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EXHIBIT 1.1
OpTel, Inc.
[ ] Shares
Class A Common Stock
($0.01 par value per share)
UNDERWRITING AGREEMENT
New York, New York
, 1999
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
As Representatives of the several Underwriters
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
OpTel, Inc., a Delaware corporation (the "Company"), proposes
to sell to the several underwriters named in Schedule I hereto (the
"Underwriters"), for whom you (the "Representatives") are acting as
representatives, [ ] shares of Class A Common Stock, $0.01 par value per share
(the "Common Stock") of the Company, and the persons named in Schedule II hereto
(the "Selling Stockholders") propose to sell to the several Underwriters [ ]
shares of Common Stock (said shares to be issued and sold by the Company and
shares to be sold by the Selling Stockholders collectively being hereinafter
called the "Underwritten Securities"). The Company also proposes to grant to the
Underwriters an option to purchase up to [ ] additional shares of Common Stock
to cover over-allotments (the "Option Securities"; the Option Securities,
together with the Underwritten Securities, being hereinafter called the
"Securities"). To the extent there are no additional Underwriters listed on
Schedule I other than you, the term Representatives as used herein shall mean
you, as Underwriters, and the terms Representatives and Underwriters shall mean
either the singular or plural as the context requires. In addition, to the
extent that there is not more than one Selling Stockholder named in Schedule II,
the term Selling Stockholder shall mean either the singular or plural. The use
of the neuter in this Agreement shall include the feminine and masculine
wherever appropriate. Certain terms used herein are defined in Section 17
hereof.
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1. Representations and Warranties.
(i) The Company represents and warrants to, and agrees with,
each Underwriter as set forth below in this Section 1.
(a) The Company has prepared and filed with the Securities and
Exchange Commission (the "SEC") a registration statement (file number
333-56231) on Form S-1, including a related preliminary prospectus, for
the registration under the Act of the offering and sale of the
Securities. The Company may have filed one or more amendments thereto,
including a related preliminary prospectus, each of which has
previously been furnished to you. The Company will next file with the
SEC either (1) prior to the Effective Date of such registration
statement, a further amendment to such registration statement
(including the form of final prospectus) or (2) after the Effective
Date of such registration statement, a final prospectus in accordance
with Rules 430A and 424(b). In the case of clause (2), the Company has
included in such registration statement, as amended at the Effective
Date, all information (other than Rule 430A Information) required by
the Act and the rules thereunder to be included in such registration
statement and the Prospectus. As filed, such amendment and form of
final prospectus, or such final prospectus, shall contain all Rule 430A
Information, together with all other such required information, and,
except to the extent the Representatives shall agree in writing to a
modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not
completed at the Execution Time, shall contain only such specific
additional information and other changes (beyond that contained in the
latest Preliminary Prospectus) as the Company has advised you, prior to
the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as defined herein)
and on any date on which Option Securities are purchased, if such date
is not the Closing Date (a "settlement date"), the Prospectus (and any
supplements thereto) will, comply in all material respects with the
applicable requirements of the Act and the rules thereunder; on the
Effective Date and at the Execution Time, the Registration Statement
did not or will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading; and,
on the Effective Date, the Prospectus, if not filed pursuant to Rule
424(b), will not, and on the date of any filing pursuant to Rule 424(b)
and on the Closing Date and any settlement date, the Prospectus
(together with any supplement thereto) will not, 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 under which they were made, not misleading; provided,
however, that the Company makes no representation or
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warranty as to the information contained in or omitted from the
Registration Statement, or the Prospectus (or any supplement thereto)
in reliance upon and in conformity with information furnished in
writing to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion in the Registration
Statement or the Prospectus (or any supplement thereto).
(c) Each of the Company and each subsidiary of the Company (a
"Subsidiary"), has been duly incorporated or organized, and each is
validly existing as a corporation or limited partnership, as the case
may be, under the laws of its jurisdiction of incorporation or
organization, with all requisite power and authority to own or lease
its properties and to conduct its business as described in the
Prospectus. Each of the Company and the Subsidiaries (x) has all
necessary authorizations, approvals, orders, licenses and permits of
and from regulatory or governmental officials, bodies and tribunals, to
own or lease its properties and to conduct its businesses as now
conducted as described in the Prospectus and (y) is duly qualified to
do business as a foreign corporation and is in good standing in all
other jurisdictions where the ownership or leasing of its properties or
the conduct of its businesses requires such qualification, except, in
the case of clauses (x) and (y), where the failure to have such
authorizations, approvals, orders, licenses and permits or to be so
qualified could not reasonably be expected to have a material adverse
effect on the business, condition (financial or otherwise), assets,
results of operations or prospects of the Company and the Subsidiaries
taken as a whole (a "Material Adverse Effect").
(d) This Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization, execution
and delivery by parties thereto other than the Company) constitutes the
valid and binding obligations of the Company, enforceable against the
Company in accordance with the terms hereof, subject only to (a)
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights
and remedies generally and (b) general principles of equity (regardless
of whether enforcement is sought in a proceeding in equity or at law)
(clauses (a) and (b) being referred to herein as the "Enforceability
Limitations").
(e) No consent, authorization, approval, license or order of,
or filing, registration or qualification with, any court or
governmental or regulatory agency or body, domestic or foreign, is
required for the performance by the Company of its obligations under
this Agreement or for the consummation of the transactions contemplated
hereby, except such as have been obtained under the Act and the
Exchange Act and such as may be required by state securities or "blue
sky" laws in connection with the offer and sale of the Securities by
the Underwriters in the manner contemplated herein and in the
Prospectus.
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(f) The issuance of the Securities to be sold by the Company
and the sale and delivery of the Securities, the execution, delivery
and performance by the Company of this Agreement, the consummation by
the Company of the transactions contemplated hereby and as described in
the Prospectus and the compliance by the Company with the terms of the
foregoing do not, and, at the Closing Date, will not conflict with or
constitute or result in a breach or violation by the Company or the
Subsidiaries of (A) any of the terms or provisions of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) by any of the Company or the Subsidiaries or give
rise to any right to accelerate the maturity or require the prepayment
of any indebtedness under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Company or the Subsidiaries under any contract, indenture, mortgage,
deed of trust, loan agreement, note, lease, license, franchise
agreement, authorization, permit, certificate or other agreement or
document to which any of the Company or the Subsidiaries is a party or
by which any of them may be bound, or to which any of them or any of
their respective assets or businesses is subject (and the Company has
no knowledge of any conflict, breach or violation of such terms or
provisions or of any such default, in any such case, which has occurred
or will so result), (B) the articles or by-laws (each, an
"Organizational Document") of each of the Company and the Subsidiaries
or (C) any law, statute, rule or regulation, or any judgment, decree or
order, in any such case, of any domestic or foreign court or
governmental or regulatory agency or other body having jurisdiction
over the Company or any of the Subsidiaries or any of their respective
properties or assets.
(g) The audited consolidated financial statements (and the
related notes) and schedules of the Company and the Subsidiaries
included in the Prospectus and the Registration Statement present
fairly the consolidated financial position, results of operations and
cash flows of the Company and the Subsidiaries, at the dates and for
the periods to which they relate, and have been prepared in accordance
with generally accepted accounting principles ("GAAP") applied on a
consistent basis, and the unaudited historical consolidated financial
statements (and the related notes) of the Company and the Subsidiaries
included in the Prospectus and the Registration Statement present
fairly the consolidated financial position, results of operations and
cash flows of the Company and the Subsidiaries, at the dates and for
the periods to which they relate, and have been prepared in accordance
with GAAP, subject, in the case of interim financial statements, to
year-end adjustments as may be required by GAAP. To the knowledge of
the Company, Deloitte & Touche LLP, which has examined certain of such
financial statements and schedules as set forth in its report included
in the Prospectus, is an independent public accounting firm with
respect to the Company and the Subsidiaries as required by the Act and
the Exchange Act and the rules and regulations
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of the SEC thereunder (the "Act Regulations") and Rule 101 of the
American Institute of Certified Public Accountants (the "AICPA").
(h) Since the respective dates as of which information is
given in the Prospectus, except as otherwise specifically stated
therein, there has been no (A) significant change in or material
adverse change in the condition (financial or otherwise), assets,
results of operations or prospects of the Company or of the Company and
the Subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, (B) transaction entered into by any
of the Company or the Subsidiaries, other than in the ordinary course
of business, that is material to the Company and the Subsidiaries taken
as a whole or (C) dividend or distribution of any kind declared, paid
or made by the Company on its capital stock.
(i) At the Closing Date, the Company will have the authorized
and issued and outstanding capitalization set forth in the Prospectus
under the caption "Capitalization" (subject to the qualifications set
forth therein); the outstanding capital stock of the Company (including
the Securities being sold hereunder by the Selling Stockholders) and
each Subsidiary has been duly authorized and validly issued, is fully
paid and nonassessable and was not issued in violation of any
preemptive or similar rights (whether provided contractually or
pursuant to Organizational Documents); the Securities being sold
hereunder by the Company have been duly and validly authorized, and,
when issued and delivered to and paid for by the Underwriters pursuant
to this Agreement, will be fully paid and nonassessable; the Securities
being sold hereunder are duly listed, and admitted and authorized for
trading, subject to official notice of issuance and evidence of
satisfactory distribution, on the Nasdaq National Market; the
certificates for the Securities are in valid and sufficient form; the
holders of outstanding shares of capital stock of the Company are not
entitled to preemptive or other rights to subscribe for the Securities
or, if entitled to any such rights, have effectively waived such
rights; and, except as set forth in the Prospectus, no options,
warrants or other rights to purchase, agreements or other obligations
to issue, or rights to convert any obligations into or exchange any
securities for, shares of capital stock of or ownership interests in
the Company are outstanding.
(j) All of the outstanding shares of the Subsidiaries are
owned beneficially and of record by the Company or by another
Subsidiary, in each case, free and clear of all liens, encumbrances,
equities or claims of any kind whatsoever or restrictions on
transferability or voting.
(k) None of the Company or any of the Subsidiaries is (A) in
violation of its Organizational Documents, (B) in default in the
performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan agreement, note, lease, license, authorization,
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permit, certificate or other agreement or document to which the Company
or any Subsidiary is a party or by which it or any of them may be
bound, or to which any of the assets or businesses of the Company or
any Subsidiary is subject, or (C) in violation of any applicable law,
rule or regulation, or any judgment, order or decree of any domestic or
foreign court with jurisdiction over the Company or any Subsidiary, or
other governmental or regulatory authority with jurisdiction over the
Company or any Subsidiary which, in the case of (B) or (C), could have
a Material Adverse Effect.
(l) Except as described or reflected in the Prospectus
(exclusive of any supplement thereto) and except for matters not
required to be described therein, there is not pending or, to the
knowledge of the Company, threatened, any action, suit, proceeding,
inquiry or investigation to which the Company or any Subsidiary is a
party, or to which the rights of entry or assets of the Company or any
of the Subsidiaries is subject, before, or brought by, any court or
governmental or regulatory agency or body with jurisdiction over the
Company or any Subsidiary.
(m) Each of the Company and the Subsidiaries owns or
possesses, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, trademarks, inventions, service marks, trade names,
copyrights and know-how (including trade secrets and other proprietary
or confidential information, systems or procedures, whether patented or
unpatented) (collectively, "intellectual property") necessary to
conduct the business as it is now or, to its belief, proposed to be
operated by it as described in the Prospectus, except as described in
the Prospectus and except where the failure to own, possess or have the
ability to acquire any such intellectual property could not,
individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect; and, except as disclosed in the Prospectus,
neither the Company nor any of the Subsidiaries has received any notice
of infringement of or conflict with (or knows of any such infringement
of or conflict with) asserted rights of others with respect to any of
such intellectual property which, if such assertion of infringement or
conflict were sustained, would result in any Material Adverse Effect.
(n) Each of the Company and the Subsidiaries has obtained all
consents, approvals, orders, certificates, licenses, permits,
franchises and other authorizations (collectively, the "Licenses") of
and from, and has made all declarations and filings with, all
governmental or regulatory authorities, including, without limitation,
the Federal Communications Commission (the "FCC"), and all courts and
other tribunals necessary to own, lease, license and use its assets and
to conduct its businesses in the manner described in the Prospectus,
except where the failure to obtain such Licenses and make such
declarations and filings would not have a Material Adverse Effect.
Neither the Company nor any of the Subsidiaries has received any notice
of proceedings relating to the revocation or modification of, or denial
of any application for, any
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License which, if the subject of an unfavorable decision, ruling or
finding, would, singly or in the aggregate, have a Material Adverse
Effect; the Company and each of the Subsidiaries, have fulfilled and
performed all of their obligations with respect to all Licenses
possessed by any of them, except where the failure to so fulfill and
perform would not, singly or in the aggregate, have a Material Adverse
Effect; and no event has occurred which allows, or after notice or
lapse of time, or both, would allow, revocation or termination thereof
or result in any other material impairment of the rights of the holder
of any such License, except where such revocation or termination would
not, singly or in the aggregate, have a Material Adverse Effect; and
the Licenses referred to above contain no restrictions on the Company
or any of the Subsidiaries that are not described in the Prospectus,
except where such restrictions would not, singly or in the aggregate,
have a Material Adverse Effect.
(o) There are no legal, governmental or regulatory proceedings
affecting the business of the Company or any Subsidiary, including,
without limitation, before the FCC, actions, suits, inquiries or
investigations which, if applicable, would be required to be described
in the Registration Statement or Prospectus that are not described, nor
any laws, rules, regulations, contracts or other documents which, under
such circumstances, would be required to be described in the
Registration Statement or Prospectus by the Act or by the Act
Regulations that have not been so described.
(p) Each of the Company and the Subsidiaries has filed all
necessary income, franchise and other tax returns due, and has paid any
taxes assessed by the due date for payment thereof, except where such
taxes are being contested in good faith or where the failure to file
and pay such taxes would not have a Material Adverse Effect.
(q) Except as described in the Prospectus (exclusive of any
supplement thereto), none of the Company nor any of the Subsidiaries
has incurred any liability for any prohibited transaction or funding
deficiency or any complete or partial withdrawal liability with respect
to any pension, profit sharing or other plan which is subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
to which the Company or the Subsidiaries makes or ever has made a
contribution and in which any employee of the Company or any such
Subsidiary is or has ever been a participant, which, individually or in
the aggregate, could reasonably be expected to have or result in a
Material Adverse Effect. With respect to such plans, each of the
Company and the Subsidiaries is in compliance in all respects with all
applicable provisions of ERISA, except where the failure to so comply
could not, individually or in the aggregate, reasonably be expected to
have or a result in a Material Adverse Effect.
(r) Except as described in the Prospectus (exclusive of any
supplement thereto) there are no mortgages, charges or security
arrangements nor any consensual encumbrances or other arrangements
which restrict the ability of any Subsidiary (i) to
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pay dividends or make any other distributions on such Subsidiary's
shares or to pay any indebtedness owed to the Company or any other
Subsidiary, (ii) to make any loans or advances to, or investments in,
the Company or any other Subsidiary or (iii) to transfer any of its
property or assets to the Company or any other Subsidiary.
(s) Except as described in the Prospectus (exclusive of any
supplement thereto), to the knowledge of the Company, there are no
defaults under any Right of Entry (as defined in the Prospectus) by any
party thereunder or notices of termination or non-renewal with respect
thereto, except for such defaults or notices as, individually or in the
aggregate, cannot reasonably be expected to have a Material Adverse
Effect.
(t) The market-related data and estimates included in the
Prospectus are based on or derived from independent sources which the
Company believes to be reliable and accurate.
(u) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended, without taking account of any exemption arising out of the
number of holders of the Company's securities.
(v) Except for Securities included by Selling Stockholders in
the Registration Statement and for rights that have been waived or have
failed to be exercised in accordance with the terms thereof, no holders
of securities of the Company have rights to require the registration of
such securities under the Registration Statement.
(w) There are no transfer taxes or other similar fees or
charges under Federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company
or sale by the Company of the Securities.
(x) The Company has not taken, directly or indirectly (other
than through the actions, if any, of the Underwriters), any action
designed to or which has constituted or which might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(y) Except as disclosed in the Registration Statement and the
Prospectus, the Company (i) does not have any material lending or other
relationship with any bank or lending affiliate of Xxxxxxx Xxxxx Xxxxxx
Holdings Inc. and (ii) does not intend to use any of the proceeds from
the sale of the Securities hereunder to repay any outstanding debt owed
to any affiliate of Xxxxxxx Xxxxx Barney Holdings Inc.
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(z) The Company is in material compliance with the SEC's staff
legal bulletin No. 5 dated October 8, 1997 related to Year 2000
compliance.
Any certificate signed by any two officers of the Company and
delivered to the Representatives or to Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Underwriters ("Counsel for the Underwriters"), in connection with the offering
of the Securities shall be deemed a representation and warranty by the Company,
as to matters covered thereby, to each Underwriter.
(ii) Each Selling Stockholder represents and warrants to, and
agrees with, each Underwriter that:
(a) Such Selling Stockholder is the lawful owner of the
Securities to be sold by such Selling Stockholder hereunder and upon
sale and delivery of, and payment for, such Securities, as provided
herein, such Selling Stockholder will convey to the Underwriters good
and marketable title to such Securities, free and clear of all liens,
encumbrances, equities and claims whatsoever (other than those created
by this Agreement or by the Custody Agreement and Power of Attorney
dated as of the date hereof among each Selling Stockholder, the
Attorney-in-Fact named therein and the Custodian named therein (the
"Custody Agreement")).
(b) Such Selling Stockholder has not taken, directly or
indirectly (other than through the actions, if any, of the
Underwriters), any action designed to or which has constituted or which
might reasonably be expected to cause or result in, under the Exchange
Act or otherwise, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(c) Certificates in negotiable form for such Selling
Stockholder's Securities have been placed in custody, for delivery
pursuant to the terms of this Agreement, under a Custody Agreement and
Power of Attorney duly authorized, executed and delivered by such
Selling Stockholder, in the form heretofore furnished to you (the
"Custody Agreement") with American Stock Transfer & Trust Company, as
Custodian (the "Custodian"); the Securities represented by the
certificates so held in custody for such Selling Stockholder are
subject to the interests hereunder of the Underwriters; the
arrangements for custody and delivery of such certificates, made by
such Selling Stockholder hereunder and under the Custody Agreement, are
not subject to termination by any acts of such Selling Stockholder, or
by operation of law, whether by the death or incapacity of such Selling
Stockholder or the occurrence of any other event; and if any such
death, incapacity or any other such event shall occur before the
delivery of such Securities hereunder, certificates for the Securities
will be delivered by the Custodian in accordance with the terms and
conditions of this Agreement and the Custody Agreement as if such
death, incapacity or other event had not occurred, regardless of
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whether or not the Custodian shall have received notice of such death,
incapacity or other event.
(d) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by such
Selling Stockholder of the transactions contemplated herein, except
such as may have been obtained under the Act and such as may be
required by state securities or "blue sky" laws in connection with the
purchase and distribution of the Securities by the Underwriters in the
manner contemplated herein and in the Prospectus.
(e) Neither the sale of the Securities being sold by such
Selling Stockholder nor the consummation of any other of the
transactions herein contemplated by such Selling Stockholder or the
fulfillment of the terms hereof by such Selling Stockholder will
conflict with, result in a breach or violation of, or constitute a
default under any law or the charter or by-laws or similar
organizational documents of such Selling Stockholder, if such Selling
Stockholder is not an individual, or the terms of any indenture or
other agreement or instrument to which such Selling Stockholder or any
of its subsidiaries is a party or bound, or any judgment, order or
decree applicable to such Selling Stockholder or any of its
subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over such Selling
Stockholder or any of its subsidiaries.
(f) Such Selling Stockholder has no reason to believe that the
representations and warranties of the Company contained in this Section
1 are not true and correct, is familiar with the Registration Statement
and has no knowledge of any material fact, condition or information not
disclosed in the Prospectus or any supplement thereto which has
adversely affected or may adversely affect the business of the Company
or any of its subsidiaries; and the sale of Securities by such Selling
Stockholder pursuant hereto is not prompted by any information
concerning the Company or any of its subsidiaries which is not set
forth in the Prospectus or any supplement thereto.
(g) In respect of any statements in or omissions from the
Registration Statement or the Prospectus or any supplements thereto
made in reliance upon and in conformity with information furnished in
writing to the Company by any Selling Stockholder specifically for use
in connection with the preparation thereof, such Selling Stockholder
hereby makes the same representations and warranties to each
Underwriter as the Company makes to such Underwriter under paragraph
(i)(b) of this Section.
Any certificate signed by any officer, partner, trustee or
similar person of any Selling Stockholder (or by such Selling Stockholder, if an
individual) and delivered to the Representatives or Counsel for the Underwriters
in connection with the offering of the Secu-
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rities shall be deemed a representation and warranty by such Selling
Stockholder, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and conditions
and in reliance upon the representations and warranties herein set forth, the
Company and the Selling Stockholders agree, severally and not jointly, to sell
to each Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Company and the Selling Stockholders, at a purchase price of
$[ ] per share, the amount of the Underwritten Securities set forth opposite
such Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth, the Company hereby grants
an option to the several Underwriters to purchase up to [ ] Option Securities at
the same purchase price per share as the Underwriters shall pay for the
Underwritten Securities. Said option may be exercised only to cover
over-allotments in the sale of the Underwritten Securities by the Underwriters.
Said option may be exercised in whole or in part at any time (but not more than
once) on or before the 30th day after the date of the Prospectus upon written or
telegraphic notice by the Representatives to the Company setting forth the
number of shares of the Option Securities as to which the several Underwriters
are exercising the option and the settlement date (the "Option Closing Date").
Delivery of certificates for the shares of Option Securities by the Company, and
payment therefor to the Company, shall be made as provided in Section 3 hereof.
The number of shares of the Option Securities to be purchased by each
Underwriter shall be the same percentage of the total number of shares of the
Option Securities to be purchased by the several Underwriters as such
Underwriter is purchasing of the Underwritten Securities, subject to such
adjustments as you in your absolute discretion shall make to eliminate any
fractional shares.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the third Business
Day prior to the Closing Date) shall be made at 10:00 AM, New York City time, on
[ ], 1999, or at such time on such later date not more than three Business Days
after the foregoing date as the Representatives shall designate, which date and
time may be postponed by agreement among the Representatives, the Company and
the Selling Stockholders or as provided in Section 9 hereof (such date and time
of delivery and payment for the Securities being herein called the "Closing
Date"). Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the respective aggregate purchase
prices of the Securities being sold by the Company and each of the Selling
Stockholders to or upon the order of the Company and the Selling Stockholders by
wire transfer payable in same-day funds to the accounts specified by the Company
and the Selling Stockholders. Delivery of the Underwritten Securities and the
Option Securities shall
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be made through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
Each Selling Stockholder will pay all applicable state
transfer taxes, if any, involved in the transfer to the several Underwriters of
the Securities to be purchased by them from such Selling Stockholder and the
respective Underwriters will pay any additional stock transfer taxes involved in
further transfers.
If the option provided for in Section 2(b) hereof is exercised
after the third Business Day prior to the Closing Date, the Company will deliver
the Option Securities to the Representatives on the date specified by the
Representatives (which shall be within three Business Days after exercise of
said option) for the respective accounts of the several Underwriters, against
payment by the several Underwriters through the Representatives of the purchase
price thereof to or upon the order of the Company by wire transfer payable in
same-day funds to the account specified by the Company. If settlement for the
Option Securities occurs after the Closing Date, the Company will deliver to the
Representatives on the settlement date for the Option Securities, and the
obligation of the Underwriters to purchase the Option Securities shall be
conditioned upon receipt of, supplemental opinions, certificates and letters
confirming as of such date the opinions, certificates and letters delivered on
the Closing Date pursuant to Section 6 hereof.
The documents required to be delivered by this Section 3 and
by Section 6 shall be delivered at the office of Counsel for the Underwriters at
00 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.
5. Agreements.
(i) The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment to
the Registration Statement or supplement to the Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a
copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has
become or becomes effective pursuant to Rule 430A, or filing of the
Prospectus is otherwise required under Rule 424(b), the Company will
cause the Prospectus, properly completed, and any supplement thereto to
be filed with
13
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the SEC pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Company will promptly advise
the Representatives (1) when the Registration Statement, if not
effective at the Execution Time, shall have become effective, (2) when
the Prospectus, and any supplement thereto, shall have been filed (if
required) with the SEC pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the SEC, (3) when,
prior to termination of the offering of the Securities, any amendment
to the Registration Statement shall have been filed or become
effective, (4) of any request by the SEC or its staff for any amendment
of the Registration Statement, or any Rule 462(b) Registration
Statement, or for any supplement to the Prospectus or for any
additional information, (5) of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (6)
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the institution or threatening of any proceeding for
such purpose. The Company will use its best efforts to prevent the
issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then supplemented would include
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement or supplement the
Prospectus to comply with the Act or the rules thereunder, the Company
promptly will (1) notify the Representatives of any such event; (2)
prepare and file with the SEC, subject to the second sentence of
paragraph (i)(a) of this Section 5, an amendment or supplement which
will correct such statement or omission or effect such compliance; and
(3) supply any supplemented Prospectus to you in such quantities as you
may reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an
earnings statement or statements of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters signed copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so
long as delivery of a prospectus by an Underwriter or dealer may be
14
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required by the Act, as many copies of each Preliminary Prospectus and
the Prospectus and any supplement thereto as the Representatives may
reasonably request.
(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate and will maintain
such qualifications in effect so long as required for the distribution
of the Securities; provided, however, that in no event shall the
Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action that would
subject it to taxation or service of process in suits, in each case
other than as to matters and transactions arising out of the offering
or sale of the Securities, in any jurisdiction where it is not now so
subject.
(f) The Company will not, without the prior written consent of
Xxxxxxx Xxxxx Xxxxxx Inc., for a period of [180] days following the
Execution Time, offer, sell or contract to sell, or otherwise dispose
of (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the Company or any affiliate of the Company or any person
in privity with the Company or any affiliate of the Company) directly
or indirectly, or announce the offering of, any other shares of Common
Stock or any securities convertible into, or exchangeable for, shares
of Common Stock; provided, however, that (i) the Company may issue and
sell Common Stock pursuant to any employee stock option plan, stock
ownership plan or dividend reinvestment plan of the Company in effect
on the Closing Date, (ii) the Company may issue Common Stock issuable
upon the conversion of securities or the exercise of warrants or
options outstanding at the Execution Time and (iii) the Company may
issue Common Stock (or securities convertible into, or exchangeable
for, shares of Common Stock) as consideration or partial consideration
for acquisitions, whether by stock purchase, merger, purchase of all or
substantially all of the assets of such person or otherwise, provided,
further, that in connection with any issuance or issuance and sale
permitted under clause (iii) of the previous proviso, the Company
agrees (A) to obtain from each person receiving shares of Common Stock
(or securities convertible into, or exchangeable for, shares of Common
Stock) a letter substantially consistent with Exhibit A hereto and (B)
not to grant any rights exercisable prior to the date [180] days after
the date of this Agreement with respect to the registration under the
Act of any shares of Common Stock (or securities convertible into, or
exchangeable for, shares of Common Stock) issued in connection with
such transaction.
(g) The Company will not take, directly or indirectly (other
than through the Underwriters), any action designed to or which has
constituted or which might reasonably be expected to cause or result,
under the Exchange Act or otherwise, in stabi-
15
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lization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(h) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation, printing or reproduction
and filing with the SEC of the Registration Statement (including
financial statements and exhibits thereto), each Preliminary
Prospectus, the Prospectus, and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and packaging) of
such copies of the Registration Statement, each Preliminary Prospectus,
the Prospectus, and all amendments or supplements to any of them, as
may, in each case, be reasonably requested for use in connection with
the offering and sale of the Securities; (iii) the preparation,
printing, authentication, issuance and delivery of certificates for the
Securities, including any stamp or transfer taxes in connection with
the original issuance and sale of the Securities sold by the Company;
(iv) the printing (or reproduction) and delivery of this Agreement, any
blue sky memorandum and all other agreements or documents printed (or
reproduced) and delivered in connection with the offering of the
Securities; (v) the registration of the Securities under the Exchange
Act and the listing of the Securities on the Nasdaq National Market;
(vi) any registration or qualification of the Securities for offer and
sale under the securities or blue sky laws of the several states
(including filing fees and the reasonable fees and expenses of counsel
for the Underwriters relating to such registration and qualification);
(vii) any filings required to be made with the National Association of
Securities Dealers, Inc. (including filing fees and the reasonable fees
and expenses of counsel for the Underwriters relating to such filings);
(viii) the transportation and other expenses incurred by or on behalf
of Company representatives in connection with presentations to
prospective purchasers of the Securities; (ix) the fees and expenses of
the Company's accountants and the fees and expenses of counsel
(including local and special counsel) for the Company; (x) all other
costs and expenses incident to the performance by the Company of their
obligations hereunder; and (xi) all fees, costs and expenses of the
Selling Stockholders for which the Company is obligated pursuant to the
terms of the applicable agreement granting such Selling Stockholders
registration rights in the Offering.
(ii) Each Selling Stockholder agrees with the several
Underwriters that:
(a) Such Selling Stockholder will not, without the prior
written consent of Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to
sell, pledge or otherwise dispose of, or file (or participate in the
filing of) a registration statement with the SEC in respect of, or
establish or increase a put equivalent position or liquidate or
decrease a call equivalent position within the meaning of Section 16 of
the Exchange Act with respect to, any shares of capital stock of the
Company or any securities convertible into or ex-
16
-16-
ercisable or exchangeable for such capital stock, or publicly announce
an intention to effect any such transaction, for a period of 180 days
after the date of this Agreement, other than shares of Common Stock
disposed of as bona fide gifts approved by Xxxxxxx Xxxxx Barney Inc. or
as distributions from a decedent's estate.
(b) Such Selling Stockholder will not take any action designed
to or which has constituted or which might reasonably be expected to
cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(c) Such Selling Stockholder will advise you promptly, and if
requested by you, will confirm such advice in writing, so long as
delivery of a prospectus relating to the Securities by an underwriter
or dealer may be required under the Act, of (i) any material change in
the Company's condition (financial or otherwise), prospects, earnings,
business or properties, (ii) any change in information in the
Registration Statement or the Prospectus relating to such Selling
Stockholder or (iii) any new material information relating to the
Company or relating to any matter stated in the Prospectus which comes
to the attention of such Selling Stockholder.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Stockholders contained herein as of the Execution Time, the Closing Date and any
settlement date pursuant to Section 3 hereof, to the accuracy of the statements
of the Company and the Selling Stockholders made in any certificates delivered
pursuant to the provisions hereof, to the performance by the Company and the
Selling Stockholders of their respective obligations hereunder and to the
following additional conditions:
(a) If the Registration Statement has not become effective
prior to the Execution Time, unless the Representatives agree in
writing to a later time, the Registration Statement will become
effective not later than (i) 6:00 PM New York City time on the date of
determination of the public offering price, if such determination
occurred at or prior to 3:00 PM New York City time on such date or (ii)
9:30 AM on the Business Day following the day on which the public
offering price was determined, if such determination occurred after
3:00 PM New York City time on such date; if filing of the Prospectus,
or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus, and any such supplement, will be filed in the manner and
within the time period required by Rule 424(b); and no stop order
suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or threatened.
17
-17-
(b) The Company shall have furnished to the Representatives
the opinion of Kronish Xxxx Xxxxxx & Xxxxxxx LLP, counsel for the
Company, dated the Closing Date in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is
validly existing under the laws of the State of Delaware, with
corporate power and authority to own, lease and operate its
assets and properties and conduct its business as described in
the Prospectus and to enter into and perform its obligations
under this Agreement;
(ii) The authorized, and to the knowledge of such
counsel based solely upon a review of the Company's stock
ledger and corporate records and a certificate of the transfer
agent, the issued and outstanding capital stock of the Company
is as set forth in the Prospectus under the caption
"Capitalization" (subject to the qualifications set forth
therein); the capital stock of the Company conforms in all
material respects to the description thereof contained in the
Prospectus; the outstanding shares of Common Stock (including
the Securities being sold hereunder by the Selling
Stockholders) have been duly and validly authorized and issued
and are fully paid and nonassessable; the Securities being
sold hereunder by the Company have been duly and validly
authorized, and, when issued and delivered to and paid for by
the Underwriters pursuant to this Agreement, will be fully
paid and nonassessable; the Securities being sold hereunder
are duly listed, and admitted and authorized for trading,
subject to official notice of issuance and evidence of
satisfactory distribution, on the Nasdaq National Market; the
certificates for the Securities are in valid and sufficient
form; the holders of outstanding shares of capital stock of
the Company are not entitled to preemptive or other rights to
subscribe for the Securities or, if entitled to any such
rights, have effectively waived such rights; and, to the
knowledge of such counsel except as set forth in the
Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert
any obligations into or exchange any securities for, shares of
capital stock of or ownership interests in the Company are
outstanding;
(iii) The Registration Statement has become effective
under the Act; any required filing of the Prospectus, and any
supplements thereto, pursuant to Rule 424(b) has been made in
the manner and within the time period required by Rule 424(b);
to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued,
no proceedings for that purpose have been instituted or
threatened and the Registration State-
18
-18-
ment and the Prospectus (other than the financial statements
and related notes, the financial statement schedules and other
financial and statistical information contained therein, as to
which such counsel need express no opinion) comply as to form
in all material respects with the applicable requirements of
the Act and the rules thereunder;
(iv) This Agreement has been duly authorized,
executed and delivered by the Company;
(v) No consent, approval, authorization, license,
qualification or order of or filing or registration with, any
court or governmental or regulatory agency or body of the
United States or the State of New York or under the General
Corporation Law of the State of Delaware is required for the
execution and delivery by the Company of this Agreement or for
the issue and sale of the Securities or the consummation by
the Company of any of the transactions contemplated herein,
except (A) such as have been obtained under the Act, (B) such
as may be required under the "blue sky" laws of any
jurisdiction in connection with the purchase and distribution
of the Securities by the Underwriters in the manner
contemplated herein and in the Prospectus (as to which such
counsel need express no opinion), (C) under the Rules and
Regulations of the FCC ("FCC Rules") or under any rules or
regulations of any State regulatory commissions ("State
Rules") responsible for the regulation of
cable/telecommunications services (as to which such counsel
need express no opinion) and (D) such as have been obtained or
made, as the case may be;
(vi) The issuance, sale and delivery of the
Securities, the execution, delivery and performance by the
Company of this Agreement (in each case assuming due
authorization and execution by each party other than the
Company) and the consummation by the Company of the
transactions contemplated hereby and the compliance by the
Company with the terms of the foregoing do not, will not,
conflict with or constitute or result in a breach or violation
by the Company or any of the Subsidiaries of (A) any provision
of the Certificate of Incorporation or By-laws of the Company,
(B) any of the terms or provisions of, or constitute a default
(or an event which, with notice or lapse of time or both,
would constitute a default) by the Company, or give rise to
any right to accelerate the maturity or require the prepayment
of any indebtedness under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Subsidiary under any
material agreements or instruments (excluding any licenses or
authorizations granted under the FCC Rules or State Rules, as
to which such counsel need express no opinion) known to such
counsel or (C) any law, statute, rule, or regulation (ex-
19
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cept for the FCC Rules and State Rules, as to which such
counsel need express no opinion) of the United States or the
State of New York or under the General Corporation Law of the
State of Delaware or any order, decree or judgment known to
such counsel to be applicable to the Company or any
Subsidiary, of any court or governmental or regulatory agency
or body or arbitrator in the United States or the States of
New York or Delaware;
(vii) The statements in the Prospectus under the
headings "Prospectus Summary -- The Offering", "Description of
Capital Stock," and "Certain Relationships and Related
Transactions," insofar as such statements purport to summarize
certain provisions of the Offering, the Company's authorized
and outstanding capital stock and certain agreements to which
the Company is a party, provide a fair summary of such
provisions of such agreements and instruments;
(viii) Neither the Company nor any of the
Subsidiaries is and, after giving effect to the offering and
sale of the Securities and the application of the proceeds
thereof as described in the Prospectus, will be an "investment
company" or a company "controlled by" or required to register
as an investment company as such terms are defined in the
Investment Company Act of 1940, as amended, and the rules and
regulations thereunder;
(ix) The statements in the Prospectus under the
caption "Certain Federal Income Tax Considerations" provide a
fair summary of the matters therein described; and
(x) Except for Securities included by Selling
Stockholders in the Registration Statement and for rights that
have been waived or have failed to be exercised in accordance
with the terms thereof, no holders of securities of the
Company have rights to require the registration of such
securities under the Registration Statement.
In addition, such counsel shall state that they have
participated in conferences with officers and other representatives of
the Company, representatives of the independent certified public
accountants of the Company and the Representatives and their
representatives, at which the contents of the Prospectus and the
Registration Statement and related matters were discussed and, although
such counsel has not undertaken to investigate or verify independently,
and do not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration Statement
(except as indicated above), on the basis of the foregoing, they have
no reason to believe that at the Effective Date or at the Execution
Time the Registration Statement contained or contains an untrue
statement of a material fact or omitted or omits to state
20
-20-
a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading or that
the Prospectus as of its date and on the Closing Date included or
includes any untrue statement of a material fact or omitted 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
(except, in each case, such counsel need express no comment as to the
financial statements and related notes, the financial statement
schedules and other financial and statistical data included therein).
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other
than the laws of the State of New York, the general corporate laws of
the State of Delaware or the laws of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion of
other counsel of good standing whom they believe to be reliable and who
are satisfactory to Counsel for the Representatives, including
Goldberg, Godles, Wiener & Xxxxxx and (B) as to matters of fact, to the
extent they deem proper, on certificates of responsible officers of the
Company and public officials.
All references in this Section 6(b) to the Prospectus shall be
deemed to include any amendment or supplement thereto at the Closing
Date. The opinion of such counsel shall be rendered to the Underwriters
at the request of the Company and shall so state therein.
(c) The Company shall have furnished to the Representatives
the opinion of Xxxxxxx Xxxxxxxxxxx, Vice President and General Counsel
of the Company, dated the Closing Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and each
of the Company and the Subsidiaries is validly existing as a
corporation or limited partnership in good standing under the
laws of the jurisdiction in which it is organized, with full
power and authority to own its properties and conduct its
business as described in the Prospectus, and is duly qualified
to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction which requires
such qualification wherein it owns or leases material
properties or conducts material business, except where the
failure be in good standing or to so qualify would not have a
Material Adverse Effect;
(ii) All the outstanding shares of capital stock of
the Company and each Subsidiary have been duly and validly
authorized and issued and are fully paid and nonassessable,
and all outstanding shares of capital stock of the
Sub-
21
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sidiaries are owned by the Company either directly or through
other Subsidiaries free and clear of any security interests,
liens or encumbrances;
(iii) The issuance, sale and delivery of the
Securities, the execution, delivery and performance by the
Company of this Agreement (in each case assuming due
authorization and execution by each party other than the
Company) and the consummation by the Company of the
transactions contemplated hereby and the compliance by the
Company with the terms of the foregoing do not, and, at the
Closing Date, will not, conflict with or constitute or result
in a breach or violation by the Company or any of the
Subsidiaries of (A) any provision of the Certificate of
Incorporation or By-laws of the Company or any of the
Subsidiaries, (B) any of the terms or provisions of, or
constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) by the Company or
any of the Subsidiaries, or give rise to any right to
accelerate the maturity or require the prepayment of any
indebtedness under, or result in the creation of imposition of
any lien, charge or encumbrance upon any property or assets of
the Company or any of the Subsidiaries under any material
agreements or instruments known to such counsel or (C) any
order, decree or judgment known to such counsel to be
applicable to the Company or any Subsidiary, of any court or
governmental or regulatory agency or body or arbitrator in the
United States or the States of New York or Delaware;
(iv) The statements in the Prospectus under the
headings "Risk Factors -- Risks Associated with Rights of
Entry", and "Business -- Legal Proceedings" fairly summarize
the legal matters therein described;
(v) To the knowledge of such counsel (no search of
court or administrative records having been made), no material
legal or governmental or regulatory proceedings (including
proceedings by or before the FCC) are pending to which the
Company or any of the Subsidiaries is a party or to which the
business of the Company or any of the Subsidiaries is subject
that is not described or reflected in the Registration
Statement or Prospectus as required, and no such proceedings
have been threatened against the Company or any of the
Subsidiaries or with respect to any of their assets; and there
is no material contract, agreement or other document not
described or referred to in the Registration Statement or
Prospectus;
(vi) To such counsel's knowledge (no search of court
or administrative records having been made), (i) no
application, action, complaint, investigation or proceeding is
pending or directly threatened that is likely to result in the
denial of any pending application for the renewal,
modification or assignment of any of the licenses, special
temporary authorizations, conditional li-
22
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censes, construction permits and other authorizations issued
by the FCC in favor of the Company and the Subsidiaries
(collectively, "FCC Authorizations") for the conduct of their
business as described in the Prospectus, and (ii) except for
proceedings of general applicability, there are no proceedings
or actions pending that could result in the revocation,
materially adverse modification or suspension of any of the
FCC Authorizations, the issuance of a cease and desist order,
or the imposition of any administrative or judicial sanction,
including but not limited to a monetary forfeiture, except in
each case as disclosed in the Prospectus or such as,
individually or in the aggregate, would not have a Material
Adverse Effect; and
(vii) To such counsel's knowledge, each FCC report,
registration, certification and notice required to be filed at
the FCC and relating to any of the FCC Authorizations or the
Company and the Subsidiaries, including but not limited to
annual Equal Employment Opportunity Reports, has been timely
filed, except as disclosed in the Prospectus or for such
reports the non-filing or failure to timely file of which
individually or in the aggregate would not have a Material
Adverse Effect.
In addition, such counsel shall state that he has no reason to
believe that at the Effective Date or at the Execution Time the
Registration Statement contained or contains an untrue statement of a
material fact or omitted 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 or that the Prospectus as of its
date and on the Closing Date included or includes any untrue statement
of a material fact or omitted 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 (except, in
each case, such counsel need express no comment as to the financial
statements and related notes, the financial statement schedules and
other financial and statistical data included therein).
In rendering such opinion, such counsel may rely as to matters
involving the application of laws of any jurisdiction other than the
laws of the State of New York or the laws of the United States, to the
extent he deems proper and specified in such opinion, upon the opinion
of other counsel of good standing whom he believes to be reliable and
who are satisfactory to Counsel for the Underwriters.
All references in this Section 6(c) to the Prospectus shall be
deemed to include any amendment or supplement thereto at the Closing
Date. The opinion of such counsel shall be rendered to the Underwriters
at the request of the Company and shall so state therein.
23
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(d) The Company shall have furnished to the Underwriters the
opinion of Goldberg, Godles, Wiener & Xxxxxx, FCC counsel for the
Company, dated the Closing Date, in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) To such counsel's knowledge, the Company and the
Subsidiaries are in compliance in all material respects with
each of the FCC Authorizations for the conduct of their
business as described in the Prospectus and all such FCC
Authorizations represent all FCC Authorizations necessary for
the conduct of the business of the Company and the
Subsidiaries as presently conducted and described in the
Prospectus;
(ii) To such counsel's knowledge, (i) except as set
forth on a schedule to such opinion letter, no application,
action or proceeding is pending for the renewal, modification
or assignment of any of the FCC Authorizations, (ii) no
application, action, complaint, investigation or proceeding is
pending or directly threatened that is likely to result in the
denial of any such application and (iii) except for
proceedings of general applicability, there are no proceedings
or actions pending that are likely to result in the
revocation, materially adverse modification or suspension of
any of the FCC Authorizations, the issuance of a cease and
desist order, or the imposition of any administrative or
judicial sanction, including but not limited to a monetary
forfeiture; and all renewal applications required to be filed
by the FCC's Rules have been filed;
(iii) To such counsel's knowledge, each FCC report,
registration, certification and notice required to be filed at
the FCC and relating to any of the FCC Authorizations or the
Company and the Subsidiaries, including but not limited to
annual Equal Employment Opportunity Reports, has been timely
filed, except for such reports the non-filing of which
individually or in the aggregate would not have a Material
Adverse Effect;
(iv) The execution, delivery and performance by the
Company of its obligations under this Agreement and the
transactions contemplated herein, did not or will not result
in a violation of the Communications Act, the Cable Acts and
the Telecommunications Act (each as defined in the
Registration Statement) or any order, rule or regulation of
the FCC;
(v) No consent, approval, authorization, order or
registration of or with the FCC is required under the
Communications Act, the Cable Acts, the Telecommunications Act
or the rules and regulations of the FCC for the execution and
delivery by the Company of, and the performance by the Company
of its obligations under, this Agreement;
24
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(vi) Other than matters described in the Prospectus
and except as to any other matters relating to the
multichannel television and telecommunications industries in
general, such counsel does not know of any proceedings
threatened or pending before the FCC against or involving the
properties, businesses or franchises of the Company which
could reasonably be expected to have a Material Adverse
Effect; and
(vii) The statements in the Prospectus under the
captions "Risk Factors -- Regulation", "--Risks Associated
with Telecommunications Strategy", "--Uncertainties Related to
the Availability of Radio Spectrum", "--Foreign Ownership
Restrictions" and "--Risks Associated with Rights of Entry"
and "Business -- Regulation" insofar as such statements
summarize applicable provisions of the Communications Act, the
Cable Acts and the Telecommunications Act and the published
orders, rules and regulations of the FCC promulgated
thereunder are accurate summaries in all material respects of
the provisions purported to be summarized under such captions
in the Prospectus; and the statutes and regulations summarized
in such captions are statutes and regulations enforced or
promulgated by the FCC that are material to the Company's
business as described in the Prospectus.
In rendering such opinion, such counsel may state that it
expresses no opinion with respect to any matters other than those
arising under the Communications Act, the Telecommunications Act and
the Cable Acts and the published rules and regulations promulgated
thereunder by the FCC, and may rely as to all matters of fact relevant
to such opinion on certificates and written statements of officers and
employees of the Company; provided, however, that all such certificates
and statements shall be satisfactory to the Representatives in all
material respects and attached to such counsel's opinion. In addition,
counsel may note that item (v) above is qualified by the requirement to
file certain corporate and loan instruments with the FCC within 30 days
of the Closing Date.
(e) Each Selling Stockholder shall have furnished to the
Representatives the opinion of counsel for such Selling Stockholder, in
each case dated the Closing Date and in form and substance reasonably
satisfactory to the Representatives.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other
than the State of New York or Delaware or the Federal laws of the
United States, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the
Underwriters, and (B) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Selling
Stockholders and public officials. The opinion of such
25
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counsel shall be rendered to the Underwriters at the request of the
Company and shall so state therein.
(f) The Representatives shall have received from Counsel for
the Underwriters, such opinion or opinions, dated the Closing Date and
addressed to the Representatives, with respect to the issuance and sale
of the Securities, the Registration Statement, the Prospectus (together
with any supplement thereto) and other related matters as the
Representatives may reasonably require, and the Company and each
Selling Stockholder shall have furnished to such counsel such documents
as they reasonably request for the purpose of enabling them to pass
upon such matters. The opinion or opinions of such counsel shall be
rendered to the Underwriters at the request of the Company and shall so
state therein.
(g) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the
Company, dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the
Prospectus, any supplements to the Prospectus and this Agreement and
that:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and the Company has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings
for that purpose have been instituted or, to the Company's
knowledge, threatened; and
(iii) since the date of the most recent financial
statements included in the Prospectus (exclusive of any
supplement thereto), there has been no material adverse effect
on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any
supplement thereto).
26
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(h) Each Selling Stockholder shall have furnished to the
Representatives a certificate, signed by an authorized officer,
partner, trustee or similar person of such Selling Stockholder (or by
such Selling Stockholder if any individual), dated the Closing Date, to
the effect that the signer of such certificate have carefully examined
the Registration Statement, the Prospectus, any supplement to the
Prospectus and this Agreement and that the representations and
warranties of such Selling Stockholder in this Agreement are true and
correct in all material respects on and as of the Closing Date to the
same effect as if made on the Closing Date.
(i) At the Execution Time and at the Closing Date, Deloitte &
Touche LLP shall have furnished to the Representatives a letter or
letters, dated respectively as of the Execution Time and as of the
Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants
within the meaning of the Act and the Exchange Act and the applicable
published rules and regulations thereunder and Rule 101 of the Code of
Professional Conduct of the American Institute of Certified Public
Accountants ("AICPA") and containing statements and information of the
type ordinarily included in accountants' "comfort letters" to
Representatives with respect to financial statements and certain
financial information contained in the Prospectus, in form and
substance satisfactory to Counsel for the Underwriters.
Deloitte & Touche LLP shall have also furnished to the
Representatives a letter stating that the Company's system of internal
accounting controls taken as a whole is sufficient to meet the broad
objectives of internal accounting control insofar as those objectives
pertain to the prevention or detection of errors or irregularities in
amounts that would be material in relation to the financial statements
of the Company and its subsidiaries.
All references in this Section 6(i) to the Registration
Statement shall be deemed to include any amendment or supplement
thereto at the date of the letter.
(j) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto), there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph
(i) of this Section 6 or (ii) any change, or any development involving
a prospective change, in or affecting the condition (financial or
otherwise), earnings, business or properties of the Company and its
subsidiaries taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto)
the effect of which, in
27
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any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of
the Securities as contemplated by the Registration Statement (exclusive
of any amendment thereof) and the Prospectus (exclusive of any
supplement thereto).
(k) The Securities shall have been approved for listing and
admitted and authorized for trading on the Nasdaq National Market, and
satisfactory evidence of such actions shall have been provided to the
Representatives.
(l) At the Execution Time, the Company shall have furnished to
the Representatives a letter substantially in the form of Exhibit A
hereto from each officer and director of the Company and each of the
stockholders listed on Schedule III hereto addressed to the
Representatives.
(m) Prior to or simultaneously with the Closing Date, (i) the
Company shall have effected a 5:1 stock split of the Common Stock; and
(ii) all outstanding shares of Class C Common of the Company shall have
converted into shares of Common Stock.
(n) Prior to or simultaneously with the Closing Date, the
Company, VPC and GVL shall have entered into the Conversion and
Exchange Agreement (as defined in the Prospectus) in form and substance
satisfactory to the Representatives, pursuant to which (i) all the
Series A Preferred Stock will be converted into Class B Common, (ii)
all the Class B Common issuable upon conversion of the Series A
Preferred Stock and all other Class B Common held by VPC and GVL will
be converted into shares of Common Stock. Such Conversion and Exchange
Agreement shall be in full force and effect without waiver of any term
thereof.
(o) Prior to the Closing Date, the Company and the Selling
Stockholders shall have furnished to the Representatives such further
information, certificates and documents as the Representatives may
reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be cancelled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Company and
each Selling Stockholder in writing or by telephone or facsimile confirmed in
writing.
28
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The several obligations of the Underwriters to purchase Option
Securities hereunder are subject to the satisfaction on and as of any Option
Closing Date of the conditions set forth in this Section 6, except that, if any
Option Closing Date is other than the Closing Date, the certificates, opinions
and letters referred to in paragraphs (b) through (k) and paragraphs (m) and (n)
shall be dated the Option Closing Date in question and the opinions called for
shall be revised to reflect the sale of Option Securities.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company or any Selling
Stockholder to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Underwriters, the Company will
reimburse the Underwriters severally through Xxxxxxx Xxxxx Xxxxxx Inc. on demand
for all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed
purchase and sale of the Securities. If the Company is required to make any
payments to the Underwriters under this Section 7 because of any Selling
Stockholder's refusal, inability or failure to satisfy any condition to the
obligations of the Underwriters set forth in Section 6, the Selling Stockholders
pro rata in proportion to the percentage of Securities to be sold by each shall
reimburse the Company on demand for all amounts so paid.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers,
employees and agents of each Underwriter and each person who controls
any Underwriter within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the
Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the
registration of the Securities as originally filed or in any amendment
thereof, or in any Preliminary Prospectus or the Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and agrees to reimburse each such indemnified
party, as incurred, for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company
will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in
29
-29-
conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for
inclusion therein and provided further, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon any such untrue statement
or alleged untrue statement or omission or alleged omission made in the
Preliminary Prospectus which is corrected or contained, as the case may
be, in the Prospectus and the Underwriters through the Representatives
fail to deliver the Prospectus. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
(b) Each Selling Stockholder severally agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers
who signs the Registration Statement, each Underwriter, the directors,
officers, employees and agents of each Underwriter and each person who
controls the Company or any Underwriter within the meaning of either
the Act or the Exchange Act and each other Selling Stockholder, if any,
to the same extent as the foregoing indemnity from the Company to each
Underwriter, but only with reference to written information furnished
to the Company by or on behalf of such Selling Stockholder specifically
for inclusion in the documents referred to in the foregoing indemnity.
Notwithstanding any other provision herein, the expense reimbursement
and indemnification liability of each Selling Stockholder hereunder
shall be limited to the amount equal to the net proceeds received by
such Selling Stockholder from the public offering of the Common Stock
sold by such Selling Stockholder to the Underwriters. This indemnity
agreement will be in addition to any liability which any Selling
Stockholder may otherwise have.
(c) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of
its officers who signs the Registration Statement, and each person who
controls the Company within the meaning of either the Act or the
Exchange Act and each Selling Stockholder, to the same extent as the
foregoing indemnity to each Underwriter, but only with reference to
written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to
any liability which any Underwriter may otherwise have. The Company and
each Selling Stockholder acknowledge that the statements set forth in
the last paragraph of the cover page regarding delivery of the
Securities and the last four paragraphs under the heading
"Underwriting" and the sentences related to concessions and reallowance
under the heading "Underwriting" in any Preliminary Prospectus and the
Prospectus constitute the only information furnished in writing by or
on behalf of the several Underwriters for inclusion in any Preliminary
Prospectus or the Prospectus.
30
-30-
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party
in writing of the commencement thereof; but the failure so to notify
the indemnifying party (i) will not relieve it from liability under
paragraph (a), (b) or (c) above unless and to the extent it did not
otherwise learn of such action and such failure results in the
forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a), (b) or (c) above. The
indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to
represent the indemnified party in any action for which indemnification
is sought (in which case the indemnifying party shall not thereafter be
responsible for the fees and expenses of any separate counsel retained
by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory
to the indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel to represent the indemnified party in an
action, the indemnified party shall have the right to employ one
additional and separate counsel (including one additional and separate
local counsel), and the indemnifying party shall bear the reasonable
fees, costs and expenses of such separate counsel (including local
counsel) if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a
conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those
available to the indemnifying party, (iii) the indemnifying party shall
not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice
of the institution of such action or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of
which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes
an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
(e) In the event that the indemnity provided in paragraph (a),
(b) or (c) of this Section 8 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, the Company, the Selling
Stockholders and the Underwriters agree to con-
31
-31-
tribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which
the Company, one or more of the Selling Stockholders and one or more of
the Underwriters may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company, by the Selling
Stockholders and by the Underwriters from the offering of the
Securities; provided, however, that in no case shall any Underwriter
(except as may be provided in any agreement among underwriters relating
to the offering of the Securities) be responsible for any amount in
excess of the underwriting discount or commission applicable to the
Securities purchased by such Underwriter hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for any
reason, the Company, the Selling Stockholders and the Underwriters
shall contribute in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company,
of the Selling Stockholders and of the Underwriters in connection with
the statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by the
Company and by the Selling Stockholders shall be deemed to be equal to
the total net proceeds from the offering (before deducting expenses)
received by each of them, and benefits received by the Underwriters
shall be deemed to be equal to the total underwriting discounts and
commissions, in each case as set forth on the cover page of the
Prospectus. Relative fault shall be determined by reference to, among
other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information provided by the Company, the Selling
Stockholders on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement
or omission. The Company, the Selling Stockholders and the Underwriters
agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation
which does not take account of the equitable considerations referred to
above. Notwithstanding the provisions of this paragraph (e), no person
guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the
meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of an Underwriter shall have the same
rights to contribution as such Underwriter, and each person who
controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed the
Registration Statement and each director of the Company shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (e).
32
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9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter, the
Selling Stockholders or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding five Business Days, as the Representatives shall
determine in order that the required changes in the Registration Statement and
the Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company, the Selling Stockholders and any
nondefaulting Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representatives, by notice given
to the Company prior to delivery of and payment for the Securities, if prior to
such time (i) trading in the Company's Common Stock shall have been suspended by
the SEC or the Nasdaq National Market or trading in securities generally on the
New York Stock Exchange or the Nasdaq National Market shall have been suspended
or limited or minimum prices shall have been established on either such Exchange
or National Market, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities or (iii) there shall have occurred any
outbreak or escalation of hostilities, declaration by the United States of a
national emergency or war or other calamity or crisis the effect of which on
financial markets is such as to make it, in the sole judgment of the
Representatives, impractical or inadvisable to proceed with the offering or
delivery of the Securities as contemplated by the Prospectus (exclusive of any
supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers, of each Selling Stockholder and of the Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter,
any Selling Stockholder or the Company or any of the officers, directors or
controlling persons referred to in Section 8 hereof, and will survive delivery
of and
33
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payment for the Securities. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc., General
Counsel, Investment Banking Division (fax no.: (000) 000-0000) and confirmed to
the General Counsel, Investment Banking Division at Xxxxxxx Xxxxx Barney Inc.,
at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel;
or, if sent to the Company, will be mailed, delivered or telefaxed to OpTel,
Inc., 0000 X. Xxxxxxxxxxx Xxxx, Xxxxxx, Xxxxx 00000, Attention: Xxxxxxx
Xxxxxxxxxxx, Vice President, Legal Affairs and General Counsel, with a copy to
Xxxxx X. Xxxxxxxxx, Esq., at Kronish Xxxx Xxxxxx & Xxxxxxx LLP, 1114 Avenue of
the Americas, Xxx Xxxx, Xxx Xxxx 00000-0000; or if sent to any Selling
Stockholder, will be mailed, delivered or telefaxed and confirmed to it at the
address set forth in Schedule II hereto.
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8 hereof,
and no other person will have any right or obligation hereunder.
14. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW THEREOF.
15. Counterparts. This Agreement may be executed in one or
more counterparts, each of which will be deemed to be an original, but all such
counterparts will together constitute one and the same instrument.
16. Headings. The section headings used herein are for
convenience only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in The City
of New York.
34
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"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the SEC promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(i)(a) above and any preliminary prospectus
included in the Registration Statement at the Effective Date that omits
Rule 430A Information.
"Prospectus" shall mean the prospectus relating to the
Securities that is first filed pursuant to Rule 424(b) after the
Execution Time or, if no filing pursuant to Rule 424(b) is required,
shall mean the form of final prospectus relating to the Securities
included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(i)(a) above, including exhibits and
financial statements, as amended at the Execution Time (or, if not
effective at the Execution Time, in the form in which it shall become
effective) and, in the event any post-effective amendment thereto or
any Rule 462(b) Registration Statement becomes effective prior to the
Closing Date, shall also mean such registration statement as so amended
or such Rule 462(b) Registration Statement, as the case may be. Such
term shall include any Rule 430A Information deemed to be included
therein at the Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.
"Rule 430A Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the initial registration statement.
[Signature Pages Follow]
35
S-1
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the several Underwriters and the Selling Stockholders.
Very truly yours,
OpTel, Inc.
By:
----------------------------------------
Name:
Title:
By:
----------------------------------------
Name:
Title:
Attorney-in-Fact for the Selling Stockholders
By:
----------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Xxxxxxxx-xx-Xxxx
00
X-0
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
By: Xxxxxxx Xxxxx Xxxxxx Inc.
By:
------------------------------------
Name:
Title:
For themselves and the other
several Underwriters named in
Schedule I to the foregoing
Agreement.
37
SCHEDULE I
NUMBER OF UNDERWRITTEN
UNDERWRITERS SECURITIES TO BE PURCHASED
------------ --------------------------
Xxxxxxx Xxxxx Barney Inc.
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
--------------------------
Total...........................
==========================
38
SCHEDULE II
NUMBER OF UNDERWRITTEN
SELLING STOCKHOLDERS: SECURITIES TO BE SOLD
--------------------- ----------------------
[name]
[address, fax no.]................................
[name]
[address, fax no.]................................
----------------------
Total...........................
======================
39
SCHEDULE III
STOCKHOLDERS FURNISHING LOCK-UP AGREEMENTS
Le Groupe Videotron Ltee
Caisse de depot et placement du Quebec
[others to come]
40
[FORM OF LOCK-UP AGREEMENT] EXHIBIT A
[LETTERHEAD OF OFFICER, DIRECTOR OR MAJOR STOCKHOLDER OF CORPORATION]
OpTel, Inc.
Public Offering of Common Stock
, 1999
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC Xxxxxxxxxxx Corp.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement"), among OpTel,
Inc., a Delaware corporation (the "Company"), the selling stockholders named
therein and each of you as representative[s] of a group of Underwriters named
therein, relating to an underwritten public offering of Class A Common Stock,
$0.01 par value per share (the "Common Stock"), of the Company.
In order to induce you and the other Underwriters to enter
into the Underwriting Agreement, the undersigned will not, without the prior
written consent of Xxxxx Xxxxxx Inc., offer, sell, contract to sell, pledge or
otherwise dispose of, or file (or participate in the filing of) a registration
statement with the Securities and Exchange Commission in respect of, or
establish or increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Securities and
Exchange Commission promulgated thereunder with respect to, any shares of
capital stock of the Company or any securities convertible into or exercisable
or exchangeable for such capital stock, or publicly announce an intention
41
-2-
to effect any such transaction, for a period of 180 days after the date of this
Agreement, other than (i) shares of Common Stock disposed of as bona fide gifts
provided the transferee agrees to be bound by the terms hereof, (ii) shares of
Common Stock acquired in the public market after the consummation of the
Offering and (iii) transfers to affiliates of the undersigned provided that such
affiliate transferee agrees to be bound by the terms hereof.
If for any reason the Underwriting Agreement shall be
terminated prior to the Closing Date (as defined in the Underwriting Agreement),
the agreement set forth above shall likewise be terminated.
Yours very truly,
[ ]
By:
-----------------------------------
Name:
Title:
Address:
