1
Exhibit 1.1
[DRAFT]
AGERE SYSTEMS INC.
Shares
Class A Common Stock, par value $0.01 per share
UNDERWRITING AGREEMENT
March , 2001
New York, New York
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
X.X. Xxxxxx Securities Inc.
Xxxxxxx Xxxxx Barney Inc.
Deutsche Banc Alex. Xxxxx Inc.
ABN AMRO Rothschild LLC
XX Xxxxx Securities Corporation
Xxxxxxxx & Partners, L.P.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
As Representatives of the Several Underwriters
Named in Schedule I hereof:
Dear Sirs:
The undersigned, Agere Systems Inc. (the "Company"), hereby confirms
its agreement with the several Underwriters, named in Schedule I hereof, as
follows:
1. Underwriters and Representatives. The term "Underwriters" as used
herein shall mean the several persons, firms and corporations named in Schedule
I hereof, and the term "Underwriter" shall mean any one of such persons, firms
or corporations. The terms "Underwriters," "persons," "firms" and "corporations"
as used herein shall include the singular of such terms as well as the plural.
The term "Representatives" shall mean Xxxxxx Xxxxxxx & Co. Incorporated, Bear,
Xxxxxxx & Co. Inc., X.X. Xxxxxx Securities Inc., Xxxxxxx Xxxxx Barney Inc.,
Deutsche Banc Alex. Xxxxx Inc., ABN AMRO Rothschild LLC, XX Xxxxx Securities
Corporation and Xxxxxxxx & Partners, L.P., who, by signing this Agreement
represent that they have been authorized by each Underwriter to execute this
Agreement on behalf of such Underwriter
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and to act for such Underwriter in the manner herein provided. All
obligations of the Underwriters hereunder are several and not joint.
2. Description of Securities. The Company proposes to issue and sell
an aggregate of shares of its Class A Common Stock, par value $0.01 per
share (the "Firm Shares") to the several Underwriters.
It is expected that the Company will enter into an underwriting agreement
(the "Selling Stockholder Underwriting Agreement") among Xxxxxx Xxxxxxx & Co.
Incorporated (the "Selling Stockholder Underwriter"), Xxxxxx Xxxxxxx & Co.
Incorporated, as selling stockholder (the "Selling Stockholder"), and the
Company, in connection with the purchase by the Selling Stockholder Underwriter
from the Selling Stockholder of shares of Class A Common Stock. It is understood
that pursuant to the Selling Stockholder Underwriting Agreement, the Selling
Stockholder Underwriter will be granted an option to purchase shares of
Common Stock to cover over-allotments.
The Company also proposes to issue and sell to the several Underwriters,
if the conditions in Section 4 hereof have been satisfied, not more than an
additional number of shares of its Class A Common Stock, par value $0.01 per
share (the "Additional Shares") obtained by subtracting the number of shares
with respect to which the Selling Stockholder Underwriter exercised its option
under the Selling Stockholder Underwriting Agreement from shares, if and
to the extent that you, as Representatives, shall have determined to exercise,
on behalf of the Underwriters, the right to purchase such shares of Class A
Common Stock granted to the Underwriters in Section 4 hereof. The Firm Shares
and the Additional Shares are hereinafter collectively referred to as the
"Shares." The shares of Class A Common Stock, par value $0.01 per share, of the
Company to be outstanding after giving effect to the sales contemplated hereby
are hereinafter referred to as the "Class A Common Stock."
Each Share will have attached thereto one right (collectively, the
"Rights") to purchase one-thousandth of a share of junior preferred stock, par
value $1.00 per share, of the Company (the "Junior Preferred Shares"). The
Rights have been issued pursuant to a Rights Agreement (the "Rights Agreement")
dated as of March , 2001 between the Company and The Bank of New York, as
Rights Agent.
3. Representations and Warranties of the Company. The Company
represents and warrants to the several Underwriters that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement (No. 333-51594) on Form
S-1, including a prospectus relating to the Shares, which has become effective
under the Securities Act of 1933 (the "Act"). The term "Registration Statement"
means the Registration Statement as amended to the date hereof including the
information, if any, deemed to be part of the Registration Statement at the time
of effectiveness pursuant to
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Rule 430A under the Act, and the term "Prospectus" means the prospectus in the
form first used to confirm sales of the Shares. The term "preliminary
prospectus" means any preliminary prospectus relating to the Shares used prior
to the effectiveness of the Registration Statement. If the Company has filed an
abbreviated registration statement to register additional shares of Class A
Common Stock pursuant to Rule 462(b) under the Securities Act (the "Rule 462
Registration Statement"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement.
(b) (i) The Registration Statement when it became effective, did not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, (ii) each preliminary prospectus relating to the Shares, if any,
complied when so filed in all material respects with the Act and the applicable
rules and regulations of the Commission thereunder, (iii) the Registration
Statement and the Prospectus comply and, as amended or supplemented, if
applicable, will comply in all material respects with the Act and the applicable
rules and regulations of the Commission thereunder and (iv) the Registration
Statement and the Prospectus (including, without limitation, the Section
entitled "Arrangements between Lucent and Our Company") do not and, as amended
or supplemented, if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that the Company makes no representations or
warranties as to the information contained in or omitted from the Registration
Statement, any preliminary prospectus or the Prospectus in reliance upon written
information furnished to the Company by or on behalf of any Underwriter
specifically for inclusion therein.
(c) The accountants who have certified the financial statements
filed with the Commission as parts of the Registration Statement and the
Prospectus are public or certified accountants, independent with respect to the
Company, as required by the Act and the rules and regulations of the Commission
thereunder.
(d) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable, and the issuance of such Shares will not be subject to
any preemptive rights.
(e) Neither the issuance or sale of the Shares nor the consummation
of any other of the transactions herein contemplated nor the fulfillment of the
terms hereof will result in a breach of any of the terms and provisions of, or
constitute a default under, any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company is a party or by which it is bound,
or the Company's Restated Certificate of Incorporation or By-Laws, or, to the
best of its knowledge, any order, rule or regulation
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applicable to the Company of any court, federal or state regulatory body,
administrative agency or other governmental body having jurisdiction over the
Company or its properties and except for the registration of the Shares and the
Rights under the Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under the United States Securities Exchange
Act of 1934 (the "Exchange Act") and applicable state or foreign securities laws
in connection with the purchase and distribution of the Shares by the
Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is required for
the execution and delivery by the Company of, compliance by the Company with the
provisions of or consummation of the transactions contemplated by, this
Agreement.
(f) The Separation and Distribution Agreement and each of the other
agreements between Lucent Technologies Inc. ("Lucent") and the Company which are
listed in Schedule II to this Agreement (the "Ancillary Agreements") have been
duly authorized, executed and delivered by the Company and each such agreement
constitutes a valid and binding agreement of the Company.
(g) The compliance by the Company with all of the provisions of the
Separation and Distribution Agreement and each of the Ancillary Agreements will
not conflict with or result in a breach or the violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is bound or to which the Company or any of its
subsidiaries is subject, nor will such actions result in any violation of the
provisions of the Company's Restated Certificate of Incorporation or By-Laws or
any statute or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its subsidiaries or any
of their properties or assets (except for such conflicts, breaches, violations
and defaults as would not have a material adverse effect on the Company and its
subsidiaries taken as a whole); and no consent, approval, authorization or order
of, or filing or registration with, any such court or governmental agency or
body is required for the execution and delivery by the Company of, and
compliance by the Company with, the provisions of the Separation and
Distribution Agreement and each of the Ancillary Agreements (except for such
consents, approvals, authorizations, orders, filings, registrations and
qualifications the failure to obtain which would not have a material adverse
effect on the Company and its subsidiaries taken as a whole).
(h) At the date hereof, except Xxxxx Corporation, no subsidiary of
the Company organized and operating in the United States would constitute a
significant subsidiary (as such term is defined in Rule 1-02(w) of Regulation
S-X) so as to require separate financial disclosure pursuant to the requirements
of Form 10-K.
4. Purchase and Sale of Shares. On the basis of the representations
and warranties and on the terms and subject to the conditions herein set forth,
each of the
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Underwriters agrees to purchase from the Company, severally and not jointly, and
on the terms and subject to the conditions herein set forth the Company agrees
to sell to each of the Underwriters, severally and not jointly, the number of
Firm Shares set forth opposite its name in Schedule I hereof at a price of
$ per share (the "Purchase Price").
The Company agrees, on the basis of the representations and
warranties contained in this Agreement, and subject to its terms and conditions,
to sell to the Underwriters up to the number of shares of Class A Common Stock
obtained by subtracting the number of shares with respect to which the Selling
Stockholder Underwriter exercised its option under the Selling Stockholder
Underwriting Agreement from shares, and the Underwriters shall have a
right to purchase in one or more instances, starting on the day following the
fourth business day after the date of this agreement, up to such number of
Additional Shares at the Purchase Price.
If the Representatives, on behalf of the Underwriters, elect to
exercise this option, the Representatives shall so notify the Company in writing
not earlier than the day after the fourth business day, and not later than 30
days, after the date of this Agreement, which notice shall specify the number of
Additional Shares to be purchased by the Underwriters and the date on which such
shares are to be purchased. Such date may be no later than ten business days
after the date of such notice. Additional Shares may be purchased as provided in
Section 5 hereof solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. If any Additional Shares are to
be purchased hereunder, each Underwriter agrees, severally and not jointly, to
purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional shares as the Representatives may determine) that bears the
same proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The terms of the public offering of the Shares are as set forth in
the Prospectus.
5. Closing. Delivery of, and payment of the Purchase Price for, the
Firm Shares which the Underwriters severally agree to purchase shall be made at
the office of Cravath, Swaine & Xxxxx, Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, at 10:00 a.m.(1) on March , 2001 or at such other place or
time on the same or such other day as shall be agreed upon by the Company and
the Representatives.
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(1) Times mentioned herein are New York time.
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The time and date for such payment and delivery are herein referred to as the
"Closing Date".
Payment for any Additional Shares shall be made to the Company in
New York City against delivery of such Additional Shares for the respective
accounts of the several Underwriters at 10:00 a.m., New York City time, on the
date specified in the notice described in Section 4 or at such other time on the
same or on such other date, in any event not later than April , 2001, as shall
be designated in writing by the Representatives. The time and date of such
payment are hereinafter referred to as the "Option Closing Date."
Certificates for each of the Firm Shares and Additional Shares shall
be in definitive form and registered in such names and in such denominations as
the Representatives shall request in writing not later than two full business
days prior to the Closing Date or the Option Closing Date, as the case may be.
The certificates evidencing the Firm Shares and Additional Shares shall be
delivered to the Representatives on the Closing Date or the Option Closing Date,
as the case may be, for the respective accounts of the several Underwriters,
with any transfer taxes payable in connection with the transfer of the Shares to
the Underwriters duly paid, against payment of the Purchase Price therefor.
The Company agrees to make the Shares available to the
Representatives for examination on behalf of the Underwriters at a place to be
mutually agreed upon, New York, New York, not later than 2:00 p.m. on the
business day next preceding the Closing Date or the Option Closing Date, as the
case may be.
If, at the Closing Date or the Option Closing Date, as the case may
be, for any reason (other than termination of this Agreement in accordance with
the provisions of Section 8, 9 or 10 hereof), one or more of the Underwriters
shall fail or refuse to pay for the Shares it has or they have agreed to
purchase at such time (any such Underwriter being hereinafter referred to as a
"defaulting Underwriter"), and the aggregate number of Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate number of Shares to be purchased at
such time, the remaining Underwriters shall be obligated severally in the
proportion which the number of Firm Shares set forth opposite their names in
Schedule I of this Agreement bear to the aggregate number of Firm Shares set
forth opposite the names of all such nondefaulting Underwriters (or in such
other proportion as the Representatives shall specify) to purchase the Shares
which the defaulting Underwriter or Underwriters agreed but failed or refused to
purchase; provided that in no event shall the number of Shares that any
Underwriter is obligated to purchase be increased pursuant to the provisions of
this paragraph by more than one-ninth of the number of shares of Shares which
such Underwriter has agreed to purchase at such time pursuant to Section 4
without the written consent of such Underwriter. In the event that any
defaulting
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Underwriter or Underwriters shall fail or refuse to purchase Firm Shares which
is more than one-tenth of the aggregate number of Firm Shares to be purchased,
and if arrangements satisfactory to the Representatives and the Company for the
purchase of all such Firm Shares are not made within two business days after
such default, this Agreement will terminate without liability on the part of any
of the nondefaulting Underwriters or of the Company. In the event that the
nondefaulting Underwriters agree to purchase, in accordance with this paragraph,
all the Firm Shares which the defaulting Underwriter or Underwriters fail or
refuse to purchase, the Representatives or the Company shall have the right to
postpone the Closing Date, but in no event longer than five business days, in
order that the required changes, if any, in the Registration Statement and in
the Prospectus or in any other documents or arrangements may be effected. If, on
the Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased, the non-defaulting Underwriters
shall have the option to (i) terminate their obligation hereunder to purchase
Additional Shares or (ii) purchase not less than the number of Additional Shares
that such non- defaulting Underwriters would have been obligated to purchase in
the absence of such default. Except to the extent provided in subparagraphs (d)
and (f) of Section 7 hereof, termination of this Agreement pursuant to this
Section 5 shall be without any liability on the part of the Company or any
Underwriter other than a defaulting Underwriter which shall have failed,
otherwise than for some reason sufficient to justify under the terms hereof of
the cancellation or termination of its obligations hereunder, to pay for the
Firm Shares which such Underwriters has agreed to purchase (any such failure or
refusal being hereinafter referred to as a "default"). Unless this Agreement is
terminated in accordance with any of its provisions, a default by one or more of
the Underwriters shall not relieve any other Underwriter from its obligation to
purchase the Firm Shares which it has agreed to purchase.
6. Payment. At the Closing Date or Option Closing Date, as the case
may be, the Company will cause the Shares to be delivered to the Representatives
for the account of each Underwriter against payment of the Purchase Price of
such Shares in Federal or other funds immediately available.
7. Covenants of the Company. The Company agrees as follows:
(a) The Company will not file any amendment or supplement to the
Registration Statement or the Prospectus of which the Representatives shall not
previously have been advised or which shall be disapproved by Xxxxx Xxxx &
Xxxxxxxx, which firm is acting as counsel for the Underwriters.
(b) The Company will deliver to the Representatives a reasonable
number of copies of the registration statement as originally filed and of all
amendments thereto up to the Closing Date. Promptly upon the filing with the
Commission of any
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amendment to the Registration Statement or of any supplement to or amendment of
the Prospectus, the Company will deliver to the Representatives a reasonable
number of copies thereof.
(c) The Company will advise the Representatives promptly (confirming
such advice in writing) of any official request made by the Commission for an
amendment to the Registration Statement or Prospectus or for additional
information with respect thereto and of any official notice of the institution
of proceedings for, or of the entry of, a stop order suspending the
effectiveness of the Registration Statement. The Company will use its best
efforts to prevent the issuance of any such stop order and, if such a stop order
should be entered, the Company will make every reasonable effort to obtain the
lifting or removal thereof as soon as possible.
(d) The Company will pay all expenses in connection with the
preparation and filing of the Registration Statement, the issuance and delivery
of the Shares and the printing of the copies of any preliminary prospectus and
of the Prospectus to be furnished as provided in the first sentence of
subparagraph (g) below; and will pay any taxes on the issuance of the Shares,
but will not pay any transfer taxes. The Company will not be required to pay any
amount for any expenses of the Representatives or any of the Underwriters,
except the cost of mailing to Underwriters of copies of the Registration
Statement and all amendments thereto, the preliminary prospectuses and the
Prospectus, and except as provided by subparagraph (f) below. The Company will
not in any event be liable to any of the several Underwriters for damages on
account of loss of anticipated profits.
(e) The Company will apply the proceeds from the sale of the Shares
as set forth under the heading "Use of Proceeds" appearing in the Prospectus.
(f) The Company will use its best efforts to qualify the Shares, or
to assist in the qualification of the Shares by or on behalf of the
Representatives, for offer and sale under the securities or Blue Sky laws of
such states of the United States as the Representatives may designate, and will
pay or reimburse the Representatives for counsel fees, filing fees and
out-of-pocket expenses in connection with such qualifications; provided that the
Company shall not be required (i) to qualify as a foreign corporation or to file
a general consent to the service of process in any state or (ii) to pay, or to
incur, or to reimburse the Representatives for, any such expenses if no Shares
are delivered to and purchased by the Underwriters hereunder because of a
default by one or more of the Underwriters or the termination of this Agreement
pursuant to Section 10 hereof.
(g) The Company will furnish to the Representatives or to the
respective Underwriters as many copies of the Prospectus as the Representative
or the respective Underwriters may reasonably request for the purpose
contemplated by the Act. If, during such period after the first date of the
public offering of the Shares as, in the
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opinion of the counsel for the Underwriters, the Prospectus is required by law
to be delivered, any event shall occur which should be set forth in a supplement
to or an amendment of the Prospectus in order to make the Prospectus not
misleading, the Company will, upon the occurrence of each such event, forthwith
at its expense, prepare and furnish to the Representatives or to the respective
Underwriters as many copies as the Representatives or the respective
Underwriters may reasonably request for the purposes contemplated by the Act of
a supplement to or amendment of the Prospectus which will supplement or amend
the Prospectus so that, as supplemented or amended, it will not at the date of
such supplement or amendment contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statement therein
not misleading. For the purpose of this subparagraph (g), the Company will
furnish such reasonable information with respect to itself as Representatives
may from time to time request, and the Representatives, at their own expense,
may visit any of the properties of the Company and may inspect the books of
account of the Company at any reasonable time. Notwithstanding any of the other
provisions of this subparagraph (g), the Company shall not be under any
obligation to furnish any supplement to or amendment of the Prospectus on
account of any change in, or to include in any amended prospectus any change in,
the information furnished to the Company by any Underwriter or Underwriters or
by the Representatives on its or their behalf for use in the Prospectus, unless
the Representatives have advised the Company in writing of such change and has
requested the Company at the expense of such Underwriter or Underwriters to
prepare a supplement to or amendment of the Prospectus to reflect such change or
to include such change in an amended prospectus.
(h) The Company will cause to be made generally available to its
security holders as soon as practicable, but in any event not later than ,
an earnings statement or statements which shall meet the requirements of Section
11(a) of the Act and Rule 158 promulgated thereunder.
(i) Without the prior written consent of Xxxxxx Xxxxxxx & Co.
Incorporated, the Company will not (a) register for sale or offer, issue,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend or otherwise transfer or dispose of, directly or indirectly, any
shares of the Company's common stock or any securities convertible into or
exercisable or exchangeable for the Company's common stock or (b) enter into any
swap or other arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of the Company's common stock, whether any
such transaction described in clause (a) or (b) of this sentence is to be
settled by delivery of the Company's common stock, or other securities, in cash
or otherwise, for a period of 180 days after the date of the Prospectus, other
than: (i) the shares of the Company's Class A Common Stock sold pursuant to this
Agreement; (ii) any shares of the Company's common stock issued upon the
exercise, exchange or conversion of a security outstanding on the date hereof of
which Xxxxxx Xxxxxxx & Co. Incorporated has been advised in
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writing, including issuances under the Company's employee benefit plans; (iii)
the granting of stock options, restricted stock or restricted stock units that
do not vest prior to 180 days after the date hereof or the sale of stock
pursuant to the Company's employee benefit plans; and (iv) the issuance of
shares, or the announcement or execution of agreements that contemplate the
issuance of shares, of the Company's common stock in connection with any
acquisition of or merger with another company or the acquisition of assets,
provided that (A) in connection with any issuance of shares of common stock
pursuant to this Section 7(i)(iv) within 90 days from the date hereof, each
recipient of such shares executes an agreement in the form of Exhibit A and (B)
the Company may not issue an aggregate number of shares of common stock pursuant
to this Section 7(i)(iv), including securities convertible into a number of
shares of common stock, that exceeds one-half the number of shares of common
stock sold by the Company in the public offering, except to the extent that in
connection with such issuance each recipient of such shares executes an
agreement in the form of Exhibit A.
8. Conditions of the Obligations of the Underwriters. The
obligations of the Underwriters to purchase and pay for the Shares shall be
subject to the following additional conditions:
(a) At the Closing Date no stop order suspending the effectiveness
of the Registration Statement, as amended from time to time, shall be in effect
and no proceedings for that purpose shall be pending before or threatened by the
Commission, and the Representative shall have received a certificate dated the
day of closing and signed by a Vice President of the Company to the effect that
no such stop order is in effect and, to the knowledge of the Company, no
proceedings for such purpose are pending before, or threatened by, the
Commission.
(b) At or prior to the Closing Date, the Representatives shall have
received from Cravath, Swaine & Xxxxx, counsel for the Company, an opinion,
satisfactory to Xxxxx Xxxx & Xxxxxxxx, to the effect that:
(i) the Company is a corporation in good standing, duly organized
and validly existing under the laws of the State of Delaware; and is
authorized by its Restated Certificate of Incorporation to transact the
business in which it is engaged, as set forth in the Prospectus;
(ii) the Company is duly qualified to transact the business in which
it is engaged, as set forth in the Prospectus, in each State in the United
States in which it operates;
(iii) the Shares and the Rights to be issued and sold by the Company
hereunder have been duly and validly authorized and, when issued and
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delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and nonassessable and free of preemptive
rights;
(iv) each of this Agreement and the Rights Agreement has been duly
authorized, executed and delivered on behalf of the Company and is valid
and binding on the Company, except as rights to indemnity and contribution
hereunder may be limited under applicable law;
(v) all consents, approvals, authorizations or other orders of U.S.
regulatory authorities legally required for the issuance and sale of the
Shares to the Underwriters pursuant to the terms of this Agreement have
been obtained, except such as may be required by the securities or Blue
Sky laws of the various States in connection with the offer and sale of
the Shares; and
(vi) such counsel (A) is of the opinion that the Registration
Statement and Prospectus (except for financial statements and schedules
and other financial and statistical data included therein as to which such
counsel need not express any opinion) comply as to form in all material
respects with the Securities Act and the applicable rules and regulations
of the Commission thereunder, (B)has no reason to believe that (except for
financial statements and schedules and other financial and statistical
data as to which such counsel need not express any belief) the
Registration Statement and the prospectus included therein at the time the
Registration Statement became effective contained any untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading and (C)
has no reason to believe that (except for financial statements and
schedules and other financial and statistical data as to which such
counsel need not express any belief) the Prospectus contains any untrue
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
The opinion specified in clause (ii) above may be delivered by Xxxx
X. Xxxxxx, Senior Vice President and General Counsel of the Company, in lieu of
Cravath, Swaine & Xxxxx.
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(c) At or prior to the Closing Date, the Representatives shall have
received from Xxxxx Xxxx & Xxxxxxxx an opinion to the effect specified in
clauses (i), (iii), (iv) and (vi) of subparagraph (b) above.
(d) At the date hereof and at or prior to the Closing Date, the
Representatives shall have received an executed copy of (1) a letter of
PricewaterhouseCoopers LLP, addressed to the Company and to the Representatives,
to the effect that (i) they are independent public accountants as required by
the Act and the applicable published rules and regulations of the Commission
thereunder; (ii) the audited financial statements of the Company contained in
the Registration Statement comply as to form in all material respects with the
applicable accounting requirements of the Act and the applicable published rules
and regulations of the Commission thereunder; and (iii) nothing has come to
their attention as the result of specified procedures not constituting an audit
that caused them to believe (A) that the unaudited financial statements,
contained in or incorporated by reference as aforesaid, do not so comply and are
not fairly presented in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited financial
statements contained as aforesaid, (B) that there was any change in the capital
stock or long term debt of the Company, or any decrease in net assets, from the
date of the latest balance sheet which is contained in the Registration
Statement, to a date not more than five days prior to the date of such letter or
(C) that there were any decreases, as compared with the corresponding period in
the preceding year, in revenue, operating income or net income from the date of
the latest figures for such items contained in the Registration Statement to the
date of the latest available financial statements of the Company; provided that,
with respect to any of the items specified in clause (iii), such letter may
contain an exception for matters which the Registration Statement discloses have
occurred or may occur; and provided further that the letter may vary from the
requirements specified in this subparagraph in such manner as the
Representatives in their sole discretion may determine to be immaterial or in
such manner as may be acceptable to the Representatives; and (2) a letter of
KPMG LLP, addressed to the Company and to the Representatives, to the effect
that (i) they are independent public accountants as required by the Act and the
applicable published rules and regulations of the Commission thereunder; and
(ii) the audited financial statements of Xxxxx Corporation contained in the
Registration Statement comply as to form in all material respects with the
applicable accounting requirements of the Act and the applicable published rules
and regulations of the Commission thereunder.
(e) Except as reflected in or contemplated by the Registration
Statement and the Prospectus, since the respective dates as of which information
is given in the Registration Statement and the Prospectus there shall not have
been, at the Closing Date, any material adverse change, financial or otherwise,
in the condition of the Company from that set forth in the Registration
Statement and the Prospectus; the representations and warranties of the Company
herein shall be true at the Closing Date; the Company shall not have failed, at
or prior to the Closing Date, to have performed all
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agreements herein contained which should have been performed by it at or prior
to such time; and the Representatives shall have received, at the Closing Date,
a certificate to the foregoing effect dated the day of the closing and signed by
a Vice President of the Company.
(f) The New York Stock Exchange shall have approved the Shares for
listing, subject only to official notice of issuance.
(g) The "lock-up" agreements, substantially in the form of Exhibit A
hereto, between the Representatives and Lucent and each of the executive
officers of the Company relating to sales and certain other dispositions of
shares of the Company's common stock or certain other securities shall have been
delivered to the Representatives on or before the date hereof.
(h) The Representatives shall have received a certificate, dated the
day of closing and signed by a Vice President or the Treasurer of Lucent, to the
effect that:
(i) the Separation and Distribution Agreement and each of the
Ancillary Agreements have been duly authorized, executed and delivered by
Lucent and each such agreement constitutes a valid and binding agreement
of Lucent; and
(ii) the compliance by Lucent with all of the provisions of the
Separation and Distribution Agreement and each of the Ancillary Agreements
will not conflict with or result in a breach or the violation of any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
to which Lucent or any of its subsidiaries is bound or to which Lucent or
any of its subsidiaries is subject, nor will such actions result in any
violation of the provisions of the certificate of incorporation or by-laws
of Lucent or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over Lucent or any of its
subsidiaries or any of their properties or assets (except for such
conflicts, breaches, violations and defaults as would not have a material
adverse effect on the Company and its subsidiaries taken as a whole); and
no consent, approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body is required for the
execution and delivery by Lucent of, and compliance by Lucent with, the
provisions of the Separation and Distribution Agreement and each of the
Ancillary Agreements (except for such consents, approvals, authorizations,
orders, filings, registrations and qualifications the failure to obtain
which would not have a material adverse effect on the Company and its
subsidiaries taken as a whole); and
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(iii) the separation of the Company's businesses from Lucent has
occurred as described in the Prospectus.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to the Representatives on the
Option Closing Date of such documents as the Representatives may reasonably
request with respect to the good standing of the Company, the due authorization
and issuance of the Additional Shares and other matters related to the issuance
of the Additional Shares.
In case any of the conditions specified above in this Section 8
shall not have been fulfilled, this Agreement may be terminated by the
Representatives by delivering written notice of termination to the Company. Any
such termination shall be without liability of any party to any other party
except to the extent provided in subparagraphs (d) and (f) of Section 7 hereof.
9. Conditions of Company's Obligation. The obligation of the Company
to deliver the Shares upon payment therefor shall be subject to the following
conditions:
(a) At the Closing Date no stop order suspending the effectiveness
of the Registration Statement, as amended from time to time, shall be in effect
and no proceedings for that purpose shall then be pending before, or threatened
by, the Commission.
(b) The Company shall assume simultaneously with the closing of the
sale of the Shares sold pursuant to this Agreement approximately $2.5 billion of
debt (as described in the Prospectus).
In case any of the conditions specified above in this Section 9
shall not have been fulfilled, this Agreement may be terminated by the Company
by delivering written notice of termination to the Representatives. Any such
termination shall be without liability of any party to any other party except to
the extent provided in subparagraphs (d) and (f) of Section 7 hereof.
10. Termination of Agreement. This Agreement may be terminated by
the Representatives by delivering written notice of termination to the Company
at any time prior to the Closing Date, if after the signing of this Agreement
trading in securities generally on the New York Stock Exchange shall have been
materially suspended or materially limited or minimum prices shall have been
established on such Exchange (which shall not include trading suspensions or
limitations resulting from the operation of General Rules 80A and 80B of such
Exchange, as amended or supplemented), or a banking moratorium shall have been
declared by either Federal or New York State authorities.
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A termination of this Agreement pursuant to this Section 10 shall be
without liability of any party to any other Party.
11. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold each Underwriter, and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, harmless from and against any and all losses, claims, damages and
liabilities with respect to the Shares or any other securities of the Company
arising because the Registration Statement, any preliminary prospectus used in
connection with the offering of the Shares or the Prospectus (if used within the
period set forth in Section 7(g) hereof and if used, as amended or supplemented
by all amendments or supplements thereto which have been furnished to the
Representatives or to such Underwriter) contained or is alleged to have
contained any untrue statement of a material fact or omitted or is alleged to
have omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, except as to losses, claims,
damages or liabilities caused by any such untrue statement or omission or
alleged untrue statement or omission made in reliance upon information furnished
to the Company herein or otherwise in writing by or on behalf of any Underwriter
for use in connection with the preparation of any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement thereof,
provided that the indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter (or to the benefit of any
person controlling such Underwriter) on account of any losses, claims, damages
or liabilities arising from the sale of Shares to any person if a copy of the
Prospectus (as amended or supplemented by all amendments or supplements thereto
which have been furnished to the Representatives or to such Underwriter, but
without exhibits) shall not have been sent, mailed or given to such person, if
required by the Act, at or prior to the written confirmation of the sale of such
Shares to such person.
The Company also agrees to indemnify and hold Bear, Xxxxxxx & Co. Inc.
("Bear, Xxxxxxx") and each person, if any, who controls Bear, Xxxxxxx within the
meaning of either Section 15 of the Act, or Section 20 of the Exchange Act,
harmless from and against any and all losses, claims, damages, and liabilities
incurred as a result of Bear, Xxxxxxx' participation as a "qualified independent
underwriter" within the meaning of Rule 2720 of the National Association of
Securities Dealers' Conduct Rules in connection with the offering of the Shares,
except to the extent any such losses, claims, damages, liabilities and judgments
are found in a final judgment by a court of competent jurisdiction (not subject
to further appeal) to have resulted primarily and directly from the gross
negligence or willful misconduct of Bear, Xxxxxxx.
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(b) Each Underwriter agrees to indemnify and hold the Company, its
directors, its officers who sign the registration statement, and each person who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, harmless from and against any and all losses, claims,
damages and liabilities arising because the Registration Statement or any
preliminary prospectus relating to the Shares, or the Prospectus or any
amendment or supplement thereto contained or is alleged to have contained any
untrue statement of a material fact or omitted or is alleged to have omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, which untrue statement or omission or alleged
untrue statement or omission was made in any such preliminary prospectus or in
the Registration Statement or Prospectus or any amendment or supplement thereto
in reliance upon information furnished to the Company herein or otherwise in
writing by or on behalf of such Underwriter for use in connection with the
preparation thereof.
(c) The Company and each Underwriter agree that upon the
commencement of any action against it, its directors, its officers who sign the
registration statement, or any person controlling it as aforesaid in respect of
which indemnity may be sought on account of any indemnity agreement contained
herein, it will promptly give written notice of the commencement thereof to the
party or parties against whom indemnity shall be sought, but the omission so to
notify such indemnifying party or parties of any such action shall not relieve
such indemnifying party or parties from any liability which it or they may have
to the indemnified party or parties otherwise than on account of such indemnity
agreement. In case such notice of any such action shall be so given, such
indemnifying party or parties shall be entitled to participate at its or their
own expense in the defense of such action, or, if it or they so elect, to assume
the defense of such action, and in the latter event such defense shall be
conducted by counsel chosen by such indemnifying party or parties and
satisfactory to the indemnified party or parties who shall be defendant or
defendants in such action, and such defendant or defendants shall bear the fees
and expenses of any additional counsel retained by them; but if the indemnifying
party or parties shall not elect to assume the defense of such action, such
indemnifying party or parties will reimburse such indemnified party or parties
for the reasonable fees and expenses of any counsel retained by them. In the
event that the parties to any such action (including impleaded parties) include
both the indemnifying party and the indemnified party and either (i) the
indemnifying party or parties and indemnified party or parties mutually agree or
(ii) representation of both the indemnifying party or parties and the
indemnified party or parties by the same counsel is inappropriate under
applicable standards of professional conduct due to actual or potential
differing interests between them, then the indemnifying party or parties shall
not have the right to
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assume the defense of such action on behalf of such indemnified party or parties
and will reimburse such indemnified party or parties for the reasonable fees and
expenses of any counsel retained by them and satisfactory to the indemnifying
party or parties, it being understood that the indemnifying party or parties
shall not, 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, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys for all such indemnified parties, which firm shall be
designated in writing by the Representatives in the case of an action in which
one or more Underwriters or controlling persons are indemnified parties and by
the Company in the case of an action in which the Company or any of its
directors, officers or controlling persons are indemnified parties. The
indemnifying party or parties shall not be liable under this Agreement with
respect to any settlement made by any indemnified party or parties without prior
written consent by the indemnifying party or parties to such settlement.
Notwithstanding anything contained herein to the contrary, if indemnity
may be sought pursuant to the second paragraph of Section 11((a) hereof, hereof
in respect of such action or proceeding, then in addition to such separate firm
for the indemnified parties, the indemnifying party shall be liable for the
reasonable fees and expenses of not more than one separate firm (in addition to
any local counsel) for Bear, Xxxxxxx in its capacity as a "qualified independent
underwriter" and all persons, if any, who control Bear, Xxxxxxx within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act.
(d) If the indemnification provided for in subparagraph (a) or (b)
of this Section 11 is unavailable to an indemnified party in respect of any
losses, claims, damages, or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect primarily the
relative benefits received by the Company on the one hand and the Underwriters
on the other from the offering of the Shares and also to reflect where
appropriate the relative fault of the Company on the one hand and the
Underwriters on the other in connection with the statement or omissions or
alleged statements or omissions which resulted in such losses, claims, damages,
or liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company and of the Underwriters shall be determined by
reference to, among other things, whether
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the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subparagraph (d) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subparagraph (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in this subparagraph (d) shall be
deemed to include, subject to the limitations set forth above in this Section
11, any legal or other expenses reasonably incurred by such indemnified party in
connection with defending any such action or claim. Notwithstanding the
provisions of this subparagraph (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the shares of Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has been required to pay, otherwise than pursuant to this subparagraph (d), by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Each Underwriter's
obligation to contribute pursuant to this subparagraph (d) is several in an
amount which shall bear the same proportion to the number of shares of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto
(plus any increase in such amounts as may be required pursuant to Section 5
hereof).
12. Miscellaneous. This Agreement shall inure to the benefit of the
Company, its directors, its officers who sign the Registration Statement, the
several Underwriters and each controlling person referred to in Section 11
hereof and their respective successors. Nothing in this Agreement is intended or
shall be construed to give to any other person, firm or corporation any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. The term "successor" as used in this Agreement shall
not include any purchaser, as such purchaser, of any of the Shares from any of
the several Underwriters.
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13. Notices. All communications hereunder shall be in writing, and
if to the Underwriters, unless otherwise provided, shall be mailed or delivered
to the Representatives, in care of Xxxxxx Xxxxxxx & Co. Incorporated, Attention:
Managing Director, Equity Syndicate Department, at 0000 Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, and if to the Company, unless otherwise provided, shall be mailed or
delivered to the Company attention: Chief Financial Officer, 000 Xxxxx
Xxxxxxxxx, Xxxxxxxxx, XX 00000.
14. Governing Law. The validity and interpretation of this Agreement
shall be governed by the laws of the State of New York.
15. Survival Clause. Except with respect to any Underwriter who is
in default within the meaning of Section 5 hereof, the indemnity and
contribution agreement contained in Section 11 hereof and the representations
and warranties of the Company set forth in this Agreement or in any certificate
furnished pursuant hereto shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter, or
(iii) acceptance of and payment for the Shares.
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Please sign and return to us the enclosed duplicate of this letter,
whereupon this letter will become a binding agreement between the Company and
the several Underwriters, in accordance with its terms.
Very truly yours,
Agere Systems Inc.
by _________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written.
Xxxxxx Xxxxxxx & Co.
Incorporated
Acting severally on behalf of themselves
and the several Underwriters named
herein.
by Xxxxxx Xxxxxxx & Co.
Incorporated
by ___________________
Name:
Title:
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SCHEDULE I
Number of Firm
Shares To Be
Name Purchased
---- ---------
Xxxxxx Xxxxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
X.X. Xxxxxx Securities Inc.
Xxxxxxx Xxxxx Barney Inc.
Deutsche Banc Alex. Xxxxx Inc.
ABN AMRO Rothschild LLC
XX Xxxxx Securities Corporation
Xxxxxxxx & Partners, L.P.
----------
Total
==========
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SCHEDULE II
The following agreements between Lucent and the Company are the
"Ancillary Agreements":
Interim Services and Systems Replication Agreement;
Fiber Product Purchase Agreement;
Microelectronics Product Purchase Agreement;
ORiNOCO Product Purchase Agreement;
Employee Benefits Agreement;
Trademark License Agreement;
Trademark Assignment;
Trade Dress Assignment;
Patent and Technology License Agreement;
Patent Assignments;
Technology Assignment and Joint Ownership Agreement;
Development Project Agreement;
Joint Design Center Operating Agreement;
Tax Sharing Agreement; and
Real Estate Agreements.
