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TELIGENT, L.L.C.
(a Delaware limited liability company)
and
TELIGENT, INC.
(a Delaware corporation)
4,400,000 Shares of Class A Common Stock
U.S. PURCHASE AGREEMENT
Dated: November , 1997
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Table of Contents
U.S. PURCHASE AGREEMENT......................................................................................... 1
SECTION 1. Representations and Warranties.................................................... 4
(a) Representations and Warranties by the L.L.C. and the Issuer....................... 4
(i) Compliance with Registration Requirements............................... 4
(ii) Independent Accountants................................................. 5
(iii) Financial Statements.................................................... 5
(iv) No Material Adverse Change in Business.................................. 5
(v) Good Standing of the L.L.C.............................................. 6
(vi) Good Standing of the Issuer............................................. 6
(vii) Good Standing of Subsidiaries........................................... 6
(viii) Capitalization of the Company........................................... 7
(ix) Authorization of Agreement.............................................. 7
(x) Authorization and Description of Securities............................. 7
(xi) Absence of Defaults and Conflicts....................................... 7
(xii) Absence of Labor Dispute................................................ 8
(xiii) Absence of Proceedings.................................................. 8
(xiv) Accuracy of Exhibits.................................................... 9
(xv) Possession of Intellectual Property..................................... 9
(xvi) Absence of Further Requirements......................................... 9
(xvii) Possession of Licenses and Permits...................................... 9
(xviii) Title to Property....................................................... 10
(xix) Investment Company Act.................................................. 10
(xx) Environmental Laws...................................................... 10
(xxi) Registration Rights..................................................... 11
(xxii) Transactions............................................................ 11
(xxiii) Insurance Coverage...................................................... 11
(xxiv) Absence of Dividend Restrictions........................................ 11
(xxv) Filings of Tax Returns.................................................. 12
(xxvi) Maintenance of Internal Accounting Controls............................. 12
(b) Officer's Certificates............................................................ 12
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing................................... 12
(a) U.S. Initial Securities........................................................... 12
(b) U.S. Option Securities............................................................ 12
(c) Payment........................................................................... 13
(d) Denominations; Registration....................................................... 14
SECTION 3. Covenants of the Issuer........................................................... 14
(a) Compliance with Securities Regulations and Commission
Requests.......................................................................... 14
(b) Filing of Amendments.............................................................. 14
(c) Delivery of Registration Statements............................................... 14
(d) Delivery of Prospectuses.......................................................... 15
i
(e) Continued Compliance with Securities Laws......................................... 15
(f) Rule 158.......................................................................... 15
(g) Use of Proceeds................................................................... 16
(h) Listing........................................................................... 16
(i) Restriction on Sale of Securities................................................. 16
(j) Reporting Requirements............................................................ 16
[(k) Compliance with NASD Rules........................................................ 16
SECTION 4. Payment of Expenses............................................................... 17
(a) Expenses.......................................................................... 17
(b) Termination of Agreement.......................................................... 17
SECTION 5. Conditions of U.S. Underwriters' Obligations...................................... 17
(a) Effectiveness of Registration Statement........................................... 17
(b) Opinions of Counsel for the L.L.C. and the Issuer................................. 18
(c) Opinion of Counsel for U.S. Underwriters.......................................... 18
(d) Officers' Certificate............................................................. 18
(e) Accountants' Comfort Letter....................................................... 19
(f) Bring-down Comfort Letter......................................................... 19
(g) Approval of Listing............................................................... 19
(h) No Objection...................................................................... 19
(i) Debt Transactions................................................................. 19
(j) Lock-up Agreements................................................................ 20
(k) Transactions...................................................................... 20
(l) Purchase of International Initial Securities...................................... 20
(m) Conditions to Purchase of U.S. Option Securities.................................. 20
(i) Officers' Certificate................................................... 20
(ii) Opinion of Counsel for the Company...................................... 20
(iii) Opinion of Counsel for U.S. Underwriters................................ 21
(iv) Bring-down Comfort Letter............................................... 21
(n) Additional Documents.............................................................. 21
(o) Termination of Agreement.......................................................... 21
SECTION 6. Indemnification................................................................... 21
(a) Indemnification of U.S. Underwriters.............................................. 21
(b) Indemnification of Issuer, Directors and Officers................................. 22
(c) Actions Against Parties; Notification............................................. 23
(d) Settlement Without Consent if Failure to Reimburse................................ 23
(e) Indemnification for Reserved Securities........................................... 24
SECTION 7. Contribution...................................................................... 24
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.......................................................................... 25
SECTION 9. Termination of Agreement.......................................................... 25
(a) Termination; General.............................................................. 25
(b) Liabilities....................................................................... 26
SECTION 10. Default by One or More of the U.S. Underwriters................................... 26
SECTION 11. Notices........................................................................... 27
ii
SECTION 12. Parties........................................................................... 27
SECTION 13. GOVERNING LAW AND TIME............................................................ 27
SECTION 14. Effect of Headings................................................................ 27
SCHEDULES
Schedule A - U.S. Underwriters............................................................ Sch A-1
Schedule B - Pricing Information.......................................................... Sch B-1
Schedule C - Persons and Entities Subject to Lock-up...................................... Sch C-1
Schedule D - Subsidiaries of the Company.................................................. Sch D-1
EXHIBITS
Exhibit A - Form of Opinion of Company Counsel...................................................A-1
Exhibit B - Form of Opinion of Special Federal Regulatory Counsel................................B-1
Exhibit C - Form of Opinion of General Counsel for the Company...................................C-1
Exhibit D - Form of Lock-Up Letter...............................................................D-1
iii
TELIGENT, L.L.C.
(a Delaware limited liability company)
and
TELIGENT, INC.
(a Delaware corporation)
4,400,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
U.S. PURCHASE AGREEMENT
-----------------------
o, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Salomon Brothers Inc
Bear, Xxxxxxx & Co. Inc.
Xxxxxxx, Sachs & Co.
as U.S. Representatives of the several U.S. Underwriters
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Teligent, L.L.C., a Delaware limited liability company (the "L.L.C.")
and Teligent, Inc., a Delaware corporation (the "Issuer"; references herein to
the "Company" mean, as of the date hereof, the L.L.C., and, as of the Closing
Time (as defined herein) and any Date of Delivery (as defined herein), the
Issuer), confirm their agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") and each of the other U.S.
Underwriters named in Schedule A hereto (collectively, the "U.S. Underwriters",
which term shall also include any underwriter substituted as hereinafter
provided in Section 10 hereof), for whom Xxxxxxx Xxxxx, Xxxxxxx Brothers Inc,
Bear, Xxxxxxx & Co. Inc. and Xxxxxxx, Xxxxx & Co. are acting as representatives
(in such capacity, the "U.S. Representatives"), with respect to the issue and
sale by the Issuer and the purchase by the U.S. Underwriters, acting severally
and not jointly, of the respective numbers of shares of Class A Common Stock,
par value $.01 per share, of the Issuer ("Class A Common Stock") set forth in
said Schedule A, and with respect to the grant by the Issuer to the U.S.
Underwriters, acting severally and not jointly, of the option described in
Section 2(b) hereof to purchase all or any part of 660,000 shares of Class A
Common Stock to cover over-allotments, if any. The aforesaid 4,400,000 shares of
Class A Common Stock (the "U.S. Initial Securities") to be purchased by the U.S.
Underwriters and all
or any part of the 660,000 shares of Class A Common Stock subject to the option
described in Section 2(b) hereof (the "U.S. Option Securities") are hereinafter
called, collectively, the "U.S. Securities".
It is understood that the L.L.C. and the Issuer are entering into an
International Purchase Agreement dated the date hereof (the "International
Purchase Agreement") providing for the offering by the Issuer of an aggregate of
1,100,000 shares of Class A Common Stock (the "International Initial
Securities") through arrangements with certain underwriters outside the United
States and Canada (the "International Managers"), for whom Xxxxxxx Xxxxx
International is acting as lead manager (the "Lead Manager") and the grant by
the Issuer to the International Managers, acting severally and not jointly, of
an option to purchase all or any part of 165,000 additional shares of Class A
Common Stock solely to cover over-allotments, if any (the "International Option
Securities" and, together with the U.S. Option Securities, the "Option
Securities"). The International Initial Securities and the International Option
Securities are hereinafter collectively called the "International Securities".
It is understood that the Issuer is not obligated to sell, and the U.S.
Underwriters are not obligated to purchase, any U.S. Initial Securities unless
all of the International Initial Securities are contemporaneously purchased by
the International Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "Underwriters", the U.S. Initial Securities and the
International Initial Securities are hereinafter collectively called the
"Initial Securities", and the U.S. Securities and the International Securities
are hereinafter called the "Securities".
The Underwriters will concurrently enter into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of Xxxxxxx Xxxxx (in such capacity, the "Global Coordinator").
The Company understands that the U.S. Underwriters propose to make a
public offering of the U.S. Securities as soon as the U.S. Representatives deems
advisable after this Agreement has been executed and delivered.
The Company and the U.S. Underwriters agree that up to 550,000 shares
of the U.S. Initial Securities to be purchased by the U.S. Underwriters (the
"Reserved Securities") shall be reserved for sale by the U.S. Underwriters to
certain of the Issuer's directors, officers and employees, members of their
immediate families or other individuals who are business associates of the
Issuer, as part of the distribution of the U.S. Securities by the U.S.
Underwriters, subject to the terms of this Agreement, the applicable rules,
regulations and interpretations of the National Association of Securities
Dealers, Inc. and all other applicable laws, rules and regulations. To the
extent that such Reserved Securities are not orally confirmed for purchase by
such persons by the end of the first business day after the date of this
Agreement, such Reserved Securities may be offered to the public as part of the
public offering contemplated hereby.
2
The Issuer has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-37381) and o
amendments thereto covering the registration of the Securities under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or prospectuses. Promptly after execution and delivery of
this Agreement, the Issuer will either (i) prepare and file a prospectus in
accordance with the provisions of Rule 430A ("Rule 430A") of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations")
and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or
(ii) if the Issuer has elected to rely upon Rule 434 ("Rule 434") of the 1933
Act Regulations, prepare and file a term sheet (a "Term Sheet") in accordance
with the provisions of Rule 434 and Rule 424(b). Two forms of prospectus are to
be used in connection with the offering and sale of the Securities: one relating
to the U.S. Securities (the "Form of U.S. Prospectus") and one relating to the
International Securities (the "Form of International Prospectus"). The Form of
International Prospectus is identical to the Form of U.S. Prospectus, except for
the front cover and back cover pages and the information under the caption
"Underwriting". The information included in any such prospectus or in any such
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (a) pursuant to paragraph
(b) of Rule 430A is referred to as "Rule 430A Information" or (b) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434 Information". Each Form of
U.S. Prospectus and Form of International Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus". Such registration
statement, including the exhibits, schedules and amendments thereto, if any, at
the time it became effective and including the Rule 430A Information and the
Rule 434 Information, as applicable, is herein called the "Registration
Statement". Any registration statement filed pursuant to Rule 462(b) of the 1933
Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement", and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final Form of U.S.
Prospectus and the final Form of International Prospectus in the forms first
furnished to the Underwriters for use in connection with the confirmation of
sales of the Securities are herein called the "U.S. Prospectus" and the
"International Prospectus", respectively, and collectively, the "Prospectuses".
If Rule 434 is relied on, the terms "U.S. Prospectus" and "International
Prospectus" shall refer to the preliminary U.S. Prospectus dated October 30,
1997 and preliminary International Prospectus dated October 30, 1997,
respectively, each together with the applicable Term Sheet, and all references
in this Agreement to the date of such Prospectuses shall mean the date of the
applicable Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the U.S. Prospectus, the
International Prospectus or any Term Sheet or any amendment or supplement to any
of the foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("XXXXX").
3
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the L.L.C. and the Issuer. Each
of the L.L.C. and the Issuer, jointly and severally, represents and warrants to
each U.S. Underwriter as of the date hereof, as of the Closing Time referred to
in Section 2(c) hereof and, if any U.S. Option Securities are purchased, as of
each Date of Delivery referred to in Section 2(b) hereof, and agrees with each
U.S. Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the L.L.C. or the Issuer, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments and
supplements thereto became effective and at the Closing Time (and, if
any U.S. Option Securities are purchased, at the Date of Delivery), the
Registration Statement, the Rule 462(b) Registration Statement and any
post-effective amendments and supplements thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and did not 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, and the Prospectuses, any preliminary prospectuses and any
supplement thereto or prospectus wrapper prepared in connection
therewith, at their respective times of issuance and at the Closing
Time, complied and will comply in all material respects with any
applicable laws or regulations of foreign jurisdictions in which the
Prospectuses and such preliminary prospectuses, as amended or
supplemented, if applicable, are distributed in connection with the
offer and sale of Reserved Securities. Neither of the Prospectuses nor
any amendments or supplements thereto (including any prospectus
wrapper), at the time the Prospectuses or any such amendment or
supplement were issued and at the Closing Time (and, if any U.S. Option
Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. If Rule 434 is used, the Company will comply with the
requirements of Rule 434 and the Prospectuses shall not be "materially
different", as such term is used in Rule 434, from the prospectuses
included in the Registration Statement at the time it became effective.
The representations and warranties in this subsection shall not apply
to statements in or omissions from the Registration Statement, any Rule
462(b) Registration Statement or any post-effective amendment thereto
or the U.S. Prospectus or any amendments or supplements thereto made in
reliance upon and in conformity with information furnished to the
Company in writing by any U.S. Underwriter through the U.S.
Representatives
4
expressly for use in the Registration Statement, any Rule 462(b)
Registration Statement or any post-effective amendment thereto or the
U.S. Prospectus or any amendments or supplements thereto.
Each preliminary prospectus and the prospectuses 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 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted
by Regulation S-T.
(ii) Independent Accountants. The accountants who certified
the financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required
by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included
in the Registration Statement and the Prospectuses, together with the
related schedules (if any) and notes, present fairly the financial
position of the L.L.C. at the dates indicated and the statement of
operations, members' deficit and cash flows of the L.L.C. for the
periods specified; said financial statements have been prepared in
conformity with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved. The
supporting schedules (if any) included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data included in the
Prospectuses present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement. The pro forma
balance sheet and the related notes thereto included in the
Registration Statement and the Prospectuses present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described
therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give
effect to the transactions and circumstances referred to therein.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectuses, except as otherwise stated therein, (A)
there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Effect"), (B) there have been no transactions
entered into by the Company or any of its subsidiaries, other than
those in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as one
enterprise, and (C) there has been no
5
dividend or distribution of any kind declared, paid or made by the
Company to any of its members or stockholders, as applicable.
(v) Good Standing of the L.L.C. The L.L.C. has been duly
organized and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware and has limited
liability company power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectuses
and to enter into and perform its obligations under this Agreement; and
the L.L.C. is duly qualified as a foreign limited liability company to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(vi) Good Standing of the Issuer. The Issuer has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into and perform
its obligations under this Agreement; and the Issuer is duly qualified
as a foreign corporation to transact business and is in good standing
in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant
subsidiary" of the Company (as such term is defined in Rule 1-02 of
Regulation S-X) (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as a
corporation or limited liability company (as applicable) in good
standing under the laws of the jurisdiction of its organization, has
corporate or limited liability company (as applicable) power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and is duly qualified as a
foreign corporation or limited liability company (as applicable) to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect; except as otherwise disclosed in the
Registration Statement, all of the issued and outstanding capital stock
or members' interests (as applicable) of each such Subsidiary has been
duly authorized and validly issued, and, in the case of Subsidiaries
that are corporations, is fully paid and non-assessable, and is owned
by the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity
(except for any pledge thereof securing the Revolving Credit Agreement
(as defined in the Registration Statement)); none of the outstanding
shares of capital stock or members' interests (as applicable) of any
Subsidiary was issued in violation of the preemptive or similar rights
of any securityholder or member (as applicable) of such
6
Subsidiary. The only subsidiaries of the Company are the subsidiaries
listed on Schedule D to this Agreement.
(viii) Capitalization of the Company. The capitalization of
the L.L.C. is as set forth in the Prospectuses in the column entitled
"Actual" under the caption "Prospectus Summary--Pro Forma
Capitalization" (except for the repayment in full since September 30,
1997 of all outstanding amounts under the Revolving Credit Agreement).
The shares of issued and outstanding capital stock of the Issuer have
been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock of the
Issuer was issued in violation of the preemptive or other similar
rights of any member or securityholder of the L.L.C. or the Issuer.
(ix) Authorization of Agreement. This Agreement and the
International Purchase Agreement have been duly authorized, executed
and delivered by each of the L.L.C. and the Issuer.
(x) Authorization and Description of Securities. The
Securities to be purchased by the U.S. Underwriters and the
International Managers from the Issuer have been duly authorized for
issuance and sale to the U.S. Underwriters pursuant to this Agreement
and the International Managers pursuant to the International Purchase
Agreement, respectively, and, when issued and delivered by the Issuer
pursuant to this Agreement and the International Purchase Agreement,
respectively, against payment of the consideration set forth herein and
in the International Purchase Agreement, respectively, will be validly
issued, fully paid and non-assessable; the Class A Common Stock
conforms to all statements relating thereto contained in the
Prospectuses and such description conforms to the rights set forth in
the instruments defining the same; no holder of the Securities is or
will be subject to personal liability by reason of being such a holder;
and the issuance of the Securities is not subject to the preemptive or
other similar rights of any member or securityholder of the L.L.C. or
the Issuer.
(xi) Absence of Defaults and Conflicts. Neither the L.L.C.,
the Issuer nor any of their respective subsidiaries is in violation of
its organizational documents (in the case of a limited liability
company) or charter or by-laws (in the case of a corporation), or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which either the L.L.C., the Issuer or any of their
respective subsidiaries is a party or by which it or any of them may be
bound, or to which any of the property or assets of either the L.L.C.,
the Issuer or any of their respective subsidiaries is subject
(collectively, the "Agreements and Instruments") except for such
violations or defaults that would not result in a Material Adverse
Effect; and the execution, delivery and performance of this Agreement
and the International Purchase Agreement and the consummation of the
transactions contemplated in this Agreement, the International Purchase
Agreement and in the Registration Statement (including the consummation
of the Reorganization, the Additional Sponsor
7
Equity Contributions and the Strategic Equity Investment, each as
defined in the Registration Statement (collectively, the
"Transactions"), the issuance and sale of the Securities and the use of
the proceeds from the sale of the Securities as described in the
Prospectuses under the caption "Use of Proceeds") and compliance by
each of the L.L.C. and the Issuer with their respective obligations
under this Agreement, the International Purchase Agreement and the
agreements pursuant to which the Transactions will be consummated have
been duly authorized by all necessary limited liability company or
corporate action (as applicable) and do not and will not, whether with
or without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of either the
L.L.C., the Issuer or any of their respective subsidiaries pursuant to,
the Agreements and Instruments (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the organizational documents (in the case of a
limited liability company) or charter or by-laws (in the case of a
corporation) of either the L.L.C., the Issuer or (except for such
violations that would not result in a Material Adverse Effect) any of
their respective subsidiaries or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over either the L.L.C., the Issuer or any of their
respective subsidiaries or any of their respective assets, properties
or operations. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or
a portion of such indebtedness by either the L.L.C., the Issuer or any
of their respective subsidiaries.
(xii) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent which, in any case under this
clause (xii), could reasonably be expected to result in a Material
Adverse Effect.
(xiii) Absence of Proceedings. Except as set forth in the
Prospectuses, there is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any of its
subsidiaries, or to which the property of the Company or any of its
subsidiaries is subject, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which
could reasonably be expected to result in a Material Adverse Effect, or
which could reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement and the International
Purchase Agreement or the performance by the L.L.C. and the Issuer of
their respective obligations hereunder or the consummation of any of
the transactions contemplated pursuant to the Transactions; the
aggregate of all pending legal or
8
governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their respective property or
assets is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material
Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectuses or to be filed as exhibits thereto which
have not been so described and filed as required.
(xv) Possession of Intellectual Property. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms,
adequate 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, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the respective interests of the Company or any of
its subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xvi) Absence of Further Requirements. Except as described in
the Prospectuses, no filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign, is necessary or
required for the performance by the L.L.C. or the Issuer of their
respective obligations hereunder, in connection with the offering,
issuance or sale of the Securities under this Agreement and the
International Purchase Agreement or the consummation of the
transactions contemplated by this Agreement or the International
Purchase Agreement or the consummation of any of the transactions
contemplated pursuant to the Transactions, except such as have been
already obtained or as may be required under the 1933 Act or the 1933
Act Regulations or state securities or blue sky laws or the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder or the laws and regulations promulgated
thereunder or the laws and regulations of jurisdictions outside the
United States in which the International Securities are offered.
(xvii) Possession of Licenses and Permits. Except as set forth
in the Prospectuses, the Company and its subsidiaries possess such
permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; each of the
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except
9
where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification of any
such Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in
a Material Adverse Effect.
(xviii) Title to Property. The Company and its subsidiaries
have good and marketable title to all real property owned by them and
good title to all other properties owned by them, in each case, free
and clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (a) are
described in the Prospectuses or (b) do not, singly or in the
aggregate, 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 or any of its subsidiaries; and all of the leases and
subleases material to the business of the Company and its subsidiaries,
considered as one enterprise, and under which the Company or any of its
subsidiaries holds properties described in the Prospectuses, are in
full force and effect, and neither the Company nor any of its
subsidiaries has any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Company or any of
its subsidiaries under any of the leases or subleases mentioned above,
or affecting or questioning the rights of the Company or any such
subsidiary to the continued possession of the leased or subleased
premises under any such lease or sublease.
(xix) Investment Company Act. The Company is not and, upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectuses will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xx) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the Company
nor any of its subsidiaries is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum
or petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its subsidiaries
10
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against the Company or
any of its subsidiaries and (D) there are no events or circumstances
that might reasonably be expected to form the basis of an order for
clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency, against or affecting the
Company or any of its subsidiaries relating to Hazardous Materials or
any Environmental Laws.
(xxi) Registration Rights. Except as described in the
Prospectuses, there are no persons with registration rights or other
similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Issuer under the
1933 Act.
(xxii) Transactions. The agreements entered into by the
L.L.C. and the Issuer for the purposes of completing the Transactions
are all in full force and effect with respect to the L.L.C. and the
Issuer and, to the knowledge of the L.L.C. and the Issuer, with respect
to the other parties thereto; and the representations and warranties of
the L.L.C. and the Issuer set forth in such agreements are true and
correct as of the date hereof and as of the respective dates of such
agreements. The L.L.C. and the Issuer have obtained all contractual
consents and approvals necessary to consummate the Transactions.
Except as described in the Prospectuses, all transactions contemplated
as part of the Transactions will be consummated prior to or
simultaneously with the Closing Time.
(xxiii) Insurance Coverage. The Company and each of its
subsidiaries are insured by 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 materially
and adversely affect the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company and its
subsidiaries as one enterprise, except as described in or contemplated
by the Prospectuses.
(xxiv) Absence of Dividend Restrictions. No subsidiary of
the L.L.C. or the Issuer, respectively, is currently prohibited,
directly or indirectly, from paying any dividends to the L.L.C. or the
Issuer, as the case may be, from making any other distribution on such
subsidiary's capital stock, from repaying to the L.L.C. or the Issuer,
as the case may be, any loans or advances to such subsidiary from the
Issuer or from
11
transferring any of such subsidiary's property or assets to the L.L.C.
or the Issuer, as the case may be, or any other subsidiary of the
L.L.C. or the Issuer, as the case may be, except as described in or
contemplated by the Prospectuses.
(xxv) Filings of Tax Returns. The Company has filed all
foreign, federal, state and local tax returns that are required to be
filed or has requested extensions thereof and has paid all material
taxes required to be paid by it and any other assessment, fine or
penalty levied against it, to the extent that any of the foregoing is
due and payable, except for any such tax, assessment, fine or penalty
that is currently being contested in good faith or as described in or
contemplated by the Prospectuses.
(xxvi) Maintenance of Internal Accounting Controls. The
Company and each of its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable and appropriate intervals and appropriate action is taken
with respect to any differences.
(b) Officer's Certificates. Any certificate signed by any officer of
the Issuer or any of its subsidiaries delivered to the U.S. Representatives or
to counsel for the U.S. Underwriters shall be deemed a representation and
warranty by the Issuer to each U.S. Underwriter as to the matters covered
thereby.
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.
(a) U.S. Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Issuer agrees to sell to each U.S. Underwriter, severally and not
jointly, and each U.S. Underwriter, severally and not jointly, agrees to
purchase from the Issuer, at the price per share set forth in Schedule B, the
number of U.S. Initial Securities set forth in Schedule A opposite the name of
such U.S. Underwriter, plus any additional number of U.S. Initial Securities
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) U.S. Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Issuer hereby grants an option to the U.S.
Underwriters, severally and not jointly, to purchase up to an additional 660,000
shares of Class A Common Stock at the price per share set forth in Schedule B,
less an amount per share equal to any dividends or distributions declared by the
Issuer and payable on the U.S. Initial Securities but not payable on the U.S.
Option Securities. The option hereby granted will expire 30 days after the date
hereof and may be exercised in whole or in part from time to time only for the
purpose of covering over-allotments which may
12
be made in connection with the offering and distribution of the U.S. Initial
Securities upon notice by the Global Coordinator to the Issuer setting forth the
number of U.S. Option Securities as to which the several U.S. Underwriters are
then exercising the option and the time and date of payment and delivery for
such U.S. Option Securities. Any such time and date of delivery for the U.S.
Option Securities (a "Date of Delivery") shall be determined by the Global
Coordinator, but shall not be earlier than one full business day, or later than
seven full business days, after the exercise of said option, nor in any event
prior to the Closing Time, as hereinafter defined. If the option is exercised as
to all or any portion of the U.S. Option Securities, each of the U.S.
Underwriters, acting severally and not jointly, will purchase that proportion of
the total number of U.S. Option Securities then being purchased which the number
of U.S. Initial Securities set forth in Schedule A opposite the name of such
U.S. Underwriter bears to the total number of U.S. Initial Securities, subject
in each case to such adjustments as the Global Coordinator in its discretion
shall make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the U.S. Initial Securities shall be made at the offices of
Skadden, Arps, Slate, Xxxxxxx & Xxxx, LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, or at such other place as shall be agreed upon by the Global Coordinator
and the Company, at [10:00] A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 pm (Eastern time) on any given day) business day after
the date hereof (unless postponed in accordance with the provisions of Section
10), or such other time not later than ten business days after such date as
shall be agreed upon by the Global Coordinator and the Issuer (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the U.S. Option Securities
are purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Issuer, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Issuer.
Payment shall be made to the Issuer by wire transfer of immediately
available funds to a bank account designated by the Issuer, against delivery to
the U.S. Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the U.S. Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the U.S. Initial Securities and the U.S. Option Securities, if any,
which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the U.S. Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the U.S. Initial Securities or the U.S.
Option Securities, if any, to be purchased by any U.S. Underwriter whose funds
have not been received by the Closing Time or the relevant Date of Delivery, as
the case may be, but such payment shall not relieve such U.S. Underwriter from
its obligations hereunder.
13
(d) Denominations; Registration. Certificates for the U.S. Initial
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the U.S.
Initial Securities and the U.S. Option Securities, if any, will be made
available for examination and packaging by the U.S. Representatives in The City
of New York not later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Issuer. The Issuer covenants with each
U.S. Underwriter as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Issuer, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify
the Global Coordinator immediately, and confirm the notice in writing,
(i) when any post-effective amendment to the Registration Statement
shall become effective, or any supplement to the Prospectuses or any
amended Prospectuses shall have been filed, (ii) of the receipt of any
comments from the Commission, (iii) of any request by the Commission
for any amendment to the Registration Statement or any amendment or
supplement to the Prospectuses or for additional information, and (iv)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
initiation or threatening of any proceedings for any of such purposes.
The Issuer will promptly effect the filings necessary pursuant to Rule
424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under
Rule 424(b) was received for filing by the Commission and, in the event
that it was not, it will promptly file such prospectus. The Issuer will
make every reasonable effort to prevent the issuance of any stop order
and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) Filing of Amendments. The Issuer will give the Global
Coordinator notice of its intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)),
any Term Sheet or any amendment, supplement or revision to either any
prospectus included in the Registration Statement at the time it became
effective or to the Prospectuses, will furnish the Global Coordinator
with copies of any such documents a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file or
use any such document to which the Global Coordinator or counsel for
the U.S. Underwriters shall object.
(c) Delivery of Registration Statements. The Issuer has
furnished or will deliver to the U.S. Representatives and counsel for
the U.S. Underwriters, without charge, signed copies of the
Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by
reference
14
therein) and signed copies of all consents and certificates of experts,
and will also deliver to the U.S. Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of
each amendment thereto (without exhibits) for each of the U.S.
Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the U.S. Underwriters will be identical
to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(d) Delivery of Prospectuses. The Issuer has delivered to each
U.S. Underwriter, without charge, as many copies of each preliminary
prospectus as such U.S. Underwriter reasonably requested, and the
Issuer hereby consents to the use of such copies for purposes permitted
by the 1933 Act. The Issuer will furnish to each U.S. Underwriter,
without charge, during the period when the Prospectuses are required to
be delivered under the 1933 Act or the Securities Exchange Act of 1934
(the "1934 Act"), such number of copies of the U.S. Prospectus (as
amended or supplemented) as such U.S. Underwriter may reasonably
request. Such copies of the U.S. Prospectus and any amendments or
supplements thereto furnished to the U.S. Underwriters will be
identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Issuer will
comply with the 1933 Act and the 1933 Act Regulations so as to permit
the completion of the distribution of the Securities as contemplated in
this Agreement, the International Agreement, and in the Prospectuses.
If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in
the opinion of counsel for the U.S. Underwriters or for the Issuer, to
amend the Registration Statement or amend or supplement any Prospectus
in order that the Prospectuses will not include any untrue statements
of a material fact or omit to state a material fact necessary in order
to make the statements therein not misleading in the light of the
circumstances existing at the time any such Prospectus is delivered to
a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend
or supplement any Prospectus in order to comply with the requirements
of the 1933 Act or the 1933 Act Regulations, the Issuer will promptly
prepare and file with the Commission, subject to Section 3(b), such
amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectuses
comply with such requirements, and the Issuer will furnish to the U.S.
Underwriters such number of copies of such amendment or supplement as
the U.S. Underwriters may reasonably request.
(f) Rule 158. The Issuer will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
15
(g) Use of Proceeds. The Issuer will use the net proceeds
received by it from the sale of the Securities in the manner specified
in the Prospectuses under "Use of Proceeds".
(h) Listing. The Issuer will use its best efforts to effect
and maintain the quotation of the Securities on the Nasdaq National
Market and will file with the Nasdaq National Market all documents and
notices required by the Nasdaq National Market of companies that have
securities that are traded in the over-the-counter market and
quotations for which are reported by the Nasdaq National Market.
(i) Restriction on Sale of Securities. During a period of 180
days from the date of the Prospectuses, the Issuer will not, without
the prior written consent of the Global Coordinator, (i) directly or
indirectly, 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 or otherwise transfer or
dispose of any share of its common stock or any securities convertible
into or exercisable or exchangeable for any of its common stock or file
any registration statement under the 1933 Act with respect to any of
the foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of any of its common
stock, whether any such swap or 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 Securities to be sold hereunder or under the
International Purchase Agreement, (B) any shares of the Issuer's common
stock issued in the Transactions as described in the Prospectuses, (C)
any shares of the Issuer's common stock issued or options to purchase
common stock granted pursuant to employment agreements or employee
benefit plans of the Issuer referred to in the Prospectuses or (D) any
shares of the Issuer's common stock issued pursuant to any non-employee
director stock plan.
(j) Reporting Requirements. The Issuer, during the period when
the Prospectuses are required to be delivered under the 1933 Act or the
1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the rules and regulations of the Commission
thereunder.
[(k) Compliance with NASD Rules. The Issuer hereby agrees that
it will ensure that the Reserved Securities will be restricted as
required by the National Association of Securities Dealers, Inc. (the
"NASD") or the NASD rules from sale, transfer, assignment, pledge or
hypothecation for a period of three months following the date of this
Agreement. The U.S. Underwriters will notify the Issuer as to which
persons will need to be so restricted. At the request of the U.S.
Underwriters, the Issuer will direct the transfer agent to place a stop
transfer restriction upon such securities for such period of time.
Should the Issuer release, or seek to release, from such restrictions
any of the Reserved Securities, the Issuer agrees to reimburse the U.S.
Underwriters for any
16
reasonable expenses (including, without limitation, legal expenses)
they incur in connection with such release.]
SECTION 4. Payment of Expenses. (a) Expenses. Each of the L.L.C. and
the Issuer agrees, jointly and severally, to pay all expenses incident to the
performance of their respective obligations under this Agreement, including (i)
the preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the U.S. Underwriters of
this Agreement, any Agreements Among Underwriters and such other documents as
may be required in connection with the offering, purchase, sale, issuance or
delivery of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the U.S. Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Securities to the U.S. Underwriters, and the
transfer of the Securities between the U.S. Underwriters and International
Managers, (iv) the fees and disbursements of counsel, accountants and other
advisors for the L.L.C. and the Issuer, (v) the reasonable fees and
disbursements of counsel for the U.S. Underwriters in connection with the
preparation of any Blue Sky Survey and any supplement thereto, (vi) the printing
and delivery to the U.S. Underwriters of copies of each preliminary prospectus,
any Term Sheets and the Prospectuses and any amendments or supplements thereto,
(vii) the preparation, printing and delivery to the U.S. Underwriters of copies
of any Blue Sky Survey and any supplement thereto, (viii) the fees and expenses
of any transfer agent or registrar for the Securities, (ix) the filing fees
incident to, and the reasonable fees and disbursements of counsel to the
Underwriters in connection with, the review by the National Association of
Securities Dealers, Inc. (the "NASD") of the terms of the sale of the
Securities, (x) the fees and expenses incurred in connection with the inclusion
of the Securities in the Nasdaq National Market and (xi) all costs and expenses
of the U.S. Underwriters, including the fees and disbursements of counsel for
the U.S. Underwriters, in connection with matters related to the Reserved
Securities which are designated by the Issuer for sale to employees and other
having a business relationship with the Issuer.
(b) Termination of Agreement. If this Agreement is terminated by the
U.S. Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the L.L.C. and the Issuer shall reimburse the U.S. Underwriters
for all of their out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the U.S. Underwriters.
SECTION 5. Conditions of U.S. Underwriters' Obligations. The
obligations of the several U.S. Underwriters hereunder are subject to the
accuracy of the representations and warranties of each of the L.L.C. and the
Issuer contained in Section 1(a) hereof or in certificates of any officer of the
Issuer or any subsidiary of the Issuer delivered pursuant to the provisions
hereof, to the performance by the Issuer of its covenants and other obligations
hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The
Registration Statement, including any Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have
17
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the U.S. Underwriters. A
prospectus containing the Rule 430A Information shall have been filed
with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A) or, if the
Issuer has elected to rely upon Rule 434, a Term Sheet shall have been
filed with the Commission in accordance with Rule 424(b).
(b) Opinions of Counsel for the L.L.C. and the Issuer. At
Closing Time, the U.S. Representatives shall have received the
favorable opinion, dated as of Closing Time, of (i) Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel for the L.L.C. and the Issuer, to
the effect set forth in Exhibit A hereto and to such further effect as
counsel to the U.S. Underwriters may reasonably request, (ii) Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, special federal regulatory counsel for
the L.L.C. and the Issuer, to the effect set forth in Exhibit B hereto
and to such further effect as counsel to the U.S. Underwriters may
reasonably request and (iii) Xxxxxxxx X. Xxxxxx, Esq., General Counsel
for the L.L.C. and the Issuer, to the effect set forth in Exhibit C
hereto and to such further effect as counsel to the U.S. Underwriters
may reasonably request; each in form and substance satisfactory to
counsel for the U.S. Underwriters, together with signed or reproduced
copies of such letter for each of the other U.S. Underwriters. Such
counsel may state that, insofar as such opinions involve factual
matters, they have relied, to the extent they deem proper, upon
certificates of officers of the L.L.C. and the Issuer and their
respective subsidiaries and certificates of public officials.
(c) Opinion of Counsel for U.S. Underwriters. At Closing Time,
the U.S. Representatives shall have received the favorable opinion,
dated as of Closing Time, of Shearman & Sterling, counsel for the U.S.
Underwriters, together with signed or reproduced copies of such letter
for each of the other U.S. Underwriters with respect to the matters set
forth in [clauses (i), (ii), (v), (vi) (solely as to preemptive or
other similar rights arising by operation of law or under the
organizational documents, charter or by-laws, as the case may be, of
the L.L.C. and the Issuer), (viii) through (x), inclusive, (xii), (xiv)
(solely as to the information in the Prospectuses under "Description of
Capital Stock--Common Stock") and the penultimate paragraph] of Exhibit
A hereto. In giving such opinion, such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
State of New York, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the U.S. Representatives. Such counsel may also state
that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers
of the L.L.C. and the Issuer and their respective subsidiaries and
certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not
have been, since the date hereof or since the respective dates as of
which information is given in the
18
Prospectuses, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business,
and the U.S. Representatives shall have received a certificate of the
President or a Vice President of the Company and of the chief financial
or chief accounting officer of the Company, dated as of Closing Time,
to the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties in Section 1(a) hereof are true
and correct with the same force and effect as though expressly made at
and as of Closing Time (except to the extent that such representations
and warranties relate to an earlier date), (iii) the Company has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied at or prior to Closing Time, and (iv) no
stop order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(e) Accountants' Comfort Letter. At the time of the execution
of this Agreement, the U.S. Representatives shall have received from
Ernst & Young LLP a letter dated such date, in form and substance
satisfactory to the U.S. Representatives, together with signed or
reproduced copies of such letter for each of the other U.S.
Underwriters, 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 the Registration Statement and the
Prospectuses.
(f) Bring-down Comfort Letter. At Closing Time, the U.S.
Representatives shall have received from Ernst & Young LLP a letter,
dated as of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (e) of
this Section, except that the specified date referred to shall be a
date not more than [three] business days prior to Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall
have been approved for inclusion in the Nasdaq National Market, subject
only to official notice of issuance.
(h) No Objection. The NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness
of the underwriting terms and arrangements.
(i) Debt Transactions. The transactions contemplated by the
Debt Purchase Agreement, dated of even date herewith, among the
International Representatives and the Issuer and the L.L.C. shall have
occurred contemporaneously with the transactions contemplated herein.
19
(j) Lock-up Agreements. At the date of this Agreement, the
U.S. Representatives shall have received an agreement substantially in
the form of Exhibit G hereto signed by the persons listed on Schedule C
hereto.
(k) Transactions. At the Closing Time, (i) the Transactions
(other than the Second Closing (as defined in the Prospectuses)) shall
have been consummated in full, (ii) the agreements entered into by the
L.L.C. and the Issuer for the purposes of completing the Second Closing
shall be in full force and effect with respect to the L.L.C. and the
Issuer and, to the knowledge of the L.L.C. and the Issuer, with respect
to the other parties thereto, the representations and warranties of the
L.L.C. and the Issuer set forth in such agreements shall be true and
correct and prior to, or simultaneously with, the Closing Time, and
(iii) the L.L.C. and the Issuer shall have provided to the Global
Coordinator and counsel for the U.S. Underwriters copies of all closing
documents delivered to the parties to the Transactions (other than with
respect to the Second Closing).
(l) Purchase of International Initial Securities.
Contemporaneously with the purchase by the U.S. Underwriters of the
U.S. Initial Securities under this Agreement, the International
Managers shall have purchased the International Initial Securities
under the International Purchase Agreement.
(m) Conditions to Purchase of U.S. Option Securities. In the
event that the U.S. Underwriters exercise their option provided in
Section 2(b) hereof to purchase all or any portion of the U.S. Option
Securities, the representations and warranties of the Company contained
in Section 1(a) hereof and the statements in any certificates furnished
by the Company or any of its subsidiaries hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of
Delivery (except to the extent that such representations and warranties
relate to an earlier date), the U.S. Representatives shall have
received:
(i) Officers' Certificate. A certificate of the
President or a Vice President of the Company and of the chief
financial or chief accounting officer of the Company, dated as
of such Date of Delivery, confirming that the certificate
delivered at Closing Time pursuant to Section 5(d) hereof
remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for the Company. The
favorable opinions of the respective counsel referred to in
Section 5(b) hereof, each in form and substance satisfactory
to counsel for the U.S. Underwriters, dated such Date of
Delivery, relating to the U.S. Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the respective opinions required by Section 5(b)
hereof.
20
(iii) Opinion of Counsel for U.S. Underwriters. The
favorable opinion of Shearman & Sterling, counsel for the
U.S. Underwriters, dated such Date of Delivery, relating to
the U.S. Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(iv) Bring-down Comfort Letter. A letter from Ernst &
Young LLP, in form and substance satisfactory to the U.S.
Representatives and dated such Date of Delivery, substantially
in the same form and substance as the letter furnished to the
U.S. Representatives pursuant to Section 5(f) hereof, except
that the "specified date" in the letter furnished pursuant to
this paragraph shall be a date not more than [five] days prior
to such Date of Delivery.
(n) Additional Documents. At Closing Time and at each Date
of Delivery, counsel for the U.S. Underwriters shall have been
furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated, or in order to evidence the accuracy
of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the
Issuer in connection with the issuance and sale of the Securities as
herein contemplated shall be satisfactory in form and substance to the
U.S. Representatives and counsel for the U.S. Underwriters.
(o) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of U.S. Option Securities on a Date of Delivery which is after
the Closing Time, the obligations of the several U.S. Underwriters to
purchase the relevant U.S. Option Securities, may be terminated by the
U.S. Representatives by written notice to the Issuer on behalf of the
L.L.C. and the Issuer, as applicable, at any time at or prior to
Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of U.S. Underwriters. Each of the L.L.C. and the
Issuer agrees, jointly and severally, to indemnify and hold harmless each U.S.
Underwriter and each person, if any, who controls any U.S. Underwriter within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and any Rule 434 Information, if applicable, or the
omission or
21
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the
Prospectuses (or any amendment or supplement thereto), or the omission
or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Issuer by any
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and any Rule 434 Information, if applicable, or any preliminary
prospectus or the U.S. Prospectus (or any amendment or supplement thereto).
The foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any U.S. Underwriter from whom the
person asserting any such loss, liability, claim, damage or expense purchased
Securities (or any director, officer or employee of such U.S. Underwriter, or
any person who controls such U.S. Underwriter within the meaning of Section 15
of the 1933 Act or Section 20 of the 0000 Xxx) if a copy of the applicable U.S.
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 U.S. Underwriter to such person, if such is required by law, at or prior to
the written confirmation of the sale of such Securities to such person and if
such U.S. Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such loss, liability, claim, damage or expense.
(b) Indemnification of Issuer, Directors and Officers. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Issuer, its
directors, each of its officers who
22
signed the Registration Statement, and each person, if any, who controls the
Issuer within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and any Rule 434
Information, if applicable, or any preliminary prospectus or the U.S. Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Issuer by such U.S. Underwriter through
Xxxxxxx Xxxxx expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the U.S. Prospectus (or any amendment
or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Issuer. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding 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.
(d) Settlement Without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such
23
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
(e) Indemnification for Reserved Securities. In connection with the
offer and sale of the Reserved Securities, each of the L.L.C. and the Issuer
agrees, jointly and severally, promptly upon a request in writing, to indemnify
and hold harmless the U.S. Underwriters from and against any and all loses,
liabilities, claims, damages and expenses incurred by them as a result of the
failure of any of the Issuer's directors, officers and employees, members of
their immediate families or other individuals who are business associates of the
Issuer to pay for and accept delivery of Reserved Securities which, by the end
of the first business day following the date of this Agreement, were subject to
a properly confirmed agreement to purchase.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Issuer on the one
hand and the U.S. Underwriters on the other hand from the offering of the U.S.
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the L.L.C. and the Issuer on the one hand
and of the U.S. Underwriters on the other hand in connection with the statements
or omissions that resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Issuer on the one hand and the
U.S. Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the U.S.
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the U.S.
Underwriters, in each case as set forth on the cover of the U.S. Prospectus, or,
if Rule 434 is used, the corresponding location on the Term Sheet, bear to the
aggregate initial public offering price of the U.S. Securities as set forth on
such cover.
The relative fault of the L.L.C. and the Issuer on the one hand and the
U.S. Underwriters on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the L.L.C. and the Issuer or by the U.S. Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The L.L.C. and the Issuer and the U.S. Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even
24
if the U.S. 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 Section 7. The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 7 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no U.S. Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the U.S. Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such U.S. Underwriter has otherwise been required to pay by reason of any 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 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls a
U.S. Underwriter within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Issuer, each officer of the Issuer who
signed the Registration Statement, and each person, if any, who controls the
Issuer within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Issuer. The U.S.
Underwriters' respective obligations to contribute pursuant to this Section are
several in proportion to the number of U.S. Initial Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any U.S.
Underwriter or controlling person, or by or on behalf of the Company, and shall
survive delivery of the Securities to the U.S. Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The U.S. Representatives may terminate this
Agreement, by notice to the Issuer on behalf of the L.L.C. and the Issuer, as
applicable, at any time at or prior to Closing Time (i) if there has been, since
the time of execution of this Agreement or since the respective dates as of
which information is given in the U.S. Prospectus, any material adverse change
in the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
if there has occurred any material adverse
25
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Issuer has been suspended or materially limited by the Commission or the Nasdaq
National Market, or if trading generally on the American Stock Exchange or the
New York Stock Exchange or in the Nasdaq National Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the NASD or any other governmental
authority, or (iv) if a banking moratorium has been declared by either Federal
or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section 9, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the U.S. Underwriters. If one or
more of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery
to purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the U.S. Representatives shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting U.S. Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the number of U.S. Securities to be purchased on such date, the
non-defaulting U.S. Underwriters shall be obligated, each severally and
not jointly, to purchase the full amount thereof in the proportions
that their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting U.S. Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of U.S. Securities to be purchased on such date, this Agreement
or, with respect to any Date of Delivery which occurs after Closing
Time, the obligation of the U.S. Underwriters to purchase and of the
Issuer to sell the Option Securities to be purchased and sold on such
Date of Delivery, shall terminate without liability on the part of any
non-defaulting U.S. Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting U.S. Underwriter from liability in respect of its default.
26
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after Closing
Time, which does not result in a termination of the obligation of the U.S.
Underwriters to purchase and the Issuer to sell the relevant U.S. Option
Securities, as the case may be, either the U.S. Representatives or the Issuer
shall have the right to postpone Closing Time or the relevant Date of Delivery,
as the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectuses or in any other
documents or arrangements. As used herein, the term "U.S. Underwriter" includes
any person substituted for a U.S. Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the U.S.
Underwriters shall be directed to the U.S. Representatives at Xxxxx Xxxxx, Xxxxx
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of o; and notices to
either of the Companies shall be directed to the Company at 0000 Xxxxxxxx Xxxx,
Xxxxxx, Xxxxxxxx 00000, attention of Xxxxxxxx X. Xxxxxx, Esq., with copies to
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, attention of Xxxx X. Xxxxx, Esq.
SECTION 12. Parties. This Agreement shall inure to the benefit of and
be binding upon the U.S. Underwriters and the L.L.C. and the Issuer and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the U.S. Underwriters and the L.L.C. and the Issuer and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the U.S.
Underwriters and the L.L.C. and the Issuer and their respective successors, and
said controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from any U.S. Underwriter shall be deemed to be a
successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
27
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to each of the L.L.C. and the Issuer a
counterpart hereof, whereupon this instrument, along with all counterparts, will
become a binding agreement between the U.S. Underwriters and the L.L.C. and
the Issuer in accordance with its terms.
Very truly yours,
TELIGENT, L.L.C.
By____________________________________
Name:
Title:
TELIGENT, INC.
By_____________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
SALOMON BROTHERS INC
BEAR, XXXXXXX & CO. INC.
XXXXXXX, SACHS & CO.
By ---------------------------------
Authorized Signatory
For themselves and as U.S. Representatives of the other U.S. Underwriters named
in Schedule A hereto.
28
SCHEDULE A
U.S. UNDERWRITERS
Number of
U.S. Initial
Name of U.S. Underwriter Securities
------------------------ ----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated...................................
Salomon Brothers Inc.......................................
Bear, Xxxxxxx & Co. Inc....................................
Xxxxxxx, Sachs & Co........................................
----------
Total...................................................... 4,400,000
==========
Sch A - 1
SCHEDULE B
PRICING INFORMATION
TELIGENT, INC.
4,400,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
1. The initial public offering price per share for the U
U.S. Initial Securities, determined as provided in Section 2, shall
be $o.
2. The purchase price per share for the U.S. Initial
Securities to be paid by the several U.S. Underwriters shall be $o,
being an amount equal to the initial public offering price set forth
above less $o per share; provided that the purchase price per share for
any U.S. Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by
the Issuer and payable on the U.S. Initial Securities but not payable
on the U.S. Option Securities.
Sch B - 1
SCHEDULE C
PERSONS AND ENTITIES SUBJECT TO LOCK-UP
Sch C- 1
SCHEDULE D
SUBSIDIARIES OF THE COMPANY
Sch C- 2
EXHIBIT A
FORM OF OPINION OF COMPANY COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
A-1
EXHIBIT B
FORM OF OPINION OF SPECIAL FEDERAL REGULATORY COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
B-1
EXHIBIT C
FORM OF OPINION OF GENERAL COUNSEL FOR THE COMPANY
TO BE DELIVERED PURSUANT TO SECTION 5(b)
C-1
EXHIBIT D
FORM OF LOCK-UP LETTER
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
SALOMON BROTHERS INC
BEAR XXXXXXX & CO. INC.
XXXXXXX, SACHS & CO.
XXXXXXX XXXXX INTERNATIONAL
SALOMON BROTHERS INTERNATIONAL LIMITED
BEAR, XXXXXXX INTERNATIONAL LIMITED
XXXXXXX SACHS INTERNATIONAL
as Representatives of the several
Underwriters to be named in the
within-mentioned Purchase Agreements
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Proposed Public Offering by Teligent, Inc.
------------------------------------------
Dear Sirs:
The undersigned, a stockholder [and an officer and/or director] of
Teligent, Inc., a Delaware corporation (the "Company"), understands that Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx"), Xxxxxxx Xxxxxxxx Inc, Bear, Xxxxxxx & Co., Inc. and Xxxxxxx, Xxxxx &
Co. propose to enter into a U.S. Purchase Agreement and Xxxxxxx Xxxxx
International, Salomon Brothers International Limited, Bear, Xxxxxxx
International Limited and Xxxxxxx Sachs International propose to enter into an
International Purchase Agreement (together, the "Purchase Agreements") with the
Company providing for the public offering of shares (the "Securities") of the
Company's Class A Common Stock, par value $.01 per share.
In recognition of the benefit that such an offering will confer upon
the undersigned as a stockholder [and an officer and/or director] of the
Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
underwriter to be named in the Purchase Agreements that, during a period of 180
days from the date of the Purchase Agreements, the undersigned will not, without
the prior written consent of Xxxxxxx Xxxxx, directly or indirectly, (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 for
the sale of, or otherwise dispose of or transfer any shares of common stock of
the Company or any securities convertible into or exchangeable or exercisable
for common
D-1
stock of the Company, whether now owned or hereafter acquired by the undersigned
or with respect to which the undersigned has or hereafter acquires the power of
disposition, or file any registration statement under the Securities Act of
1933, as amended, with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of any
common stock of the Company, whether any such swap or transaction is to be
settled by delivery of common stock of the Company or other securities, in cash
or otherwise; provided, however, that the undersigned may without such consent
(i) exercise any outstanding stock options granted pursuant to employment
agreements or employee benefit plans of the Company referred to in the
Prospectuses (as defined in the Purchase Agreements) so long as the undersigned
agrees to be bound by this Agreement with respect to shares of common stock
issued upon such exercise and (ii) make bona fide gifts of shares of common
stock of the Company so long as the transferee agrees to be bound by this
Agreement with respect to such shares.
Very truly yours,
Signature: ____________________________
Print Name:____________________________
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