1
EXHIBIT 1
NETWORK SOLUTIONS, INC.
7,730,000 Shares of Common Stock
Underwriting Agreement
, 2000
X.X. Xxxxxx Securities Inc.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx & Xxxxx LLC
PaineWebber Incorporated
FleetBoston Xxxxxxxxx Xxxxxxxx
Prudential Securities Incorporated
As Representatives of the several Underwriters
listed in Schedule I hereto
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Network Solutions, Inc., a Delaware corporation (the
"Company") proposes to issue and sell 1,000,000 shares (the "Company Shares") of
Common Stock, par value $.001 per share (the "Common Stock"), of the Company,
and certain stockholders of the Company named in Schedule II hereto (the
"Selling Stockholders") propose to sell an aggregate of 6,730,000 shares of
Common Stock (the "Selling Stockholder Shares" and, together with the Company
Shares, the "Underwritten Shares") as set forth in Schedule II hereto, to the
several Underwriters listed in Schedule I hereto (the "Underwriters"), for whom
you are acting as representatives (the "Representatives"). In addition, for the
sole purpose of covering over-allotments in connection with the sale of the
Underwritten Shares, the Company proposes to issue and sell to the Underwriters,
at the option of the Underwriters, up to an additional 1,159,500 shares (the
"Option Shares") of Common Stock. The Underwritten Shares and the Option Shares
are herein referred to as the "Shares."
Science Applications International Corporation, a Delaware
corporation ("SAIC"), is herein referred to as the "Principal Stockholder," and
the other Selling Stockholders set forth on Schedule II are herein referred to
as the "Management Stockholders."
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The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement on Form S-3, including a prospectus, relating to the Shares. The
registration statement as amended at the time when it became or shall become
effective, including information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the
Securities Act, is referred to in this Agreement as the "Registration
Statement," and the prospectus in the form first used to confirm sales of Shares
is referred to in this Agreement as the "Prospectus." If the Company has filed
an abbreviated registration statement 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. Any reference in this Agreement to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Item
12 of Form S-3 under the Securities Act, as of the effective date of the
Registration Statement or the date of such preliminary prospectus or the
Prospectus, as the case may be, and any reference to "amend," "amendment" or
"supplement" with respect to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to refer to and include any
documents filed after such date under the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") that are deemed to be incorporated by
reference therein.
1. The Company agrees to issue and sell the Company Shares and
each of the Selling Stockholders agrees, severally and not jointly, to sell the
Selling Stockholder Shares to the several Underwriters as hereinafter provided,
and each Underwriter, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agrees to
purchase, severally and not jointly, from each of the Company and each of the
Selling Stockholders at a purchase price per share of $ (the "Purchase Price")
the number of Underwritten Shares (to be adjusted by you so as to eliminate
fractional shares) determined by multiplying the aggregate number of
Underwritten Shares to be sold by the Company and by each of the Selling
Stockholders as set forth opposite their respective names under the heading
"Number of Underwritten Shares" in Schedule II hereto by a fraction, the
numerator of which is the aggregate number of Underwritten Shares to be
purchased by such Underwriter as set forth opposite the name of such Underwriter
in Schedule I hereto and the denominator of which is the aggregate number of
Underwritten Shares to be purchased by all the Underwriters from the Company and
all the Selling Stockholders hereunder.
In addition, the Company agrees to issue and sell the Option
Shares to the several Underwriters as hereinafter provided, and the
Underwriters, upon the basis of the
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representations and warranties herein contained, but subject to the conditions
hereinafter stated, shall have the option to purchase, severally and not
jointly, from the Company at the Purchase Price that portion of the number of
Option Shares as to which such election shall have been exercised (to be
adjusted by you so as to eliminate fractional shares) determined by multiplying
such number of Option Shares by a fraction, the numerator of which is the
maximum number of Option Shares which such Underwriter is entitled to purchase
as set forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the maximum number of Option Shares which all of the
Underwriters are entitled to purchase hereunder, for the sole purpose of
covering over-allotments (if any) in the sale of Underwritten Shares by the
several Underwriters.
The Underwriters may exercise the option to purchase the
Option Shares at any time (but not more than once) on or before the thirtieth
day following the date of this Agreement, by written notice from the
Representatives to the Company. Such notice shall set forth the aggregate number
of Option Shares as to which the option is being exercised and the date and time
when the Option Shares are to be delivered and paid for, which may be the same
date and time as the Closing Date (as hereinafter defined) but shall not be
earlier than the Closing Date nor later than the tenth full Business Day (as
hereinafter defined) after the date of such notice (unless such time and date
are postponed in accordance with the provisions of Section 9 hereof). Any such
notice shall be given at least two Business Days prior to the date and time of
delivery specified therein.
On December 21, 1999, the Company approved a 2-for-1 stock
split of the shares of Common Stock, to be effected in the form of a stock
dividend on shares of Common Stock outstanding on a date after the Closing Date
as determined by a duly appointed committee of the Board of Directors of the
Company (the "Record Date"). The stock dividend will be distributed to
stockholders a date after the Record Date as determined by a duly appointed
committee of the Board of Directors of the Company (the "Distribution Date"). In
the event the Additional Closing Date (as defined below) is after the Record
Date, the Company shall issue to each Underwriter on the Additional Closing Date
the number of Option Shares to be purchased by such Underwriter as determined
above together with a "due xxxx" for an equal number of shares of Common Stock
to be issued by the Company on or after the Distribution Date in exchange for
such "due xxxx."
2. The Company and the Selling Stockholders understand that
the Underwriters intend (i) to make a public offering of the Shares as soon
after (A) the Registration Statement has become effective and (B) the parties
hereto have executed and delivered this Agreement as in the judgment of the
Representatives is advisable and (ii) initially to offer the Shares upon the
terms set forth in the Prospectus.
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3. Payment for the Shares shall be made by wire transfer in
immediately available funds to the accounts specified by the Company, in the
case of the Company Shares, and to an account specified by the Principal
Stockholder and the Attorneys-in-Fact, in the case of the Selling Stockholder
Shares, to the Representatives on , 2000, or at such other time on the same
or such other date, not later than the fifth Business Day thereafter, as the
Representatives, the Company, the Principal Stockholder and the
Attorneys-in-Fact may agree upon in writing, or to an account specified to the
Representatives by the Company, in the case of the Option Shares, on the date
and time specified by the Representatives in the written notice of the
Underwriters' election to purchase such Option Shares. The time and date of such
payment for the Underwritten Shares is referred to herein as the "Closing Date,"
and the time and date for such payment for the Option Shares, if other than the
Closing Date, are herein referred to as the "Additional Closing Date." As used
herein, the term "Business Day" means any day other than a day on which banks
are permitted or required to be closed in New York City.
Payment for the Shares to be purchased on the Closing Date or
the Additional Closing Date, as the case may be, shall be made against delivery
to the Representatives for the respective accounts of the several Underwriters
of the Shares to be purchased on such date 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 Additional Closing Date, as
the case may be, with any transfer taxes payable in connection with the transfer
to the Underwriters of the Company Shares and the Option Shares duly paid by the
Company and any transfer taxes payable in connection with the transfer to the
Underwriters of the Selling Stockholder Shares duly paid by the Selling
Stockholders. The certificates for the Shares will be made available for
inspection and packaging by the Representatives at the office of X.X. Xxxxxx
Securities Inc. set forth above not later than 1:00 P.M., New York City time, on
the Business Day prior to the Closing Date or the Additional Closing Date, as
the case may be.
4. (A) The Company represents and warrants to each Underwriter
and the Selling Stockholders that:
(a) each preliminary prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities
Act, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, that this
representation and warranty shall not apply to any statements in, or
omissions from, the Registration Statement or the Prospectus made in
reliance
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upon and in conformity with information furnished to the Company in
writing by or on behalf of the Underwriters expressly for use therein;
(b) the Registration Statement and Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) comply, or will comply, as the case may be, in all
material respects with the Securities Act and do not and will not, as
of the applicable effective date as to the Registration Statement and
any amendment thereto and as of the date of the Prospectus and any
amendment or supplement thereto, contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
the Prospectus, as amended or supplemented, if applicable, at the
Closing Date or Additional Closing Date, as the case may be, will not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that
the foregoing representations and warranties shall not apply to
statements or omissions in the Registration Statement or the Prospectus
made in reliance upon and in conformity with information furnished to
the Company in writing by or on behalf of the Underwriters through the
Representatives expressly for use therein;
(c) the documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable, and none of such
documents contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
any further documents so filed and incorporated by reference in the
Prospectus, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the Exchange
Act, and will not contain an untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading;
(d) the financial statements, and the related notes thereto,
included or incorporated by reference in the Registration Statement and
the Prospectus present fairly the financial position of the Company as
of the dates indicated and the results of its operations and changes in
cash flows for the periods specified; said financial statements have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis, and the supporting schedules
included or incorporated by reference in the Registration Statement
present fairly the information required to be stated therein;
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(e) since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any change in the capital stock or long-term debt of the Company
or any of its subsidiaries, or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, business, prospects, management,
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole (a "Material Adverse
Change"), otherwise than as set forth or contemplated in the
Prospectus; and except as set forth or contemplated in the Prospectus,
neither the Company nor any of its subsidiaries has entered into any
transaction or agreement (whether or not in the ordinary course of
business) material to the Company and its subsidiaries, taken as a
whole;
(f) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a
material adverse effect on the general affairs, business, prospects,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole (a
"Material Adverse Effect");
(g) each of the Company's subsidiaries has been duly
incorporated and is validly existing as a corporation under the laws of
its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus, and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws
of each jurisdiction in which it owns or leases properties, or conducts
any business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a
Material Adverse Effect; and all the outstanding shares of capital
stock of each subsidiary of the Company have been duly authorized and
validly issued, are fully-paid and non-assessable, and are owned by the
Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests and claims;
(h) this Agreement has been duly authorized, executed and
delivered by the Company;
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(i) the Company has an authorized capitalization as set forth
in the Prospectus and such authorized capital stock conforms as to
legal matters to the description thereof set forth in the Prospectus,
and all of the outstanding shares of capital stock of the Company
(including the Shares) have been duly authorized and validly issued,
are fully paid and non-assessable and are not subject to any
pre-emptive or similar rights; and, except as described in or expressly
contemplated by the Prospectus, there are no outstanding rights
(including, without limitation, pre-emptive rights), warrants or
options to acquire, or instruments convertible into or exchangeable
for, any shares of capital stock or other equity interest in the
Company, or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any capital stock
of the Company, any such convertible or exchangeable securities or any
such rights, warrants or options;
(j) the Company Shares and Option Shares have been duly
authorized, and, when issued and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will be
duly issued and will be fully paid and non-assessable and will conform
to the description thereof in the Prospectus; and the issuance of the
Company Shares and Option Shares is not subject to any preemptive or
similar rights;
(k) neither the Company nor any of its subsidiaries is, and
with the giving of notice or lapse of time or both would be, in
violation of or in default under its certificate of incorporation (the
"Certificate of Incorporation") or by-laws (the "By-Laws") or any
indenture, mortgage, deed of trust, loan agreement or other agreement
(including, without limitation, the Cooperative Agreement between the
Department of Commerce, as successor to the National Science Foundation
and the Company dated as of January 1, 1993, as amended to date (the
"Cooperative Agreement")) or instrument to which any of the Company or
any of its subsidiaries is a party or by which the Company or any of
its subsidiaries or any of their respective properties is bound, except
for violations and defaults which individually and in the aggregate are
not material to the Company and its subsidiaries, taken as a whole; the
issuance and sale of the Company Shares and Option Shares and the
performance by the Company of its obligations under this Agreement and
the consummation of the transactions contemplated herein will not
conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor will
any such action result in any violation of the provisions of the
Certificate of Incorporation or the By-Laws of the Company or any
applicable law or statute or any order, rule or regulation of any court
or gov-
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ernmental agency or body having jurisdiction over the Company, its
subsidiaries or any of their respective properties; no consent,
approval, authorization, order, license, registration or qualification
of or with any such court or governmental agency or body is required
for the consummation by the Company of the transactions contemplated by
this Agreement, except such consents, approvals, authorizations,
orders, licenses, registrations or qualifications as have been obtained
under the Securities Act and as may be required under state securities
or blue sky laws in connection with the purchase and distribution of
the Shares by the Underwriters;
(l) other than as set forth in the Prospectus, there are no
legal or governmental investigations, actions, suits or proceedings
pending or, to the knowledge of the Company, threatened against or
affecting the Company or any of its subsidiaries or any of their
respective properties or to which the Company is or may be a party or
to which any property of the Company or any of its subsidiaries is or
may be subject which, if determined adversely to the Company or any of
its subsidiaries, could individually or in the aggregate have, or
reasonably be expected to have, a Material Adverse Effect, and, to the
Company's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others; and there are no
statutes, regulations, contracts or other documents that are required
to be described in the Registration Statement or Prospectus or to be
filed as exhibits to the Registration Statement that are not described
or filed as required;
(m) no relationship, direct or indirect, exists between or
among the Company and its subsidiaries, on the one hand, and the
directors, officers, stockholders, customers or suppliers of the
Company or any of its subsidiaries, on the other hand, which is
required by the Securities Act to be described in the Registration
Statement and the Prospectus which is not so described;
(n) except as set forth in the Prospectus, no person has the
right to require the Company to register any securities for offering
and sale under the Securities Act by reason of the filing of the
Registration Statement with the Commission or, to the knowledge of the
Company, the sale of the Selling Stockholder Shares by the Selling
Stockholders pursuant hereto;
(o) the Company is not 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 "Investment Company
Act");
(p) PricewaterhouseCoopers LLP ("PricewaterhouseCoopers"), who
have certified certain financial statements of the Company, are
independent public accountants as required by the Securities Act;
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(q) the Company and its subsidiaries, or the Principal
Stockholder on the Company's behalf, have filed all federal, state,
local and foreign tax returns which have been required to be filed and
has paid all taxes shown thereon and all assessments received by them
or either of them to the extent that such taxes have become due and are
not being contested in good faith; and, except as disclosed in the
Registration Statement and the Prospectus, no tax deficiency has been
determined adversely to the Company which has had, nor does the Company
have any knowledge of any tax deficiency, which if determined adversely
to the Company might have, a Material Adverse Effect;
(r) the Company has not taken nor will it take, directly or
indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Common Stock;
(s) the unissued Shares issuable upon the exercise of options
(the "Options") to be exercised by certain of the Management
Stockholders (the "Optionholders") have been duly and validly
authorized and reserved for issuance, and at the time of delivery to
the Underwriters with respect to such Shares, such Shares will be
issued and delivered in accordance with the provisions of the
applicable stock option agreements between the Company and such Selling
Stockholders pursuant to which such Options were granted (the "Option
Agreements") and will be duly and validly issued, fully paid and
non-assessable and will conform to the description thereof in the
Prospectus;
(t) the Options were duly authorized and issued pursuant to
the Option Agreements and constitute valid and binding obligations of
the Company, and the Optionholders are entitled to the benefits
provided by the Option Agreements; the Option Agreements were duly
authorized, executed and delivered and constitute valid and binding
instruments enforceable in accordance with their terms subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights and
to general equity principles; and the Options and the Option Agreements
conform to the descriptions thereof in the Prospectus;
(u) the statistical and market-related data included in the
Registration Statement and the Prospectus are based on or derived from
sources which are believed by the Company to be reliable;
(v) except as set forth in the Prospectus, each of the Company
and its subsidiaries owns or possesses the patents, patent rights,
licenses, inventions, trademarks, service marks, trade names,
copyrights and know-how, including trade se-
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crets and other unpatented and/or unpatentable proprietary or
confidential information, databases, computer applications, programs
and other software and other intellectual property (collectively, the
"Intellectual Property"), reasonably necessary to carry on the business
conducted by it, except to the extent that the failure to own or
possess such Intellectual Property would not have a Material Adverse
Effect, and, except as described in the Registration Statement and the
Prospectus, the Company has no knowledge of infringement of or conflict
with asserted rights of others with respect to any Intellectual
Property, except for notices the content of which if accurate would not
have a Material Adverse Effect;
(w) there are no existing or, to the knowledge of the Company,
threatened labor disputes with the employees of the Company or any of
its subsidiaries which are likely to have a Material Adverse Effect;
(x) the Company carries, or is covered by, insurance in such
amounts and covering such risks as is adequate for the conduct of its
business and the value of its properties and as is customary for
companies engaged in similar businesses in similar industries;
(y) the Company and its subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its businesses and (iii) are in
compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
Material Adverse Effect; and
(z) each employee benefit plan, within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), that is maintained, administered or contributed to by the
Company or any of its affiliates for employees or former employees of
the Company and its affiliates has been maintained in material
compliance with its terms and the requirements of any applicable
statutes, orders, rules and regulations, including but not limited to
ERISA and the Internal Revenue Code of 1986, as amended ("Code"). No
prohibited transaction, within the meaning of Section 406 of ERISA or
Section 4975 of the Code, has occurred with respect to any such plan
excluding transactions effected pursuant to a statutory or
administrative exemption. For each such plan which is subject to the
funding rules of Section 412 of the Code or Section 302 of ERISA, no
"accumulated
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funding deficiency," as defined in Section 412 of the Code, has been
incurred, whether or not waived, and the fair market value of the
assets of each such plan (excluding for these purposes accrued but
unpaid contributions) exceed the present value of all benefits accrued
under such plan determined using reasonable actuarial assumptions.
(B) The Principal Stockholder hereby represents and warrants
to each of the Underwriters, the Company and the Management Stockholders that:
(a) the Principal Stockholder has been duly incorporated and
is validly existing as a corporation in good standing under the laws of
the State of Delaware;
(b) the Principal Stockholder has good and marketable title to
all the Shares to be sold by the Principal Stockholder hereunder, in
each case free and clear of all liens, encumbrances, equities, security
interests and claims whatsoever, with full right and authority to
deliver the same hereunder, and upon the delivery of and payment for
such Shares hereunder, the several Underwriters will receive good and
marketable title thereto, free and clear of all liens, encumbrances,
equities, security interests or claims whatsoever;
(c) the Principal Stockholder has not taken nor will it take,
directly or indirectly, any action which is designed to, or that might
reasonably be expected to, cause or result in stabilization or
manipulation of the price of the Common Stock;
(d) the Principal Stockholder has no actual knowledge that the
representations and warranties of the Company contained in Section 4(A)
of this Agreement are not true and correct, is familiar with the
Registration Statement and has no knowledge of any material fact,
condition or information not disclosed in the Registration Statement
which has had or may have a Material Adverse Effect; the sale of the
Shares by the Principal Stockholder pursuant to this Agreement is not
prompted by any information concerning the Company which is not set
forth in the Registration Statement; and the information pertaining to
such Principal Stockholder under the caption "Selling Stockholders" in
the Prospectus is complete and accurate in all material respects;
(e) the Registration Statement and the Prospectus (as amended
or supplemented) comply, or will comply, as the case may be, in all
material respects with the Securities Act and do not and will not, as
of the applicable effective date of the Registration Statement and any
amendment thereto and as of the date of the Prospectus and any
amendment or supplement thereto, contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary
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to make the statements therein not misleading, and the Prospectus, as
amended or supplemented, if applicable, at the Closing Date or
Additional Closing Date, as the case may be, will not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, except that the foregoing
representations and warranties shall not apply to statements or
omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by or on behalf of the Underwriters through the
Representatives expressly for use therein;
(f) this Agreement has been duly authorized, executed and
delivered by the Principal Stockholder; and
(g) the sale of the Shares by the Principal Stockholder
hereunder, the compliance by the Principal Stockholder with all of the
provisions of this Agreement and the consummation of the transactions
contemplated herein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under (in each case material to the Principal Stockholder and its
subsidiaries, considered as a whole), any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
the Principal Stockholder is a party or by which the Principal
Stockholder is bound or to which any of the property or assets of the
Principal Stockholder is subject, nor will such action result in any
violation of the provisions of the certificate of incorporation or
by-laws of the Principal Stockholder, nor will such action result in
any violation (in each case material to the Principal Stockholder and
its subsidiaries, considered as a whole) of any applicable statute or
any applicable order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Principal Stockholder or
any of its properties; no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the sale of the Shares or the
consummation by the Principal Stockholder of the transactions
contemplated by this Agreement, except such consents, approvals,
authorizations, orders, licenses, registrations or qualifications as
have been obtained or made under the Securities Act or the Exchange Act
and as may be required under state securities or blue sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters; the Principal Stockholder has full right, power and
authority to enter into this Agreement and to sell, assign, transfer
and deliver the Shares to be sold by it; each agreement between the
Company and the Principal Stockholder referred to in the Prospectus has
been duly executed and delivered by the Principal Stockholder and
constitutes a valid and binding obligation of the Principal Stockholder
enforceable against the Principal Stockholder in accordance with its
terms.
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(C) Each of the Management Stockholders severally represents
and warrants to each of the Underwriters that:
(a) all consents, approvals, authorizations and orders
necessary for the execution and delivery by such Management Stockholder
of this Agreement and the Power of Attorney (the "Power of Attorney")
and the Custody Agreement (the "Custody Agreement") hereinafter
referred to, and for the sale and delivery of the Shares to be sold by
such Management Stockholder hereunder, have been obtained; and such
Management Stockholder has full right, power and authority to enter
into this Agreement, the Power of Attorney and the Custody Agreement
and to sell, assign, transfer and deliver the Shares to be sold by such
Management Stockholder hereunder; and this Agreement, the Power of
Attorney and the Custody Agreement have each been duly, executed and
delivered by such Management Stockholder;
(b) the sale of the Shares to be sold by such Management
Stockholder hereunder and the compliance by such Management Stockholder
with all of the provisions of this Agreement, the Power of Attorney and
the Custody Agreement and the consummation of the transactions herein
and therein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a
default under, any statute or any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such
Management Stockholder is a party or by which such Management
Stockholder is bound or to which any of the property or assets of such
Management Stockholder is subject, nor will such action result in any
violation of any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over such Management
Stockholder or the property of such Management Stockholder;
(c) such Management Stockholder has good and valid title to
the Shares to be sold at the Closing Date by such Management
Stockholder hereunder (other than the Shares to be issued upon exercise
of Options), free and clear of all liens, encumbrances, equities or
adverse claims; such Management Stockholder will have, immediately
prior to the Closing Date, assuming due issuance of any Shares to be
issued upon exercise of Options, good and valid title to the Shares to
be sold at the Closing Date by such Management Stockholder, free and
clear of all liens, encumbrances, equities or adverse claims; and, upon
delivery of the certificates representing such Shares and payment
therefor pursuant hereto, good and valid title to such Shares, free and
clear of all liens, encumbrances, equities, security interests or
claims, will pass to the several Underwriters;
(d) such Management Stockholder has not taken nor will such
Management Stockholder take, directly or indirectly, any action which
is designed to, or that
14
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might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock;
(e) the information pertaining to such Management Stockholder
under the caption "Selling Stockholders" in the Prospectus is complete
and accurate in all material respects;
(f) when the Registration Statement becomes effective and at
all times subsequent thereto through the latest of the Closing Date,
the Additional Closing Date or the termination of the offering of the
Shares, such parts of the Registration Statement and Prospectus, and
any supplements or amendments thereto, as they relate to such
Management Stockholder 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
(g) the lock-up letter previously delivered to the
Underwriters by such Management Stockholder is in full force and effect
on the date of this Agreement.
(D) Xxxxxx X. Xxxxxxxxxxxx (the "Senior Management
Stockholder") represents and warrants to each of the Underwriters that such
Senior Management Stockholder has no reason to believe that the representations
and warranties of the Company contained in Section 4(A) of this Agreement are
not true and correct in all material respects.
Each of the Management Stockholders severally represents and
warrants to each of the Underwriters that certificates in negotiable form
representing all of the Shares to be sold by such Management Stockholders
hereunder, other than any such Shares to be issued upon the exercise of Options,
have been, and each of the Management Stockholders who is selling Shares upon
the exercise of Options to each of the Underwriters represents and warrants that
duly completed and executed irrevocable Option exercise notices, in the forms
specified by the relevant Option Agreement, with respect to all of the Shares to
be sold by such Management Stockholder to each of the Underwriters hereunder
have been, placed in custody under a Custody Agreement relating to such Shares,
in the form heretofore furnished to you, duly executed and delivered by such
Management Stockholder to the Company, as custodian (the "Custodian"), and that
such Management Stockholder has duly executed and delivered Powers of Attorney,
in the form heretofore furnished to you, appointing the person or persons
indicated in such Power of Attorney, and each of them, as such Management
Stockholder's Attorneys-in-Fact (the "Attorneys-in-Fact" or any one of them the
"Attorney-in Fact") with authority to execute and deliver this Agreement on
behalf of such Management Stockholder, to determine the purchase price to be
paid by the Underwriters to the Management Stockholders as provided herein, to
authorize the delivery of the Shares to be sold by such Management Stockholder
hereunder, to effect (if applicable) the
15
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exercise of the Options to be exercised with respect to the Shares to be sold by
such Management Stockholder hereunder and otherwise to act on behalf of such
Management Stockholder in connection with the transactions contemplated by this
Agreement and the Custody Agreement.
Each of the Management Stockholders specifically agrees that
the Shares represented by the certificates or the irrevocable Option exercise
notice, in either case held in custody for such Management Stockholder under the
Custody Agreement, are subject to the interests of the Underwriters hereunder,
and that the arrangements made by such Management Stockholder for such custody,
and the appointment by such Management Stockholder of the Attorneys-in-Fact by
the Power of Attorney, are to that extent irrevocable. Each of the Management
Stockholders specifically agrees that the obligations of such Management
Stockholder hereunder shall not be terminated by operation of law, whether by
the death or incapacity of any individual Management Stockholder, or, in the
case of an estate or trust, by the death or incapacity of any executor or
trustee or the termination of such estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership or
corporation, or by the occurrence of any other event. If any individual
Management Stockholder or any such executor or trustee should die or become
incapacitated, or if any such estate or trust should be terminated, or if any
such partnership or corporation should be dissolved, or if any other such event
should occur, before the delivery of the Shares by it hereunder, certificates
representing such Shares shall be delivered by or on behalf of such Management
Stockholder in accordance with their terms and conditions of this Agreement and
the Custody Agreement, and actions taken by the Attorneys-in-Fact pursuant to
the Powers of Attorney shall be as valid as if such death, incapacity,
termination, dissolution or other event had not occurred, regardless of whether
or not the Custodian, the Attorneys-in-Fact, or any of them, shall have received
notice of such death, incapacity, termination, dissolution or other event.
5. (A) The Company covenants and agrees with each of the
several Underwriters as follows:
(a) to use its best efforts to cause the Registration
Statement to become effective at the earliest possible time and, if
required, to file the final Prospectus with the Commission within the
time periods specified by Rule 424(b) and Rule 430A under the
Securities Act and to file promptly all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act subsequent to the date of the Prospectus and for so
long as the delivery of a prospectus is required in connection with the
offering or sale of the Shares; and to furnish copies of the Prospectus
to the Underwriters in New York City prior to 10:00 a.m., New York City
time,
16
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on the Business Day next succeeding the date of this Agreement in such
quantities as the Representatives may reasonably request;
(b) to deliver, at the expense of the Company, to the
Representatives seven signed copies of the Registration Statement (as
originally filed) and each amendment thereto, in each case including
exhibits and documents incorporated by reference therein, and to each
other Underwriter a conformed copy of the Registration Statement (as
originally filed) and each amendment thereto, in each case without
exhibits but including the documents incorporated by reference therein
and, during the period in which a prospectus is required by law to be
delivered by an Underwriter or a dealer, to each of the Underwriters as
many copies of the Prospectus (including all amendments and supplements
thereto) and documents incorporated by reference therein as the
Representatives may reasonably request for the purposes contemplated by
the Securities Act;
(c) before filing any amendment or supplement to the
Registration Statement or the Prospectus, whether before or after the
time the Registration Statement becomes effective, to furnish to the
Representatives a copy of the proposed amendment or supplement for
review and not to file any such proposed amendment or supplement to
which the Representatives reasonably object;
(d) to advise the Representatives promptly, and to confirm
such advice in writing (i) when the Registration Statement has become
effective, (ii) when any amendment to the Registration Statement has
been filed or becomes effective, (iii) when any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Representatives with copies thereof, (iv) of any request by the
Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for any additional
information, (v) 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
the Prospectus or the initiation or threatening of any proceeding for
that purpose, (vi) of the occurrence of any event, within the period
referenced in paragraph (e) below, as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, and (vii) of
the receipt by the Company of any notification with respect to any
suspension of the qualification of the Shares for offer and sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its best efforts to prevent the issuance of
any such stop order, or of any order preventing or suspending the use
of any preliminary prospectus or the Prospectus, or of any order
17
-17-
suspending any such qualification of the shares, or notification of any
such order thereof and, if issued, to obtain as soon as possible the
withdrawal thereof;
(e) if, during such period of time after the first date of the
public offering of the Shares as in the opinion of counsel for the
Underwriters a prospectus relating to the Shares is required by law to
be delivered in connection with sales by the Underwriters or any
dealer, any event shall occur as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in light of the circumstances when the Prospectus is delivered
to a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with law, forthwith to prepare and
furnish, at the expense of the Company, to the Underwriters and to the
dealers (whose names and addresses the Representatives will furnish to
the Company) to which Shares may have been sold by the Representatives
on behalf of the Underwriters and to any other dealers upon request,
such amendments or supplements to the Prospectus as may be necessary so
that the statements in the Prospectus as so amended or supplemented
will not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus will
comply with law;
(f) to endeavor to qualify the Shares for offer and sale under
the securities or blue sky laws of such jurisdictions as the
Representatives shall reasonably request and to continue such
qualification in effect so long as reasonably required for distribution
of the Shares; provided that the Company shall not be required to file
a general consent to service of process in any jurisdiction;
(g) to make generally available to its security holders and to
the Representatives as soon as practicable an earnings statement
covering a period of at least twelve months beginning with the first
fiscal quarter of the Company occurring after the effective date of the
Registration Statement, which shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 of the Commission promulgated
thereunder;
(h) during a period of five years commencing with the date
hereof, to furnish to the Representatives copies of all reports or
other communications (financial or other) furnished to holders of the
Shares, and copies of any reports and financial statements furnished to
or filed with the Commission;
(i) for a period of 90 days after the date of the initial
public offering of the Shares (the "Lock-Up Period") not to, (i)
directly or indirectly, offer, pledge, announce the intention to sell,
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
18
-18-
purchase or otherwise transfer or dispose of any shares of Common Stock
or any securities of the Company which are substantially similar to the
Common Stock, including but not limited to any securities convertible
into or exercisable or exchangeable for, or that represent the right to
receive, Common Stock or any such substantially similar securities or
(ii) enter into any swap, option, future, forward or other agreement
that transfers, in whole or in part, any of the economic consequences
of ownership of the Common Stock or any such substantially similar
securities, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise without the prior written consent of
the Representatives, other than (i) the Option Shares to be sold
hereunder, (ii) any options granted or shares of Common Stock of the
Company issued upon the exercise of options granted or to be granted
under the Company's 1996 Stock Incentive Plan, the Company's 1997
Employee Stock Purchase Plan or any 401(k) plan administered by SAIC or
by the Company during the Lock-Up Period, (iii) shares of Common Stock
issued by the Company as consideration for the acquisition of a
business similar or complementary to that of the Company; provided, any
acquiror of such shares of Common Stock shall agree to be bound by this
Section 5(A)(i) or identical restrictions on transfer of such shares
for the duration of the Lock-Up Period or (iv) as otherwise set forth
in the Prospectus;
(j) to use the net proceeds received by the Company from the
sale of the Shares by the Company pursuant to this Agreement in the
manner specified in the Prospectus under the caption "Use of Proceeds";
(k) to list for quotation the Shares on the National Market
System of the Nasdaq Stock Market, Inc. (the "Nasdaq National Market");
and
(l) whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality of
the foregoing, all costs and expenses (i) incident to the preparation,
registration, transfer, execution, issuance and delivery of the Shares,
(ii) incident to the preparation, printing and filing under the
Securities Act of the Registration Statement, the Prospectus and any
preliminary prospectus (including in each case all exhibits, amendments
and supplements thereto) (but not after nine (9) months after the date
hereof), (iii) incurred in connection with the registration or
qualification of the Shares under the laws of such jurisdictions as the
Representatives may designate (including fees of counsel for the
Underwriters and its disbursements), (iv) in connection with the
listing of the Shares on the Nasdaq National Market, (v) related to the
filing with, and clearance of the offering by, the National Association
of Securities Dealers, Inc., (vi) in connection with the printing
(includ-
19
-19-
ing word processing and duplication costs) and delivery of this
Agreement, any blue sky memoranda and the furnishing to the
Underwriters and dealers of copies of the Registration Statement and
the Prospectus, including mailing and shipping, as herein provided,
(vii) any expenses incurred by the Company in connection with a "road
show" presentation to potential investors, (viii) the cost of preparing
stock certificates and (ix) the cost and charges of any transfer agent
and any registrar.
(B) The Principal Stockholder covenants and agrees with the
several Underwriters that, for a period of 90 days after the date of the initial
public offering of the Shares not to, (i) offer, pledge, announce the intention
to sell, 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 shares of Common Stock or any
securities of the Company which are substantially similar to the Common Stock,
including but not limited to any securities convertible into or exercisable or
exchangeable for, or that represent the right to receive, Common Stock or any
such substantially similar securities or (ii) enter into any swap or other
agreement that transfers, in whole or in part, any of the economic consequences
of ownership of the Common Stock or any such substantially similar securities,
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise or (iii) make any demand for or exercise any right with respect to the
registration of any shares of Common Stock or any such substantially similar
securities without the prior written consent of the Representatives, in each
case other than the Shares to be sold by such Selling Stockholder hereunder.
(C) Each of the Management Stockholders covenants and agrees
with each of the several Underwriters to deliver to the Representatives prior to
or at the Closing Date a properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement specified by the
Treasury Department regulations in lieu thereof) in order to facilitate the
Underwriters' documentation of their compliance with the reporting and
withholding provisions of the Tax Equity and Fiscal Responsibility Act of 1982
with respect to the transactions herein contemplated.
6. The several obligations of the Underwriters hereunder to
purchase the Shares on the Closing Date or the Additional Closing Date, as the
case may be, are subject to the performance by the Company and each of the
Selling Stockholders of their respective obligations hereunder and to the
following additional conditions:
(a) the Registration Statement shall have become effective (or
if a post-effective amendment is required to be filed under the
Securities Act, such post-effective amendment shall have become
effective) not later than 5:00 P.M., New York City time, on the date
hereof; and no stop order suspending the effectiveness
20
-20-
of the Registration Statement or any post-effective amendment shall be
in effect, and no proceedings for such purpose shall be pending before
or threatened by the Commission; the Prospectus shall have been filed
with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under
the Securities Act and in accordance with Section 5(a) hereof; and all
requests for additional information shall have been complied with to
the satisfaction of the Representatives;
(b) the representations and warranties of the Company and the
Selling Stockholders contained herein are true and correct on and as of
the Closing Date or the Additional Closing Date, as the case may be, as
if made on the Closing Date or the Additional Closing Date, as the case
may be, and each of the Company and the Selling Stockholders shall have
complied with all agreements and all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date or the
Additional Closing Date, as the case may be;
(c) subsequent to the execution and delivery of this Agreement
and prior to the Closing Date or the Additional Closing Date, as the
case may be, there shall not have occurred any downgrading, nor shall
any notice have been given of (i) any downgrading, (ii) any intended or
potential downgrading or (iii) any review or possible change that does
not indicate an improvement, in the rating accorded any securities of
or guaranteed by the Company by any "nationally recognized statistical
rating organization", as such term is defined for purposes of Rule
436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is
given in the Prospectus, there shall not have been any change in the
capital stock or long-term debt of the Company or any Material Adverse
Change, or any development involving a prospective Material Adverse
Change otherwise than as set forth or contemplated in the Prospectus,
the effect of which in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares on the Closing Date or the Additional Closing
Date, as the case may be, on the terms and in the manner contemplated
in the Prospectus; and the Company has not sustained since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus;
(e) the Representatives shall have received on and as of the
Closing Date or the Additional Closing Date, as the case may be, (1) a
certificate of the Chief Ex-
21
-21-
ecutive Officer and Chief Financial Officer of the Company,
satisfactory to the Representatives, to the effect set forth in
subsections (a) through (c) (with respect to the respective
representations, warranties, agreements and conditions of the Company)
of this Section 6 and to the further effect that there has not occurred
any Material Adverse Change, or any development involving a prospective
Material Adverse Change from that set forth or contemplated in the
Registration Statement and (2) a certificate from each of the Principal
Stockholder and the Management Stockholders, satisfactory to the
Representatives to the effect set forth in subsection (b) of this
Section 6 (with respect to the respective representations, warranties,
agreements and conditions of such Selling Stockholders);
(f) Pillsbury, Madison & Sutro LLP, counsel for the Company
and the Selling Stockholders, shall have furnished to the
Representatives their written opinion, dated the Closing Date or the
Additional Closing Date, as the case may be, in form and substance
satisfactory to the Representatives, to the effect that:
(i) each of the Company and the Principal Stockholder
has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the
jurisdiction of its incorporation. The Company is duly
qualified as a foreign corporation and in good standing in
each state of the United States of America in which its
ownership or leasing of property requires such qualification
(except where the failure to be so qualified would not have a
Material Adverse Effect) and has full corporate power and
authority to own or lease its properties and conduct its
business as described in the Registration Statement;
(ii) each of the Company's subsidiaries has been duly
incorporated or organized and is validly existing as a
corporation under the laws of its jurisdiction of
incorporation or organization with full corporate power and
authority Registration Statement to own its properties and
conduct its business as described in the Registration
Statement and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing in
each state of the United States of America in which the
ownership or leasing of property requires such qualification
(except other than where the failure to be so qualified would
not have a Material Adverse Effect); and all of the
outstanding shares of capital stock of each subsidiary have
been duly and validly authorized and issued, are fully paid
and non-assessable, and are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances,
equities or claims;
22
-22-
(iii) the authorized capital stock of the Company
consists of 10,000,000 shares of Preferred Stock, par value
$.001 per share, of which there are no outstanding shares and
210,000,000 shares of Common Stock, of which there are
outstanding shares (including the Company Shares and the
Option Shares, if any, issued pursuant to the terms of the
Agreement); proper corporate proceedings have been taken
validly to authorized such authorized capital stock; all of
the outstanding shares of such capital stock (including the
Company Shares and the Option Shares, if any, issued pursuant
to the terms of this Agreement) have been duly and validly
issued and are fully paid and nonassessable; and no preemptive
rights of, or rights of refusal in favor of, stockholders
exist with respect to the Shares, or the issue and sale
thereof, and no restrictions on transfer or voting exist with
respect to the Shares in each case pursuant to the Certificate
of Incorporation or Bylaws of the Company or under law and, to
the knowledge of such counsel, there are no contractual
preemptive rights that have not been waived, rights of first
refusal or rights of co-sale which exist with respect to the
issue and sale of the Shares and there are no contractual
restrictions on transfer or voting which exist with respect to
the Shares;
(iv)the Registration Statement has become effective
under the Securities Act and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement or suspending or preventing the use of
the Prospectus is in effect and no proceedings for that
purpose have been instituted or are pending or contemplated by
the Commission;
(v) the Registration Statement and the Prospectus
(except as to the financial statements and schedules and other
financial data contained therein, as to which such counsel
need express no opinion) comply as to form in all material
respects with the requirements of the Securities Act and with
the rules and regulations of the Commission thereunder;
(vi)such counsel have no reason to believe that the
Registration Statement (except as to the financial statements
and schedules and other financial data contained therein, as
to which such counsel need not express any opinion or belief)
at the Effective Date 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, or that the Prospectus (except as to the
financial statements and schedules and other financial data
contained therein, as to which such counsel need not express
any opinion or belief), as of its date or at the Closing Date
or the Additional Closing Date, as the case may be, contained
or contains any untrue statement of a material
23
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fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(vii) the information required to be set forth in the
Registration Statement in answer to Items 9, 10 (insofar as it
relates to such counsel), 11 (insofar as it relates to legal
proceedings or security ownership of beneficial owners and
management) and 15 of Form S-3 is to the best of such
counsel's knowledge accurately and adequately set forth
therein in all material respects or no response is required
with respect to such Items, and the description of the stock
option plan and the options granted and which may be granted
thereunder set forth in the Prospectus accurately and fairly
presents the information required to be shown with respect to
said plans and options to the extent required by the
Securities Act and the rules and regulations of the Commission
thereunder;
(viii) the documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made
by the Company prior to the Closing Date or the Additional
Closing Date, as the case may be (except as to the financial
statements and schedules and other financial data contained
therein, as to which such counsel need not express any
opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all
material respects with the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder; and they have no
reason to believe that any of such documents, when such
documents became effective or were so filed, as the case may
be, contained, in the case of a registration statement which
became effective under the Securities Act, an untrue statement
of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading, or, in the case of other
documents which were filed under the Exchange Act with the
Commission, an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made when such documents were so filed, not
misleading;
(ix) such counsel do not know of any franchises,
contracts, leases, documents or legal or governmental
proceedings, pending or threatened, which in the opinion of
such counsel are of a character required to be described in
the Registration Statement or the Prospectus or to be filed as
ex-
24
-24-
hibits to the Registration Statement, which are not described
and filed as required;
(x) the Underwriting Agreement has been duly
authorized, executed and delivered on or behalf of by the
Company and the Selling Stockholders;
(xi) a Power of Attorney and a Custody Agreement have
been duly authorized, executed and delivered by each
Management Stockholder and constitute valid and binding
agreements of each Management Stockholder in accordance with
their terms; the Attorneys-in-Fact have been duly authorized
by the Management Stockholders to execute and deliver on their
behalf this Agreement and any other document necessary or
desirable in connection with the transactions contemplated
hereby and to deliver the Shares to be sold by the Management
Stockholders and receive payment therefor pursuant hereto;
(xii) each of the intercompany agreements referred to
in the Prospectus has been duly authorized, executed and
delivered by the Company and the Principal Stockholder;
(xiii) the execution, delivery and performance by the
Company and the Selling Stockholders of the Underwriting
Agreement, the sale by the Selling Stockholders of the
Underwritten Shares and the issuance and sale by the Company
of the Company Shares and the Option Shares, each as
contemplated by the Underwriting Agreement, have been duly
authorized on the part of the Company and each of the Selling
Stockholders and will not conflict with, or result in a breach
of, the Certificate of Incorporation or Bylaws of the Company
or the Principal Stockholder or any agreement (including,
without limitation, the Cooperative Agreement) or instrument
known to such counsel to which the Company or any Selling
Stockholder is a party or any applicable law or regulation, or
so far as is known to such counsel, any order, writ,
injunction or decree, or any jurisdiction, court or
governmental instrumentality;
(xiv) all holders of securities of the Company having
rights to the registration of shares of Common Stock, or other
securities, because of the filing of the Registration
Statement by the Company have waived such rights or such
rights have expired by reason of lapse of time following
notification of the Company's intent to file the Registration
Statement;
(xv) no consent, approval, authorization or order of
any court or governmental agency or body is required for the
consummation of the transac-
25
-25-
tions contemplated in the Underwriting Agreement, except such
as have been obtained under the Securities Act and such as may
be required under state securities or blue sky laws in
connection with the purchase and distribution of the Shares by
the Underwriters;
(xvi) each Selling Stockholder is the sole registered
owner of the Shares to be sold by such Selling Stockholder
under the Underwriting Agreement; the Principal Stockholder
has full corporate power, right and authority to sell the
Shares sold by it; and
(xvii) good and marketable title to the Shares sold
by each Selling Stockholder under the Underwriting Agreement,
free and clear of all liens, encumbrances, equities, security
interests and claims, has been transferred to the
Underwriters, who have severally purchased such Shares under
the Underwriting Agreement, assuming for the purpose of this
opinion that the Underwriters purchased the same in good faith
without notice of any adverse claims.
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the
United States and the States of New York, Delaware and California, to
the extent such counsel deems proper and to the extent specified in
such opinion, if at all, upon an opinion or opinions (in form and
substance reasonably satisfactory to Underwriters' counsel) of other
counsel reasonably acceptable to the Underwriters' counsel, familiar
with the applicable laws; (B) as to matters of fact, to the extent such
counsel deems proper, on certificates of responsible officers of the
Company and certificates or other written statements of officials of
jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company. The opinion of such counsel
for the Company shall state that the opinion of any such other counsel
upon which they relied is in form satisfactory to such counsel and, in
such counsel's opinion, the Underwriters and they are justified in
relying thereon. With respect to the matters to be covered in
subparagraph (vi) above counsel may state their opinion and belief is
based upon their participation in the preparation of the Registration
Statement and the Prospectus and any amendment or supplement thereto
(other than the documents incorporated by reference therein) and review
and discussion of the contents thereof (including the documents
incorporated by reference therein) but is without independent check or
verification except as specified.
The opinion of Pillsbury, Madison & Sutro LLP described above
shall be rendered to the Underwriters at the request of the Company and
shall so state therein.
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(g) on the date hereof and the effective date of the most
recently filed post-effective amendment filed on or subsequent to the
date hereof to the Registration Statement and also on the Closing Date
or Additional Closing Date, as the case may be, PricewaterhouseCoopers
shall have furnished to you letters, dated the respective dates of
delivery thereof, in form and substance satisfactory to you, containing
statements and information of the type customarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained or
incorporated by reference in the Registration Statement and the
Prospectus;
(h) the Representatives shall have received on and as of the
Closing Date or Additional Closing Date, as the case may be, an opinion
of Xxxxxx Xxxxxx & Xxxxxxx, counsel to the Underwriters, with respect
to the due authorization and valid issuance of the Shares, the
Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(i) the Shares to be delivered on the Closing Date or
Additional Closing Date, as the case may be, shall have been approved
for listing on the Nasdaq National Market, subject to official notice
of issuance;
(j) on or prior to the Closing Date or Additional Closing
Date, as the case may be, the Company and the Selling Stockholders
shall have furnished to the Representatives such further certificates
and documents as the Representatives shall reasonably request; and
(k) the lock-up agreements of each of the Company's executive
officers and directors, delivered to you on or before the date hereof,
shall be in full force and effect on the Closing Date or Additional
Closing Date, as the case may be.
7. Each of the Company, the Principal Stockholder and the
Senior Management Stockholder agrees, jointly and severally, to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, the legal fees and other
expenses incurred in connection with any suit, action or proceeding or any claim
asserted) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by any omission or
alleged omission to state therein a material
27
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fact required to be stated therein or necessary to make the statements therein
not misleading, except insofar as such losses, claims, damages or liabilities
are caused by any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with information relating to
any Underwriter furnished to the Company in writing by such Underwriter through
the Representatives expressly for use therein; provided, however, that the
obligations of each of the Principal Stockholder and the Senior Management
Stockholder under the foregoing indemnity shall not exceed the net proceeds
received by such Selling Stockholder from the sale of Shares sold by such
Selling Stockholder hereunder (which net proceeds shall not include the
Underwriters' discount and, in the event the Senior Management Stockholder sells
Shares upon the exercise of Options, shall not include the amount remitted to
the Company to effect the exercise thereof); and provided, further, that the
foregoing indemnity shall not inure to the benefit of any Underwriter from whom
the person asserting such losses, claims, damages, liabilities and judgments
purchased Shares, or any person controlling such Underwriter, if a copy of the
Prospectus (including any amendment or supplement thereto) was not sent or given
by or on behalf of such Underwriter to such person at or prior to the written
confirmation of the sale of the Shares to such person, and if the Prospectus
(including any amendment or supplement thereto) would have cured the defect
giving rise to such losses, claims, damages, liabilities or judgments, unless
such failure to deliver a copy of the Prospectus was a result of the failure of
the Company to provide as many copies of such Prospectus as such Underwriter may
reasonably request in a timely manner.
Each of Xxxxx X. Xxxxxx and Xxxxxxxx X. Xxxxx (together, the
"Other Management Stockholders") agrees, severally and not jointly, to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from the Company, the Principal Stockholders and the Senior Management
Stockholder to each Underwriter, but only with reference to information
furnished to the Company in writing by or on behalf of such Other Management
Stockholder expressly for use in the Registration Statement, the Prospectus, any
amendment and supplement thereto, or any preliminary prospectus; provided,
however, that the obligations of each of the Other Management Stockholders under
the foregoing indemnity shall not exceed the net proceeds received by such Other
Management Stockholder from the sale of Shares sold by such Other Management
Stockholder hereunder (which net proceeds shall not include the Underwriters'
discount and, in the case of an Other Management Stockholder who sells Shares
upon the exercise of Options, shall not include the amount remitted to the
Company to effect the exercise thereof).
Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless 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 Securities
28
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Act and Section 20 of the Exchange Act and each of the Selling Stockholders to
the same extent as the foregoing indemnities from the Company and the Selling
Stockholders to each Underwriter, but only with reference to information
furnished to the Company in writing by or on behalf of the Underwriters through
the Representatives expressly for use in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to the preceding
paragraphs of this Section 7, such person (the "Indemnified Person") shall
promptly notify the person or persons against whom such indemnity may be sought
(each an "Indemnifying Person") in writing, and such Indemnifying Persons, upon
request of the Indemnified Person, shall retain counsel reasonably satisfactory
to the Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Persons may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Person
and not the Indemnifying Persons unless (i) the Indemnifying Persons and the
Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Persons has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties in
any such proceeding (including any impleaded parties) include both an
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that no Indemnifying Person
shall, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for the Underwriters and such control persons of Underwriters
shall be designated in writing by X.X. Xxxxxx Securities Inc. and any such
separate firm for the Company, its directors, its officers who sign the
Registration Statement and such control persons of the Company shall be
designated in writing by the Company and any such separate firm for the Selling
Stockholders shall be designated in writing by the Attorney-in-Fact. No
Indemnifying Person shall be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, each Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested an Indemnifying Person
to reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, such
Indemnifying Person agrees that it shall be liable for any set-
29
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tlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such Indemnifying
Person of the aforesaid request and (ii) such Indemnifying Person shall not have
reimbursed the Indemnified Person in accordance with such request prior to the
date of such settlement. No Indemnifying Person shall, without the prior written
consent of the Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Person is or could
have been a party and indemnity could have been sought hereunder by such
Indemnified Person, unless such settlement includes an unconditional release of
such Indemnified Person from all liability on claims that are the subject matter
of such proceeding.
If the indemnification provided for in the first four
paragraphs of this Section 7 is unavailable to an Indemnified Person or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount
paid or payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders on the
one hand and the Underwriters on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Selling Stockholders on the one hand and the Underwriters on
the other hand in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other hand
shall be deemed to be in the same respective proportions as the net proceeds
from the offering (before deducting expenses) received by the Company and the
Selling Stockholders and the total underwriting discounts and the commissions
received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus, bear to the aggregate public offering price of the
Shares. The relative fault of the Company and the Selling Stockholders on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Selling Stockholders and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company, the Selling Stockholders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the Selling
Stockholders or the Underwriters were treated as one entity for such purposes)
or by any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph.
30
-30-
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, (i) in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages that
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission and (ii) in no event
shall a Selling Stockholder be required to contribute any amount in excess of
the amount by which the net proceeds received by it through the sale of its
shares to the Underwriters exceeds the amount of any damages that such Selling
Stockholder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission (which net proceeds, in
the case of a Management Stockholder who sell Shares upon the exercise of
Options, shall not include the amount remitted to the Company to effect the
exercise thereof). No person guilty of fraudulent misrepresentation (within the
meaning of Section ll(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7 are several in proportion to the respective number of Shares set forth
opposite their names in Schedule I hereto, and not joint.
The remedies provided for in this Section 7 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company and the Selling
Stockholders set forth in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or by or on behalf of the Company, its officers or directors or
any other person controlling the Company or the Selling Stockholders and (iii)
acceptance of and payment for any of the Shares.
8. Notwithstanding anything herein contained, this Agreement
(or the obligations of the several Underwriters with respect to the Option
Shares) may be terminated in the absolute discretion of the Representatives, by
notice given to the Company and the Selling Stockholders, if after the execution
and delivery of this Agreement and prior to the Closing Date (or, in the case of
the Option Shares, to the Company prior to the Additional Closing Date) (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange or the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board Options Exchange,
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the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of or guaranteed by the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities, or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in the judgment of the Representatives, is material and
adverse and which, in the judgment of the Representatives, makes it
impracticable to market the Shares being delivered at the Closing Date or the
Additional Closing Date, as the case may be, on the terms and in the manner
contemplated in the Prospectus.
9. This Agreement shall become effective upon the later of (x)
execution and delivery hereof by the parties hereto and (y) release of
notification of the effectiveness of the Registration Statement (or, if
applicable, any post-effective amendment) by the Commission.
If on the Closing Date or the Additional Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they have agreed to purchase hereunder on such date,
and the aggregate number of Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than one-tenth
of the aggregate number of Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Underwritten Shares set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the Representatives
may specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to Section 1 be increased pursuant to this Section 9 by an
amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If on the Closing Date or the Additional Closing
Date, as the case may be, any Underwriter or Underwriters shall fail or refuse
to purchase Shares which it or they have agreed to purchase hereunder on such
date, and the aggregate number of Shares with respect to which such default
occurs is more than one-tenth of the aggregate number of Shares to be purchased
on such date, and arrangements satisfactory to the Representatives, the Company
and the Selling Stockholders for the purchase of such Shares are not made within
36 hours after such default, this Agreement (or the obligations of the several
Underwriters to purchase the Option Shares, as the case may be, failing such
arrangements satisfactory to the Representatives and the Company) shall
terminate without liability on the part of any non-defaulting Underwriter, the
Company or the Selling Stockholders. In any such case either you, the Company or
the Selling Stockholders shall have the right to postpone the Closing Date (or,
in the case of the Option Shares, either you, the Company or the Company shall
have the right to postpone the Additional Closing Date), but in no event for
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longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriters,
or any of them, because of any failure or refusal on the part of the Company or
the Selling Stockholders to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason any of the Company or the
Selling Stockholders shall be unable to perform its obligations under this
Agreement or any condition of the Underwriters' obligations cannot be fulfilled,
the Company and the Selling Stockholders agree to reimburse the Underwriters or
such Underwriters as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
expenses of its counsel) reasonably incurred by the Underwriter in connection
with this Agreement or the offering contemplated hereunder.
11. This Agreement shall inure to the benefit of and be
binding upon the Company, the Selling Stockholders and the Underwriters any
controlling persons referred to herein and their respective successors and
assigns. Nothing expressed or mentioned in this Agreement is intended or shall
be construed to give 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. No purchaser of Shares from any Underwriter shall be
deemed to be a successor by reason merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by
the Representatives jointly or by X.X. Xxxxxx Securities Inc. alone on behalf of
the Underwriters, and any such action taken by the Representatives jointly or by
X.X. Xxxxxx Securities Inc. alone shall be binding upon the Underwriters. 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 Underwriters shall be given to the
Representatives, c/o X.X. Xxxxxx Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (telefax: 212-648-5705), Attention: Syndicate Department, copy to
Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (telefax:
212-269-5420), Attention: Xxxxxx X. Xxxxxxxxx, Esq. Notices to the Company shall
be given to it at its office, 000 Xxxxxxx Xxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000,
(telefax: 000-000-0000), Attention: Chief Executive Officer. Notices to the
Principal Stockholder shall be given to it at its office, 00000 Xxxxxx Xxxxx
Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000 (telefax: 619-535-7992), Attention: General
Counsel. Notices to the Management Stockholders shall be given to the
Attorneys-in-Fact, c/o the Company, 000 Xxxxxxx Xxxx Xxxxx, Xxxxxxx, Xxxxxxxx
00000, (telefax: 703-742-9626), Attention: Chief Executive Officer. Copies of
notices to any of the Company or the Selling Stockholders should be given to
Pillsbury Madison & Sutro
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LLP, 0000 Xxxx Xxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000 (telefax: 650-233-4545),
Attention: Xxxxx X. del Xxxxx, Esq.
13. This Agreement may be signed in counterparts, each of
which shall be an original and all of which together shall constitute one and
the same instrument.
14. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAWS PROVISIONS THEREOF.
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If the foregoing is in accordance with your understanding,
please sign and return five counterparts hereof.
Very truly yours,
NETWORK SOLUTIONS, INC.
By:
Name:
Title:
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
By:
Name:
Title:
MANAGEMENT STOCKHOLDERS
By:
Name:
Title: Attorney-in-Fact
As Attorney-in-Fact acting on behalf of
each of the Management Stockholders
named in Schedule II to this Agreement.
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Accepted: , 2000
X.X. XXXXXX SECURITIES INC.
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXXXX & XXXXX LLC
PAINEWEBBER INCORPORATED
FLEETBOSTON XXXXXXXXX XXXXXXXX
PRUDENTIAL SECURITIES INCORPORATED
Acting severally on behalf of themselves and
the several Underwriters listed in Schedule I hereto.
By: X.X. XXXXXX SECURITIES INC.
By: ________________________________
Name:
Title:
36
SCHEDULE I
Number of
Underwritten Shares
Underwriter To Be Purchased
X.X. Xxxxxx Securities Inc.........................................................
Xxxxxx Xxxxxxx & Co. Incorporated..................................................
Xxxxxxxxx & Xxxxx LLC..............................................................
PaineWebber Incorporated...........................................................
FleetBoston Xxxxxxxxx Xxxxxxxx, Inc................................................
Prudential Securities Incorporated.................................................
---------
Total 7,730,000
=========
37
SCHEDULE II
Number of
Selling Stockholders Underwritten Shares
-------------------- -------------------
Science Applications International Corporation....................................... 6,700,000
Xxxxx X. Xxxxxx...................................................................... 12,300
Xxxxxx X. Xxxxxxxxxxxx............................................................... 10,000
Xxxxxxxx X. Xxxxx.................................................................... 7,700
---------
Total 6,730,000
=========
