EXHIBIT 1.1
ARRIS GROUP, INC.
15,000,000 Shares of Common Stock
Underwriting Agreement
June 19, 2002
CIBC World Markets Corp. X.X. Xxxxxx Securities Inc.
000 Xxxxxxxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
As Representatives of the Several
Underwriters listed in Schedule I hereto
Ladies and Gentlemen:
Nortel Networks LLC, a stockholder (the "Selling Stockholder") of Arris
Group, Inc., a Delaware corporation (the "Company"), proposes to sell to the
several Underwriters listed in Schedule I hereto (the "Underwriters"), for whom
you are acting as representatives (the "Representatives"), an aggregate of
15,000,000 shares of Common Stock, par value $0.01 per share, of the Company
(the "Underwritten Shares") and, for the sole purpose of covering
over-allotments in connection with the sale of the Underwritten Shares, at the
option of the Underwriters, up to an additional 2,250,000 shares of Common Stock
of the Company (the "Option Shares"). The Underwritten Shares and the Option
Shares are herein referred to as the "Shares". The outstanding shares of Common
Stock of the Company are herein referred to as the "Stock".
The Company hereby confirms its agreement with the several Underwriters
concerning the purchase and sale of the Shares, as follows:
1. Registration Statement. The Company has prepared and filed
with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement (File No. 333-88498) including a prospectus, relating to the Shares.
Such registration statement, as amended at the time it became effective,
including the information, if any, deemed pursuant to Rule 430A under the
Securities Act to be part of the registration statement at the time of its
effectiveness ("Rule 430A Information"), is referred to herein as the
"Registration Statement"; and as used herein, the term "Preliminary Prospectus"
means each prospectus included in such registration statement (and any
amendments thereto) before it became effective, and any prospectus filed with
the Commission pursuant to Rule 424 under the Securities Act filed after the
time such registration statement became effective that omits Rule 430A
Information, and the term "Prospectus" means the prospectus in the form first
used to confirm sales of the Shares. 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
State-
ment. 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. Capitalized terms used but not defined
herein shall have the meanings given to such terms in the Registration Statement
and the Prospectus.
2. Purchase of the Shares by the Underwriters. (a) The Selling
Stockholder agrees, to sell the Shares to the several Underwriters as provided
in this Agreement, and each Underwriter, on the basis of the representations,
warranties and agreements set forth herein and subject to the conditions set
forth herein, agrees, severally and not jointly, to purchase from the Selling
Stockholder at a purchase price per share of $4.4745 (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 Selling Stockholder 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 Selling
Stockholder hereunder.
In addition, the Selling Stockholder agrees to sell the Option Shares
to the several Underwriters and the Underwriters shall have the option to
purchase at their election up to 2,250,000 Option Shares at the Purchase Price.
The Underwriters, on the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, shall have the
option to purchase, severally and not jointly, from the Selling Stockholder 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 and the denominator of which is the
maximum number of Option Shares which all of the Underwriters are entitled to
purchase hereunder.
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
Selling Stockholder. 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 11
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hereof). Any such notice shall be given at least two business days prior to the
date and time of delivery specified therein.
(b) The Selling Stockholder understands that the Underwriters
intend to make a public offering of the Shares as soon after the effectiveness
of this Agreement as in the judgment of the Representatives is advisable, and
initially to offer the Shares on the terms set forth in the Prospectus. The
Selling Stockholder acknowledges and agrees that the Underwriters may offer and
sell Shares to or through any affiliate of an Underwriter and that any such
affiliate may offer and sell Shares purchased by it to or through any
Underwriter.
(c) Payment for the Shares shall be made by wire transfer in
immediately available funds to the account specified by the Selling Stockholder
at the offices of Xxxxxxxx Xxxxxxx LLP, 000 Xxxxxxxxx Xxxxxx, XX, Xxxxx 0000,
Xxxxxxx, Xxxxxxx 00000 at 10:00 A.M. Eastern Time on June 25, 2002, or at such
other time or place on the same or such other date, not later than the fifth
business day thereafter, as the Representatives and the Selling Stockholder may
agree upon in writing or, in the case of the Option Shares, on the date and at
the time and place 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 are 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".
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 in definitive form 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 sale of the Shares duly paid by the Selling Stockholder. The
certificates for the Shares will be made available for inspection and packaging
by the Representatives at the office of Xxxxxxxx Xxxxxxx LLP set forth above not
later than 1:00 P.M., Eastern Time, on the business day prior to the Closing
Date or the Additional Closing Date, as the case may be.
3. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter and the Selling Stockholder that:
(a) Preliminary Prospectus. No order preventing or suspending the
use of any Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, complied in all material
respects with the Securities Act and did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that the
Company makes no representation and warranty with respect to any statements or
omissions 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 in any Preliminary Prospectus. provided,
further that the Company makes no representation or warranty with respect to any
state-
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ments or omissions made in reliance upon and in conformity with information
relating to the Selling Stockholder furnished to the Company in writing by the
Selling Stockholder for use in any Preliminary Prospectus.
(b) Registration Statement and Prospectus. No order suspending the
effectiveness of the Registration Statement has been issued by the Commission
and no proceeding for that purpose has been initiated or threatened by the
Commission; as of the applicable effective date of the Registration Statement
and any amendment thereto, the Registration Statement complied and will comply
in all material respects with the Securities Act, and did not and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading; and as of the applicable filing date of the Prospectus
and any amendment or supplement thereto and as of the Closing Date and as of the
Additional Closing Date, as the case may be, the Prospectus will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that the Company makes no representation and warranty with respect to any
statements or omissions 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 in the Registration
Statement and the Prospectus and any amendment or supplement thereto; provided,
further that the Company makes no representation or warranty with respect to any
statements or omissions made in reliance upon and in conformity with information
relating to the Selling Stockholder furnished to the Company in writing by the
Selling Stockholder expressly for use in the Registration Statement and the
Prospectus and any amendment or supplement thereto.
(c) Incorporated Documents. 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 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, in the light of the circumstances under which they were
made, not misleading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material respects
to the requirements of the Act or the Exchange Act, as applicable, and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(d) Financial Statements. The financial statements and the related
notes thereto included or incorporated by reference in the Registration
Statement and the Prospectus comply in all material respects with the applicable
requirements of the Securities Act and the Exchange Act, as applicable, and
present fairly the financial position of the Company and its subsidiaries as of
the dates indicated and the results of their operations and the changes in their
cash flows for the periods specified; such financial statements have been
prepared in conformity with generally
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accepted accounting principles applied on a consistent basis throughout the
periods covered thereby (except that unaudited interim financial statements are
subject to normal year-end adjustments), and the supporting schedules included
or incorporated by reference in the Registration Statement present fairly the
information required to be stated therein; the other financial information
included or incorporated by reference in the Registration Statement and the
Prospectus has been derived from the accounting records of the Company and its
subsidiaries and presents fairly the information shown thereby; and the pro
forma financial information and the related notes thereto included or
incorporated by reference in the Registration Statement and the Prospectus has
been prepared in accordance with the applicable requirements of the Securities
Act and the Exchange Act, as applicable, and the assumptions underlying such pro
forma financial information are reasonable and are set forth in the Registration
Statement and the Prospectus.
(e) No Material Adverse Change. Since the date of the most recent
financial statements of the Company included or incorporated by reference in the
Registration Statement and the Prospectus, (i) there has not been any change in
the capital stock or long-term debt of the Company or any of its subsidiaries,
or any dividend or distribution of any kind declared, set aside for payment,
paid or made by the Company on any class of capital stock, or any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the business, properties, management, financial
position, stockholders' equity, or results of operations of the Company and its
subsidiaries taken as a whole; (ii) neither the Company nor any of its
subsidiaries has entered into any transaction or agreement that is material to
the Company and its subsidiaries taken as a whole or incurred any liability or
obligation, direct or contingent, that is material to the Company and its
subsidiaries taken as a whole; and (iii) neither the Company nor any of its
subsidiaries has sustained 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 disturbance or dispute or any action, order or
decree of any court or arbitrator or governmental or regulatory authority,
except in each case as otherwise disclosed in the Registration Statement and the
Prospectus.
(f) Organization and Good Standing. The Company and each of its
subsidiaries have been duly organized and are validly existing and in good
standing under the laws of their respective jurisdictions of organization, are
duly qualified to do business and are in good standing in each jurisdiction in
which their respective ownership or leasing of property or the conduct of their
respective businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to conduct
the businesses in which they are engaged, except where the failure to be so
qualified or have such power or authority would not, individually or in the
aggregate, have a material adverse effect on the business, properties,
management, financial position, stockholders' equity, or results of operations
of the Company and its subsidiaries taken as a whole (a "Material Adverse
Effect"). The Company does not own or control, directly or indirectly, any
corporation, association or other entity other than the subsidiaries listed in
Schedule II to this Agreement.
(g) Capitalization. The Company has an authorized capitalization
as set forth in the Prospectus under the heading "Capitalization"; all the
outstanding shares of capital stock of the
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Company (including the Shares to be sold by the Selling Stockholder) have been
duly and validly authorized and issued and are fully paid and non-assessable and
are not subject to any pre-emptive or similar rights; 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 of its
subsidiaries, or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any capital stock of the
Company or any such subsidiary, any such convertible or exchangeable securities
or any such rights, warrants or options; the capital stock of the Company
conforms in all material respects to the description thereof contained in the
Registration Statement and the Prospectus; and all the outstanding shares of
capital stock or other equity interests of each subsidiary of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and (except as otherwise described in the Prospectus) are owned directly or
indirectly by the Company, free and clear of any lien, charge, encumbrance,
security interest, restriction on voting or transfer or any other claim of any
third party, except that the Company has pledged the shares of capital stock and
other equity interests of all of its subsidiaries pursuant to the Company's
primary credit facility.
(h) Due Authorization. The Company has full right, power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder; and this Agreement has been duly authorized, executed and delivered
by the Company.
(i) No Violation or Default. Neither the Company nor any of its
subsidiaries is (i) in violation of its charter or by-laws or similar
organizational documents; (ii) in default, and no event has occurred that, with
notice or lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in 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; or
(iii) in violation of any law or statute or any judgment, order, rule or
regulation of any court or arbitrator or governmental or regulatory authority,
except, in the case of clauses (ii) and (iii) above, for any such default or
violation that would not, individually or in the aggregate, have a Material
Adverse Effect.
(j) No Conflicts. The execution, delivery and performance by the
Company of this Agreement and the sale of the Shares to be sold by the Selling
Stockholder hereunder will not (i) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to,
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, (ii)
result in any violation of the provisions of the charter or by-laws or similar
organizational documents of the Company or any of its subsidiaries or (iii)
result in the violation of any law or
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statute or any judgment, order, rule or regulation of any court or arbitrator or
governmental or regulatory authority.
(k) No Consents Required. No consent, approval, authorization,
order, registration or qualification of or with any court or arbitrator or
governmental or regulatory authority is required for the execution, delivery and
performance by the Company of this Agreement, or, to the knowledge of the
Company, the sale of the Shares to be sold by the Selling Stockholder hereunder,
except for the registration of the Shares under the Securities Act and such
consents, approvals, authorizations, orders and registrations or qualifications
as may be required under applicable state securities laws in connection with the
purchase and distribution of the Shares by the Underwriters.
(l) Legal Proceedings. Except as described in the Prospectus,
there are no legal, governmental or regulatory investigations, actions, suits or
proceedings pending to which the Company or any of its subsidiaries is or may be
a party or to which any property of the Company or any of its subsidiaries is or
may be the subject that, individually or in the aggregate, if determined
adversely to the Company or any of its subsidiaries, could reasonably be
expected to have a Material Adverse Effect or materially and adversely affect
the ability of the Company to perform its obligations under this Agreement; no
such investigations, actions, suits or proceedings are threatened or, to the
best knowledge of the Company, contemplated by any governmental or regulatory
authority or threatened by others; and (i) there are no current or pending
legal, governmental or regulatory actions, suits or proceedings that are
required under the Securities Act to be described in the Registration Statement
or Prospectus that are not so described and (ii) there are no statutes,
regulations or contracts or other documents that are required under the
Securities Act to be filed as exhibits to the Registration Statement or
described in the Registration Statement or the Prospectus that are not so filed
or described.
(m) Independent Accountants. Ernst & Young LLP, who have certified
certain financial statements of the Company and its subsidiaries, and Deloitte &
Touche LLP, who have certified certain financial statements of Arris Interactive
LLC, are each independent public accountants with respect to the Company and its
subsidiaries as required by the Securities Act.
(n) Title to Real and Personal Property. Other than liens imposed
by the Company's primary credit facility, the Company and its subsidiaries have
good and marketable title in fee simple to, or have valid rights to lease or
otherwise use, all items of real and personal property that are material to the
respective businesses of the Company and its subsidiaries, in each case free and
clear of all liens, encumbrances, claims and defects and imperfections of title
except those that (i) do not materially interfere with the use made and proposed
to be made of such property by the Company and its subsidiaries or (ii) could
not reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.
(o) Title to Intellectual Property. The Company and its
subsidiaries own or possess adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights, licenses and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential
in-
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formation, systems or procedures) necessary for the conduct of their respective
businesses; and the conduct of their respective businesses will not conflict in
any material respect with any such rights of others, and the Company and its
subsidiaries have not received any notice of any claim of infringement or
conflict with any such rights of others except as could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect.
(p) No Undisclosed Relationships. No relationship, direct or
indirect, exists between or among the Company or any of 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, that is required by the
Securities Act to be described in the Registration Statement and the Prospectus
and that is not so described.
(q) Investment Company Act. The Company is not and, after giving
effect to the offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be an "investment
company" or an entity "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended, and the rules and regulations
of the Commission thereunder (collectively, "Investment Company Act").
(r) Taxes. The Company and its subsidiaries have paid all federal,
state, local and foreign taxes and filed all tax returns required to be paid or
filed through the date hereof; and except as otherwise disclosed in the
Prospectus, there is no tax deficiency that has been, or could reasonably be
expected to be, asserted against the Company or any of its subsidiaries or any
of their respective properties or assets.
(s) Licenses and Permits. The Company and its subsidiaries possess
all licenses, certificates, permits and other authorizations issued by, and have
made all declarations and filings with, the appropriate federal, state, local or
foreign governmental or regulatory authorities that are necessary for the
ownership or lease of their respective properties or the conduct of their
respective businesses as described in the Registration Statement and the
Prospectus, except where the failure to possess or make the same would not,
individually or in the aggregate, have a Material Adverse Effect; and except as
described in the Prospectus, neither the Company nor any of its subsidiaries has
received notice of any revocation or modification of any material license,
certificate, permit or authorization or has any reason to believe that any
material license, certificate, permit or authorization will not be renewed in
the ordinary course.
(t) No Labor Disputes. No labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to the best
knowledge of the Company, is contemplated or threatened.
(u) Compliance With Environmental Laws. The Company and its
subsidiaries (i) are in compliance with any and all applicable federal, state,
local and foreign laws, rules, regulations, decisions and orders relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (collectively, "Environmental
Laws"); (ii) have received and are in compliance with all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective
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businesses; and (iii) have not received notice of any actual or potential
liability for the investigation or remediation of any disposal or release of
hazardous or toxic substances or wastes, pollutants or contaminants, except in
any such case for any such failure to comply, or failure to receive required
permits, licenses or approvals, or liability as would not, individually or in
the aggregate, have a Material Adverse Effect.
(v) Compliance With ERISA. 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 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 (the "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; and for each such plan that is subject to the funding rules of
Section 412 of the Code or Section 302 of ERISA, no "accumulated 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) exceeds the present value
of all benefits accrued under such plan determined using reasonable actuarial
assumptions.
(w) Accounting Controls. The Company and its subsidiaries maintain
systems of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(x) Insurance. The Company and its subsidiaries have insurance
covering their respective properties, operations, personnel and businesses,
including business interruption insurance, which insurance is in amounts and
insures against such losses and risks as is adequate to protect the Company and
its subsidiaries and their respective businesses; and neither the Company nor
any of its subsidiaries has (i) received notice from any insurer or agent of
such insurer that capital improvements or other expenditures are required or
necessary to be made in order to continue such insurance or (ii) any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage at reasonable cost from
similar insurers as may be necessary to continue its business.
(y) No Unlawful Payments. Neither the Company nor any of its
subsidiaries nor, to the best knowledge of the Company, any director, officer,
agent, employee or other person associated with or acting on behalf of the
Company or any of its subsidiaries has (i) used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating to
political activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic
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government official or employee from corporate funds; (iii) violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment.
(z) No Restrictions on Subsidiaries. Other than restrictions
imposed by the Company's primary credit facility, no subsidiary of the Company
is currently prohibited, directly or indirectly, under any agreement or other
instrument to which it is a party or is subject, from paying any dividends to
the Company, from making any other distribution on such subsidiary's capital
stock, from repaying to the Company any loans or advances to such subsidiary
from the Company or from transferring any of such subsidiary's properties or
assets to the Company or any other subsidiary of the Company.
(aa) No Broker's Fees. Neither the Company nor any of its
subsidiaries is a party to any contract, agreement or understanding with any
person (other than this Agreement) that would give rise to a valid claim against
the Company or any of its subsidiaries or any Underwriter for a brokerage
commission, finder's fee or like payment in connection with the offering and
sale of the Shares.
(bb) No Registration Rights. Except for persons holding rights
which have been expressly waived in connection with the sale of the Shares, no
person has the right to require the Company or any of its subsidiaries to
register any securities for sale under the Securities Act by reason of the
filing of the Registration Statement with the Commission or the issuance and
sale of the Shares to be sold by the Company hereunder or, to the best knowledge
of the Company, the sale of the Shares to be sold by the Selling Stockholder
hereunder.
(cc) No Stabilization. The Company has not taken, directly or
indirectly, any action designed to or that could reasonably be expected to cause
or result in any stabilization or manipulation of the price of the Shares.
(dd) Forward-Looking Statements. No forward-looking statement
(within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act) contained in the Registration Statement and the Prospectus has
been made or reaffirmed without a reasonable basis or has been disclosed other
than in good faith.
(ee) Statistical and Market Data. Nothing has come to the attention
of the Company that has caused the Company to believe that the statistical and
market-related data included in the Registration Statement and the Prospectus is
not based on or derived from sources that are reliable and accurate in all
material respects.
4. Representations and Warranties of the Selling Stockholder. The
Selling Stockholder represents and warrants to each Underwriter that:
(a) Required Consents; Authority. All consents, approvals,
authorizations and orders necessary for the execution and delivery by the
Selling Stockholder of this Agreement, and for the sale and delivery of the
Shares to be sold by the Selling Stockholder hereunder, have been
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obtained; and the Selling 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 the Selling Stockholder hereunder; this Agreement has been duly
authorized, executed and delivered by the Selling Stockholder.
(b) No Conflicts. The execution, delivery and performance by the
Selling Stockholder of this Agreement, the sale of the Shares to be sold by the
Selling Stockholder and the consummation by the Selling Stockholder of the
transactions herein contemplated will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Selling Stockholder pursuant to,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Selling Stockholder is a party or by which the Selling
Stockholder is bound or to which any of the property or assets of the Selling
Stockholder is subject, (ii) result in any violation of the provisions of the
charter or by-laws or similar organizational documents of the Selling
Stockholder or (iii) result in the violation of any law or statute applicable to
the Selling Stockholder or any judgment, order, rule or regulation of any court
or arbitrator or governmental or regulatory agency specifically naming the
Selling Stockholder.
(c) Title to Shares. The Selling Stockholder has good and valid
title to the Shares to be sold at the Closing Date or the Additional Closing
Date, as the case may be, by the Selling Stockholder hereunder, free and clear
of all liens, encumbrances, equities or adverse claims; the Selling Stockholder
will have, immediately prior to the Closing Date or the Additional Closing Date,
as the case may be, good and valid title to the Shares to be sold at the Closing
Date or the Additional Closing Date, as the case may be, by the Selling
Stockholder, free and clear of all liens, encumbrances, equities or adverse
claims; and, upon the Underwriters obtaining control of the Shares to be sold by
the Selling Stockholder hereunder, and assuming the Underwriters purchased such
Shares for value and without notice of any adverse claim to such Shares within
the meaning of Section 8-102 of the Uniform Commercial Code, the Underwriters
will have acquired all rights of the Selling Stockholder in such Shares free of
any adverse claim, any lien in favor of the Company and any restrictions on
transfer imposed by the Company.
(d) No Stabilization. The Selling Stockholder has not taken,
directly or indirectly, any action designed to or that could reasonably be
expected to cause or result in any stabilization or manipulation of the price of
the Shares.
(e) Registration Statement and Prospectus. Solely in respect of
information regarding Nortel Networks LLC and its affiliates (other than the
Company and subsidiaries of the Company), as of the applicable effective date of
the Registration Statement and any amendment thereto, the Registration Statement
did not and will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading; and, solely in respect of
information regarding Nortel Networks LLC and its affiliates (other than the
Company and subsidiaries of the Company), as of the applicable filing date of
the Prospectus and any amendment or supplement thereto and as of the Closing
Date and as of the Additional Closing Date, as the case may be, the Prospectus
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will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
The Selling Stockholder specifically agrees that the Shares represented
by the certificates are subject to the interests of the Underwriters hereunder.
The Selling Stockholder specifically agrees that the obligations of the Selling
Stockholder hereunder shall not be terminated by operation of law, by the
dissolution of the Selling Stockholder, or by the occurrence of any other event.
If any the Selling Stockholder should be dissolved, or if any other such event
should occur, before the delivery of the Shares hereunder, certificates
representing such Shares shall be delivered by or on behalf of the Selling
Stockholder in accordance with the terms and conditions of this Agreement.
5. Further Agreements of the Company. The Company covenants and
agrees with each Underwriter and the Selling Stockholder that:
(a) Effectiveness of the Registration Statement. The Company will
use its reasonable best efforts to maintain the effectiveness of the
Registration Statement and, if required, will 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 the Company
will furnish copies of the Prospectus to the Underwriters in New York City prior
to 10:00 A.M., New York City time, on the second business day next succeeding
the date of this Agreement in such quantities as the Representatives may
reasonably request.
(b) Delivery of Copies. The Company will deliver upon request,
without charge, (i) to the Representatives, three signed copies of the
Registration Statement as originally filed and each amendment thereto, in each
case including all exhibits and consents filed therewith and documents
incorporated by reference therein; and (ii) to each Underwriter (A) a conformed
copy of the Registration Statement as originally filed and each amendment
thereto (without exhibits) and (B) during the Prospectus Delivery Period, as
many copies of the Prospectus (including all amendments and supplements thereto
and documents incorporated by reference therein) as the Representatives may
reasonably request. As used herein, the term "Prospectus Delivery Period" means
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 of the Shares
by any Underwriter or dealer.
(c) Amendments or Supplements. Before filing any amendment or
supplement to the Registration Statement or the Prospectus , whether before or
after the time that the Registration Statement became effective, the Company
will furnish to the Representatives and counsel for the Underwriters a copy of
the proposed amendment or supplement for review and will not file any such
proposed amendment or supplement to which the Representatives reasonably object.
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(d) Notice to the Representatives. The Company will advise the
Representatives promptly, and 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 amendment to the Prospectus has been filed;
(iv) of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or the receipt of any
comments from the Commission relating to the Registration Statement or any other
request by the Commission for any additional information; (v) of the issuance by
the Commission of any order suspending the effectiveness of the Registration
Statement or 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 Prospectus Delivery
Period as a result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, not
misleading; and (vii) of the receipt by the Company of any notice 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 the Company will use its best efforts to prevent the issuance of
any such order suspending the effectiveness of the Registration Statement,
preventing or suspending the use of any Preliminary Prospectus or the Prospectus
or suspending any such qualification of the Shares and, if any such order is
issued, will obtain as soon as possible the withdrawal thereof.
(e) Ongoing Compliance of the Prospectus. If during the Prospectus
Delivery Period (i) any event shall occur or condition shall exist 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 a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances existing when the Prospectus is delivered to a
purchaser, not misleading or (ii) it is necessary to amend or supplement the
Prospectus to comply with law, the Company will immediately notify the
Underwriters thereof and forthwith prepare and, subject to paragraph (c) above,
file with the Commission and furnish to the Underwriters and to such dealers as
the Representatives may designate, 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 existing
when the Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with law.
(f) Blue Sky Compliance. The Company will qualify the Shares for
offer and sale under the securities or Blue Sky laws of such jurisdictions as
the Representatives shall reasonably request and will continue such
qualifications in effect so long as required for distribution of the Shares;
provided that the Company shall not be required to (i) qualify as a foreign
corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify, (ii) file
any general consent to service of process in any such jurisdiction or (iii)
subject itself to taxation in any such jurisdiction if it is not otherwise so
subject.
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(g) Earning Statement. The Company will make generally available
to its security holders and the Representatives as soon as practicable an
earning statement that satisfies the provisions of Section 11(a) of the
Securities Act and Rule 158 of the Commission promulgated thereunder covering a
period of at least twelve months beginning with the first fiscal quarter of the
Company occurring after the "effective date" (as defined in Rule 158) of the
Registration Statement.
(h) Clear Market. For a period of ninety (90) days after the date
of this Agreement, the Company will not (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, directly or indirectly,
any shares of Stock or any securities convertible into or exercisable or
exchangeable for Stock 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 Stock, whether any such transaction described in clause (i) or (ii) above is
to be settled by delivery of Stock or such other securities, in cash or
otherwise, without the prior written consent of the Representatives, other than
the Shares to be sold hereunder, any shares of Stock of the Company issued upon
the exercise of options granted under existing employee stock option plans,
shares of Stock of the Company issued in exchange for 4.5% convertible
subordinated notes of the Company in transactions pursuant to ss.3(a)(9) of the
Securities Act and shares of Stock of the Company offered for sale by selling
shareholders pursuant to that certain registration statement (File No.
333-82404), as amended, relating to shares of Stock issued pursuant to the terms
of the Asset Purchase Agreement dated as of December 8, 2001, as amended,
between the Company and Cadant, Inc.
(i) Use of Proceeds. The Company will not receive any of the net
proceeds from the sale of the Shares as described in the Prospectus under the
heading "Use of Proceeds".
(j) No Stabilization. The Company will not take, directly or
indirectly, any action designed to or that could reasonably be expected to cause
or result in any stabilization or manipulation of the price of the Shares.
(k) Exchange Listing. The Company will use its best efforts to
ensure that the Shares may be listed and traded on the NASDAQ Stock Market, Inc.
(l) Reports. During the Prospectus Delivery Period, the Company
will furnish to the Representatives, as soon as they are available, 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 or any national securities exchange or automatic
quotation system.
6. Further Agreements of the Selling Stockholder. The Selling
Stockholder covenants and agrees with each Underwriter that:
(a) Clear Market. For a period of ninety (90) days after the date
of this Agreement, the Selling Stockholder will not (i) offer, pledge, announce
the intention to sell, sell, contract to
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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, directly or indirectly, any shares of Stock or any securities
convertible into or exercisable or exchangeable for Stock other than as a bona
fide gift or bona fide gifts; provided, however, that the recipient of such bona
fide gift or gifts shall execute a copy of and be bound by the terms of, the
lock-up agreement, substantially in the form of Exhibit A attached hereto, 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 Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of 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
Stock or any security convertible into or exercisable or exchangeable for Stock
without the prior written consent of the Representatives, in each case other
than (y) the Shares to be sold by the Selling Stockholder hereunder and (z) any
shares of Stock sold by the Selling Stockholder to the Company. Notwithstanding
anything contained herein to the contrary, the Selling Stockholder shall be
entitled to have its membership interest in Arris Interactive L.L.C. ("Arris
Interactive") redeemed by Arris Interactive pursuant to that certain Option
Agreement dated as of June 7, 2002 among the Selling Stockholder, the Company
and Arris Interactive.
(b) No Stabilization. It will not take, directly or indirectly,
any action designed to or that could reasonably be expected to cause or result
in any stabilization or manipulation of the price of the Shares.
(c) Tax Form. It will 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.
7. Conditions of Underwriters' Obligations. The obligation of
each Underwriter to purchase the Underwritten Shares on the Closing Date or the
Option Shares on the Additional Closing Date, as the case may be as provided
herein is subject to the performance by the Company and the Selling Stockholder
of their respective covenants and other obligations hereunder and to the
following additional conditions:
(a) Registration Compliance; No Stop Order. The Registration
Statement (or if a post-effective amendment thereto is required to be filed
under the Securities Act, such post-effective amendment) shall have become
effective, and the Representatives shall have received notice thereof, not later
than 5:00 P.M., New York City time, on the date hereof; no order suspending the
effectiveness of the Registration Statement shall be in effect, and no
proceeding for such purpose shall be pending before or threatened by the
Commission; the Prospectus shall have been timely filed with the Commission
under the Securities Act and in accordance with Section 5(a) hereof; and all
requests by the Commission for additional information shall have been complied
with to the reasonable satisfaction of the Representatives.
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(b) Representations and Warranties. The respective representations
and warranties of the Company and the Selling Stockholder contained herein shall
be true and correct on the date hereof and on and as of the Closing Date or the
Additional Closing Date, as the case may be; and the statements of the Company
and its officers and of the Selling Stockholder made in any certificates
delivered pursuant to this Agreement shall be true and correct on and as of the
Closing Date or the Additional Closing Date, as the case may be.
(c) No Material Adverse Change or Ratings Agency Change.
Subsequent to the execution and delivery of this Agreement (i) no event or
condition of a type described in Section 3(e) hereof shall have occurred or
shall exist, which event or condition is not described in the Prospectus
(excluding any amendment or supplement thereto) and the effect of which in the
judgment of the Representatives makes it impracticable or inadvisable to proceed
with the offering, sale or 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 by this Agreement and the Prospectus; and (ii) there shall not have
occurred any downgrading, nor shall any notice have been given of any intended
or potential downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating accorded any
securities of the Company or any of its subsidiaries by any "nationally
recognized statistical rating organization" as such term is defined for purposes
of Rule 436(g)(2) under the Securities Act.
(d) Officers' Certificates. The Representatives and, in the case
of clause (i) below, the Selling Stockholder, shall have received on and as of
the Closing Date or the Additional Closing Date, as the case may be, a
certificate: (i) of the chief financial officer of the Company and one
additional senior executive officer of the Company who is satisfactory to the
Representatives and the Selling Stockholder (A) confirming that such officers
have carefully reviewed the Registration Statement and the Prospectus and, to
the best knowledge of such officers, the representation of the Company set forth
in Section 3(b) hereof is true and correct, (B) confirming that the other
representations and warranties of the Company in this Agreement are true and
correct and that the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to
such Closing Date and (C) to the effect set forth in paragraphs (a), (c) and (d)
above and (ii) of the Selling Stockholder, in form and substance reasonably
satisfactory to the Representatives, (A) confirming that the representation of
the Selling Stockholder set forth in Section 4(e) hereof is true and correct and
(B) confirming that the other representations and warranties of the Selling
Stockholder in this agreement are true and correct and that the Selling
Stockholder has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to such Closing Date.
(e) Comfort Letters. On the date of this Agreement and on the
Closing Date or the Additional Closing Date, as the case may be, each of Ernst &
Young LLP and Deloitte & Touche LLP shall have furnished to the Representatives
and the Selling Stockholder, at the request of the Company, letters, dated the
respective dates of delivery thereof and addressed to the Underwriters and the
Selling Stockholder, in form and substance reasonably satisfactory to the
Representatives and the Selling Stockholder, containing statements and
information of the type customarily included in accountants' "comfort letters"
to underwriters with respect to the
-16-
financial statements and certain financial information contained or incorporated
by reference in the Registration Statement and the Prospectus; provided, that
the letter delivered on the Closing Date or the Additional Closing Date, as the
case may be shall use a "cut-off" date no more than three business days prior to
such Closing Date or such Additional Closing Date, as the case may be.
(f) Opinion of Counsel for the Company. Xxxxxxxx Xxxxxxx LLP,
counsel for the Company, shall have furnished to the Representatives and the
Selling Stockholder, at the request of the Company, their written opinion, dated
the Closing Date or the Additional Closing Date, as the case may be, and
addressed to the Underwriters and the Selling Stockholder, in form and substance
reasonably satisfactory to the Representatives and the Selling Stockholder, to
the effect set forth in Annex A hereto.
(g) Opinion of Counsel for the Selling Stockholder. In-house
counsel for the Selling Stockholder shall have furnished to the Representatives,
at the request of the Selling Stockholder, their written opinion, dated the
Closing Date or the Additional Closing Date, as the case may be, and addressed
to the Underwriters, in form and substance reasonably satisfactory to the
Representatives, to the effect set forth in Annex B hereto.
(h) Opinion of Counsel for the Underwriters. The Representatives
shall have received on and as of the Closing Date or the Additional Closing
Date, as the case may be, an opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Underwriters, with respect to such matters as the Representatives may reasonably
request, and such counsel shall have received such documents and information as
they may reasonably request to enable them to pass upon such matters.
(i) No Legal Impediment to Issuance. No action shall have been
taken and no statute, rule, regulation or order shall have been enacted, adopted
or issued by any federal, state or foreign governmental or regulatory authority
that would, as of the Closing Date or the Additional Closing Date, as the case
may be, prevent the issuance or sale of the Shares; and no injunction or order
of any federal, state or foreign court shall have been issued that would, as of
the Closing Date or the Additional Closing Date, as the case may be, prevent the
issuance or sale of the Shares.
(j) Good Standing. The Representatives shall have received on and
as of the Closing Date or the Additional Closing Date, as the case may be,
satisfactory evidence of the good standing of the Company and its subsidiaries
in their respective jurisdictions of organization and their good standing as
foreign entities in such other jurisdictions as the Representatives may
reasonably request, in each case in writing or any standard form of
telecommunication from the appropriate Governmental Authorities of such
jurisdictions.
(k) Exchange Listing. The Shares to be delivered on the Closing
Date or Additional Closing Date, as the case may be, shall have been approved
for listing and trading on the NASDAQ Stock Market, Inc.
-17-
(l) Lock-up Agreements. The "lock-up" agreements, each
substantially in the form of Exhibit A hereto, between the Underwriters and each
of the shareholders, officers and directors of the Company listed on Exhibit A-1
hereto relating to sales and certain other dispositions of shares of Stock or
certain other securities, delivered to the Underwriters as of the date hereof,
shall be in full force and effect on the Closing Date or the Additional Closing
Date, as the case may be.
(m) Additional Documents. On or prior to the Closing Date or the
Additional Closing Date, as the case may be, the Company and the Selling
Stockholder shall have furnished to the Representatives such further
certificates and documents as the Representatives may reasonably request.
All opinions, letters, certificates and evidence mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
8. Indemnification and Contribution.
(a) Indemnification of the Underwriters by the Company. The
Company agrees to indemnify and hold harmless each Underwriter, its affiliates,
directors and officers and each person, if any, who controls such Underwriter
within the meaning of 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 reasonable legal fees and other
expenses incurred in connection with any suit, action or proceeding or any claim
asserted, as such fees and expenses are incurred), joint or several, that arise
out of, or are based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (or any
amendment or supplement thereto) or any Preliminary Prospectus, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages or liabilities arise out of, or are
based upon, any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with any information relating
to any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use therein, it being understood and
agreed that the only such information furnished by any Underwriter consists of
the information described as such in subsection (c) below , provided, that, the
Company shall not be liable to any Underwriter under this Section 8(a) with
respect to any Preliminary Prospectus to the extent that any such loss, claim,
damage or liability of such Underwriter results from the fact that such
Underwriter sold the Shares to a person as to whom it shall be established that
there was not sent or given, at or prior to written confirmation of such sale, a
copy of the Prospectus or of the Prospectus as then amended or supplemented in
any case where such delivery is required by the Securities Act if the Company
previously furnished copies thereof in the quantity requested in accordance with
Section 5(b) hereof to such Underwriter and if such untrue statement or omission
or alleged untrue statement or omission made in such Preliminary Prospectus is
eliminated or remedied in the Prospectus (or in the Prospectus as
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amended or supplemented if the Company shall have furnished any amendments or
supplements thereto).
(b) Indemnification of the Underwriters by the Selling
Stockholder. The Selling Stockholder agrees to indemnify and hold harmless each
Underwriter, its affiliates, directors and officers and each person, if any, who
controls such Underwriter within the meaning of 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 reasonable legal
fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred), joint
or several, that arise out of, or are based upon, any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) or any
Preliminary Prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities arise out of, or are based upon, 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, it
being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in subsection (c)
below, provided, that, the Selling Stockholder shall not be liable to any
Underwriter under this Section 8(b) with respect to any Preliminary Prospectus
to the extent that any such loss, claim, damage or liability of such Underwriter
results from the fact that such Underwriter sold the Shares to a person as to
whom it shall be established that there was not sent or given, at or prior to
written confirmation of such sale, a copy of the Prospectus or of the Prospectus
as then amended or supplemented in any case where such delivery is required by
the Securities Act if the Company previously furnished copies thereof in the
quantity requested in accordance with Section 5(b) hereof to such Underwriter
and if such untrue statement or omission or alleged untrue statement or omission
made in such Preliminary Prospectus is eliminated or remedied in the Prospectus
(or in the Prospectus as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto).
Notwithstanding anything to the contrary contained in this Section
8(b), each Underwriter agrees not to assert its rights to indemnity under this
Section 8(b) against the Selling Stockholder until (i) such Underwriter has
requested indemnification and reimbursement from the Company for such losses,
claims, damages, liabilities or expenses and (ii) the Company does not within 90
days of such request (A) agree to so indemnify such Underwriter and (B)
reimburse in full such Underwriter or controlling person for any such losses,
claims, damages, liabilities or expenses incurred.
In addition, nothing contained herein shall be construed to abrogate or
in any way limit the Company's indemnification obligations under that certain
Registration Rights Agreement dated as of August 3, 2001 between the Selling
Stockholder and the Company.
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(c) Indemnification of the Company and the Selling Stockholder.
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who signed the Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act and the
Selling Stockholder to the same extent as the indemnity set forth in paragraph
(a) above, but only with respect to any losses, claims, damages or liabilities
that arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with any information relating to such Underwriter furnished to the Company in
writing by such Underwriter through the Representatives expressly for use in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto) or any Preliminary Prospectus, it being understood and agreed upon that
the only such information furnished by any Underwriter consists of the following
information in the Prospectus furnished on behalf of each Underwriter: the
concession and reallowance figures appearing in the fourth paragraph under the
caption "Underwriting" and the information contained in the tenth paragraph (and
four bullet points included therein) under the caption "Underwriting".
(d) Notice and Procedures. 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 indemnification
may be sought pursuant to the preceding paragraphs of this Section 8, such
person (the "Indemnified Person") shall promptly notify the person against whom
such indemnification may be sought (the "Indemnifying Person") in writing;
provided that the failure to notify the Indemnifying Person shall not relieve it
from any liability that it may have under this Section 8 except to the extent
that it has been actually prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and provided, further, that the failure to
notify the Indemnifying Person shall not relieve it from any liability that it
may have to an Indemnified Person otherwise than under this Section 8. If any
such proceeding shall be brought or asserted against an Indemnified Person and
it shall have notified the Indemnifying Person thereof, the Indemnifying Person
shall retain counsel reasonably satisfactory to the Indemnified Person to
represent the Indemnified Person and any others entitled to indemnification
pursuant to this Section 8 that the Indemnifying Person may designate in such
proceeding and shall pay the fees and expenses of such counsel related to such
proceeding, as incurred. 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 unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary; (ii) the Indemnifying Person has failed within a reasonable time to
retain counsel reasonably satisfactory to the Indemnified Person; (iii) the
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or in addition to those
available to the Indemnifying Person; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the 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 and agreed that the Indemnifying Person shall
not, 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 paid or reimbursed as they are incurred. Any
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such separate firm for any Underwriter, its affiliates, directors and officers
and any control persons of such Underwriter shall be designated in writing by
CIBC World Markets Corp., any such separate firm for the Company, its directors,
its officers who signed the Registration Statement and any control persons of
the Company shall be designated in writing by the Company and any such separate
firm for the Selling Stockholder shall be designated by the Selling Stockholder.
The Indemnifying Person shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Person agrees to
indemnify each 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 that an Indemnifying
Person reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by this paragraph, the Indemnifying Person shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 90 days after receipt by the Indemnifying
Person of such request (ii) the Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such
settlement and (iii) such Indemnified Person shall have given the Indemnifying
Person at least 30 days' prior notice of its intention to settle. No
Indemnifying Person shall, without the 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
indemnification could have been sought hereunder by such Indemnified Person,
unless such settlement (x) includes an unconditional release of such Indemnified
Person, in form and substance reasonably satisfactory to such Indemnified
Person, from all liability on claims that are the subject matter of such
proceeding and (y) does not include any statement as to or any admission of
fault, culpability or a failure to act by or on behalf of any Indemnified
Person.
(e) Contribution. If the indemnification provided for in
paragraphs (a), (b) and (c) above 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 Stockholder on the one
hand and the Underwriters on the other from the offering of the Shares or (ii)
if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company and the
Selling Stockholder on the one hand and the Underwriters on the other 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
Stockholder on the one hand and the Underwriters on the other shall be deemed to
be in the same respective proportions as the net proceeds (before deducting
expenses) received by the Company and the Selling Stockholder from the sale of
the Shares and the total underwriting discounts and commissions received by the
Underwriters in connection therewith, in each case as set forth in the table on
the cover of the Prospectus, bear to the aggregate offering price of the Shares.
The relative fault of the Company and the Selling Stockholder on the one hand
and the Underwriters on the other shall be determined
-21-
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
Stockholder or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
(f) Limitation on Liability. The Company, the Selling Stockholder
and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this Section 8 were determined by pro rata allocation
(even if the Selling Stockholder or the Underwriters were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (e) above. The
amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in paragraph (e) above 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 any such
action or claim. Notwithstanding the provisions of this Section 8, in no event
shall an Underwriter be required to contribute any amount in excess of the
amount by which the total underwriting discounts and commissions received by
such Underwriter with respect to the offering of the Shares 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. Notwithstanding anything to the contrary in this Section 8, in no
event shall the Selling Stockholder be required to pay to the Underwriters any
amount in excess of the net proceeds of the offering of the Shares received by
the Selling Stockholder. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 8 are several in proportion to their respective purchase obligations
hereunder and not joint.
(g) Non-Exclusive Remedies. The remedies provided for in this
Section 8 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any Indemnified Person at law or in equity.
9. Effectiveness of Agreement. This Agreement shall become
effective upon the later of (i) the execution and delivery hereof by the parties
hereto and (ii) receipt by the Company and the Representatives of notice of the
effectiveness of the Registration Statement (or, if applicable, any
post-effective amendment thereto).
10. Termination. This Agreement may be terminated in the absolute
discretion of the Representatives, by notice to the Company and the Selling
Stockholder, if after the execution and delivery of this Agreement and prior to
the Closing Date or, in the case of the Option Shares, prior to the Additional
Closing Date (i) trading generally shall have been suspended or materially
limited on or by any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade; (ii) trading of any securities issued 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 shall
-22-
have been declared by 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, either within or outside the United
States, that, in the judgment of the Representatives, is material and adverse
and makes it impracticable or inadvisable to proceed with the offering, sale or
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 by this Agreement
and the Prospectus.
11. Defaulting Underwriter. (a) If, on the Closing Date or the
Additional Closing Date, as the case may be, any Underwriter defaults on its
obligation to purchase the Shares that it has agreed to purchase hereunder on
such date, the non-defaulting Underwriters may in their discretion arrange for
the purchase of such Shares by other persons satisfactory to the Company and the
Selling Stockholder on the terms contained in this Agreement. If, within 36
hours after any such default by any Underwriter, the non-defaulting Underwriters
do not arrange for the purchase of such Shares, then the Company and the Selling
Stockholder shall be entitled to a further period of 36 hours within which to
procure other persons satisfactory to the non-defaulting Underwriters to
purchase such Shares on such terms. If other persons become obligated or agree
to purchase the Shares of a defaulting Underwriter, either the non-defaulting
Underwriters or the Company and the Selling Stockholder may postpone the Closing
Date or the Additional Closing Date, as the case may be, for up to five full
business days in order to effect any changes that in the opinion of counsel for
the Company, counsel for the Selling Stockholder or counsel for the Underwriters
may be necessary in the Registration Statement and the Prospectus or in any
other document or arrangement, and the Company agrees to promptly prepare any
amendment or supplement to the Registration Statement and the Prospectus that
effects any such changes. As used in this Agreement, the term "Underwriter"
includes, for all purposes of this Agreement unless the context otherwise
requires, any person not listed in Schedule I hereto that, pursuant to this
Section 11, purchases Shares that a defaulting Underwriter agreed but failed to
purchase.
(b) If, after giving effect to any arrangements for the purchase
of the Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters, the Company and the Selling Stockholder as provided in paragraph
(a) above, the aggregate number of Shares that remain unpurchased on the Closing
Date or the Additional Closing Date, as the case may be does not exceed
one-eleventh of the aggregate number of Shares to be purchased on such date,
then the Company and the Selling Stockholder shall have the right to require
each non-defaulting Underwriter to purchase the number of Shares that such
Underwriter agreed to purchase hereunder on such date plus such Underwriter's
pro rata share (based on the number of Shares that such Underwriter agreed to
purchase on such date) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase
of the Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters, the Company and the Selling Stockholder as provided in paragraph
(a) above, the aggregate number of Shares that remain unpurchased on the Closing
Date or the Additional Closing Date, as the case may be, exceeds one-eleventh of
the aggregate amount of Shares to be purchased on such date, or if the Company
and the Selling Stockholder shall not exercise the right described in paragraph
(b)
-23-
above, then this Agreement or, with respect to any Additional Closing Date, the
obligation of the Underwriters to purchase Shares on the Additional Closing
Date, as the case may be, shall terminate without liability on the part of the
non-defaulting Underwriters. Any termination of this Agreement pursuant to this
Section 11 shall be without liability on the part of the Company and the Selling
Stockholder, except that the Company will continue to be liable for the payment
of expenses as set forth in Section 12 hereof and except that the provisions of
Section 8 hereof shall not terminate and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have to the Company, the Selling Stockholder
or any non-defaulting Underwriter for damages caused by its default.
12. Payment of Expenses. (a) Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
the Company will pay or cause to be paid all costs and expenses incident to the
performance of its obligations hereunder, including without limitation, (i) the
costs incident to the authorization, issuance, sale, preparation and delivery of
the Shares and any taxes payable in that connection; (ii) the costs incident to
the preparation, printing and filing under the Securities Act of the
Registration Statement, the Preliminary Prospectus and the Prospectus (including
all exhibits, amendments and supplements thereto) and the distribution thereof;
(iii) the costs of reproducing and distributing this Agreement and related
documentation (such as certificates and closing documentation); (iv) the fees
and expenses of the Company's counsel and independent accountants; (v) the fees
and expenses incurred in connection with the registration or qualification and
determination of eligibility for investment of the Shares under the laws of such
jurisdictions as the Representatives may designate and the preparation, printing
and distribution of a Blue Sky Memorandum, if necessary (including the related
fees and expenses of counsel for the Underwriters); (vi) the cost of preparing
stock certificates; (vii) the costs and charges of any transfer agent and any
registrar; (viii) all expenses and application fees incurred in connection with
any filing with, and clearance of the offering by, the National Association of
Securities Dealers, Inc.; (ix) all expenses incurred by the Company in
connection with any "road show" presentation to potential investors; and (x) all
expenses and application fees related to the listing of the Shares on the NASDAQ
Stock Market, Inc. Notwithstanding the foregoing, all transfer taxes, brokerage
commissions and underwriters' discounts attributable to the Shares and any
out-of-pocket expenses of the Selling Stockholder (except as expressly
contemplated by that certain Registration Rights Agreement dated as of August 3,
2001 between the Selling Stockholder and the Company) shall be for the account
of the Selling Stockholder.
(b) If this Agreement is terminated pursuant to Section 10 (or
other than solely by reason of any failure to perform or breach of any provision
of this Agreement by the Selling Stockholder), the Company agrees to reimburse
the Underwriters for all out-of-pocket costs and expenses (including the fees
and expenses of their counsel) reasonably incurred by the Underwriters in
connection with this Agreement and the offering contemplated hereby.
(c) If (i) the Selling Stockholder for any reason fails to tender
the Shares for delivery to the Underwriters or (ii) the Underwriters decline to
purchase the Shares solely by reason of any failure to perform or breach of any
provision of this Agreement by the Selling Stockholder,
-24-
the Selling Stockholder agrees to reimburse the Underwriters for all
out-of-pocket costs and expenses (including the fees and expenses of their
counsel) reasonably incurred by the Underwriters in connection with this
Agreement and the offering contemplated hereby.
13. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors and the officers and directors and any controlling persons
referred to in Section 8 hereof. Nothing in this Agreement is intended or shall
be construed to give any other person any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
No purchaser of Shares from any Underwriter shall be deemed to be a successor
merely by reason of such purchase.
14. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company, the Selling
Stockholder and the Underwriters contained in this Agreement or made by or on
behalf of the Company, the Selling Stockholder or the Underwriters pursuant to
this Agreement or any certificate delivered pursuant hereto shall survive the
delivery of and payment for the Shares and shall remain in full force and
effect, regardless of any termination of this Agreement or any investigation
made by or on behalf of the Company, the Selling Stockholder or the
Underwriters.
15. Certain Defined Terms. For purposes of this Agreement, (a)
except where otherwise expressly provided, the term "affiliate" has the meaning
set forth in Rule 405 under the Securities Act; (b) 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; and (c) the term "subsidiary" has the meaning set forth
in Rule 405 under the Securities Act.
16. Miscellaneous. (a) Authority of the Representatives. Any
action by the Underwriters hereunder may be taken by the Representatives on
behalf of the Underwriters, and any such action taken by the Representatives
shall be binding upon the Underwriters.
(b) Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted and confirmed by any standard form of telecommunication. Notices (i)
to the Underwriters shall be given to each of the Representatives at: CIBC World
Markets Corp., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(fax:000-000-0000), Attention: Equity Capital Markets; and X.X. Xxxxxx
Securities Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (fax:000-000-0000),
Attention: Equity Capital Markets; (ii) to the Company shall be given to it at
Arris Group, Inc., 00000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxx 00000 (Fax:
000-000-0000); Attention: Chief Financial Officer; and (iii) to the to the
Selling Stockholder shall be given to it at 0000 Xxxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxx 00000-0000 (Fax: 000-000-0000), Attention: Xxxxx Xxxxxxx, Head of Global
Corporate Development, with a copy to 0000 Xxxxx Xxxx, Xxxxx 000, Xxxxxxxx,
Xxxxxxx, Xxxxxx X0X 0X0 (Fax: 000-000-0000), Attention: Corporate Secretary.
(c) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
-25-
(d) Counterparts. This Agreement may be signed in counterparts
(which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which together
shall constitute one and the same instrument.
(e) Amendments or Waivers. No amendment or waiver of any provision
of this Agreement, nor any consent or approval to any departure therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
parties hereto.
(f) Headings. The headings herein are included for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[Signatures on following page]
-26-
If the foregoing is in accordance with your understanding, please
indicate your acceptance of this Underwriting Agreement by signing in the space
provided below.
Very truly yours,
ARRIS GROUP, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Executive Vice President & CFO
NORTEL NETWORKS LLC
By: Nortel Networks Inc.
Its: Managing Member
By: /s/ Xxxx X. Xxxx
-------------------------------------
Name: Xxxx X. Xxxx
Title: Assistant Secretary
Accepted: June 19, 2002
CIBC WORLD MARKETS CORP.
X.X XXXXXX SECURITIES INC.
For themselves and on behalf of the
several Underwriters listed
in Schedule 1 hereto.
CIBC WORLD MARKETS CORP.
By /s/ Xxxxxx X. Xxxxxxx, Xx.
------------------------------------
Authorized Signatory
X.X XXXXXX SECURITIES INC.
By /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Authorized Signatory
Schedule I
UNDERWRITER NUMBER OF SHARES
----------- ----------------
CIBC World Markets Corp............................................ 6,327,000
X.X. Xxxxxx Securities Inc......................................... 6,327,000
Xxxxxxx & Company, Inc............................................. 1,036,000
SunTrust Capital Markets, Inc...................................... 740,000
X.X. Xxxxxxxxxx & Co., Inc......................................... 370,000
Friedman, Billings, Xxxxxx & Co., Inc.............................. 100,000
Xxxxxxx Bros., L.P................................................. 100,000
----------
15,000,000
----------
S-1
Schedule II
Schedule of Subsidiaries of the Company
Arris Interactive L.L.C.
Arris International, Inc.
Keptel, Inc.
Keptel de Mexico SA de CV
ANTEC Latin America, Inc. Sucursal Argentina
Texscan Corporation
Antec International Corporation
ANTEC Europe Limited
Texscan de Mexico, S.A., de C.V.
Electronic Connector Corporation of Illinois
Communicaciones Broadband S.A. de C.V.
Power Guard, Inc.
Electronic System Products, Inc.
ANTEC Foreign Sales Corporation
ANTEC Asset Management Company
ANTEC Licensing Company
Arris International Iberia, S.L.
ANTEC do Brasil LTDA
Arris International Netherlands BV
S-2
Annex A
[Form of Opinion of Counsel for the Company]
(a) We have been verbally informed by a representative of the
Commission's staff that the Registration Statement was declared effective under
the Securities Act as of June 7, 2002 at 3:00 p.m. and, to our knowledge, no
order suspending the effectiveness of the Registration Statement has been issued
and no proceeding for that purpose is pending or, to the best knowledge of such
counsel, threatened by the Commission.
(b) The Registration Statement and the Prospectus (other than the
financial statements and related schedules therein, and other financial and
statistical data contained or incorporated by reference 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.
(c) The Company and each of its subsidiaries listed on Schedule A
hereto (the "Material Subsidiaries") have been duly organized and are validly
existing and in good standing under the laws of their respective jurisdictions
of organization and have all power and authority necessary to own or hold their
respective properties and to conduct their businesses as described in the
Registration Statement and Prospectus. The Company and Arris International, Inc.
are duly qualified to do business in Georgia.
(d) The authorized capital stock of the Company is as set forth in
the Prospectus under the caption "Capitalization." All the outstanding shares of
capital stock of the Company's Common Stock (including the Shares to be sold by
the Selling Stockholder) have been duly and validly authorized and issued and
are fully paid and non-assessable; all the outstanding shares of capital stock
or other equity interests of each Material Subsidiary of the Company have been
duly and validly authorized and issued, are fully paid and non-assessable.
(e) The Company has full right, power and authority to execute and
deliver the Underwriting Agreement and to perform its obligations thereunder;
and the Underwriting Agreement has been duly authorized, executed and delivered
by the Company.
(f) Neither the Company nor any of its Material Subsidiaries is in
violation of its charter or by-laws or similar organizational documents as a
result of the ownership of their respective properties or the conduct of their
businesses as described in the Registration Statement and Prospectus.
(g) The execution, delivery and performance by the Company of the
Underwriting Agreement, and compliance by the Company with the terms of, and the
consummation of the transactions contemplated by, the Underwriting Agreement
will not (i) conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its Material Subsidiaries pursuant to, any indenture,
mortgage, deed of
S-3
trust, loan agreement or other agreement or instrument filed or incorporated by
reference as an exhibit to the Company's Form 10-K for the year ended December
31, 2001, the Company's 10-Q for the quarter ended March 31, 2002 or the Forms
8-K filed by the Company since December 31, 2001; (ii) to the knowledge of such
counsel, result in any violation of the provisions of the charter or by-laws or
similar organizational documents of the Company or any of its Material
Subsidiaries or (iii) result in the violation of any federal or Georgia statute,
the Delaware General Corporation Law or the Delaware Limited Liability Company
Act or any rule or regulation that has been issued pursuant to any federal or
Georgia statute, the Delaware General Corporation Law or the Delaware Limited
Liability Company Act or any order known to us issued pursuant to any federal or
Georgia statute , the Delaware General Corporation Law or the Delaware Limited
Liability Company Act by any court or regulatory authority having jurisdiction
over the Company or any of its subsidiaries.
(h) No consent, approval, authorization, order, registration or
qualification of or with any court or arbitrator or governmental or regulatory
authority is required for the execution, delivery and performance by the Company
of the Underwriting Agreement and compliance by the Company with the terms
thereof and the consummation of the transactions contemplated by the
Underwriting Agreement, except for the registration of the Shares under the
Securities Act and such consents, approvals, authorizations, orders and
registrations or qualifications as may be required under applicable state
securities laws in connection with the purchase and distribution of the Shares
by the Underwriters.
(i) To the best knowledge of such counsel, except as described in
the Prospectus, there are no legal, governmental or regulatory investigations,
actions, suits or proceedings pending to which the Company or any of its
subsidiaries is a party or to which any property of the Company or any of its
subsidiaries is be the subject which, individually or in the aggregate, if
determined adversely to the Company or any of its subsidiaries, could reasonably
be expected to have a Material Adverse Effect; and to the best knowledge of such
counsel, no such investigations, actions, suits or proceedings are threatened or
contemplated by any governmental or regulatory authority or threatened by
others.
(j) The descriptions in the Prospectus of statutes, legal,
governmental and regulatory proceedings and contracts and other documents are
accurate in all material respects; the statements made in the Prospectus under
the heading "Description of Our Capital Stock", in the Prospectus incorporated
by reference from Item 3 of Part I of the Company's Annual Report on Form 10-K
for the year ended December 31, 2002 and in the Registration Statement in item
15, to the extent that they constitute summaries of the terms of stock, matters
of law or regulation or legal conclusions, fairly summarize the matters
described therein in all material respects; and, to the best knowledge of such
counsel, (A) there are no current or pending legal, governmental or regulatory
actions, suits or proceedings that are required under the Securities Act to be
described in the Prospectus and that are not so described and (B) there are no
statutes, regulations or contracts and other documents that are required under
the Securities Act to be filed as exhibits to the Registration Statement or
described in the Prospectus and that have not been so filed or described.
S-4
(k) The documents incorporated by reference under the heading
"Incorporation 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, (other than the financial
statements and related schedules therein and any statistical or market data, as
to which such counsel need express no 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.
Such counsel shall also state that they have participated in
conferences with representatives of the Company and with representatives of its
independent accountants and counsel at which conferences the contents of the
Registration Statement and the Prospectus and any amendment and supplement
thereto and related matters were discussed and, although such counsel assume no
responsibility for the accuracy, completeness or fairness of the Registration
Statement, the Prospectus and any amendment or supplement thereto (except as
expressly provided above), nothing has come to the attention of such counsel to
cause such counsel to believe that the Registration Statement, at the time of
its effective date (including the information, if any, deemed pursuant to Rule
430A to be part of the Registration Statement at the time of effectiveness),
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 or any amendment or supplement thereto as
of its date and the Closing Date contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading
(other than the financial statements and other financial information contained
therein, as to which such counsel need express no belief).
In rendering such opinion, such counsel may rely as to matters of fact
on certificates of responsible officers of the Company and public officials that
are furnished to the Underwriters.
The opinion of Xxxxxxxx Xxxxxxx described above shall be rendered to
the Underwriters at the request of the Company and shall so state therein.
S-5
Annex B
[Form of Opinion of Counsel For
The Selling Stockholder]
(a) The Underwriting Agreement has been duly authorized, executed
and delivered by the Selling Stockholder.
(b) The Selling Stockholder is the record and lawful owner of all
of the Shares to be sold by the Selling Stockholder and has legal and valid
title to such Shares, and upon the Underwriters obtaining control of the Shares
to be sold by the Selling Stockholder pursuant to the Underwriting Agreement,
and assuming the Underwriters purchased such Shares for value and without notice
of any adverse claim to such Shares within the meaning of Section 8-102 of the
Uniform Commercial Code, the Underwriters will have acquired all rights of the
Selling Stockholder in such Shares free of any adverse claim, any lien in favor
of the Company and any restrictions on transfer imposed by the Company.
(c) The sale of the Shares and the execution and delivery by the
Selling Stockholder of, and the performance by the Selling Stockholder of its
obligations under, the Underwriting Agreement, and the consummation of the
transactions contemplated therein, (i) have been duly authorized on the part of
the Selling Stockholder, and (ii) 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 material agreement
or instrument known to such counsel to which the Selling Stockholder is a party
or by which the Selling Stockholder is bound or to which any of the property or
assets of the Selling Stockholder is subject, nor will any such action result in
any violation of the provisions of the charter or by-laws or similar
organizational documents of the Selling Stockholder or any applicable U.S.
Federal law or statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling Stockholder or
any of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental agency
or body is required for the sale of the Shares or the consummation by the
Selling Stockholder of the transactions contemplated by the Underwriting
Agreement, except such consents, approvals, authorizations, 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.
The opinion of counsel described above shall be rendered to the
Underwriters at the request of the Selling Stockholder and shall so state
therein.
S-6
Exhibit A
[FORM OF] LOCK-UP AGREEMENT
[Month Date], 2002
CIBC World Markets Corp. X.X. Xxxxxx Securities Inc.
000 Xxxxxxxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 Xxx Xxxx, Xxx Xxxx 00000
Re: Arris Group, Inc. -- Offering of Common
Stock owned by Nortel Networks LLC
Ladies and Gentlemen:
The undersigned understands that you have entered into an Underwriting
Agreement (the "Underwriting Agreement") with Arris Group, Inc., a Delaware
corporation (the "Company") and Nortel Networks LLC ("Nortel"), providing for
the public offering (the "Public Offering") by you (the "Underwriters") of
common stock of the company (the "Common Stock"), owned by Nortel (the
"Shares"). Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Underwriting Agreement.
In consideration of your agreement to purchase and make the Public
Offering of the Shares, and for other good and valuable consideration receipt of
which is hereby acknowledged, the undersigned hereby agrees that, without your
prior written consent, which shall not be unreasonably withheld, the undersigned
will not, during the period (the "Lock-Up Period") ending 90 days after the date
of the final prospectus relating to the Public Offering (the "Prospectus"), (1)
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,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock (including, but not limited
to, Common Stock which may be deemed to be beneficially owned by the undersigned
in accordance with the rules and regulations of the Securities and Exchange
Commission and securities which may be issued upon exercise of a stock option or
warrant) other than (A) as a bona fide gift or bona fide gifts, provided,
however, that the recipient of such bona fide gift or bona fide gifts shall
execute a copy of and be bound by the terms of, this Agreement or (B) the sale
of any shares of Common Stock acquired upon the exercise of options granted
under the Company's stock option or stock incentive plans that would otherwise
expire during the Lock-Up Period, or (2) 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 securities of the
Company which are substantially similar to the Common Stock, including, but not
limited to, any security convertible into or exercisable or exchangeable for
Common Stock, whether any such transaction described in clause (1) or (2) above
is to be settled by delivery of Common Stock or such other securities, in cash
or otherwise. In addition, the undersigned agrees that, without the prior
written consent of the Underwriters, which shall not be unreasonably withheld,
it will not, during the period ending 90 days after the date of the Prospectus,
make
S-7
any demand for or exercise any right with respect to, the registration of any
shares of Common Stock or any security convertible into or exercisable or
exchangeable for Common Stock.
In furtherance of the foregoing, the Company and any duly appointed
transfer agent for the registration or transfer of the securities described
herein are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this Lock-Up Agreement.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Agreement. All authority
herein conferred or agreed to be conferred and any obligations of the
undersigned shall be binding upon the successors, assigns, heirs or personal
representatives of the undersigned.
The undersigned understands that, if the Underwriting Agreement (other
than the provisions thereof which survive termination) shall terminate or be
terminated prior to payment for and delivery of the Shares to be sold
thereunder, this Lock-Up Agreement shall terminate and be of no further force or
effect, and the undersigned shall be released from all obligations under this
Lock-Up Agreement.
The undersigned understands that the Underwriters propose to proceed
with the Public Offering in reliance upon this Lock-Up Agreement.
THIS LOCK-UP 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.
Very truly yours,
By:
----------------------------
Name:
Title:
Accepted as of the date first set forth above:
CIBC WORLD MARKETS CORP. X.X. XXXXXX SECURITIES INC.
By: By:
--------------------------- ----------------------------
Name: Name:
Title: Title:
S-8
Exhibit A-1
[Signatories to Lock-Up Agreements]
Xxxx X. Xxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxxx
Xxxxxx Xxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxx
Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Xxxxx Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxx X. Xxxxx
Xxxxx Xxxxxxx
Xxxxx Xxxxxxxx
Xxxxx Xxx Xxxxxx
S-9
