Exhibit 1
4,000,000 Shares
DIGITAL INSIGHT CORPORATION
Common Stock, par value $0.001
UNDERWRITING AGREEMENT
______________, 2002
______________, 2002
Xxxxxx Xxxxxxx & Co. Incorporated
Banc of America Securities LLC
XX Xxxxxx Securities Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Madames:
Digital Insight Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell to the several Underwriters named in Schedule I
hereto (the "Underwriters") an aggregate of 4,000,000 shares of the Common
Stock, par value $0.001 of the Company (the "Firm Shares"). The Company also
proposes to issue and sell to the several Underwriters not more than an
additional 600,000 shares in the aggregate of Common Stock, par value $0.001, of
the Company (the "Additional Shares"), if and to the extent that you, as
managers of the offering, shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such Additional Shares granted to the
Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "Shares". The shares of Common
Stock, par value $0.001, of the Company to be outstanding after giving effect to
the sales contemplated hereby are hereinafter referred to as the "Common Stock".
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to the
Shares. The registration statement as amended at the time it becomes effective,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the
Securities Act of 1933, as amended (the "Securities Act"), is hereinafter
referred to as the "Registration Statement"; the prospectus in the form first
used to confirm sales of Shares is hereinafter referred to as the "Prospectus".
If the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "Rule 462 Registration Statement"), then any reference herein to the
term "Registration Statement" shall be deemed to include such Rule 462
Registration Statement (including, in the case of all references to the
Registration Statement and the Prospectus, documents incorporated therein by
reference).
1. Representations and Warranties. The Company represents and warrants
to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in the Registration Statement or Prospectus complied
or will comply when so filed in all material respects with the Exchange Act and
applicable rules and regulations of the Commission thereunder, (ii) the
Registration Statement, when it became effective, did not contain and, as
amended or supplemented, if applicable, will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, (iii) the
Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iv) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this paragraph do
not apply to statements or omissions in the Registration Statement or the
Prospectus based upon information relating to any Underwriter furnished to the
Company in writing by such Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
(d) Each Subsidiary (as defined hereinafter) of the Company, other
than ViFi LLC ("ViFi"), has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
Subsidiaries, taken as a whole; ViFi has been duly formed and is validly
existing as a limited liability company under the laws of the State of Delaware
with the power under its limited liability company agreement to own its property
and to conduct its business as described in the Prospectus and is duly qualified
to transact business in each jurisdiction in which the conduct of its business
or its ownership or leasing of its property requires such qualification, except
to the extent that the failure to be so qualified would not have a material
adverse effect on the Company and its Subsidiaries, taken as a whole; all of the
issued shares of capital stock of each Subsidiary of the Company, other than
ViFi, have been duly and validly authorized and issued, are fully paid and non-
assessable and are owned directly by the Company, free and clear of all liens,
encumbrances, equities or claims; all of the member interest in ViFi is owned
directly by the Company, free and clear of all liens, encumbrances, equities and
claims. Other than the ownership of all of the outstanding capital stock of
nFront, Inc., 1View Network Corporation, AnyTime Access, Inc. and Mureau
Acquisition Corp. and all of the member interest in ViFi (each a "Subsidiary,"
collectively,
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the "Subsidiaries"), the Company does not own any of the equity of any
corporation, partnership, joint venture, association or other entity.
(e) This Agreement has been duly authorized, executed and delivered
by the Company.
(f) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(g) The shares of Common Stock outstanding prior to the issuance of
the Shares have been duly authorized and are validly issued, fully paid and non-
assessable.
(h) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares will not
be subject to any preemptive or similar rights.
(i) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene any
provision of applicable law or the certificate of incorporation or by-laws of
the Company or any agreement or other instrument binding upon the Company or any
of its Subsidiaries that is material to the Company and its Subsidiaries, taken
as a whole, or any judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Company or any Subsidiary, and no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company of its obligations
under this Agreement, except such as may be required under the Securities Act or
by the securities or Blue Sky laws of the various states in connection with the
offer and sale of the Shares.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its Subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement).
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its Subsidiaries is a party or to
which any of the properties of the Company or any of its Subsidiaries is subject
that are required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes, regulations, contracts or
other documents that are required to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration Statement that
are not described or filed as required.
(l) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(m) The Company is not, and after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Prospectus will not be,
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required to register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
(n) The Company and its Subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.
(o) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with Environmental
Laws or any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
(p) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Securities Act with respect to any
securities of the Company or to require the Company to include such securities
with the Shares registered pursuant to the Registration Statement except in each
case as described in the Prospectus (and as to which any requirements to include
any securities in, or register any securities pursuant to, the Registration
Statement have been satisfied or duly waived).
(q) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or with
any person or affiliate located in Cuba.
(r) Except in each case as described in the Prospectus, subsequent to
the respective dates as of which information is given in the Registration
Statement and the Prospectus, (1) the Company and its Subsidiaries have not
incurred any material liability or obligation, direct or contingent, nor entered
into any material transaction not in the ordinary course of business; (2) the
Company has not purchased any of its outstanding capital stock, nor declared,
paid or otherwise made any dividend or distribution of any kind on its capital
stock other than ordinary and customary dividends; and (3) there has not been
any material change in the capital stock, short-term debt or long-term debt of
the Company and its Subsidiaries.
(s) The Company and its Subsidiaries have good and marketable title
in fee simple to all real property and good and marketable title to all personal
property owned by them which is material to the business of the Company and its
Subsidiaries, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not
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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, in each case except as described in the
Prospectus.
(t) The Company and its Subsidiaries own or possess, or can acquire
on reasonable terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names currently employed by them in
connection with the business now operated by them, and neither the Company nor
any of its Subsidiaries has received any notice of infringement of or conflict
with asserted rights of others with respect to any of the foregoing which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
(u) No material labor dispute with the employees of the Company or
any of its Subsidiaries exists, except as described in the Prospectus, or, to
the knowledge of the Company, is imminent; and the Company is not aware of any
existing, threatened or imminent labor disturbance by the employees of any of
its principal suppliers, manufacturers or contractors that could have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.
(v) The Company and its Subsidiaries are insured by the insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; neither the Company nor any of its Subsidiaries has been refused any
insurance coverage sought or applied for; and neither the Company nor any of its
Subsidiaries has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a material adverse effect on the Company
and its Subsidiaries, taken as a whole, except as described in the Prospectus.
(w) The Company and its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective businesses, and
neither the Company nor any of its Subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a material adverse effect on
the Company and its Subsidiaries, taken as a whole, except as described the
Prospectus.
(x) The Company and each of its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (1)
transactions are executed in accordance with management's general or specific
authorizations; (2) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (3) access to assets is
permitted only in
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accordance with management's general or specific authorization; and (4) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell to
the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $ a share (the "Purchase Price")
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to 600,000 Additional
Shares at the Purchase Price. If you, on behalf of the Underwriters, elect to
exercise such option, you shall so notify the Company in writing not later than
30 days after the date of this Agreement, which notice shall specify the number
of Additional Shares to be purchased by the Underwriters and the date on which
such shares are to be purchased. Such date may be the same as the Closing Date
(as defined below) but not earlier than the Closing Date nor later than ten
business days after the date of such notice. Additional Shares may be purchased
as provided in Section 3 hereof solely for the purpose of covering over-
allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each Underwriter agrees, severally and
not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) that bears the
same proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of Xxxxxx
Xxxxxxx & Co. Incorporated and Banc of America Securities, LLC on behalf of the
Underwriters, it will not, during the period ending 90 days after the date of
the Prospectus, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or (ii) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (A) the Shares to be sold hereunder, (B) the
issuance by the Company of shares of Common Stock upon the exercise of an option
or warrant or the conversion of a security outstanding on the date hereof which
is described in the Prospectus or of which the Underwriters have otherwise been
advised in writing, or (C) the issuance by the Company of shares of Common Stock
or options to purchase shares of Common Stock pursuant to the Company's employee
benefit plans as in existence on the date of this Agreement. The Company hereby
represents and warrants that, during the period ending 90 days after the date of
the Prospectus, it will not release any of its officers, directors or other
stockholders; from any lock-up agreements currently existing or hereafter
effected without the prior written consent of Xxxxxx Xxxxxxx & Co. Incorporated
and Banc of America Securities, LLC.
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3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at $___
a share (the "Public Offering Price") and to certain dealers selected by you at
a price that represents a concession not in excess of $____ a share under the
Public Offering Price, and that no Underwriter will allow, and no dealer will
reallow, any concession to other Underwriters or dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to
the Company in immediately available funds by wire transfer to the account
specified by the Company against delivery of such Firm Shares for the respective
accounts of the several Underwriters at 10:00 a.m., New York City time, on ____,
2002, or at such other time on the same or such other date, not later than ____,
2002, as shall be designated in writing by you. The time and date of such
payment are hereinafter referred to as the "Closing Date".
Payment for any Additional Shares shall be made to the Company in
immediately available funds by wire transfer to the account specified by the
Company against delivery of such Additional Shares for the respective accounts
of the several Underwriters at 10:00 a.m., New York City time, on the date
specified in the notice described in Section 2 or at such other time on the same
or on such other date, in any event not later than _________, 2002, as shall be
designated in writing by you. The time and date of such payment are hereinafter
referred to as the "Option Closing Date".
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date or
Option Closing Date (as applicable) are subject to the condition that the
Registration Statement shall have become effective not later than 5:00 p.m. (New
York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any review
for a possible change that does not indicate the direction of the possible
change, in the rating accorded any of the
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Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2) under the
Securities Act; and
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise, or in
the earnings, business or operations of the Company and its Subsidiaries, taken
as a whole, from that set forth in the Prospectus (exclusive of any amendments
or supplements thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your judgment,
impracticable to market the Shares on the terms and in the manner contemplated
in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of the
Company, to the effect set forth in Section 5(a)(i) above and to the effect that
the representations and warranties of the Company contained in this Agreement
are true and correct in all material respects (if not qualified by materiality)
and in all respects (if qualified by materiality) as of the Closing Date and
that the Company has complied with all of the agreements and satisfied all of
the conditions on its part to be performed or satisfied hereunder on or before
the Closing Date.
The officer signing and delivering such certificate may rely upon the best
of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of O'Melveny & Xxxxx LLP, outside counsel for the Company, dated the
Closing Date, to the effect that:
(i) the Company has been duly incorporated and is validly
existing in good standing under the laws of the State of Delaware, with
corporate power to own its property and to conduct its business as described in
the Prospectus and is qualified as a foreign corporation to do business in the
states identified in a certificate signed by an executive officer of the Company
(the "Officer's Certificate") as states in which the Company conducts business
or owns or leases property, and is in good standing in each of those states;
(ii) each of the Subsidiaries, other than ViFi, has been duly
incorporated, and is validly existing in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power to own its property
and to conduct its business as described in the Prospectus and is qualified as a
foreign corporation to do business in the states identified in the Officer's
Certificate as states in which such corporations conduct business or own or
lease property, and is in good standing in each of those states;
(iii) ViFi has been duly formed and is validly existing as a
limited liability company under the laws of the State of Delaware, has the power
under its limited liability company agreement to own its property and to conduct
its business as described in the Prospectus and is qualified as a foreign
limited liability company to do business in the states identified in the
Officer's Certificate as a states in which ViFi conducts business or owns or
leases property;
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(iv) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
(v) the shares of Common Stock outstanding prior to the
issuance of the Shares to be sold by the Company have been duly authorized by
all necessary corporate action on the part of the Company and are validly
issued, fully paid and non-assessable;
(vi) all of the outstanding shares of capital stock of each
Subsidiary, other than ViFi, have been duly authorized by all necessary
corporate action on behalf of the corporation and are validly issued, fully paid
and non-assessable and are owned of record by the Company and, to the knowledge
of such counsel, beneficially owned by the Company, free and clear of all liens,
encumbrances, equities or claims;
(vii) all of the member interest in ViFi is owned of record by
the Company and, to the knowledge of such counsel, beneficially owned by the
Company, free and clear of all liens, encumbrances, equities or claims;
(viii) the Shares to be sold by the Company have been duly
authorized by all necessary corporate action on the part of the Company and upon
payment for and delivery of the Shares to be sold by the Company in accordance
with this Agreement, the Shares to be sold by the Company will be validly
issued, fully paid and non-assessable; and holders of the Common Stock are not
entitled to any preemptive rights to subscribe to any additional shares of the
Common Stock under the Company's Certificate of Incorporation or Bylaws or the
Delaware General Corporation Law or, to the knowledge of such counsel, any
similar rights;
(ix) to the knowledge of such counsel, there is no legal or
beneficial owner of any securities or the Company who has any rights, not
effectively satisfied or waived, to require registration of any shares of
capital stock of the Company in connection with the filing of the Registration
Statement;
(x) the Company has the corporate power to enter into this
Agreement and to issue, sell and deliver to the Underwriters the Shares to be
issued and sold by the Company;
(xi) this Agreement has been duly authorized by all necessary
corporate action on the part of the Company and has been duly executed and
delivered by the Company;
(xii) the execution and delivery by the Company of this
Agreement do not, and the Company's performance of its obligations under this
Agreement will not, (1) violate the Company's Certificate of Incorporation or
Bylaws, (2) violate, breach or result in a default under any existing obligation
of or restriction on the Company or any of its Subsidiaries under any agreement
(the "Other Agreements") listed as an exhibit to the Registration Statement or
the documents incorporated therein by reference, or (3) breach or otherwise
violate any existing obligation of or restriction on the Company or any of its
Subsidiaries under any order, judgment or decree of any California or federal
court or governmental authority binding on the Company or any of its
Subsidiaries identified in the Officer's Certificate, except that such counsel
need express no
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opinion as to the effect of the Company's performance of its obligations in
this Agreement on the Company's compliance with any financial covenants in the
Other Agreements;
(xiii) the statements (A) in the Prospectus under the captions
"Business -Government Regulation," "Description of Capital Stock" and
"Underwriters" and (B) in the Registration Statement in Item 15, in each case
insofar as such statements constitute summaries of any legal matters, documents
or proceedings referred to therein, fairly present the information required by
Form S-3 with respect to any such legal matters, documents or proceedings and
fairly summarize the matters referred to therein;
(xiv) such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of its
Subsidiaries is a party or to which any of the properties of the Company or any
of its Subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described;
(xv) such counsel does not know of any statutes, regulations,
contracts or other documents of a character required to be described in the
Registration Statement or filed as an exhibit to the Registration Statement that
are not described or filed as required;
(xvi) the Company is not, and after giving effect to the
offering and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus will not be, required to register as an investment
company under the Investment Company Act of 1940, as amended; and
(xvii) (A) each document, if any, filed pursuant to the Exchange
Act and incorporated by reference in the Registration Statement and Prospectus
(except for financial statements and schedules and other financial and
statistical information as to which such counsel need not express any opinion)
appeared on their face to comply in all material respects with the requirements
as to form for reports on Form 10-K and Form 8-K, as the case may be, under the
Exchange Act and the related rules and regulations in effect at the respective
dates of their filing, and (B) the Registration Statement, on the date it was
filed, appeared on its face to comply in all material respects with the
requirements as to form for registration statements on Form S-3 under the
Securities Act and the related rules and regulations in effect at the date of
filing, except that such counsel need express no opinion concerning the
financial statements and schedules and other financial and statistical data
contained therein.
Such counsel shall state that in connection with such counsel's
participation in conferences in connection with the preparation of the
Registration Statement and the Prospectus, such counsel has not independently
verified the accuracy, completeness or fairness of the statements contained
therein, and the limitations inherent in the examination made by such counsel
and the knowledge available to such counsel are such that such counsel is unable
to assume, and does not assume, any responsibility for such accuracy,
completeness or fairness (except as otherwise specifically stated in paragraph
(xiii) above). However, such counsel shall state that on the basis of such
counsel's review and participation in conferences in connection with the
preparation of the Registration Statement and the Prospectus, such counsel does
not believe that the Registration Statement as of its effective date contained
any untrue statement of a material fact or omitted to state a material fact
required to be
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stated therein or necessary to make the statements therein not misleading, and
such counsel does not believe that the Prospectus, on the date of the opinion,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; however, such counsel
need express no opinion or belief as to any document filed by the Company under
the Exchange Act, whether before or after the effective date of the Registration
Statement, except to the extent that any such document is incorporated by
reference in the Registration Statement or the Prospectus and considered as a
whole, nor need such counsel express any opinion or belief as to the financial
statements and schedules and other financial and statistical data contained in
the Registration Statement or the Prospectus.
(d) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C., counsel for the Underwriters,
dated the Closing Date, covering the matters referred to in Sections 5(c)(iv),
5(c)(viii), 5(c)(xi), 5(c)(xiii) (but only as to the statements in the
Prospectus under "Description of Capital Stock" and "Underwriters") and the
paragraph following the enumerated opinions in paragraph (c) above.
The opinion of O'Melveny & Xxxxx LLP described in Section 5(c) above shall
be rendered to the Underwriters at the request of the Company and shall so state
therein.
(e) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date, as the
case may be, in form and substance satisfactory to the Underwriters, from
PricewaterhouseCoopers LLP and Deloitte & Touche LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in, or
incorporated by reference into, the Registration Statement and the Prospectus;
provided that the letter delivered on the Closing Date shall use a "cut-off
date" not earlier than the date hereof.
(f) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and certain stockholders, executive officers and
directors of the Company relating to sales and certain other dispositions of
shares of Common Stock or certain other securities, delivered to you on or
before the date hereof, shall be in full force and effect on the Closing Date.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the Option Closing Date of such
documents as you may reasonably request with respect to the good standing of the
Company, the due authorization and issuance of the Additional Shares and other
matters related to the issuance of the Additional Shares.
6. Covenants of the Company. In further consideration of the agreements
of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, a signed copy of the
Registration Statement (including exhibits thereto and documents incorporated by
reference) and for delivery to each other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto and documents incorporated by
reference) and to furnish to you in New York City, without charge, prior
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to 10:00 a.m. New York City time on the second business day next succeeding the
date of this Agreement and during the period mentioned in Section 6(c) below, as
many copies of the Prospectus and any supplements and amendments thereto or to
the Registration Statement as you may reasonably request. The terms "supplement"
and "amendment" and "amend" as used in this Agreement shall include all
documents subsequently filed by the Company with the Commission pursuant to the
Exchange Act that are deemed to be incorporated by reference in the Prospectus.
(b) Before amending or supplementing the Registration Statement or
the Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to which
you reasonably object, and to file with the Commission within the applicable
period specified in Rule 424(b) under the Securities Act any prospectus required
to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in connection with sales by an
Underwriter or dealer, any event shall occur or condition exist as a result of
which it is necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if, in the opinion of counsel for
the Underwriters, it is necessary to amend or supplement the Prospectus to
comply with applicable law, forthwith to prepare, file with the Commission and
furnish, at its own expense, to the Underwriters and to the dealers (whose names
and addresses you will furnish to the Company) to which Shares may have been
sold by you on behalf of the Underwriters and to any other dealers upon request,
either amendments or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be misleading or
so that the Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request.
(e) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the twelve-month
period ending _________ that satisfies the provisions of Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder.
7. Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company agrees to
pay or cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (i) the fees, disbursements and
expenses of the Company's counsel and the Company's accountants in connection
with the registration and delivery of the Shares under the Securities Act and
all other fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment
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memorandum in connection with the offer and sale of the Shares under state
securities laws and all expenses in connection with the qualification of the
Shares for offer and sale under state securities laws as provided in Section
6(d) hereof including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky or Legal Investment memorandum, (iv) all filing
fees and the reasonable fees and disbursements of counsel to the Underwriters
incurred in connection with the review and qualification of the offering of the
Shares by the National Association of Securities Dealers, Inc., (v) all costs
and expenses incident to listing the Shares on the Nasdaq National Market, (vi)
the cost of printing certificates representing the Shares, (vii) the costs and
charges of any transfer agent, registrar or depositary, (viii) the costs and
expenses of the Company relating to investor presentations on any "road show"
undertaken in connection with the marketing of the offering of the Shares,
including, without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the
Company, travel and lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft chartered in
connection with the road show and, (ix) all other costs and expenses incident to
the performance of the obligations of the Company hereunder for which provision
is not otherwise made in this Section. It is understood, however, that except as
provided in this Section, Section 8 entitled "Indemnity and Contribution", and
the last paragraph of Section 10 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them and any
advertising expenses connected with any offers they may make.
8. Indemnity and Contribution. (a) The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein; provided that the foregoing indemnity agreement with respect to
any preliminary prospectus shall not inure to the benefit of any Underwriter, or
person controlling such Underwriter, from whom the person asserting any such
losses, claims, damages or liabilities purchased Shares, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Shares to such
Person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such loss, claim, damage or liability unless such
failure is the result of non-compliance by the Company with Sections 6(a) or
6(c) hereof.
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(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, the directors of the Company, the officers of the
Company who sign the Registration Statement and each person, if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendment thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendment or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (i) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, and (ii) the fees and expenses
of more than one separate firm (in addition to any local counsel) for the
Company, its directors, its officers who sign the Registration Statement and
each person, if any, who controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act. In the case
of any such separate firm for the Underwriters and such control persons of any
Underwriters, such firm shall be designated in writing by Xxxxxx Xxxxxxx & Co.
Incorporated and Banc of America Securities, LLC. In the case of any such
separate firm for the Company, and such directors, officers and control persons
of the Company, such firm shall be designated in writing by the Company. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and
-14-
third sentences of this paragraph, the indemnifying party agrees that it shall
be liable for any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 30 days after receipt
of such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement. No indemnifying party shall,
without the prior written consent of the indemnified party effect any settlement
of any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 8(a) or
8(b), is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraphs, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause 8(d)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 8(d)(i) above but also the relative
fault of the indemnifying party or parties on the one hand and of the
indemnified party or parties on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other hand
in connection with the offering of the Shares shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Shares
(before deducting expenses) received by the Company and the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover of the Prospectus, bear to the aggregate Public
Offering Price of the Shares. The relative fault of the Company on the one hand
and the Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 8 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section 8(d). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, 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
-15-
public were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The remedies provided for in this
Section 8 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 8 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force and
effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, or the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
9. Termination. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the National Association of
Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and (b) in the case of any of
the events specified in clauses 9(a)(i) through 9(a)(iv), such event, singly or
together with any other such event, makes it, in your judgment, impracticable to
market the Shares on the terms and in the manner contemplated in the Prospectus.
10. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase Shares
that it has or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Firm Shares set forth opposite the names of all such non-
defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided that in no event shall the
number of Shares that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 10 by an amount in excess of
one-ninth of such number of Shares without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares
with respect to which such default
-16-
occurs is more than one-tenth of the aggregate number of Firm Shares to be
purchased, and arrangements satisfactory to you and the Company for the purchase
of such Firm Shares are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or the Company. In any such case either you or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements may be
effected. If, on the Option Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Additional Shares and the aggregate number of
Additional Shares with respect to which such default occurs is more than one-
tenth of the aggregate number of Additional Shares to be purchased, the non-
defaulting Underwriters shall have the option to (i) terminate their obligation
hereunder to purchase Additional Shares or (ii) purchase not less than the
number of Additional Shares that such non-defaulting Underwriters would have
been obligated to purchase in the absence of such default. Any action taken
under this paragraph shall not relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
11. Counterparts. This Agreement may be signed in counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
[remainder of page intentionally left blank]
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Very truly yours,
DIGITAL INSIGHT CORPORATION
By: ______________________________ By: ________________________________
Name: Xxxx Xxxxxx Name: Xxxxxxx Xxxx
Title: Chairman and CEO Title: Vice President, Finance
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Banc of America Securities LLC
XX Xxxxxx Securities Inc.
Acting severally on behalf
of themselves and the
several Underwriters named
in Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: ______________________________
Name:
Title:
SCHEDULE I
Number of Firm Shares
Underwriter To Be Purchased
---------------------------------- ----------------------
Xxxxxx Xxxxxxx & Co. Incorporated
Banc of America Securities LLC
XX Xxxxxx Securities Inc.
Total: ==========
S-1
EXHIBIT A
[FORM OF LOCK-UP LETTER]
February __, 2002
Xxxxxx Xxxxxxx & Co. Incorporated and Banc of America Securities LLC
XX Xxxxxx Securities Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Madames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx
Xxxxxxx") proposes to enter into an Underwriting Agreement (the "Underwriting
Agreement") with Digital Insight Corporation, a Delaware corporation (the
"Company") providing for the public offering (the "Public Offering") by the
several Underwriters, including Xxxxxx Xxxxxxx (the "Underwriters"), of
4,000,000 shares (the "Shares") of the Common Stock, par value $0.001 of the
Company (the "Common Stock").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters (which consent may be withheld in its sole
discretion), it will not, during the period commencing on the date hereof and
ending 90 days after the date of the final prospectus relating to the Public
Offering (the "Prospectus"), (1) offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase, lend, or otherwise transfer or dispose
of, directly or indirectly, any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or (2) enter
into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership of Common Stock, whether any
such transaction described in clause (1) or (2) above is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise. The
foregoing sentence shall not apply to transactions relating to shares of Common
Stock or other securities acquired in open market transactions after the
completion of the Public Offering. In addition, the undersigned agrees that,
without the prior written consent of Xxxxxx Xxxxxxx on behalf of the
Underwriters (which consent may be withheld in its sole discretion), it will
not, during the period commencing on the date hereof and ending 90 days after
the date of the Prospectus, make any demand for or exercise any right with
respect to, the registration of any shares of Common Stock or any security
convertible into or exercisable or exchangeable for Common Stock. 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 of Common Stock 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
Public Offering. The undersigned further understands that
E-1
this Lock-Up Agreement is irrevocable and shall be binding upon the
undersigned's heirs, legal representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters. This Agreement shall
lapse and become null and void if the Public Offering shall not have occurred on
or before June 30, 2002.
Very truly yours,
___________________________________
(Name)
___________________________________
(Address)
E-2
