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EXHIBIT 2.1 (b)
ESCROW AGREEMENT
THIS ESCROW AGREEMENT is made as of February 13, 1998 (the "Closing
Date"), by and among Manugistics Nova Scotia Company, a Nova Scotia unlimited
company ("Buyer"), ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, or either of them acting
alone, as paying agent ("Paying Agent"), State Street Bank and Trust Company, a
Massachusetts corporation ("Custodian"), and State Street Bank and Trust
Company, a Massachusetts corporation ("Escrow Agent").
BACKGROUND:
A. Pursuant to a certain Stock Purchase Agreement dated as of the date
hereof by and among Insight Venture Partners I, L.P., Wexford Insight Canada,
L.P., Arca Investments Inc., Capital d'Amerique CDPQ Inc., CBC Pension Board of
Trustees, Gee & Co., The Canada Trust Company a/c ▇▇▇-▇▇▇▇▇▇-▇, ▇▇▇▇▇▇
University Pension Fund, Royal Trust Corporation of Canada in Trust for Account
No. 083166009, Royal Trust Corporation of Canada in Trust for Account No.
029361001, Association de bienfaisance et de retraite des policiers de la
Communaute urbaine de Montreal, Ontario Hydro in Trust for the Pension Fund,
Sun Life Assurance Company of Canada, The Canada Trust Company Account No.
▇▇▇-▇▇▇▇▇▇-▇, Altacap Investors Inc., ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇, The ▇▇▇▇▇ Family Trust, ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Laurentian Bank of Canada
ITF ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, RBC Dominion Securities ITF ▇▇▇ ▇▇▇▇▇▇▇▇, RBC Dominion
Securities ITF ▇▇▇▇▇▇ ▇▇▇▇▇, RBC Dominion Securities ITF ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ in Trust for ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ in Trust for ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ Removic, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Saint-Laurent, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ van Galder, ▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, RBC
Dominion Securities ITF ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ c/f ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and Hie ▇▇▇▇
▇▇▇▇ (collectively, the "Sellers"), Buyer, ProMIRA Software Incorporated (the
"Company"), and the Paying Agent, including the Exhibits thereto (the "Stock
Purchase Agreement"), Buyer has directed Boston Equiserve Limited Partnership
(the "Transfer Agent") to register 155,003 shares of the common stock of
Manugistics Group, Inc., par value $.002 per share (the "One Year Escrow
Shares"), in the name of Escrow Agent. The One Year Escrow Shares, together
with all cash and non-cash dividends and other
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amounts payable after the Closing Date with respect to the One Year Escrow
Shares are collectively referred to herein as the "One Year Escrow Fund". The
One Year Escrow Fund shall be held by Escrow Agent subject to the terms and
conditions set forth herein.
B. Pursuant to the Stock Purchase Agreement, Buyer has also directed
the Transfer Agent to register 154,994 shares of the common stock of
Manugistics Group, Inc., par value $.002 per share (the "Two Year Escrow
Shares") in the name of Escrow Agent. The Two Year Escrow Shares, together
with all cash and non-cash dividends and other amounts payable after the
Closing Date with respect to the Two Year Escrow Shares are collectively
referred to herein as the "Two Year Escrow Fund". The Two Year Escrow Fund
shall be held by Escrow Agent subject to the terms and conditions set forth
herein.
C. The One Year Escrow Fund and the Two Year Escrow Fund, each of which
is to be held in a separate account, are collectively referred to herein as the
"Escrow Funds".
D. Pursuant to the terms of the Stock Purchase Agreement, each of the
Sellers has appointed ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, or either of them acting
alone, as Paying Agent to act as their agent and attorney-in-fact and
representative in accordance with the terms of this Escrow Agreement.
NOW, THEREFORE, in consideration of the foregoing background and of the
mutual covenants set forth herein and in the Stock Purchase Agreement, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. APPOINTMENT OF ESCROW AGENT. Buyer does hereby appoint and
designate, with the consent of Paying Agent, State Street Bank and Trust
Company as Escrow Agent for the purposes set forth herein, and Escrow Agent
does hereby accept such appointment under the terms and conditions set forth
herein.
2. ESTABLISHMENT OF THE ESCROW FUNDS.
(a) The One Year Escrow Fund. Pursuant to the terms of Section
3.2(b)(ii)(C)(1) of the Stock Purchase Agreement, Buyer has provided written
instructions to the Transfer Agent to register the One Year Escrow Shares in
the name of the Escrow Agent. Immediately upon ascertaining that the Transfer
Agent has complied with its written instructions to register the One Year
Escrow Shares in the name of Escrow Agent, as aforesaid, and its providing
written notice of such compliance to Paying Agent, Buyer shall have no further
liability to Paying Agent or any of the Sellers with respect to the delivery of
the One Year Escrow Shares.
(b) The Two Year Escrow Fund. Pursuant to the terms of Section
3.2(b)(ii)(C)(2) of the Stock Purchase Agreement, Buyer has
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provided written instructions to the Transfer Agent to register the Two Year
Escrow Shares in the name of the Escrow Agent. Immediately upon ascertaining
that the Transfer Agent has complied with its written instructions to register
the Two Year Escrow Shares in the name of Escrow Agent, as aforesaid, and its
providing written notice of such compliance to Paying Agent, Buyer shall have
no further liability to Paying Agent or any of the Sellers with respect to the
delivery of the Two Year Escrow Shares.
3. INVESTMENT OF ESCROW FUNDS.
(a) One Year Escrow Fund.
(i) During the term of this Escrow Agreement, Escrow Agent
shall deposit all cash dividends and other monetary amounts payable after the
date hereof with respect to the One Year Escrow Shares, if any, in an insured
money market account with Escrow Agent, or in such other accounts or
investments as Buyer and Paying Agent may from time to time designate by joint
written notice of such parties to Escrow Agent. All monetary and non-monetary
dividends payable after the date hereof with respect to the One Year Escrow
Shares shall be added to and shall form part of the One Year Escrow Shares.
(ii) Escrow Agent shall have the right to liquidate any
investments in which such cash dividends and other monetary amounts included in
the One Year Escrow Fund are held, in order to provide funds necessary to make
required payments under this Escrow Agreement. Escrow Agent shall not be
liable for any loss upon such liquidation which is due to fluctuations in the
market rates applicable to investments of any monetary portion of the One Year
Escrow Fund, if any, or penalties incurred because of early redemption.
(iii) Escrow Agent shall not be obligated or permitted to
liquidate any of the One Year Escrow Shares in order to provide funds necessary
to make required payments under this Escrow Agreement; it being acknowledged
and understood that Escrow Agent shall make transfers of shares comprising the
One Year Escrow Fund in accordance with the terms of this Agreement to satisfy
such required payments.
(b) Two Year Escrow Fund.
(i) During the term of this Escrow Agreement, Escrow Agent
shall deposit all cash dividends and other monetary amounts payable after the
date hereof with respect to the Two Year Escrow Shares, if any, in an insured
money market account with Escrow Agent, or in such other accounts or
investments as Buyer and Paying Agent may from time to time designate by joint
written notice of such parties to Escrow Agent. All monetary and non-monetary
dividends payable after the date hereof with respect to
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the Two Year Escrow Shares shall be added to and shall form part of the Two
Year Escrow Shares.
(ii) Escrow Agent shall have the right to liquidate any
investments in which such cash dividends and other monetary amounts included in
the Two Year Escrow Fund are held in order to provide funds necessary to make
required payments under this Escrow Agreement. Escrow Agent shall not be
liable for any loss upon such liquidation which is due to fluctuations in the
market rates applicable to investments of any monetary portion of the Two Year
Escrow Fund, if any, or penalties incurred because of early redemption.
(iii) Escrow Agent shall not be obligated or permitted to
liquidate any of the Two Year Escrow Shares in order to provide funds necessary
to make required payments under this Escrow Agreement; it being acknowledged
and understood that Escrow Agent shall make transfers of shares comprising the
Two Year Escrow Fund in accordance with the terms of this Agreement.
4. DISPOSITION OF THE ESCROW FUNDS.
(a) One Year Escrow Fund. Escrow Agent shall disburse the One Year
Escrow Fund upon and pursuant to the written instructions set forth in this
Section 4(a).
(i) Disposition to Buyer. Except as otherwise provided in
Section 6(a)(i) hereof, on the tenth business day following receipt by Escrow
Agent of a written notice of instruction from Buyer to do so (a "Disbursement
Notice"), provided such Disbursement Notice shall be received by Escrow Agent
on or before the first anniversary of the Closing Date, Escrow Agent shall
(A) first, disburse any monetary amounts set forth in
the Disbursement Notice from the One Year Escrow Fund to Buyer; and
(B) second, by written notice, substantially in the
form attached hereto as EXHIBIT II, direct the Transfer Agent to register the
number of One Year Escrow Shares set forth in such Disbursement Notice in the
name of Buyer and deliver such One Year Escrow Shares to Buyer, as set forth in
such Disbursement Notice.
Each Disbursement Notice shall identify the section number(s) of the Stock
Purchase Agreement pursuant to which the claim is being asserted, identify
whether such claim arises as a result of an amount paid or a claim asserted but
unpaid, and set forth the number of One Year Escrow Shares and other amounts to
be so disbursed from the One Year Escrow Fund so that the aggregate amount of
the then current market value of such One Year Escrow
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Shares, as established by the Nasdaq Exchange closing price therefor on the
last business day prior to the date of such Disbursement Notice (the "Notice
Date Market Value"), rounded up to the next full share, and such other monies
subject of such Disbursement Notice, if any, is equal to the amount of any
claim (collectively, the "One Year Claim Amount") for indemnification of Buyer
and/or its affiliates and/or their respective officers, directors, agents and
employees. The Disbursement Notice shall also set forth the number of One Year
Escrow Shares constituting the One Year Disbursement Notice Cushion (as defined
in Section 6(a)(ii) hereof.)
(ii) Disposition to Paying Agent. On the later of (a) the
date of the first anniversary of the Closing Date; or (b) the tenth business
day following the date of receipt by Escrow Agent of a Disbursement Notice in
accordance with the terms of Section 4(a)(i) above, Escrow Agent shall, by
written notice, substantially in the form attached hereto as EXHIBIT III,
direct the Transfer Agent to register in the name of the Paying Agent that
number of the One Year Escrow Shares not reserved for in a One Year Reserve
pursuant to Section 6(a)(ii) hereof or not already disbursed pursuant to
Section 4(a)(i)(B) hereof, and shall disburse to Paying Agent all cash
dividends and other amounts paid after the Closing Date with respect to the One
Year Escrow Shares and all interest accrued thereon and then remaining in the
One Year Escrow Fund on such date.
(iii) Escrow Agent shall provide a copy of its written
instructions pursuant to this Section 4(a) to Buyer and Paying Agent.
(b) Two Year Escrow Fund. Escrow Agent shall disburse the Two Year
Escrow Fund upon and pursuant to the written instructions set forth in this
Section 4(b).
(i) Disposition to Buyer. Except as otherwise provided in
Section 6(b)(i) hereof, on the tenth business day following receipt by Escrow
Agent of a Disbursement Notice, provided such Disbursement Notice shall be
received by Escrow Agent on or before the second anniversary of the Closing
Date, Escrow Agent shall
(A) first, disburse any monetary amounts set forth in
the Disbursement Notice from the Two Year Escrow Fund to Buyer; and
(B) second, by written notice, substantially in the
form attached hereto as EXHIBIT IV, direct the Transfer Agent to register the
number of Two Year Escrow Shares set forth in such Disbursement Notice in the
name of Buyer and deliver such Two Year Escrow Shares to Buyer, as set forth in
such Disbursement Notice.
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Each Disbursement Notice shall identify the section number(s) of the Stock
Purchase Agreement pursuant to which the claim is being asserted, identify
whether such claim arises as a result of an amount paid or a claim asserted but
unpaid, and set forth the number of Two Year Escrow Shares and other amounts to
be so disbursed from the Two Year Escrow Fund so that the aggregate amount of
the then current market value of such Two Year Escrow Shares, as established by
the Nasdaq Exchange closing price therefor on the last business day prior to
the date of such Disbursement Notice, rounded up to the next full share, and
such other monies subject of such Disbursement Notice, if any, is equal to the
amount of any claim (collectively the "Two Year Claim Amount") for
indemnification of Buyer and/or its affiliates and/or their respective
officers, directors, agents and employees. The Disbursement Notice shall also
set forth the number of Two Year Escrow Shares constituting the Two Year
Disbursement Notice Cushion (as defined in Section 6(b)(ii) hereof.)
(ii) Disposition to Paying Agent. On the later of (a) the
second anniversary following the Closing Date; or (b) the tenth business day
following the date of receipt by the Escrow Agent of a Disbursement Notice in
accordance with the terms of Section 4(b)(i) above, Escrow Agent shall by
written notice, substantially in the form attached hereto as EXHIBIT V, direct
the Transfer Agent to register in the name of the Paying Agent that number of
Two Year Escrow Shares not reserved for in a Two Year Reserve pursuant to
Section 6(b)(ii) hereof or not already disbursed pursuant to Section 4(b)(i)(B)
hereof, and shall disburse all cash dividends and other amounts paid after the
Closing Date with respect to the Two Year Escrow Shares and all interest
accrued thereon and then remaining in the Two Year Escrow Fund on such date.
(iii) Escrow Agent shall provide a copy of its written
instructions to the Transfer Agent pursuant to this Section 4(b) to Buyer and
Paying Agent.
5. NOTICES TO ESCROW AGENT AND PAYING AGENT. Buyer agrees to
simultaneously furnish to Paying Agent copies of all notices sent by Buyer to
Escrow Agent. In addition, Buyer agrees to furnish to Paying Agent (but not to
Escrow Agent), as an attachment to each Disbursement Notice furnished by Buyer
to Paying Agent, a full written explanation of each claim (including the amount
thereof, whether paid or asserted but unpaid, the section(s) of the Stock
Purchase Agreement under which each claim is asserted, and a summary of the
relevant facts upon which each claim is based).
6. OBJECTIONS TO DISBURSEMENTS.
(a) Disbursement Notices Relating to the One Year Escrow Fund.
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(i) In the event Paying Agent objects to anything contained
in any Disbursement Notice received from Buyer, Paying Agent shall provide
written notice of such objection to such Disbursement Notice (an "Objection
Notice") to Escrow Agent (with a copy simultaneously furnished to Buyer) before
5:00 p.m. (Eastern Standard Time) on or before the seventh business day
following the date on which Escrow Agent and Paying Agent receive such
Disbursement Notice.
(ii) Pending resolution of the objection described in the
Objection Notice in accordance with the terms of this Section 6(a) and Section
9 hereof, Escrow Agent shall not make the disbursement set forth in the
Disbursement Notice, but shall retain as a reserve (the "One Year Reserve") the
One Year Claim Amount referred to in (A) any Disbursement Notice received by
Escrow Agent from Buyer pursuant to the terms of Section 4(a)(i) hereof with
respect to which Escrow Agent has not disbursed to Buyer because the Escrow
Agent has received an Objection Notice pursuant to Section 6(a)(i) hereof,
together with that number of One Year Escrow Shares, rounded up to the next
full share, the Notice Date Market Value of which is equal to one-half of the
One Year Claim Amount (the "One Year Disbursement Notice Cushion"). In the
event Escrow Agent does not receive an Objection Notice before 5:00 p.m. on or
before the seventh business day after the date of any Disbursement Notice, as
aforesaid, Paying Agent shall be deemed to have approved such Disbursement
Notice.
(iii) Following receipt of an Objection Notice, Escrow Agent
may, at its sole discretion, commence an action in interpleader with a court of
competent jurisdiction to resolve such Objection Notice and, in connection
therewith, deposit the One Year Reserve with the clerk of such court.
(iv) Notwithstanding anything to the contrary contained
herein, in the event the Paying Agent delivers an Objection Notice to Escrow
Agent in accordance with this Section 6(a), the number of One Year Escrow
Shares required to satisfy the full amount of any such claim as set forth in
the Disbursement Notice and subject of such Objection Notice, shall be
calculated based upon the Nasdaq Exchange closing price applicable to such One
Year Escrow Shares on the second business day immediately preceding the date
that the amount of such claim is finally determined in accordance with this
Escrow Agreement, whereupon the Escrow Agent shall promptly instruct the
Transfer Agent to register and deliver such One Year Escrow Shares in
accordance with the terms of settlement of such claim pursuant to Section 9
hereof.
(b) Disbursement Notices Relating to the Two Year Escrow Fund.
(i) In the event Paying Agent objects to anything contained in
any Disbursement Notice received from Buyer, Paying
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Agent shall provide written notice of such objection to such Disbursement
Notice (an "Objection Notice") to Escrow Agent (with a copy simultaneously
furnished to Buyer) before 5:00 p.m. (Eastern Standard Time) on or before the
seventh business day following the date on which Escrow Agent receives such
Disbursement Notice.
(ii) Pending resolution of the objection described in the
Objection Notice in accordance with the terms of this Section 6(b) and Section
9 hereof, Escrow Agent shall not make the disbursement set forth in the
Disbursement Notice, but shall retain as a reserve (the "Two Year Reserve") the
Two Year Claim Amount referred to in (A) any Disbursement Notice received by
Escrow Agent from Buyer pursuant to the terms of Section 4(b)(i) hereof with
respect to which Escrow Agent has not disbursed to Buyer because the Escrow
Agent has received an Objection Notice pursuant to Section 6(b)(i) hereof,
together with that number of Two Year Escrow Shares, rounded up to the next
full share, the Notice Date Market Value of which is equal to one-half of the
Two Year Claim Amount (the "Two Year Disbursement Notice Cushion"). In the
event Escrow Agent does not receive an Objection Notice before 5:00 p.m. on or
before the seventh business day after the date of any Disbursement Notice, as
aforesaid, Paying Agent shall be deemed to have approved such Disbursement
Notice.
(iii) Following receipt of an Objection Notice, Escrow Agent
may, at its sole discretion, commence an action in interpleader with a court of
competent jurisdiction to resolve such Objection Notice and, in connection
therewith, deposit the Two Year Reserve with the clerk of such court.
(iv) Notwithstanding anything to the contrary contained
herein, in the event the Paying Agent delivers an Objection Notice to Escrow
Agent in accordance with this Section 6(b), the number of Two Year Escrow
Shares required to satisfy the full amount of any such claim as set forth in
the Disbursement Notice and subject of such Objection Notice, shall be
calculated based upon the Nasdaq Exchange closing price applicable to such Two
Year Escrow Shares on the second business day immediately preceding the date
that the amount of such claim is finally determined in accordance with this
Escrow Agreement, whereupon the Escrow Agent shall promptly instruct the
Transfer Agent to register and deliver such Two Year Escrow Shares in
accordance with the terms of settlement of such claim pursuant to Section 9
hereof.
7. TERMINATION OF ESCROW FUNDS.
(a) One Year Escrow Fund. Upon registration by the Transfer Agent
of all One Year Escrow Shares in the One Year Escrow Fund as provided in
Sections 4(a)(i) and (ii) hereof, including all shares held in the One Year
Reserve pursuant to Sections 6(a) and 9 hereof, and upon disbursement by Escrow
Agent of all other amounts in the One Year Escrow Fund, if any, this Escrow
Agreement
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(with respect to the One Year Escrow Fund) shall terminate, subject to the
provisions of Sections 9, 11 and 12 hereof, which Sections shall survive such
termination. This Escrow Agreement (with respect to the One Year Escrow Fund)
may also be terminated at any time by and upon the receipt by Escrow Agent of
ten (10) days' prior joint written notice of termination executed by Buyer and
Paying Agent directing the distribution of the One Year Escrow Fund.
(b) Two Year Escrow Fund. Upon registration by the Transfer Agent
of all Two Year Escrow Shares in the Two Year Escrow Fund as provided in
Sections 4(b)(i) and (ii) hereof, including all Two Year Escrow Shares held in
the Two Year Reserve pursuant to Sections 6(b) and 9 hereof, and upon
disbursement by Escrow Agent of all other amounts in the Two Year Escrow Fund,
if any, this Escrow Agreement (with respect to the Two Year Escrow Fund) shall
terminate, subject to the provisions of Sections 9, 11 and 12 hereof, which
Sections shall survive such termination. This Escrow Agreement (with respect
to the Two Year Escrow Fund) may also be terminated at any time by and upon the
receipt by Escrow Agent of ten (10) days' prior joint written notice of
termination executed by Buyer and Paying Agent directing the distribution of
the Two Year Escrow Fund.
8. DUTIES AND RESPONSIBILITIES OF ESCROW AGENT
(a) Buyer and Paying Agent acknowledge and agree that Escrow Agent
(i) shall be obligated only for the performance of such duties as are
specifically set forth in this Escrow Agreement; (ii) shall not be obligated to
take any legal or other action hereunder which might in its judgment involve
any expense or liability unless it shall have been furnished with
indemnification reasonably acceptable to it; (iii) may rely on and shall be
protected in acting or refraining from acting upon any written notice,
instruction (including, without limitation, wire transfer instructions, whether
incorporated herein or provided in a separate written instruction), instrument,
statement, request or document furnished to it hereunder and believed by it to
be genuine and to have been signed or presented by the proper person, and shall
have no responsibility for determining the accuracy thereof; and (iv) may
consult counsel satisfactory to it, including house counsel, and the advice or
opinion of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the opinion of such counsel.
(b) Neither Escrow Agent nor any of its directors, officers or
employees shall be liable to anyone for any action taken or omitted to be taken
by it or any of its directors, officers or employees hereunder except in the
case of gross negligence, bad faith, fraud or willful misconduct. Buyer and
Paying Agent, jointly and severally, covenant and agree to
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indemnify Escrow Agent and hold it harmless without limitation from and against
any loss, liability or expense of any nature incurred by Escrow Agent arising
out of or in connection with this Escrow Agreement or with the administration
of its duties hereunder, including but not limited to legal fees and other
costs and expenses of defending or preparing to defend against any claim or
liability unless such loss, liability or expense shall be caused by Escrow
Agent's willful misconduct, fraud, bad faith or gross negligence. In no event
shall Escrow Agent be liable for indirect, punitive, special or consequential
damages.
(c) The parties hereto agree that, for tax reporting purposes, all
interest or other income earned from the investment of the Escrow Funds shall
be allocable to Paying Agent. The parties hereto agree to provide Escrow Agent
with a certified tax identification number by signing and returning a Form W-9
(or Form W-8, in the case of non-U.S. persons) to Escrow Agent within 30 days
from the date hereof. The parties hereto understand that, in the event their
tax identification numbers are not certified to Escrow Agent, the Internal
Revenue Code may require withholding of a portion of any interest of other
income earned on the investment of the Escrow Funds, in accordance with the
Internal Revenue Code, as amended from time to time. Buyer and Paying Agent
agree to assume any and all obligations imposed now or hereafter by any
applicable tax law with respect to the disbursement of the Escrow Funds
pursuant to the terms hereof and to indemnify and hold Escrow Agent harmless
from and against any taxes, additions for late payment, interest, penalties and
other expenses that may be assessed against Escrow Agent on any such payment
under this Escrow Agreement. Buyer and Paying Agent undertake to instruct
Escrow Agent in writing with respect to Escrow Agent's responsibility for
withholding and other taxes, assessments or other governmental charges,
certifications and governmental reporting in connection with its acting as
Escrow Agent under this Escrow Agreement. Buyer and Paying Agent, jointly and
severally, agree to indemnify and hold Escrow Agent harmless from any liability
on account of taxes, assessments or other governmental charges, including
without limitation the withholding or deduction or the failure to withhold or
deduct same, and any liability for failure to obtain proper certifications or
to properly report to governmental authorities, to which Escrow Agent may be or
become subject in connection with or which arises out of this Escrow Agreement,
including costs and expenses (including reasonable legal fees and expenses),
interest and penalties. Notwithstanding the foregoing, no distributions will
be made unless Escrow Agent shall be provided with an original, signed W-9 form
or its equivalent prior to distribution, including tax identification numbers,
for all distributees.
9. DISPUTE RESOLUTION. It is understood and agreed that should any
dispute arise with respect to the delivery, ownership, right of possession,
and/or disposition of the One Year Escrow Fund, the Two Year Escrow Fund or
should any claim be made upon the
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One Year Escrow Fund or the Two Year Escrow Fund by a third party, Escrow
Agent, upon receipt of written notice of such dispute or claim by the parties
hereto or by a third party, is authorized and directed to retain in its
possession, without liability to anyone, (a) all of the One Year Reserve (if
the dispute relates to the One Year Escrow Fund), and (b) all of the Two Year
Reserve (if the dispute relates to the Two Year Escrow Fund) until such dispute
shall have been settled either by the mutual agreement of the parties involved
or by a final order, decree or judgment of a court of competent jurisdiction,
the time for perfection of an appeal of such order, decree or judgment having
expired. Escrow Agent may, but shall be under no duty whatsoever to, institute
or defend any legal proceedings which relate to the One Year Escrow Fund or the
Two Year Escrow Fund. Notwithstanding anything to the contrary contained in
this Escrow Agreement, the mechanism for resolution of disputes between the
parties shall be governed by the terms of the Stock Purchase Agreement.
10. RESIGNATION. Escrow Agent may resign and be discharged from its
duties or obligations hereunder by giving written notice to Buyer and Paying
Agent. Such resignation shall take effect thirty (30) days after the giving of
such notice, or upon such later date as specified in such notice, or upon
receipt by Escrow Agent of an instrument of acceptance executed by a successor
escrow agent and upon delivery by Escrow Agent to such successor of all the
escrow documents, funds or securities then held by Escrow Agent hereunder. If
no such successor escrow agent is appointed in writing prior to the effective
date of such resignation, Escrow Agent shall direct the Transfer Agent to
register all One Year Escrow Shares included in the One Year Escrow Fund, all
Two Year Escrow Shares included in the Two Year Escrow Fund to Buyer and shall
deliver all monies included in the One Year Escrow Fund and Two Year Escrow
Fund, if any, by check payable to Buyer, to be held in accordance with the
terms of this Escrow Agreement, whereupon Buyer shall use its best efforts to
(a) promptly designate a successor escrow agent, (b) direct the Transfer Agent
to register such One Year Escrow Shares and Two Year Escrow Shares in the name
of such successor escrow agent and (c) deliver such monies, if any, to such
successor escrow agent.
11. ESCROW AGENT NOT PERSONALLY LIABLE. All of the parties hereto
expressly recognize that Escrow Agent, acting in such capacity, shall not have
any personal liability with respect to matters, promises or agreements
hereunder, including, without limitation, under Sections 8 and 12 hereof, or in
any other fashion under this Escrow Agreement, but instead is in all matters
hereunder acting solely as the agent of Buyer with the consent of Paying Agent;
provided, however, that Escrow Agent shall be liable for his, her or its own
gross negligence, bad faith, willful misconduct and fraud.
12. COMPENSATION AND EXPENSES.
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(a) Subject to the terms of Section 12(b) hereof, Buyer agrees to
pay Escrow Agent's reasonable compensation for its normal services hereunder in
accordance with the fee schedule attached hereto as EXHIBIT I, including,
without limitation, legal fees and expenses incurred in connection with the
preparation of this Escrow Agreement, which may be subject to change on an
annual basis.
(b) As between Buyer and Paying Agent, any fees or expenses arising
in connection with (i) any matters described in Section 9 hereof shall be borne
entirely by the party who does not prevail in such matter, and (ii) any other
matter involving a provision of this Escrow Agreement (other than as provided
in Section 12(a) hereof) including, without limitation, the expenses of Escrow
Agent, shall be borne, jointly and severally by Buyer and Paying Agent, fifty
percent (50%) by Buyer and fifty percent (50%) by Paying Agent. Escrow Agent
shall be entitled to reimbursement on demand for all expenses incurred in
connection with the administration of the escrow created hereby which are in
excess of its compensation for normal services hereunder, including without
limitation, payment of any legal fees and expenses incurred by Escrow Agent in
connection with the resolution of any claim by any party hereunder.
13. TENDER OFFER. Notwithstanding anything to the contrary contained
herein, the parties hereto agree that the Escrow Agent shall, upon receipt of
the written direction of the Paying Agent, direct the Transfer Agent to
register all of the One Year Escrow Shares and the Two Year Escrow Shares,
other than those One Year Escrow Shares reserved for in any One Year Reserve
and those Two Year Escrow Shares reserved for in any Two Year Reserve
(collectively, the "Escrowed Securities") in the name of the Paying Agent for
the purpose of tendering such Escrowed Securities in response to a Permitted
Tender Offer (as hereinafter defined), provided that the Escrow Agent receives
from the offeror (the "Offeror") under the Permitted Tender Offer either before
or concurrently with the registration of the Escrowed Securities in the name of
the Paying Agent a certificate of an authorized signing officer of the Offeror
to the effect that the terms and conditions of the Permitted Tender Offer have
been met or satisfied and that the Offeror is irrevocably obligated to, and
will, take up and pay for all securities deposited under the Permitted Tender
Offer; provided however, for greater certainty, that if all the terms and
conditions of the Permitted Tender Offer are not met or satisfied or all the
securities duly deposited thereunder are not taken up and paid for, the
Escrowed Securities shall not be taken up or paid for and shall be
re-registered in the name of the Escrow Agent to be held subject to the terms
and provisions of this Escrow Agreement. For purposes of this Escrow
Agreement, a "Permitted Tender Offer" shall be deemed to have been made in
circumstances where one or more persons or companies (the "Offeror"), each
being at arms's length to Manugistics Group, Inc. makes a bona fide tender
offer or merger proposal to acquire all the shares of common
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stock of Manugistics Group, Inc. which is supported by the board of directors
of Manugistics Group, Inc. or, if not supported by the board of directors of
Manugistics Group, is accepted by the holders of more than fifty percent (50%)
of the shares of common stock of Manugistics Group, Inc. In the event that any
Escrowed Securities are taken up by an Offeror pursuant to a Permitted Tender
Offer, such Escrowed Securities shall be deemed to have been released from the
applicable escrow provisions of this Escrow Agreement as of the date they are
registered in the name of the Paying Agent (the "Release Date").
Notwithstanding anything to the contrary contained in this Section 13, all
shares issued by an Offeror in exchange for the Escrowed Securities so
registered in the name of Paying Agent shall immediately be registered in the
name of the Escrow Agent and shall be subject to all of the terms and
conditions of this Escrow Agreement, as if such shares were originally part of
the One Year Escrow Fund and Two Year Escrow Fund, as the case may be. The
Escrow Agent shall give all written instructions to the Transfer Agent that are
reasonably necessary to give effect to this Section 13.
14. NOTICES. Any notice permitted or required hereunder shall be deemed
to have been duly given if delivered personally or if sent by overnight
courier, postage prepaid, to the parties at their address set forth below:
If to Buyer:
c/o Manugistics, Inc.
Attention: General Counsel
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP
3200 The Mellon Bank Center
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
If to Paying Agent:
▇▇▇▇▇▇ ▇▇▇/▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Miralta Capital, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇
with a copy to:
Fraser & ▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇
Attention: ▇.▇. ▇▇▇▇▇▇▇
If to Escrow Agent:
State Street Bank and Trust Company
Financial Markets Group
Corporate Trust Departments
Two International Place
Boston, Massachusetts 02110-2804
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇,
Corporate Trust Department
If to the Transfer Agent:
Boston EquiServe, Limited Partnership
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Account Manager
or at such other address as any of the above may have furnished to the other
parties in writing, as aforesaid, and any such notice or communication given in
the manner specified in this Section 14 shall be deemed to have been given as
of the date so delivered or sent if delivered personally or if sent by
overnight courier, postage prepaid, except with respect to Escrow Agent as to
which date notice shall be deemed to have been given on the date received by
Escrow Agent.
15. SEVERABILITY. If any term, provision, covenant or restriction of
this Escrow Agreement 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 Escrow Agreement shall remain in full force
and effect and shall in no way be affected, impaired or invalidated.
16. SUCCESSORS AND ASSIGNS; ASSIGNMENT. This Escrow Agreement shall be
binding upon and shall inure to the benefit of and be enforceable by the heirs,
executors, administrators, personal representatives, successors and assigns of
the parties hereto; provided, however, that no party hereto shall assign this
Escrow Agreement without first obtaining the prior written consent of the
others and giving written notice thereof to Escrow Agent.
17. MODIFICATIONS. This Escrow Agreement may not be altered or modified
without the express written consent of all parties hereto. No course of
conduct shall constitute a waiver of any of the terms and conditions of this
Escrow Agreement, unless such waiver is specified in writing, and then only to
the extent so
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specified. A waiver of any of the terms and conditions of this Escrow
Agreement on one occasion shall not constitute a waiver of the other terms of
this Escrow Agreement, or of such terms and conditions on any other occasion.
18. GOVERNING LAW. This Escrow Agreement shall be governed by and
construed under the laws of the Commonwealth of Massachusetts.
19. CONSENT TO JURISDICTION AND SERVICE. The parties hereby absolutely
and irrevocably consent and submit to the jurisdiction of the courts of the
Commonwealth of Massachusetts and of any Federal court located in said
Commonwealth in connection with any actions or proceedings brought against any
party hereto arising out of or relating to this Escrow Agreement. In any such
action or proceeding, the parties hereby absolutely and irrevocably waive
personal service of any summons, complaint, declaration or other process and
hereby absolutely and irrevocably agree that the service thereof may be made by
certified or registered first-class mail directed to such parties at their
respective addresses in accordance with Section 14 hereof.
20. FORCE MAJEURE. No party hereto shall be responsible for delays or
failures in performance resulting from acts beyond its control. Such acts
shall include, without limitation, acts of God, strikes, lockouts, riots, acts
of war, epidemics, governmental regulations superimposed after the fact, fire,
communication line failures, computer viruses, power failures, earthquakes or
other disasters.
21. REPRODUCTION OF DOCUMENTS. This Escrow Agreement and all documents
relating hereto including, without limitation, (a) consents, waivers and
modifications which may hereafter be executed, and (b) certificates and other
information previously or hereafter furnished may be reproduced by any
photographic, photostatic, microfilm, optical disk, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
22. HEADINGS. The section headings herein are for convenience only and
shall not affect the construction thereof.
23. BUSINESS DAY. For purposes of this Escrow Agreement, the term
"business day" shall mean any day during the year on which banks are not
authorized to be closed in the States of Delaware and Massachusetts, United
States of America or in the Provinces of Nova Scotia and Ontario, Canada.
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24. PREPARATION OF AGREEMENT. The parties acknowledge that they have
requested and are satisfied that this Escrow Agreement be drawn up in English.
Les parties reconnaissent qu'elles ont exige que la presente convention soit
redigee en anglais et s'en declarent satisfaites.
25. COUNTERPARTS. This Escrow Agreement may be executed in several
counterparts, including, without limitation, execution by facsimile, each of
which shall be an original, but all of which together shall constitute one and
the same agreement.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement
to be executed on the day and year first above written.
Attest: MANUGISTICS NOVA SCOTIA COMPANY
BY:
-------------------------- --------------------------
Title: Title:
-------------------------- ------------------------------
Witness: ▇▇▇▇▇▇ ▇▇▇, Paying Agent
Attest: STATE STREET BANK AND TRUST COMPANY
BY:
-------------------------- -------------------------
Title: Title:
-------------------------- -----------------------------
Witness: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, Paying Agent
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EXHIBIT I
State Street Bank and Trust Company
Fee Schedule
ACCEPTANCE FEE: Waived
ADMINISTRATIVE FEE: $3,500.00 per year or part
thereof
INVESTMENT FEE: $65.00 per buy/sell
(direct investments in
Treasuries, C/D's, CP,
Repo's, etc.)
SWEEP FEE: 40 Basis Points per annum
(SSgA or selected other of the average daily net assets
Money Market Funds)
WIRE TRANSFER FEE (outgoing): $20.00 (domestic)
$35.00 (international)
OUT-OF-POCKET EXPENSES: At Cost
LEGAL FEES (Peabody & ▇▇▇▇▇▇) At Cost
19
EXHIBIT II
FORM OF NOTICE TO TRANSFER AGENT FOR DISBURSEMENT TO BUYER
(ONE YEAR ESCROW SHARES)
20
EXHIBIT III
FORM OF NOTICE TO TRANSFER AGENT FOR DISBURSEMENT TO PAYING AGENT
(ONE YEAR ESCROW SHARES)
21
EXHIBIT IV
FORM OF NOTICE TO TRANSFER AGENT FOR DISBURSEMENT TO BUYER
(TWO YEAR ESCROW SHARES)
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EXHIBIT V
FORM OF NOTICE TO TRANSFER AGENT FOR DISBURSEMENT TO PAYING AGENT
(TWO YEAR ESCROW SHARES)