set forth herein will be relied upon by INDUS, TSW and Newco and their
respective counsel and accounting firms and by TSW's stockholders.
2.2 Representations, Warranties and Covenants of Stockholder. Stockholder
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represents, warrants and covenants as follows:
(i) Authority: Affiliate Status. Stockholder has full power and
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authority to enter into, execute, deliver and perform Stockholder's obligations
under this Affiliate Agreement and to make the representations, warranties and
covenants herein contained. Stockholder further understands and agrees that
Stockholder may be deemed to be an "affiliate" of TSW within the meaning of the
1933 Act and, in particular, Rule 145 promulgated under the 1933 Act ("Rule
145").
(ii) TSW Securities Owned. Except as otherwise disclosed in the
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TSW Disclosure Letter, at the date hereof, all the TSW Stock owned by
Stockholder are, and at all times until and through the Expiration Date all the
TSW Securities owned by Stockholder will be, free and clear of any rights of
first refusal, co-sale rights, security interests, liens, pledges, claims,
options, charges or other encumbrances.
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(iii) Transfer Restrictions on TSW Securities. Stockholder agrees
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with INDUS not to sell, transfer, encumber or dispose of, or offer to sell,
transfer, encumber or dispose of any TSW Securities until the Expiration Date,
and at such time, only as agreed pursuant to the terms hereof.
(iv) Waivers. Except as contemplated, created or granted by the
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Plan of Reorganization, Stockholder hereby waives, effective as of the Effective
Time, any liquidation, redemption, antidilution, registration rights,
information rights, preemptive rights, priority rights, rights or first refusal,
co-sale or other similar rights under the terms of the Articles of Incorporation
or Bylaws of TSW or any agreement with TSW or its security holders in effect
immediately prior to the Effective Time.
(v) Further Assurances. Stockholder agrees to execute and
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deliver any additional documents reasonably necessary or desirable, in the
opinion of INDUS or TSW, to carry out the purposes and intent of this Affiliate
Agreement.
(vi) Transfer Restrictions on Merger Securities. As used herein,
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the term "Merger Securities" means, collectively, all shares of Newco Common
Stock that are or may be issued by Newco in connection with the Merger or the
transactions contemplated by the Merger Agreements, or to any former holder of
TSW options, warrants or rights to acquire shares of TSW Common Stock, and any
securities that may be paid as a dividend or otherwise distributed thereon or
with respect thereto or issued or delivered in exchange or substitution therefor
or upon conversion thereof. Stockholder agrees not to sell, transfer, exchange,
pledge, or otherwise dispose of, or make any offer or agreement relating to, any
of the Merger Securities and/or any option, right or other interest with respect
to any Merger Securities that Stockholder may acquire, unless: (i) such sale,
transfer, exchange, pledge or disposition is permitted pursuant to Rule
145(d)(3) under the Securities Act (as contemplated by Section 3 hereof) and
Newco's accountants have advised such Stockholder in writing that such sale,
transfer, exchange, pledge or disposition would not preclude pooling of
interests accounting treatment of the Merger; (ii) Newco's legal counsel or
legal counsel representing Stockholder, which counsel is reasonably satisfactory
to Newco, shall have advised Newco in a written opinion letter reasonably
satisfactory to Newco and Newco's legal counsel, and upon which Newco and its
legal counsel may rely, that no registration under the 1933 Act would be
required in connection with the proposed sale, transfer, exchange, pledge or
other disposition of Merger Securities by Stockholder, or (iii) a registration
statement under the 1933 Act covering the Merger Securities proposed to be sold,
transferred, exchanged, pledged or otherwise disposed of, describing the manner
and terms of the proposed sale, transfer, exchange, pledge or other disposition,
and containing a current prospectus, shall have been filed with the Securities
and Exchange Commission ("SEC") and been declared effective by the SEC under
the 1933 Act; or (iii) an authorized representative of the SEC shall have
rendered written advice to Stockholder (sought by Stockholder or counsel to
Stockholder, with a copy thereof and all other related communications delivered
to Newco and its legal counsel) to the effect that the SEC would take no action,
or that the staff of the SEC would not recommend that the SEC take action, with
respect to the proposed disposition of Merger Securities, if consummated.
Nothing herein imposes upon Newco any obligation to register any Merger
Securities under the 1933 Act.
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(vii) Pooling Lock-Up. Notwithstanding any other provision of this
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Affiliate Agreement to the contrary, from and after the date of this Agreement,
Stockholder will not further sell, transfer, exchange, pledge or otherwise
dispose of, or in any other way reduce Stockholder's risk of ownership or
investment in, or make any offer or agreement relating to any of the foregoing
with respect to any TSW Securities or any rights, options or warrants to
purchase TSW Securities or any Merger Securities or other securities of Newco
during the time period (the "Lock-Up Period") beginning thirty (30) days
immediately preceding the Effective Time and ending at such time after the
Effective Time as Newco has publicly released the combined financial results of
Newco, INDUS and TSW for a period of at least thirty (30) days of combined
operations of Newco, INDUS and TSW after the Effective Time of the Merger. Newco
agrees to publish such financial results expeditiously in a manner consistent
with INDUS' prior practices. Notwithstanding the foregoing, Newco agrees that
any "affiliates" of TSW within the meaning of Rule 145 will be allowed as a
group to sell up to an aggregate of 1% of TSW Stock under the "de minimis"
exceptions to the pooling of interest requirements, with each transaction to be
approved in advance by Newco's auditors.
(viii) Intent. Stockholder does not now have, and as of the
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Effective Time of the Merger will not have, any present plan or intention to
engage in a further sale, exchange, transfer, distribution, pledge, disposition
or any other transaction which would result in a direct or indirect disposition
or an equity swap or other risk diminishing transaction (a "Sale") of more than
fifty percent (50%) of the Newco Common Stock (or other Merger Securities) that
Stockholder may acquire in connection with the Merger, or any securities that
may be paid as a dividend or otherwise distributed thereon or with respect
thereto or issued or delivered in exchange or substitution therefor or upon
conversion thereof ("Derivative Securities"). Stockholder is not aware of, nor
is Stockholder participating in, any plan on the part of TSW stockholders to
engage in Sales of Newco Common Stock (or other Merger Securities) to be issued
in the Merger such that the aggregate fair market value, as of the Effective
Time of the Merger of the shares subject to such Sales would exceed fifty
percent (50%) of the aggregate fair market value of all shares of outstanding
TSW Securities immediately prior to the Merger. For purposes of this
representation, TSW Securities (or any portion thereof) (i) with respect to
which a TSW stockholder receives consideration in the Merger other than Newco
Common Stock (including, without limitation, cash received in lieu of fractional
shares) and/or (ii) with respect to which a Sale occurs during the period
beginning with the commencement of negotiations (whether formal or informal)
between INDUS and TSW regarding the Merger and ending on the Effective Time of
the Merger (the "Pre-Merger Period"), shall be considered shares of outstanding
TSW Common Stock exchanged for Newco Common Stock received in the Merger and
then disposed of pursuant to any plan on the part of TSW stockholders.
SECTION 3. RESTRICTIONS ON RESALES
Stockholder understands that, in addition to the restrictions imposed under
Section 2 of this Affiliate Agreement, the provisions of Rule 145 currently
limit Stockholder's public resales of Merger Securities, in the manner set forth
in subsections (i), (ii) and (iii) below, until such time as Stockholder has
beneficially owned, within the meaning of Rule 144(d) under the 1933 Act, the
Merger Securities for a period of at least one (1) year (or in some cases two
(2) years) after the Effective Time of the Merger, and thereafter if and for so
long as Stockholder is an affiliate of Newco:
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(i) 145(d)(1). Unless and until the restriction "cut-off"
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provisions of Rule 145(d)(2) or Rule 145(d)(3) set forth below become available,
public resales of Merger Securities may be made by Stockholder only in
compliance with the requirements of Rule 145(d)(1). Rule 145(d)(1) permits such
resales only: (i) if Newco meets the public information requirements of Rule
144(c); (ii) in brokers' transactions or in transactions with a market maker;
and (iii) where the aggregate number of Merger Securities sold at any time
together with all sales of restricted Newco Common Stock sold by or for
Stockholder's account during the preceding three-month period does not exceed
the greater of: (A) one percent (1%) of the shares of Newco Common Stock
outstanding as shown by the most recent report or statement published by Newco;
or (B) the average weekly volume of trading in Newco Common Stock on all
national securities exchanges, or reported through the automated quotation
system of a registered securities association, during the four calendar weeks
preceding the date of receipt of the order to execute the sale.
(ii) 145(d)(2). Stockholder may make unrestricted resales of
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Merger Securities pursuant to Rule 145(d)(2) if: (i) Stockholder has
beneficially owned (within the meaning of Rule 144(d) under the 0000 Xxx) the
Merger Securities for at least one (1) year after the Effective Time of the
Merger; (ii) Stockholder is not an affiliate of Newco; and (iii) Newco meets the
public information requirements of Rule 144(c).
(iii) 145(d)(3). Stockholder may make unrestricted resales of
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Merger Securities pursuant to Rule 145(d)(3) if Stockholder has beneficially
owned (within the meaning of Rule 144(d) under the 0000 Xxx) the Merger
Securities for at least two (2) years after the Effective Time of the Merger and
is not, and has not been for at least three (3) months, an affiliate of Newco.
INDUS and Newco each acknowledge that the provisions of Section 2.2(vi) of
this Affiliate Agreement will be satisfied as to any sale by the undersigned of
the Merger Securities pursuant to Rule 145(d), by a broker's letter and a letter
from Stockholder with respect to that sale stating either that (i) each of the
above-described requirements of Rule 145(d)(1) has been met or (ii) are
inapplicable by virtue of Rule 145(d)(2) or Rule 145(d)(3) and each of the
above-described requirements of Rule 145(d)(2) or (d)(3) (as applicable) have
been met; provided that in each case Newco has no reasonable basis to believe
such sales were not made in compliance with such provisions of Rule 145(d).
SECTION 4. LEGENDS
Stockholder also understands and agrees that stop transfer instructions
will be given to Newco's transfer agent with respect to certificates evidencing
the Merger Securities to enforce (i) Stockholder's compliance with Stockholder's
representations in Subsection 2.2(vii), (ii) Stockholders' agreements in Section
3, and (iii) Stockholder's compliance with applicable securities laws regarding
the Merger Securities, and that there will be placed on the certificates
evidencing such Merger Securities such legends as Newco or its counsel may
reasonably require, including without limitation, a legend providing
substantially as follows:
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"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED, SOLD,
PLEDGED, EXCHANGED, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN
ACCORDANCE WITH THE REQUIREMENTS OF THE SECURITIES ACT OF 1933. AS
AMENDED, ANY APPLICABLE STATE SECURITIES LAWS, AND THE OTHER CONDITIONS
SPECIFIED IN THAT CERTAIN AFFILIATE AGREEMENT DATED AS OF JUNE 5, 1997
AMONG THE INDUS GROUP, INC., NEWCO GROUP, INC., TSW INTERNATIONAL, INC. AND
THE HOLDER OF SUCH SHARES, A COPY OF WHICH MAY BE INSPECTED BY THE HOLDER
OF THIS CERTIFICATE AT THE OFFICES OF NEWCO. NEWCO WILL FURNISH, WITHOUT
CHARGE, A COPY THEREOF TO THE HOLDER OF THIS CERTIFICATE, UPON WRITTEN
REQUEST THEREFOR."
SECTION 5. MISCELLANEOUS
5.1 Notices. Any notice or other communication required or permitted to
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be given under this Affiliate Agreement will be in writing, will be delivered
personally, by telecopier (with a hard copy also mailed), or by registered or
certified mail, postage prepaid and will be deemed given upon delivery, if
delivered personally, one business day after transmission by telecopier with
confirmation of receipt, or three (3) days after deposit in the mails, if
mailed, to the following addresses:
(i) If to INDUS or to Newco:
THE INDUS GROUP, Inc.
00 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Chief Financial Officer
With a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx, Xx.
(ii) If to TSW:
TSW International, Inc.
0000 Xxxxx Xxxxx Xxxxxxx
Xxxxxxx, XX 00000
Attn: Chief Financial Officer
With a copy to:
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Wachtell, Lipton, Xxxxx & Xxxx
00 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxx
If to Stockholder:
To the address for notice for such Stockholder set forth on
Attachment I hereto, or to such other address as a party may have furnished
to the other parties in writing pursuant to this Section 5.1.
5.2 Termination. This Affiliate Agreement shall be terminated and shall
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be of no further force and effect upon the termination of the Plan of
Reorganization pursuant to its terms.
5.3 Counterparts. This Affiliate Agreement may be executed in any number
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of counterparts, each of which will be an original as regards any party whose
signature appears thereon and all of which together will constitute one and the
same instrument. This Affiliate Agreement will become binding when one or more
counterparts hereof, individually or taken together, will bear the signatures of
all parties reflected hereon as signatories.
5.4 Assignment; Binding Upon Successors and Assigns. Neither party hereto
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may assign any of its rights or obligations hereunder without the prior written
consent of the other party hereto. This Affiliate Agreement will be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
5.5 Waiver and Amendment. The waiver by a party of any breach hereof or
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default in the performance hereof will not be deemed to constitute a waiver of
any other default or any succeeding breach or default. This Affiliate Agreement
may be amended by the parties hereto upon the execution and delivery of a
written agreement executed by the parties hereto at any time before or after
approval of the Merger by the TSW stockholders, but, after such approval, no
amendment will be made which by applicable law requires the further approval of
the TSW stockholders without obtaining such further approval.
5.6 Governing Law. The internal laws of the State of Delaware
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(irrespective of its choice of law principles) will govern the validity of this
Affiliate Agreement, the construction of its terms, and the interpretation and
enforcement of the rights and duties of the parties hereto.
5.7 Severability. If any term, provision, covenant or restriction of this
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Affiliate Agreement (or of the Plan of Reorganization) is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Affiliate Agreement
(or of the Plan of Reorganization, as the case may be) will remain in full force
and effect and will in no way be effected, impaired or invalidated. The parties
further agree to replace such invalid or unenforceable term with a valid and
enforceable provision that will achieve, to the greatest extent possible, the
economic, business and other purposes of the invalid or unenforceable provision.
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5.8 Construction of Agreement. This Affiliate Agreement has been
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negotiated by the respective parties hereto and their attorneys and the language
hereof will not be construed for or against either party. A reference to a
Section will mean a Section in this Affiliate Agreement unless otherwise
explicitly set forth. The titles and headings herein are for reference purposes
only and will not in any manner limit the construction of this Affiliate
Agreement which will be considered as a whole.
5.9 Attorneys' Fees. Should suit be brought to enforce or interpret any
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part of this Affiliate Agreement, the prevailing party will be entitled to
recover as an element of the costs of suit and not as damages, reasonable
attorneys' fees to be fixed by the court (including without limitation, costs,
expenses and fees on any appeal). The prevailing party will be entitled to
recover its costs of suit, regardless of whether such suit proceeds to final
judgment.
5.10 Partnership. Newco, INDUS and TSW agree that if Stockholder is a
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limited partnership, Stockholder's general and limited partners shall in no
event be liable for any obligations or liabilities of Stockholder under this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Affiliate
Agreement as of the date first set forth above.
THE INDUS GROUP, INC. TSW INTERNATIONAL, INC.
a California corporation a Georgia corporation
By:______________________________ By:_____________________________
Name:____________________________ Name:___________________________
Title:___________________________ Title:__________________________
NEWCO GROUP, INC. STOCKHOLDER:
a Delaware corporation
By:______________________________ ________________________________
Name:____________________________ Name:___________________________
Title:___________________________
[SIGNATURE PAGE TO TSW AFFILIATE AGREEMENT]
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ATTACHMENT 1
TSW STOCK
Affiliate's Address for Notice:
Class and Number of shares of TSW capital stock
beneficially owned by the undersigned:
Number of options, warrants or other convertible
securities convertible into TSW capital stock
beneficially owned by the undersigned:
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