Exhibit 1.1
LIONBRIDGE TECHNOLOGIES, INC.
COMMON STOCK, $0.01 PAR VALUE
PER SHARE
UNDERWRITING AGREEMENT
December [ ], 2005
Xxxxxxx, Xxxxx & Co.,
Friedman, Billings, Xxxxxx & Co., Inc.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
Xxxxx & Co., Inc., a Delaware corporation (the "Primary Selling
Stockholder"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of 9,400,000 shares (the "Firm Shares") and, at the
election of the Underwriters, each of Lionbridge Technologies, Inc., a Delaware
corporation (the "Company") and the stockholder of the Company named in Schedule
II hereto (the "Additional Selling Stockholder", and together with the Primary
Selling Stockholder, the "Selling Stockholders") propose, subject to the terms
and conditions stated herein, to sell to the Underwriters up to 1,410,000
additional shares (the "Optional Shares") of Common Stock, par value $0.01 (the
"Stock") of the Company (the Firm Shares and the Optional Shares that the
Underwriters elect to purchase pursuant to Section 2 hereof being collectively
called the "Shares").
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form S-3 (File No. 333-129933) (the
"Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, and,
excluding exhibits thereto but including all documents incorporated by
reference in the prospectus contained therein, to you for each of the
other Underwriters, have been declared effective by the Commission in such
form; other than a registration statement, if any, increasing the size of
the offering (a "Rule 462(b) Registration Statement"), filed pursuant to
Rule 462(b) under the Securities Act of 1933, as amended (the "Act"),
which became effective upon filing, no other document with respect to the
Initial Registration Statement or document incorporated by reference
therein has heretofore been filed with the Commission; and no stop order
suspending the effectiveness of the Initial Registration Statement, any
post-effective amendment thereto or the Rule 462(b) Registration
Statement, if any, has been issued and no proceeding for that purpose has
been initiated or threatened by the Commission (any preliminary prospectus
included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act is hereinafter called a "Preliminary Prospectus";
the various parts of the Initial Registration Statement and the Rule
462(b) Registration Statement, if any, including all exhibits thereto and
including the information contained in the form of final prospectus filed
with the Commission pursuant to Rule 424(b) under the Act in accordance
with Section 5(a) hereof and deemed by virtue of Rule 430A under the Act
to be part of the Initial Registration Statement at the time it was
declared effective, each as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statement"; the
Preliminary Prospectus relating to the Shares that was included in the
Registration Statement immediately prior to the Applicable Time (as
defined in Section 1(a)(iii) hereof) is hereinafter called the "Pricing
Prospectus"; and such final prospectus, in the form first filed pursuant
to Rule 424(b) under the Act, is hereinafter called the "Prospectus"; any
reference herein to any Preliminary Prospectus, the Pricing Prospectus or
the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under
the Act, as of the date of such prospectus; and any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated therein; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after
the effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement; and any "issuer
free writing prospectus" as defined in Rule 433
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under the Act relating to the Shares is hereinafter called an "Issuer Free
Writing Prospectus");
(ii) No order preventing or suspending the use of any Preliminary
Prospectus or any Issuer Free Writing Prospectus has been issued by the
Commission, and each Preliminary Prospectus, at the time of filing
thereof, conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder, and did not
contain an 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, in the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein;
(iii) For the purposes of this Agreement, the "Applicable Time" is
___:___ (Eastern time) on the date of this Agreement; the Pricing
Prospectus as supplemented by the Issuer Free Writing Prospectuses and
other documents listed in Schedule III(a) hereto, taken together
(collectively, the "Pricing Disclosure Package") as of the Applicable
Time, did not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and each Issuer Free Writing Prospectus listed on Schedule
III(a) or Schedule III(b) hereto does not conflict with the information
contained in the Registration Statement, the Pricing Prospectus or the
Prospectus and each Issuer Free Writing Prospectus listed in Schedule
III(b) hereto, as supplemented by and taken together with the Pricing
Disclosure Package as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements or omissions
made in an Issuer Free Writing Prospectus in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein;
(iv) The documents incorporated by reference in the Pricing
Prospectus and the Prospectus, when they became effective or were filed
with the Commission, as the case may be, conformed in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder,
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and none of such documents contained an 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 any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an 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
provided, however, that this representation and warranty shall not apply
to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by an Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein; and no such
documents were filed with the Commission since the Commission's close of
business on the business day immediately prior to the date of this
Agreement and prior to the execution of this Agreement, except as set
forth on Schedule III(c) hereto;
(v) The Registration Statement conforms and the Prospectus and any
further amendments or supplements to the Registration Statement and the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to each part of
the Registration Statement and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an 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; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein;
(vi) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Pricing Prospectus any material loss or
interference with its business from fire, earthquake, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Pricing Prospectus; and, since the
respective dates as of which information is given in the Registration
Statement and the Pricing Prospectus, there has not been any change in
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the capital stock (other than changes that may result from the exercise of
options for the Company's capital stock outstanding as of the date of this
Agreement) or long-term debt of the Company or any of its subsidiaries or
any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries, otherwise than as set forth or contemplated
in the Pricing Prospectus;
(vii) The Company and its subsidiaries have good and marketable
title in fee simple to all real property (other than mortgages with
respect to such real property) and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects except (A) with respect to personal property,
security interests in favor of Wachovia Bank, National Association, (B)
such as are described in the Pricing Prospectus or (C) such as do not
materially affect the value of such property and do not interfere with the
use made and proposed to be made of such property by the Company and its
subsidiaries; 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 with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries;
(viii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Pricing
Prospectus, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no material
liability or disability by reason of the failure to be so qualified in any
such jurisdiction; and each subsidiary of the Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation;
(ix) The Company has an authorized capitalization as set forth in
the Pricing Prospectus under the caption "Capitalization", and all of the
issued shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and conform to
the description of the Stock contained in the Pricing Prospectus and
Prospectus; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
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issued, are fully paid and non-assessable and (except for directors'
qualifying shares) are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances or claims, except for security
interests, liens, encumbrances, pledges or other claims in favor of
Wachovia Bank, National Association;
(x) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued and fully paid and non-assessable and will conform
to the description of the Stock contained in the Prospectus;
(xi) The issue and sale of the Shares to be sold by the Company and
the compliance by the Company with this Agreement and the consummation of
the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the property or assets of the Company or any
of its subsidiaries is subject, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or By-laws
of the Company or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Company
or any of its subsidiaries or any of their properties; and no consent,
approval, authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the issue
and sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under
the Act of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required by the National
Association of Securities Dealers, Inc., or under state securities or Blue
Sky laws in connection with the purchase and distribution of the Shares by
the Underwriters;
(xii) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or in default in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound;
(xiii) The statements set forth under the caption "Description of
Capital Stock" incorporated by reference in the Pricing
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Prospectus and Prospectus from the Company's registration statement on
Form S-1, as amended, through the incorporation by reference of certain
portions of the Company's registration statement on Form 8-A, insofar as
it purports to constitute a summary of the terms of the Stock and in the
Pricing Prospectus and Prospectus under the caption "Underwriting",
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate, complete and fair;
(xiv) Other than as set forth in the Pricing Prospectus, there are
no legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which, if determined adversely to
the Company or any of its subsidiaries, would individually or in the
aggregate result in a material adverse effect on the general affairs
management, current or future financial position, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a whole
(a "Material Adverse Effect"); and no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(xv) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of proceeds thereof, will not be an
"investment company", as such term is defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act");
(xvi) At the time of filing the Initial Registration Statement the
Company was not, and the Company on the date of this Agreement is not, an
"ineligible issuer" as defined under Rule 405 under the Act;
(xvii) PricewaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries, and have audited
the Company's internal control over financial reporting and management's
assessment thereof and KPMG LLP, who have certified certain financial
statements of BGS, are each independent public accountants as required by
the Act and the rules and regulations of the Commission thereunder;
(xviii) The Company maintains a system of internal control over
financial reporting (as such term is defined in Rule 13a-15(f) under the
Exchange Act) that complies with the requirements of the Exchange Act and
has been designed by the Company's principal executive officer and
principal financial officer, or under their supervision, to provide
reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles (it being
understood that in accordance
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with the Commission's answers in "Management's Report on Internal Control
Over Financial Reporting and Certification of Disclosure in Exchange Act
Periodic Reports Frequently Asked Questions (revised October 6, 2004)",
the Company does not expect to include in its assessment of internal
controls, the operations acquired from Xxxxx & Co., Inc. (the "Xxxxx
Operations") until the filing of the Company's 10-K for the Year Ended
December 31, 2006). Except as disclosed in the Pricing Prospectus, and
except with respect to (A) below, for the Xxxxx Operations: (A) the
Company's internal control over financial reporting is effective and (B)
the Company is not aware of any material weaknesses in its internal
control over financial reporting;
(xix) Since the date of the latest audited financial statements
included or incorporated by reference in the Pricing Prospectus, there has
been no change in the Company's internal control over financial reporting
that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting;
(xx) The Company maintains disclosure controls and procedures (as
such term is defined in Rule 13a-15(e) under the Exchange Act) that comply
with the requirements of the Exchange Act; such disclosure controls and
procedures have been designed to ensure that material information relating
to the Company and its subsidiaries is made known to the Company's
principal executive officer and principal financial officer by others
within those entities; and such disclosure controls and procedures are
effective;
(xxi) No labor dispute with employees of the Company or any of its
subsidiaries exist or, to the Company's knowledge is threatened or
imminent that could have a Material Adverse Effect; and
(xxii) Except as disclosed in the Pricing Prospectus and subject to
the security interests in favor of Wachovia Bank, National Association,
the Company and its subsidiaries, own or possess, or can acquire on
reasonable terms, all material patents, patent applications, trademarks,
service marks, trade names, licenses, copyrights and proprietary or other
confidential information currently employed by them in connection with
their respective businesses, and neither the Company nor any such
subsidiary has received any notice of infringement of or conflict with
asserted rights of any third party with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a Material Adverse Effect.
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(b) Each of the Selling Stockholders severally represents and warrants to,
and agrees with, each of the Underwriters and the Company that:
(i) All consents, approvals, authorizations and orders necessary for
the execution and delivery by such Selling Stockholder of this Agreement
and for the sale and delivery of the Shares to be sold by such Selling
Stockholder hereunder, have been obtained; and such Selling Stockholder
has full right, power and authority to enter into this Agreement sell,
assign, transfer and deliver the Shares to be sold by such Selling
Stockholder hereunder;
(ii) The sale of the Shares to be sold by such Selling Stockholder
hereunder and the compliance by such Selling Stockholder with all of the
provisions of this Agreement and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any statute, indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which such Selling
Stockholder is a party or by which such Selling Stockholder is bound or to
which any of the property or assets of such Selling Stockholder is
subject, nor will such action result in any violation of the provisions of
the Certificate of Incorporation or By-laws of such Selling Stockholder if
such Selling Stockholder is a corporation, or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over such Selling Stockholder or the property of such Selling
Stockholder;
(iii) Such Selling Stockholder has, and immediately prior to the
relevant Time of Delivery (as defined in Section 4 hereof) such Selling
Stockholder will have, good and valid title to the Shares to be sold by
such Selling Stockholder hereunder, free and clear of all liens,
encumbrances or claims; and, upon delivery of such Shares and payment
therefor pursuant hereto, good and valid title to such Shares, free and
clear of all liens, encumbrances or claims, will pass to the several
Underwriters;
(iv) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(v) To the extent that any statements or omissions made in the
Registration Statement, any Preliminary Prospectus, the Pricing
Prospectus, the Prospectus or any amendment or supplement thereto are made
in reliance upon and in conformity with written information furnished
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to the Company by such Selling Stockholder expressly for use therein, such
Preliminary Prospectus, Pricing Prospectus and the Registration Statement
did, and the Prospectus and any further amendments or supplements to the
Registration Statement and the Prospectus, when they become effective or
are filed with the Commission, as the case may be, will conform in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder and will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading;
(vi) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, such Selling Stockholder will deliver to you prior to or at
the relevant Time of Delivery (as hereinafter defined) a properly
completed and executed United States Treasury Department Form W-9 (or
other applicable form or statement specified by Treasury Department
regulations in lieu thereof);
(vii) The obligations of the Selling Stockholders hereunder shall
not be terminated by operation of law, whether by the death or incapacity
of any individual Selling Stockholder or, in the case of an estate or
trust, by the death or incapacity of any executor or trustee or the
termination of such estate or trust, or in the case of a partnership or
corporation, by the dissolution of such partnership or corporation, or by
the occurrence of any other event; if any individual Selling Stockholder
or any such executor or trustee should die or become incapacitated, or if
any such estate or trust should be terminated, or if any such partnership
or corporation should be dissolved, or if any other such event should
occur, before the delivery of the Shares hereunder, certificates
representing the Shares shall be delivered by or on behalf of the Selling
Stockholders in accordance with the terms and conditions of this
Agreement; and
(viii) Such Selling Stockholder is not a member of or an affiliate
of or associated with any member of the NASD.
2. Subject to the terms and conditions herein set forth, (a) the Primary
Selling Stockholder agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Primary
Selling Stockholder, at a purchase price per share of $......., the number of
Firm Shares set forth opposite the name of such Underwriter in Schedule I hereto
and (b) in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Shares as provided below, the Company agrees to
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issue and sell and the Additional Selling Stockholder agrees to sell to each of
the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company and the Additional Selling Stockholder at
the purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction, the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder).
The Company and the Additional Selling Stockholder, as and to the extent
indicated in Schedule II hereto, hereby grant, severally and not jointly, to the
Underwriters the right to purchase at their election up to 1,410,000 Optional
Shares, at the purchase price per share set forth in the paragraph above, for
the sole purpose of covering sales of shares in excess of the number of Firm
Shares, provided that the purchase price per Optional Share shall be reduced by
an amount per share equal to any dividends or distributions declared by the
Company and payable on the Firm Shares but not payable on the Optional Shares.
Any such election to purchase Optional Shares shall be made pro rata among the
Company and the Additional Selling Shareholder. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company
and the Additional Selling Stockholder, given within a period of 30 calendar
days after the date of this Agreement and setting forth the aggregate number of
Optional Shares to be purchased and the date on which such Optional Shares are
to be delivered, as determined by you but in no event earlier than the First
Time of Delivery (as defined in Section 4 hereof) or, unless you, the Company
and the Additional Selling Stockholder otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Shares, the several
Underwriters propose to offer the Shares for sale upon the terms and conditions
set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder will be
represented by one or more definitive global Shares in book-entry form which
will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company and each Selling
Stockholder will deliver the Shares to Xxxxxxx, Xxxxx & Co., for the account of
each Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company and each Selling Stockholder to Xxxxxxx, Sachs
& Co. at least forty-eight hours in advance, by causing DTC to credit the
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Shares to the account of Xxxxxxx, Xxxxx & Co. at DTC. The Company will cause the
certificates representing the Shares to be made available to Xxxxxxx, Sachs &
Co. for checking and packaging at least twenty-four hours prior to the Time of
Delivery (as defined below) with respect thereto at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m., New
York City time, on December [ ], 2005 or such other time and date as Xxxxxxx,
Xxxxx & Co. and the Primary Selling Stockholder may agree upon in writing, and,
with respect to the Optional Shares, 9:30 a.m., New York time, on the date
specified by Xxxxxxx, Sachs & Co. in the written notice given by Xxxxxxx, Xxxxx
& Co. of the Underwriters' election to purchase such Optional Shares, or such
other time and date as Xxxxxxx, Sachs & Co. and the Company and the Additional
Selling Stockholder may agree upon in writing. Such time and date for delivery
of the Firm Shares is herein called the "First Time of Delivery", such time and
date for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 8 hereof, including the cross receipt
for the Shares and any additional documents requested by the Underwriters
pursuant to Section 8(o) or 8(p) hereof, will be delivered at the offices of
Xxxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxxxxxxxx Xxxxxx, XX, Xxxxxxxxxx, XX, (the
"Closing Location"), and the Shares will be delivered at the Designated Office,
all at such Time of Delivery. A meeting will be held at the Closing Location at
4:00 p.m., Eastern time, on the New York Business Day next preceding such Time
of Delivery, at which meeting the final drafts of the documents to be delivered
pursuant to the preceding sentence will be available for review by the parties
hereto. For the purposes of this Section 4, "New York Business Day" shall mean
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York are generally authorized or obligated by law or
executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the execution and
delivery of this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or the Prospectus prior to the last
Time of Delivery which shall be disapproved by you promptly after reasonable
notice thereof; to advise you, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed or
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becomes effective or any amendment or supplement to the Prospectus has been
filed and to furnish you with copies thereof; to file promptly all material
required to be filed by the Company with the Commission pursuant to Rule 433(d)
under the Act; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date of the Prospectus and for so long as the delivery of a prospectus (or
in lieu thereof, the notice referred to in Rule 173(a) under the Act) is
required in connection with the offering or sale of the Shares; to advise you,
promptly after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or other prospectus in respect of the Shares, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or the Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order preventing
or suspending the use of any Preliminary Prospectus or other prospectus or
suspending any such qualification, to promptly use its best efforts to obtain
the withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Shares, provided
that in connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in any
jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the New York Business Day
next succeeding the date of this Agreement and from time to time, to furnish the
Underwriters with written and electronic copies of the Prospectus in New York
City in such quantities as you may reasonably request, and, if the delivery of a
prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the
Act) is required at any time prior to the expiration of nine months after the
time of issue of the Prospectus in connection with the offering or sale of the
Shares and if at such time any event shall have occurred as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order
13
to comply with the Act or the Exchange Act, to notify you and upon your request
to file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many written and electronic
copies as you may from time to time reasonably request of an amended Prospectus
or a supplement to the Prospectus which will correct such statement or omission
or effect such compliance, and in case any Underwriter is required to deliver a
prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the
Act) in connection with sales of any of the Shares at any time nine months or
more after the time of issue of the Prospectus, upon your request but at the
expense of such Underwriter, to prepare and deliver to such Underwriter as many
written and electronic copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning from the date hereof and continuing to and
including the date 90 days after the date of the Prospectus, not to offer, sell,
contract to sell, pledge, grant any option to purchase, make any short sale or
otherwise dispose, except as provided hereunder, of any securities of the
Company that are substantially similar to the Shares, including but not limited
to any options or warrants to purchase shares of Stock or any securities that
are convertible into or exchangeable for, or that represent the right to
receive, Stock or any such substantially similar securities other than (i) the
issuance of shares of Stock pursuant to employee stock option plans existing on,
or upon the conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement, (ii) the issuance of shares of
Stock in exchange for the assets of, or a majority or controlling portion of the
equity of, another entity in connection with the acquisition by the Company or
any of its subsidiaries of such entity, provided, however, that in the case of
(ii), (A) prior to such issuance of shares of Stock, each recipient of such
shares shall have executed and delivered to the Representatives an agreement
substantially in the form of Annex V hereto, and (B) the aggregate market value
of such shares of Stock shall not exceed 10% of the market capitalization of the
Company immediately following the First Time of Delivery or (iii) without the
prior written consent of Xxxxxxx, Xxxxx & Co.;
(f) To furnish to its stockholders as soon as practicable after the end of
each fiscal year an annual report (including a balance sheet and statements of
income, stockholders' equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon as
14
practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the effective date of the
Registration Statement), to make available to its stockholders consolidated
summary financial information of the Company and its subsidiaries for such
quarter in reasonable detail;
(g) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to deliver to
you, as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed, it being
understood that the filing of any such reports and financial statements with the
Commission via XXXXX filing system shall be deemed to have been provided to you
as a result of such filing.
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Pricing Prospectus
under the caption "Use of Proceeds";
(i) To use its best efforts to list for quotation the Shares on the Nasdaq
Stock Market Inc.'s National Market ("NASDAQ");
(j) If the Company elects to rely upon Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act; and
(k) Upon request of any Underwriter, to furnish, or cause to be furnished,
to such Underwriter an electronic version of the Company's trademarks,
servicemarks and corporate logo for use on the website, if any, operated by such
Underwriter for the purpose of facilitating the on-line offering of the Shares
(the "License"); provided, however, that the License shall be used solely for
the purpose described above, is granted without any fee and may not be assigned
or transferred.
6. (a) The Company and each of the Selling Stockholders represents and
agrees that, without the prior consent of Xxxxxxx, Xxxxx & Co., it has not made
and will not make any offer relating to the Shares that would constitute a "free
writing prospectus" as defined in Rule 405 under the Act; each Underwriter
represents and agrees that, without the prior consent of the Company, the
Selling Stockholders and Xxxxxxx, Sachs & Co., it has not made
15
and will not make any offer relating to the Shares that would constitute a free
writing prospectus; any such free writing prospectus the use of which has been
consented to by the Company, the Selling Stockholders and Xxxxxxx, Xxxxx & Co.
is listed on Schedule III(a) or Schedule III(b) hereto;
(b) The Company and each Selling Stockholder has complied and will comply
with the requirements of Rule 433 under the Act applicable to any Issuer Free
Writing Prospectus, including timely filing with the Commission or retention
where required and legending; the Company represents that it has satisfied and
agrees that it will satisfy the conditions under Rule 433 under the Act to avoid
a requirement to file with the Commission any electronic road show;
(c) The Company and each Selling Stockholder agrees that if at any time
following issuance of an Issuer Free Writing Prospectus any event occurred or
occurs as a result of which such Issuer Free Writing Prospectus would conflict
with the information in the Registration Statement, the Pricing Prospectus or
the Prospectus or would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements therein, in
light of the circumstances then prevailing, not misleading, the Company or the
Selling Stockholder will give prompt notice thereof to Xxxxxxx, Sachs & Co. and,
if requested by Xxxxxxx, Xxxxx & Co., and the Company will prepare and furnish
without charge to each Underwriter an Issuer Free Writing Prospectus or other
document which will correct such conflict, statement or omission; provided,
however, that this representation and warranty shall not apply to any statements
or omissions in an Issuer Free Writing Prospectus made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein.
7. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants and the accountants for
BGS in connection with the registration of the Shares under the Act and all
other expenses in connection with the preparation, printing, reproduction and
filing of the Registration Statement, any Preliminary Prospectus, any Issuer
Free Writing Prospectus and the Prospectus and amendments and supplements
thereto and the mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the cost of printing or producing any Agreement among
Underwriters, this Agreement, the Blue Sky Memorandum, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey (iv) all fees and
expenses
16
in connection with listing the Shares on NASDAQ; (v) the filing fees incident
to, and the fees and disbursements of counsel for the Underwriters in connection
with, any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Shares; (vi) the cost of preparing stock
certificates; (vii) the cost and charges of any transfer agent or registrar; and
(viii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this Section,
and Sections 9 and 12 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Shares by them, and any advertising expenses connected with
any offers they may make.
8. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and the Selling Stockholders herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and of the Selling
Stockholders shall have performed all of its obligations hereunder theretofore
to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) under the Act within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; all material required to be filed by the Company pursuant to Rule
433(d) under the Act shall have been filed with the Commission within the
applicable time period prescribed for such filing by Rule 433 under the Act; if
the Company has elected to rely upon Rule 462(b) under the Act, the Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., Washington,
D.C. time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; no stop order suspending or preventing the use of
the Prospectus or any Issuer Free Writing Prospectus shall have been initiated
or threatened by the Commission; and all requests for additional information on
the part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters, shall have
furnished to you such written opinion or opinions, dated such Time of Delivery,
with respect to the incorporation of the Company, the validity of the Shares and
such other related matters as you may reasonably request, and such counsel shall
have received such papers and information as they may reasonably request to
enable them to pass on such matters;
17
(c) Xxxxxxx Procter LLP, counsel for the Company, shall have furnished to
you their written opinion (a form of such opinion is attached as Annex III
hereto), dated the such Time of Delivery, in form and substance satisfactory to
you, to the effect that:
(i) the Company has been duly incorporated and is validly existing
as a corporation under the laws of Delaware and is in good standing under
the laws of each of Delaware and Massachusetts; each of VeriTest, Inc. and
Lionbridge US, Inc. (collectively, the "Delaware Subsidiaries") is validly
existing as a corporation in good standing under the laws of the
jurisdictions listed on Schedule IV attached hereto;
(ii) the Company and each of the Delaware Subsidiaries have the
corporate power to own or lease their respective properties and conduct
their respective businesses as described in the Registration Statement and
the Prospectus, and the Company has the corporate power to execute,
deliver and perform this Agreement;
(iii) the issued shares of capital stock of each of the Delaware
Subsidiaries have been duly authorized and validly issued, are fully paid
and nonassessable, and are owned beneficially by the Company free and
clear of, to the best of such counsel's knowledge, any security interests,
pledges, liens or encumbrances except for security interests, pledges,
liens or encumbrances in favor of Wachovia Bank, National Association or
as described in the Prospectus;
(iv) the authorized capital stock of the Company is as set forth in
the Prospectus under the caption "Capitalization" as of the dates stated
therein; the Shares to be issued by the Company pursuant to the terms of
this Agreement have been duly authorized for issuance and sale to the
Underwriters pursuant to this Agreement and, when issued and delivered by
the Company pursuant to this Agreement against payment of the
consideration set forth in this Agreement, will be validly issued, fully
paid and non-assessable; to such counsel's knowledge and except as
described in the Prospectus, no holders of outstanding shares of capital
stock of the Company are entitled as such to any preemptive or other
rights to subscribe for any of the Shares under any of the agreements
filed as an exhibit to the Company's most recent annual report on Form
10-K or any subsequent quarterly report on Form 10-Q or current report on
Form 8-K and to which the Company or any of its subsidiaries is a party
(the "Listed Agreements"); and to such counsel's knowledge, no holders of
securities of the Company are entitled to have such securities registered
under the Registration Statement other than those holders whose rights
18
have been waived or satisfied pursuant to the Registration Statement or as
described in the Prospectus;
(v) the statements under the captions (A) "Description of Capital
Stock" incorporated by reference in the Prospectus from the Company's
registration statement on Form S-1, as amended, through the incorporation
by reference of certain portions of the Company's registration statement
on Form 8-A to the extent they constitute matters of law or legal
conclusions regarding the Stock and (B) "Underwriting" in the Prospectus,
to the extent they constitute matters of law or legal conclusions, have
been reviewed by such counsel and are correct in all material respects;
and the statements set forth under the headings "Legal Proceedings," in
the Company's Quarterly Report on From 10-Q for the Quarter Ended
September 30, 2005 incorporated by reference in the prospectus, insofar as
such statements constitute matters of law or legal conclusions, are
correct in all material respects;
(vi) this Agreement has been duly authorized, executed and delivered
by the Company;
(vii) the issuance, offering and sale of the Shares to the
Underwriters by the Company pursuant to this Agreement, the performance by
the Company of this Agreement do not (A) require the consent, approval,
authorization, registration or qualification of or with any governmental
authority, except such as have been obtained under the Act and such as may
be required under the NASD or state securities or blue sky laws (as to
which such counsel need express no opinion), or (B) conflict with or
result in a breach or violation of any of the terms and provisions of, or
constitute a default under, any Listed Agreement, or the charter documents
or by-laws of the Company or any of the U.S. Subsidiaries, or Delaware
General Corporation Law or any Massachusetts or federal statute, rule or
regulation or any judgment, decree, order, rule or regulation of any court
or other governmental authority or any arbitrator known to us and
applicable to the Company or the U.S. Subsidiaries;
(viii) the Company is not subject to registration as an investment
company or an entity "controlled" by an investment company under the
Investment Company Act of 1940, as amended, and, assuming the proceeds
from the Offering are used as contemplated under the caption "Use of
Proceeds" in the Prospectus, the transactions contemplated by this
Agreement will not cause the Company to become an investment company
subject to registration under such Act;
19
(ix) the form of certificate used to evidence the Shares complies in
all material respects with the Delaware General Corporation Law and with
any applicable requirements of the organizational documents of the
Company;
(x) we have been informed by the Commission that the Registration
Statement is effective under the Act; any required filing of the
Prospectus pursuant to Rule 424(b) of the Act has been made in the manner
and within the time period required by Rule 424(b); and we have been
informed by the Commission that no stop order suspending the effectiveness
of the Registration Statement has been issued and, to such counsel's
knowledge, no proceedings for that purpose have been instituted or
threatened or are contemplated by the Commission.
Such counsel shall state that it has reviewed the Registration
Statement and the Prospectus, participated in discussions with the
representatives of the Underwriters, those of counsel for the
Underwriters, and those of representatives of the Company and
PricewaterhouseCoopers LLP, independent auditors of the Company, during
which the contents of the Registration Statement, the Pricing Prospectus
and the Prospectus were discussed. Such counsel may state that between the
effectiveness of the Registration Statement and the relevant Time of
Delivery, it participated in further discussions with representatives of
the Underwriters, those of counsel for the Underwriters and those of the
Company and PricewaterhouseCoopers LLP, independent auditors of the
Company, and such counsel reviewed certain certificates of officers of the
Company and public officials and the letters from PricewaterhouseCoopers
LLP, independent auditors of the Company, delivered to you at the relevant
Time of Delivery. Such counsel may state that the purpose of its
engagement was not to establish or to confirm factual matters set forth in
the Registration Statement, the Pricing Prospectus, the Prospectus and any
further amendments and supplements thereto and that it has not undertaken
any obligation to verify independently any of the factual matters set
forth in the Registration Statement, the Pricing Prospectus, the
Prospectus and any further amendments and supplements thereto. Such
counsel may state that many of the determinations required to be made in
the preparation of the Registration Statement, the Pricing Prospectus, the
Prospectus and any further amendments and supplements thereto involve
matters of a non-legal nature. Subject to the foregoing, such counsel will
confirm that: (i) on the basis of the information gained in the course of
performing the services referred to above, nothing came to such counsel's
attention that caused them to believe that any part of the Registration
Statement, as of its effective date, contained an untrue statement of a
material fact or omitted
20
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus and any
further amendments and supplements thereto, when such part or amendment
became effective, contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, (ii) nothing came to such counsel's attention that caused them
to believe that the Pricing Disclosure Package, as of the Applicable Time,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the
light of circumstances under which they were made, not misleading; and
(iii) nothing came to such counsel's attention in the course of the
procedures described in the second sentence of this paragraph that caused
them to believe that the Prospectus and any further amendments and
supplements thereto, as of the relevant Time of Delivery, contain any
untrue statement of a material fact or omitted or omits to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided,
however, that such counsel need not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, the Prospectus and any further amendments and
supplements thereto, and such counsel need not express any belief as to
the financial statements or other financial data derived from accounting
records contained in the Registration Statement, the Prospectus and any
further amendments and supplements thereto. Such counsel shall also
confirm that the Registration Statement, as of its effective date, and the
Prospectus and any further amendments and supplements thereto, as of the
date when such part or amendment became effective, appeared on their face
to be responsive in all material respects to the requirements of the Act
and the applicable rules and regulations of the Commission thereunder.
(d) Xxxxxxxx Xxxxxx, general counsel of the Company, shall have furnished
to you her written opinion in form and substance reasonably satisfactory to you,
stating that:
(i) the Company and each of its U.S. subsidiaries ("U.S.
Subsidiaries") are validly existing as a corporation and are in good
standing;
(ii) all of the issued shares of capital stock of the Company and
each of the U.S. Subsidiaries have been duly authorized and validly
issued, are fully paid and nonassessable, have been issued in compliance
with all applicable federal and state securities laws and, to such
counsel's
21
knowledge, were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase securities;
(iii) neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or, to such
counsel's knowledge, in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument which it is a party or by which it or any of its properties may
be bound which would have a Material Adverse Effect;
(iv) the Company and each of its subsidiaries have the corporate
power to own or lease their respective properties and conduct their
respective businesses as described in the Registration Statement and the
Prospectus; and
(v) (A) no legal or governmental proceedings are pending to which
the Company or any of its subsidiaries is a party or to which the property
of the Company or any of its subsidiaries is subject that are required to
be described in the Registration Statement or the Prospectus and are not
described therein, and, no such proceedings have been threatened against
the Company or any of its subsidiaries or with respect to any of their
respective properties and (B) no contract or other document known to such
counsel is required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement that
is not described therein or filed as required.
(e) De Brauw Blackstone Westbroek p.c., counsel for the Company's
Lionbridge Technologies Holdings B.V., Lionbridge Technologies B.V., Lionbridge
of Europe B.V and Lionbridge of Gibraltar B.V. subsidiaries, shall have
delivered an opinion to the Underwriters in a form reasonably satisfactory to
the Underwriters;
(f) Xxxxxx Xxx, counsel for the Company's Lionbridge International
subsidiary, shall have delivered an opinion to the Underwriters in a form
reasonably satisfactory to the Underwriters;
(g) The counsel for the Primary Selling Stockholder shall have furnished
to you their written opinion with respect to the Primary Selling Stockholder (a
draft of such opinion is attached as Annex IV(a) hereto), dated the relevant
Time of Delivery, in form and substance satisfactory to you, to the effect that:
(i) this Agreement has been duly executed and delivered by or on
behalf of the Primary Selling Stockholder; and the sale of the
22
Shares to be sold by such Selling Stockholder hereunder and the compliance
by the Primary Selling Stockholder with all of the provisions of this
Agreement and will not breach or result in a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
identified as an exhibit to the Primary Selling Stockholder's most recent
annual report on Form 10-K filed with the Commission, nor will such action
result in any violation of the provisions of the Certificate of
Incorporation or By laws of the Primary Selling Stockholder or any federal
or New York statute or the Delaware General Corporation Law or any rule or
regulation that has been issued pursuant to any federal or New York
statute or the Delaware General Corporation Law or any order known to such
counsel of any court or governmental agency or body having jurisdiction
over the Primary Selling Stockholder or any of its properties;
(ii) no consent, approval, authorization, order, registration or
qualification of or with any federal or New York governmental agency or
body or any Delaware governmental agency or body acting pursuant to the
Delaware General Corporation Law or, to such counsel's knowledge, any
federal or New York court or any Delaware court acting pursuant to the
Delaware General Corporation Law is required for the issue and sale of the
Shares by the Primary Selling Stockholder and the compliance by the
Primary Selling Stockholder with all of the provisions of this Agreement,
and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of such Shares by the
Underwriters; and
(iii) upon the payment and transfer contemplated by this Agreement,
the Underwriters will acquire a security entitlement with respect to the
Shares to be sold by the Primary Selling Stockholder and no action based
on an adverse claim may be asserted against the Underwriters.
(h) The counsel for the Additional Selling Stockholder shall have
furnished to you their written opinion with respect to the Additional Selling
Stockholder (a draft of such opinion is attached as Annex IV(b) hereto), dated
the relevant Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) this Agreement has been duly executed and delivered by or on
behalf of the Additional Selling Stockholder; and the sale of the Shares
to be sold by the Additional Selling Stockholder hereunder and the
performance by the Additional Selling Stockholder of this Agreement will
not conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any federal or Massachusetts
statute,
23
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Additional Selling
Stockholder is a party or by which the Additional Selling Stockholder is
bound or to which any of the property or assets of the Additional Selling
Stockholder is subject, nor will such action result in any violation of
any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Additional
Selling Stockholder or the property of the Additional Selling Stockholder;
(ii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the
transactions contemplated by this Agreement in connection with the Shares
to be sold by the Additional Selling Stockholder hereunder, except which
have been duly obtained and are in full force and effect, such as have
been obtained under the Act and such as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of such Shares by the Underwriters; and
(iii) assuming that the Underwriters acquire the Shares to be sold
to them by the Additional Selling Stockholder pursuant to the this
Agreement without notice of an adverse claim thereto, upon (a)(i)
indication by DTC by book entry that the Shares to be sold by the
Additional Selling Stockholder have been credited to the Representatives'
securities accounts on behalf of the Underwriters at DTC or (ii) DTC's
acquisition of the Shares to be sold by the Additional Selling Stockholder
for the Representatives on behalf of the Underwriters and acceptance of
the Shares to be sold by the Additional Selling Stockholder for the
Representatives' securities accounts on behalf of the Underwriters and (b)
payment therefor in accordance with the terms of this Agreement, no action
based on an adverse claim may be validly asserted against the Underwriters
with respect to their interest in the Shares to be sold by the Additional
Selling Stockholder. For purposes of this paragraph iii, the terms
"adverse claim", "notice of an adverse claim" and "securities account"
have the respective meanings ascribed thereto in Sections 8-102(a)(1),
8-105 and 8-501 of the Uniform Commercial Code.
(i) On the date of the Prospectus at a time prior to the execution of this
Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, each of
PricewaterhouseCoopers LLC and KPMG LLC shall have furnished to you a letter or
letters, dated the respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto and Annex II
hereto, respectively (the executed copy of the letters delivered prior to the
execution of
24
this Agreement are attached as Annex I(a) and Annex II(a) hereto
and drafts of the form of letters to be delivered on the effective date of any
post-effective amendment to the Registration Statement and as of each Time of
Delivery are attached as Annex I(b) and Annex II(b) hereto);
(j) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Pricing Prospectus any loss or interference
with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the Pricing
Prospectus, and (ii) since the respective dates as of which information is given
in the Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole, otherwise than as set forth
or contemplated in the Pricing Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Shares being delivered at such Time of Delivery on the terms
and in the manner contemplated in the Prospectus;
(k) On or after the Applicable Time (i) no downgrading shall have occurred
in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities;
(l) On or after the Applicable Time there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on NASDAQ; (ii) a suspension or material limitation in trading in the
Company's securities on NASDAQ; (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war or (v) the occurrence of any other calamity or crisis
or any change in financial, political or economic conditions in the United
States or elsewhere, if the effect of any such event specified in clause (iv) or
(v) in your judgment makes it impracticable or inadvisable to proceed with the
public offering or the delivery of
the Shares being delivered at such Time of Delivery on the terms and in the
manner contemplated in the Prospectus;
(m) The Shares to be sold at such Time of Delivery shall have been duly
listed for quotation on NASDAQ;
(n) The Company shall have obtained and delivered to the Underwriters
executed copies of an agreement from each of the Primary Selling Stockholder and
Xxxx Xxxxx, substantially to the effect set forth in Annex V(a) and Annex V(b),
respectively, hereto in form and substance satisfactory to you;
(o) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement;
(p) The Company shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Company satisfactory to
you as to the accuracy of the representations and warranties of the Company
herein at and as of such Time of Delivery, as to the performance by the Company
of all of its obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (j) of this Section
and as to such other matters as you may reasonably request; and
(q) Each Selling Stockholder shall have furnished or caused to be
furnished to you at such Time of Delivery, certificates satisfactory to you as
to the accuracy of the representations and warranties of such Selling
Stockholder herein at and as of such Time of Delivery, as to the performance by
such Selling Stockholder of all of its obligations hereunder to be performed at
or prior to such Time of Delivery.
9. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or
supplement thereto, any Issuer Free Writing Prospectus or any "issuer
information" filed or required to be filed pursuant to Rule 433(d) under the
Act, or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent that
26
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement, any Preliminary Prospectus, the Pricing
Prospectus or the Prospectus, or any amendment or supplement thereto, or any
Issuer Free Writing Prospectus, in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx, Xxxxx &
Co. expressly for use therein.
(b) Each of the Selling Stockholders, severally and not jointly, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Selling Stockholder expressly for use therein;
and will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that such
Selling Stockholder shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx, Sachs &
Co. expressly for use therein. Notwithstanding the foregoing, each individual
Selling Stockholder shall be liable under the foregoing indemnity agreement only
to the extent of the proceeds (net of underwriting discounts and commissions)
received by such Selling Stockholder from the sale of the Shares to the
Underwriters pursuant to this Agreement.
(c) Each Underwriter will indemnify and hold harmless the Company and each
Selling Stockholder against any losses, claims, damages or liabilities to which
the Company or such Selling Stockholder may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, any
27
Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any
amendment or supplement thereto, or any Issuer Free Writing Prospectus, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Preliminary Prospectus, the
Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or
any Issuer Free Writing Prospectus, in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein; and will reimburse the Company
or such Selling Stockholder for any legal or other expenses reasonably incurred
by the Company and each Selling Stockholder in connection with investigating or
defending any such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
28
(e) If the indemnification provided for in this Section 9 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company and the Selling Stockholders on the one hand and the Underwriters
on the other from the offering of the Shares. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (d) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Selling Stockholders on the one hand and the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company and the Selling Stockholders bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault 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 Company or the Selling
Stockholders on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company, each of the Selling
Stockholders and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this subsection (e) 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 which does not take account of the
equitable considerations referred to above in this subsection (e). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (e) shall be deemed to include 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 subsection (e),
(i) no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission and
29
(ii) no Selling Stockholder shall be required to contribute in excess of an
amount equal to the product of the number of Shares sold by such Selling
Stockholder and the public offering price of the Shares set forth in the
Prospectus, net of underwriting discounts and commissions. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(e) to contribute are several in proportion to their respective underwriting
obligations and not joint. Notwithstanding anything to the contrary in the
subsection (e), the Selling Stockholders shall only be required to contribute
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent that such
untrue statement or alleged untrue statement or omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Selling Stockholder for use
therein; and no Selling Stockholder shall be required to contribute any amount
in excess of an amount equal to the product of (i) the number of Shares sold by
such Selling Stockholder and (ii) the public offering price of the Shares as set
forth in the Prospectus, net of underwriting discounts and commissions.
(f) The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act and each broker-dealer affiliate of
any Underwriter; and the obligations of the Underwriters under this Section 9
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
10. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such Shares,
then the Company and the Selling Stockholders shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to you to purchase such Shares on such terms. In the event
30
that, within the respective prescribed periods, you notify the Company and the
Selling Stockholders that you have so arranged for the purchase of such Shares,
or the Company and the Selling Stockholders notify you that they have so
arranged for the purchase of such Shares, you or the Company and the Selling
Stockholders shall have the right to postpone such Time of Delivery for a period
of not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in your opinion may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased does not exceed one-eleventh of
the aggregate number of all the Shares to be purchased at such Time of Delivery,
then the Company and the Selling Stockholders shall have the right to require
each non-defaulting Underwriter to purchase the number of shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery, or
if the Company shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Shares of a defaulting
Underwriter or Underwriters, then this Agreement (or, with respect to the Second
Time of Delivery, the obligations of the Underwriters to purchase and of the
Company to sell the Optional Shares) shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company, except
for the expenses to be borne by the Company and the Underwriters as provided in
Section 7 hereof and the indemnity and contribution agreements in Section 9
hereof; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
31
11. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any of the Selling Stockholders or any officer or director or controlling
person of the Company, or any officer or director or controlling person of any
Selling Stockholder, and shall survive delivery of and payment for the Shares.
12. If this Agreement shall be terminated pursuant to Section 10 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 7 and 9 hereof; but,
if for any other reason, any Shares are not delivered by or on behalf of the
Company and the Selling Stockholders as provided herein, the Company and each of
the Selling Stockholders pro rata (based on the number of Shares to be sold by
the Company and such Selling Stockholder hereunder will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but neither the Company nor any Selling Stockholder
shall then be under any further liability to any Underwriter in respect of the
Shares not so delivered except as provided in Sections 7 and 9 hereof.
13. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Sachs &
Co., Xxx Xxx Xxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department; and if to the Company shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth in
the Registration Statement, Attention: Secretary; and if to any Selling
Stockholder shall be delivered or sent by mail, telex or facsimile transmission
at its address set forth in Schedule II hereto; provided, however, that any
notice to an Underwriter pursuant to Section 9(c) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at its address
set forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon
request. Any such
32
statements, requests, notices or agreements shall take effect upon receipt
thereof.
14. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and the Selling Stockholders and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and each person who controls the Company, any Selling Stockholder or any
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the Shares from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
15. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
16. The Company and each Selling Stockholder acknowledges and agrees that
(i) the purchase and sale of the Shares pursuant to this Agreement is an
arm's-length commercial transaction between the Company and the Selling
Stockholders, on the one hand, and the several Underwriters, on the other, (ii)
in connection therewith and with the process leading to such transaction each
Underwriter is acting solely as a principal and not the agent or fiduciary of
the Company or the Selling Stockholders, (iii) no Underwriter has assumed an
advisory or fiduciary responsibility in favor of the Company or the Selling
Stockholders with respect to the offering contemplated hereby or the process
leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company or the Selling Stockholders on other matters) or
any other obligation to the Company or the Selling Stockholders except the
obligations expressly set forth in this Agreement and (iv) each of the Company
and each Selling Stockholder has consulted its own legal and financial advisors
to the extent it deemed appropriate. The Company and the Selling Stockholders
agree that they will not claim that the Underwriters, or any of them, has
rendered advisory services of any nature or respect, or owes a fiduciary or
similar duty to the Company, in connection with such transaction or the process
leading thereto.
17. This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the Selling Stockholders and
the Underwriters, or any of them, with respect to the subject matter hereof.
18. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
33
19. The Company, each Selling Stockholder and each of the Underwriters
hereby irrevocably waives, to the fullest extent permitted by applicable law,
any and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
20. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
21. Notwithstanding anything herein to the contrary, the Company and each
Selling Stockholder is authorized to disclose to any persons the U.S. federal
and state income tax treatment and tax structure of the potential transaction
and all materials of any kind (including tax opinions and other tax analyses)
provided to the Company and the Selling Stockholders relating to that treatment
and structure, without the Underwriters imposing any limitation of any kind.
However, any information relating to the tax treatment and tax structure shall
remain confidential (and the foregoing sentence shall not apply) to the extent
necessary to enable any person to comply with securities laws. For this purpose,
"tax structure" is limited to any facts that may be relevant to that treatment.
34
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Company and each of the Representatives plus one for
each counsel counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters, the Company and
the Selling Stockholders. It is understood that your acceptance of this letter
on behalf of each of the Underwriters is pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company and the Selling Stockholders for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
XXXXX & CO., INC.
By:
----------------------------
Name:
Title:
Accepted as of the date hereof:
XXXXXXX, SACHS & CO. LIONBRIDGE TECHNOLOGIES, INC.
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
BY: BY:
------------------------------ ----------------------------
(Xxxxxxx, Sachs & Co.) NAME:
TITLE:
XXXXXXX X. XXXXXXXX
--------------------------------
On behalf of each of the Underwriters
35
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- --------------- ------------------
Xxxxxxx, Sachs & Co....................................
Friedman, Billings, Xxxxxx & Co., Inc..................
--------------- ------------------
Total...........................................
=============== ==================
36
SCHEDULE II
Number of Optional
Total Number of Firm Shares to be Sold if
Shares to be Sold Maximum Option Exercised
-------------------- ------------------------
The Company 0 1,355,000
The Selling Stockholders:
Xxxxx & Co. Inc. 9,400,000 0
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
Attn: General Counsel
Xxxxxxx X. Xxxxxxxx 0 55,000
c/o Lionbridge
Technologies, Inc.
00 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
37
SCHEDULE III
(a) Materials other than the Pricing Prospectus that comprise the Pricing
Disclosure Package:
(b) Issuer Free Writing Prospectuses not included in the Pricing
Disclosure Package:
(c) Additional Documents Incorporated by Reference:
38
SCHEDULE IV
The Company: Massachusetts
Lionbridge US, Inc.: Colorado, Idaho and Massachusetts
VeriTest, Inc.: Idaho, North Carolina and Washington
39
ANNEX I
Pursuant to Section 8(i) of the Underwriting Agreement,
PricewaterhouseCoopers LLP shall furnish letters to the Underwriters to the
effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or the Exchange
Act, as applicable, and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance with
standards established by the American Institute of Certified Public
Accountants of the consolidated interim financial statements, selected
financial data and/or condensed financial statements derived from audited
financial statements of the Company for the periods specified in such
letter, as indicated in their reports thereon, copies of which have been
furnished to the representatives of the Underwriters (the
"Representatives") and are attached hereto;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus and/or included in the Company's quarterly report on Form 10-Q
incorporated by reference into the Prospectus as indicated in their
reports thereon copies of which are attached hereto; and on the basis of
specified procedures including inquiries of officials of the Company who
have responsibility for financial and accounting matters regarding whether
the unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Company's
Annual Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
40
(v) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the interim financial
statements of the Company and its subsidiaries as of October 31, 2005 and
for the period ending October 31, 2005, except with respect to
subparagraph (D) below, which shall be as of the time noted therein,
inspection of the minute books of the Company and its subsidiaries since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, inquiries of officials of the
Company and its subsidiaries responsible for financial and accounting
matters and such other inquiries and procedures as may be specified in
such letter, nothing came to their attention that caused them to believe
that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or
incorporated by reference in the Company's Quarterly Reports on Form
10-Q incorporated by reference in the Prospectus do not comply as to
form in all material respects with the applicable accounting
requirements of the Exchange Act as it applies to Form 10-Q and the
related published rules and regulations, or (ii) any material
modifications should be made to the unaudited condensed consolidated
statements of income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus or included in
the Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus, for them to be conformity with
generally accepted accounting principles;
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any such
unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included or
incorporated by reference in the Company's Annual Report on Form
10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited
condensed financial statements referred to in clause (A) and any
unaudited income statement data and balance sheet items included in
the Prospectus and referred to in clause (B) were not determined on
a basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal
year;
(D) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of convertible
securities, in each case which were outstanding
41
on the date of the latest balance sheet included or incorporated by
reference in the Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or any decreases
in consolidated net current assets or stockholders' equity, in each
case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(E) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus
to the specified date referred to in clause (D) there were any
decreases in consolidated net revenues or operating profit or the
total or per share amounts of consolidated net income or other items
specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with the
comparable period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in
each case for increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter;
and
(vi) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (v) above, they have carried out
certain specified procedures, not constituting an examination in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference) or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the
Prospectus specified by the Representatives, and have compared certain of
such amounts, percentages and financial information with the accounting
records of the Company and its subsidiaries and have found them to be in
agreement.
42
ANNEX II
Pursuant to Section 8(i) of the Underwriting Agreement, KPMG LLP shall
furnish letters to the Underwriters to the effect that:
(i) They were independent public accountants with respect to BGS
Companies, Inc. and its affiliates within the meaning of the Act and the
applicable published rules and regulations thereunder for the periods covered;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules of BGS Companies Inc. and its affiliates
(and, if applicable, financial forecasts and/or pro forma financial information)
examined by them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act or the Exchange Act, as
applicable, and the related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards established by
the American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon, copies
of which have been furnished to the representatives of the Underwriters (the
"Representatives") and are attached hereto;
(iii) They have made a review in accordance with standards established by
the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows of BGS Companies Inc. and its affiliates
included in the Prospectus and/or included in any Exchange Act filing
incorporated by reference into the Prospectus as indicated in their reports
thereon copies of which are attached hereto; and on the basis of specified
procedures including inquiries of officials of BGS Companies Inc. who have
responsibility for financial and accounting matters regarding whether the
unaudited condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the related
published rules and regulations, nothing came to their attention that caused
them to believe that the unaudited condensed consolidated financial statements
do not comply as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published rules and
regulations;
(iv) On the basis of limited procedures, not constituting an examination
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information referred to
below, a reading of the interim financial statements of the Company and its
subsidiaries as of August 11, 2005 and for the period ending August 11, 2005,
except with respect to subparagraph (D) below, which shall be as of the time
noted therein, inspection of the minute books of BGS Companies Inc. and its
affiliates since the date of the latest audited financial statements
43
included or incorporated by reference in the Prospectus, inquiries of officials
of BGS Companies Inc. and its affiliates responsible for financial and
accounting matters and such other inquiries and procedures as may be specified
in such letter, nothing came to their attention that caused them to believe
that:
(A) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows of BGS
Companies Inc. and its affiliates incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable accounting
requirements of the Exchange Act and the related published rules and
regulations, or (B) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows of BGS Companies Inc. and its affiliates
incorporated by reference in the Prospectus, for them to be conformity with
generally accepted accounting principles; and
(v) In addition to the examination referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraph (iv) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives which are derived from the general
accounting records of BGS Companies Inc. and its affiliates, which appear in the
Prospectus (excluding documents incorporated by reference) or in Part II of, or
in exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the Prospectus
specified by the Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of BGS
Companies Inc. and its affiliates and have found them to be in agreement.
44
ANNEX III
[FORM OF GP/COMPANY OPINION]
45
ANNEX IV(a)
[FORM OF PRIMARY SELLING STOCKHOLDER OPINION]
46
ANNEX IV(b)
[FORM OF ADDITIONAL SELLING STOCKHOLDER OPINION]
47
ANNEX V(a)
LOCK-UP AGREEMENT
DECEMBER___, 2005
Xxxxxxx, Xxxxx & Co.
Friedman, Billings, Xxxxxx & Co., Inc.
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Lionbridge Technologies, Inc.- Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that you, as representatives (the
"Representatives"), propose to enter into an Underwriting Agreement on behalf of
the several Underwriters named in Schedule I to such agreement (collectively,
the "Underwriters"), with Lionbridge Technologies, Inc., a Delaware corporation
(the "Company") and the Selling Stockholders named therein (the "Underwriting
Agreement"), providing for a public offering of the Common Stock of the Company
(the "Shares") pursuant to a Registration Statement on Form S-3 to be filed with
the Securities and Exchange Commission (the "SEC").
In consideration of the agreement by the Underwriters to offer and sell
the Shares, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period beginning from the date hereof and continuing to and including the
date 90 days after the date of the final Prospectus covering the public offering
of the Shares, the undersigned will not offer, sell, contract to sell, pledge,
grant any option to purchase, make any short sale or otherwise dispose of any
shares of Common Stock of the Company, or any options or warrants to purchase
any shares of Common Stock of the Company, or any securities convertible into,
exchangeable for or that represent the right to receive shares of Common Stock
of the Company, whether now owned or hereinafter acquired, owned directly by the
undersigned (including holding as a custodian) or with respect to which the
undersigned has beneficial ownership within the rules and regulations of the SEC
(collectively the "Undersigned's Shares").
The foregoing restriction is expressly agreed to preclude the undersigned
from engaging in any hedging or other transaction which is designed to or which
reasonably could be expected to lead to or result in a sale or disposition of
the Undersigned's Shares even if such Shares would be disposed of by someone
other than the undersigned. Such prohibited hedging or other transactions would
include without limitation any short sale or any purchase, sale or grant of any
right (including without limitation any put or call option) with respect to any
of the Undersigned's Shares or with respect to any security that includes,
relates to, or derives any significant part of its value from such Shares.
Notwithstanding the foregoing, this Lock-Up Agreement shall not apply to
the sale of any Shares to the Underwriters pursuant to the Underwriting
Agreement. In addition, the
48
undersigned may transfer the Undersigned's Shares with the prior written consent
of Xxxxxxx, Xxxxx & Co. on behalf of the Underwriters. In addition,
notwithstanding the foregoing, if the undersigned is a corporation, the
corporation may transfer the capital stock of the Company to any wholly-owned
subsidiary of such corporation; provided, however, that in any such case, it
shall be a condition to the transfer that the transferee execute an agreement
stating that the transferee is receiving and holding such capital stock subject
to the provisions of this Agreement and there shall be no further transfer of
such capital stock except in accordance with this Agreement, and provided
further that any such transfer shall not involve a disposition for value. The
undersigned now has, and, except as contemplated above, for the duration of this
Lock-Up Agreement will have, good and marketable title to the Undersigned's
Shares, free and clear of all liens, encumbrances, and claims whatsoever. The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company's transfer agent and registrar against the transfer of the
Undersigned's Shares except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors, and assigns.
Very truly yours,
Xxxxx & Co., Inc.
By:
-----------------------------------
Name:
Title:
49
ANNEX V(b)
LIONBRIDGE TECHNOLOGIES, INC.
LOCK-UP AGREEMENT
DECEMBER ___, 2005
Xxxxxxx, Xxxxx & Co.
Friedman, Billings, Xxxxxx & Co., Inc.
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Lionbridge Technologies, Inc.- Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that you, as representatives (the
"Representatives"), propose to enter into an Underwriting Agreement on behalf of
the several Underwriters named in Schedule I to such agreement (collectively,
the "Underwriters"), with Lionbridge Technologies, Inc., a Delaware corporation
(the "Company") and the Selling Stockholders named therein (the "Underwriting
Agreement"), providing for a public offering of the Common Stock of the Company
(the "Shares") pursuant to a Registration Statement on Form S-3 to be filed with
the Securities and Exchange Commission (the "SEC").
In consideration of the agreement by the Underwriters to offer and sell
the Shares, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period beginning from the date hereof and continuing to and including the
date 90 days after the date of the final Prospectus covering the public offering
of the Shares, the undersigned will not offer, sell, contract to sell, pledge,
grant any option to purchase, make any short sale or otherwise dispose of any
shares of Common Stock of the Company, or any options or warrants to purchase
any shares of Common Stock of the Company, or any securities convertible into,
exchangeable for or that represent the right to receive shares of Common Stock
of the Company, whether now owned or hereinafter acquired, owned directly by the
undersigned (including holding as a custodian) or with respect to which the
undersigned has beneficial ownership within the rules and regulations of the SEC
(collectively the "Undersigned's Shares").
The foregoing restriction is expressly agreed to preclude the undersigned
from engaging in any hedging or other transaction which is designed to or which
reasonably could be expected to lead to or result in a sale or disposition of
the Undersigned's Shares even if such Shares would be disposed of by someone
other than the undersigned. Such prohibited hedging or other transactions would
include without limitation any short sale or any purchase, sale or grant of any
right (including without limitation any put or call option) with respect to any
of the Undersigned's Shares or with respect to any security that includes,
relates to, or derives any significant part of its value from such Shares.
50
Notwithstanding the foregoing, this Lock-Up Agreement shall not apply to
the sale of any Shares to the Underwriters pursuant to the Underwriting
Agreement. In addition, the undersigned may transfer the Undersigned's Shares
(i) as a bona fide gift or gifts, provided that the donee or donees thereof
agree to be bound in writing by the restrictions set forth herein, (ii) to any
trust for the direct or indirect benefit of the undersigned or the immediate
family of the undersigned, provided that the trustee of the trust agrees to be
bound in writing by the restrictions set forth herein, and provided further that
any such transfer shall not involve a disposition for value, (iii) pursuant to
any 10b5-1 plan of the Company existing on the date hereof, or (iv) with the
prior written consent of Xxxxxxx, Xxxxx & Co. on behalf of the Underwriters. For
purposes of this Lock-Up Agreement, "immediate family" shall mean any
relationship by blood, marriage or adoption, not more remote than first cousin.
In addition, notwithstanding the foregoing, if the undersigned is a corporation,
the corporation may transfer the capital stock of the Company to any
wholly-owned subsidiary of such corporation; provided, however, that in any such
case, it shall be a condition to the transfer that the transferee execute an
agreement stating that the transferee is receiving and holding such capital
stock subject to the provisions of this Agreement and there shall be no further
transfer of such capital stock except in accordance with this Agreement, and
provided further that any such transfer shall not involve a disposition for
value. The undersigned now has, and, except as contemplated by clause (i), (ii),
or (iii) above, for the duration of this Lock-Up Agreement will have, good and
marketable title to the Undersigned's Shares, free and clear of all liens,
encumbrances, and claims whatsoever. The undersigned also agrees and consents to
the entry of stop transfer instructions with the Company's transfer agent and
registrar against the transfer of the Undersigned's Shares except in compliance
with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors, and assigns.
This Lock-Up Agreement shall automatically terminate and be of no further
force or effect upon the earliest to occur, if any, of (i) either Xxxxxxx, Sachs
& Co. or the Company advising the other party in writing, prior to execution of
the Underwriting Agreement, that it has determined not to proceed with the
Offering, (ii) the termination of the Underwriting Agreement before the sale of
any Shares to the Underwriters and (iii) December 31, 2005 if the Offering has
not been completed by such date.
Very truly yours,
Xxxx Xxxxx
----------------------------------------
51
