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Exhibit 1.2
[DRAFT]
AGERE SYSTEMS INC.
Shares
Class A Common Stock, par value $0.01 per share
UNDERWRITING AGREEMENT
March , 2001
New York, New York
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
The undersigned, Agere Systems Inc. (the "Company"), and Xxxxxx
Xxxxxxx & Co. Incorporated (the "Selling Stockholder"), in its capacity as
Selling Stockholder, hereby confirm their agreement with Xxxxxx Xxxxxxx & Co.
Incorporated (the "Underwriter"), in its capacity as Underwriter, as follows:
1. Description of Securities. The shares of Class A Common Stock,
par value $0.01 per share, of the Company (the "Class A Common Stock"), and
Class B Common Stock, par value $0.01 per share, of the Company (the "Class B
Common Stock"), to be outstanding after giving effect to the sales contemplated
hereby are hereinafter referred to as the "Common Stock."
The Selling Stockholder proposes to sell to the Underwriter, if the
conditions in Section 4 hereof have been satisfied, not more than shares of
Class A Common Stock (the "Shares") if and to the extent that the Underwriter
shall have determined to exercise the right to purchase such shares of Class A
Common Stock granted to the Underwriter in Section 4 hereof. The conditions in
Section 4 relate to the offering and sale by the Company of shares of Class
A Common Stock (the "Primary Offering") sold pursuant to the terms of the
underwriting agreement (the "Primary Underwriting Agreement") dated the date
hereof among Xxxxxx Xxxxxxx & Co. Incorporated, Bear, Xxxxxxx & Co. Inc., J.P.
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Xxxxxx Securities Inc., Xxxxxxx Xxxxx Barney Inc., Deutsche Banc Alex. Xxxxx
Inc., ABN AMRO Rothschild LLC, XX Xxxxx Securities Corporation and Xxxxxxxx &
Partners, L.P., as representatives of the underwriters, and the Company.
Each Share will have attached thereto one right (collectively, the
"Rights") to purchase one-thousandth of a share of junior preferred stock, par
value $1.00 per share, of the Company (the "Junior Preferred Shares"). The
Rights have been issued pursuant to a Rights Agreement (the "Rights Agreement")
dated as of March , 2001 between the Company and The Bank of New York, as Rights
Agent.
2. Representations and Warranties of the Company. The Company
represents and warrants to the Underwriter that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement (No. 333-51594) on Form
S-1, including a prospectus relating to the Shares, which has become effective
under the Securities Act of 1933 (the "Act"). The term "Registration Statement"
means the Registration Statement as amended to the date hereof including the
information, if any, deemed to be part of the Registration Statement at the time
of effectiveness pursuant to Rule 430A under the Act, and the term "Prospectus"
means the prospectus in the form first used to confirm sales of the Shares. The
term "preliminary prospectus" means any preliminary prospectus relating to the
Shares used prior to the effectiveness of the Registration Statement. If the
Company has filed an abbreviated registration statement to register additional
shares of Class A Common Stock pursuant to Rule 462(b) under the Securities Act
(the "Rule 462 Registration Statement"), then any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462 Registration
Statement.
(b) (i) The Registration Statement when it became effective did not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, (ii) each preliminary prospectus relating to the Shares, if any,
complied when so filed in all material respects with the Act and the applicable
rules and regulations of the Commission thereunder, (iii) the Registration
Statement and the Prospectus comply and, as amended or supplemented, if
applicable, will comply in all
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material respects with the Act and the applicable rules and regulations of the
Commission thereunder and (iv) the Registration Statement and the Prospectus
(including, without limitation, the Section entitled "Arrangements between
Lucent and Our Company") do not and, as amended supplemented, if applicable,
will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement, any preliminary
prospectus or the Prospectus in reliance upon written information furnished to
the Company by or on behalf of the Underwriter or the Selling Stockholder
specifically for inclusion therein.
(c) The accountants who have certified the financial statements
filed with the Commission as parts of the Registration Statement and the
Prospectus are public or certified accountants, independent with respect to the
Company, as required by the Act and the rules and regulations of the Commission
thereunder.
(d) Neither the sale of the Shares nor the consummation of any other
of the transactions herein contemplated nor the fulfillment of the terms hereof
will result in a breach of any of the terms and provisions of, or constitute a
default under, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company is a party or by which it is bound, or the
Company's Restated Certificate of Incorporation or By-Laws, or, to the best of
its knowledge, any order, rule or regulation applicable to the Company of any
court, federal or state regulatory body, administrative agency or other
governmental body having jurisdiction over the Company or its properties and
except for the registration of the Shares and the Rights under the Act and such
consents, approvals, authorizations, registrations or qualifications as may be
required under the United States Securities Exchange Act of 1934 (the "Exchange
Act") and applicable state or foreign securities laws in connection with the
purchase and distribution of the Shares by the Underwriter, no consent,
approval, authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the execution and delivery
by the Company of, compliance by the Company with the provisions of or
consummation of the transactions contemplated by, this Agreement.
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(e) The Separation and Distribution Agreement and each of the other
agreements between Lucent Technologies Inc. ("Lucent") and the Company, which
are listed in Schedule I to this Agreement (the "Ancillary Agreements"), have
been duly authorized, executed and delivered by the Company and each such
agreement constitutes a valid and binding agreement of the Company.
(f) The compliance by the Company with all of the provisions of the
Separation and Distribution Agreement and each of the Ancillary Agreements will
not conflict with or result in a breach or the violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is bound or to which the Company or any of its
subsidiaries is subject, nor will such actions result in any violation of the
provisions of the Company's Restated Certificate of Incorporation or By-Laws or
any statute or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its subsidiaries or any
of their properties or assets (except for such conflicts, breaches, violations
and defaults as would not have a material adverse effect on the Company and its
subsidiaries taken as a whole); and no consent, approval, authorization or order
of, or filing or registration with, any such court or governmental agency or
body is required for the execution and delivery by the Company of, and
compliance by the Company with, the provisions of the Separation and
Distribution Agreement and each of the Ancillary Agreements (except for such
consents, approvals, authorizations, orders, filings, registrations and
qualifications of which the failure to obtain would not have a material adverse
effect on the Company and its subsidiaries taken as a whole).
(g) At the date hereof, except for Xxxxx Corporation, no subsidiary
of the Company organized and operating in the United States would constitute a
significant subsidiary (as such term is defined in Rule 1-02(w) of Regulation
S-X) so as to require separate financial disclosure pursuant to the requirements
of Form 10-K.
3. Representations and Warranties of the Selling Stockholder. The
Selling Stockholder represents and warrants to, and agrees with, the Underwriter
that:
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(a) The Selling Stockholder is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
Selling Stockholder has all requisite corporate power and authority to enter
into this Agreement and to perform its obligations hereunder. This Agreement has
been duly executed and delivered by the Selling Stockholder and constitutes a
legal, valid and binding obligation of the Selling Stockholder, enforceable
against the Selling Stockholder in accordance with its terms.
(b) No consent, approval, license, permit, order or authorization
of, or registration, declaration or filing with, any Federal, state, local or
foreign government or any court of competent jurisdiction, administrative agency
or commission or other governmental authority or instrumentality, domestic or
foreign or nongovernmental third party is required to be obtained or made by or
with respect to the Selling Stockholder in connection with the execution,
delivery and performance of this Agreement except as has been previously
obtained or made.
(c) The Selling Stockholder has good and valid title to the Shares,
free and clear of any liens, claims, encumbrances, security interests, options,
charges or restrictions of any kind. Other than this Agreement, the Shares are
not subject to any voting trust agreement or other contract, agreement,
arrangement, commitment or understanding, including any such agreement,
arrangement, commitment or understanding restricting or otherwise relating to
the voting, dividend rights or disposition of the Shares.
(d) Neither the sale of the Shares being sold by the Selling
Stockholder nor the consummation of any other of the transactions herein
contemplated by the Selling Stockholder or the fulfillment of the terms hereof
by the 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 of the
Selling Stockholder or the terms of any indenture or other agreement or
instrument to which the Selling Stockholder or any of its subsidiaries is a
party or bound, or any judgment, order or decree applicable to the Selling
Stockholder or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction over
the Selling Stockholder or any of its subsidiaries.
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(e) 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 the Selling Stockholder specifically for use in connection with the
preparation thereof, the Selling Stockholder hereby makes the same
representations and warranties to the Underwriter as the Company makes to the
Underwriter under paragraph (b) of Section 2.
Any certificate signed by any officer of the Selling Stockholder and
delivered to the Underwriter or Underwriter's counsel in connection with the
offering of the Shares shall be deemed a representation and warranty by the
Selling Stockholder, as to matters covered thereby, to the Underwriter.
4. Purchase and Sale of Shares. The Selling Stockholder agrees, on
the basis of the representations and warranties contained in this Agreement, and
subject to its terms and conditions, to sell to the Underwriter up to Shares,
and the Underwriter shall have a right to purchase in one or more instances up
to Shares at a price of $ per share (the "Purchase Price"). If the
Underwriter elects to exercise such option, the Underwriter shall so notify the
Selling Stockholder in writing not later than four business days after the date
of this Agreement, which notice shall specify the number of Shares to be
purchased by the Underwriter and the date on which such shares are to be
purchased. Such date may not be earlier than April , 2001 nor later than ten
business days after the date of such notice. Shares may be purchased as provided
in Section 5 hereof solely for the purpose of covering over-allotments made in
connection with the Primary Offering.
The terms of the public offering of the Shares are as set forth in
the Prospectus.
5. Closing. Delivery of, and payment of the Purchase Price for, any
Shares shall be made to the Selling Stockholder at the office of Cravath, Swaine
& Xxxxx, Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 against
delivery of such Shares for the account of the Underwriter at 10:00 a.m., New
York City time, on the date specified in the notice described in Section 4 or at
such other time on the same or on such other date, in any event not later than
April , 2001, as shall be designated in writing by the Underwriter. The time and
date of such
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payment are hereinafter referred to as the "Option Closing Date."
Certificates for the Shares shall be in definitive form and
registered in such names and in such denominations as the Underwriter shall
request in writing not later than two full business days prior to the Option
Closing Date. The certificates evidencing the Shares shall be delivered to the
Underwriter on the Option Closing Date, as the case may be, for the account of
the Underwriter. The Selling Stockholder will pay all applicable state transfer
taxes, if any, involved in the transfer to the Underwriter of the shares to be
purchased by the Underwriter from the Selling Stockholder; and the Underwriter
will pay any additional stock transfer taxes involved in further transfers.
The Selling Stockholder agrees to make the Shares available to the
Underwriter for examination at a place to be mutually agreed upon, New York, New
York, not later than 2:00 p.m. on the business day next preceding the Option
Closing Date.
6. Payment. At the Option Closing Date, as the case may be, the
Selling Stockholder will cause the Shares to be delivered to the account of the
Underwriter against payment of the Purchase Price of such Shares in Federal or
other funds immediately available.
7. Covenants of the Company and the Selling Stockholder. (i) The
Company agrees as follows:
(a) The Company will not file any amendment or supplement to the
Registration Statement or the Prospectus of which the Underwriter shall not
previously have been advised or which shall be disapproved by Xxxxx Xxxx &
Xxxxxxxx, which firm is acting as counsel for the Underwriter.
(b) The Company will deliver to the Underwriter a reasonable number
of copies of the registration statement as originally filed and of all
amendments thereto up to the Option Closing Date. Promptly upon the filing with
the Commission of any amendment to the Registration Statement or of any
supplement to or amendment of the Prospectus, the Company will deliver to the
Underwriter a reasonable number of copies thereof.
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(c) The Company will advise the Underwriter promptly (confirming
such advice in writing) of any official request made by the Commission for an
amendment to the Registration Statement or Prospectus or for additional
information with respect thereto and of any official notice of the institution
of proceedings for, or of the entry of, a stop order suspending the
effectiveness of the Registration Statement. The Company will use its best
efforts to prevent the issuance of any such stop order and, if such a stop order
should be entered, the Company will make every reasonable effort to obtain the
lifting or removal thereof as soon as possible.
(d) The Company will pay all expenses in connection with the
preparation and filing of the Registration Statement and the printing of the
copies of any preliminary prospectus and of the Prospectus to be furnished as
provided in the first sentence of subparagraph (f) below; but will not pay any
transfer taxes. The Company will not be required to pay any amount for any
expenses of the Selling Stockholder or the Underwriter, except the cost of
mailing to the Underwriter of copies of the Registration Statement and all
amendments thereto, the preliminary prospectuses and the Prospectus, except as
provided by subparagraph (e) below. The Company will not in any event be liable
to the Underwriter for damages on account of loss of anticipated profits.
(e) The Company will use its best efforts to qualify the Shares, or
to assist in the qualification of the Shares by or on behalf of the Underwriter,
for offer and sale under the securities or Blue Sky laws of such states of the
United States as the Underwriter may designate, and will pay or reimburse the
Underwriter for counsel fees, filing fees and out-of-pocket expenses in
connection with such qualifications; provided, however, that the Company shall
not be required (i) to qualify as a foreign corporation or to file a general
consent to the service of process in any state or (ii) to pay, or to incur, or
to reimburse the Underwriter for, any such expenses if no Shares are delivered
to and purchased by the Underwriter hereunder because of the termination of this
Agreement pursuant to Section 10 hereof.
(f) The Company will furnish to the Underwriter as many copies of
the Prospectus as the Underwriter may reasonably request for the purpose
contemplated by the Act. If, during such period after the first date of the
public
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offering of the Shares as, in the opinion of the counsel for the Underwriter,
the Prospectus is required by law to be delivered, any event shall occur which
should be set forth in a supplement to or an amendment of the Prospectus in
order to make the Prospectus not misleading, the Company will, upon the
occurrence of each such event, forthwith at its expense, prepare and furnish to
the Underwriter as many copies as the Underwriter may reasonably request for the
purposes contemplated by the Act of a supplement to or amendment of the
Prospectus which will supplement or amend the Prospectus so that, as
supplemented or amended, it will not at the date of such supplement or amendment
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statement therein not misleading. For the
purpose of this subparagraph (f), the Company will furnish such reasonable
information with respect to itself as the Underwriter may from time to time
request, and the Underwriter, at its own expense, may visit any of the
properties of the Company and may inspect the books of accounts of the Company
at any reasonable time. Notwithstanding any of the other provisions of this
subparagraph (f), the Company shall not be under any obligation to furnish any
supplement to or amendment of the Prospectus on account of any change in, or to
include in any amended prospectus any change in, the information furnished to
the Company by the Underwriter on its behalf for use in the Prospectus, unless
the Underwriter has advised the Company in writing of such change and has
requested the Company at the expense of the Underwriter to prepare a supplement
to or amendment of the Prospectus to reflect such change or to include such
change in an amended prospectus.
(g) The Company will cause to be made generally available to its
security holders as soon as practicable, but in any event not later than , an
earnings statement or statements which shall meet the requirements of Section
11(a) of the Act and Rule 158 promulgated thereunder.
(h) Without the prior written consent of Xxxxxx Xxxxxxx & Co.
Incorporated, the Company will not (a) register for sale or offer, issue,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend or otherwise transfer or dispose of, directly or indirectly, any
shares of the Company's common stock or any securities convertible into or
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exercisable or exchangeable for the Company's common stock or (b) enter into any
swap or other arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of the Company's common stock, whether any
such transaction described in clause (a) or (b) of this sentence is to be
settled by delivery of the Company's common stock, or other securities, in cash
or otherwise, for a period of 180 days after the date of the Prospectus, other
than: (i) the shares of the Company's Class A Common stock sold pursuant to this
Agreement; (ii) any shares of the Company's common stock issued upon the
exercise, exchange or conversion of a security outstanding on the date hereof of
which Xxxxxx Xxxxxxx & Co. Incorporated has been advised in writing, including
issuances under the Company's employee benefit plans; (iii)the granting of stock
options, restricted stock or restricted stock units that do not vest prior to
180 days after the date hereof or the sale of stock pursuant to the Company's
employee benefit plans; and (iv) the issuance of shares, or the announcement or
execution of agreements that contemplate the issuance of shares, of the
Company's common stock in connection with any acquisition of or merger with
another company or the acquisition of assets, provided that (A) in connection
with any issuance of shares of common stock pursuant to this Section 7(i)(iv)
within 90 days from the date hereof, each recipient of such shares executes an
agreement in the form of Exhibit A to the Primary Underwriting Agreement (B) the
Company may not issue an aggregate number of shares of common stock pursuant to
this Section 7(i)(iv), including securities convertible into a number of shares
of common stock, that exceeds one-half the number of shares of common stock sold
by the Company in the Primary Offering, except to the extent that in connection
with such issuance each recipient of such shares executes an agreement in the
form of Exhibit A to the Primary Underwriting Agreement.
(ii) The Selling Stockholder agrees with the Underwriter that:
(a) The Selling Stockholder will not, without the prior written
consent of Xxxxxx Xxxxxxx & Co. Incorporated, offer, sell, contract to sell,
pledge 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
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privity with the Company or any affiliate of the Company) directly or
indirectly, or file (or participate in the filing of) a registration statement
with the 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 Exchange Act 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 to effect any such
transaction, for a period of 180 days after the date of the Underwriting
Agreement, other than shares of Common Stock disposed of as bona fide gifts
approved by Xxxxxx Xxxxxxx & Co. Incorporated.
(b) The Selling Stockholder will pay all expenses it incurs as a
Selling Stockholder.
8. Conditions of the Obligations of the Underwriter. The obligations
of the Underwriter to purchase and pay for the Shares shall be subject to the
following additional conditions:
(a) At the Option Closing Date no stop order suspending the
effectiveness of the Registration Statement, as amended from time to time,
shall be in effect and no proceedings for that purpose shall be pending before
or threatened by the Commission, and the Underwriter shall have received a
certificate dated the day of closing and signed by a Vice President of the
Company to the effect that no such stop order is in effect and, to the
knowledge of the Company, no proceedings for such purpose are pending before,
or threatened by, the Commission.
(b) At or prior to the Option Closing Date, the Underwriter shall
have received from Cravath, Swaine & Xxxxx, counsel for the Company, an opinion,
satisfactory to Xxxxx Xxxx & Xxxxxxxx, to the effect that:
(i) The Company is a corporation in good standing, duly organized
and validly existing under the laws of the State of Delaware; and is
authorized by its Restated Certificate of Incorporation to transact the
business in which it is engaged, as set forth in the Prospectus;
(ii) the Company is duly qualified to transact the business in which
it is engaged, as set forth in
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the Prospectus, in each State in the United States in which it operates;
(iii) each of this Agreement and the Rights Agreement has been duly
authorized, executed and delivered on behalf of the Company and is valid
and binding on the Company, except as rights to indemnity and contribution
hereunder may be limited under applicable law;
(iv) all consents, approvals, authorizations or others orders of
U.S. regulatory authorities legally required for the issuance and sale of
the Shares to the Underwriter pursuant to the terms of this Agreement,
have been obtained, except such as may be required by the securities or
Blue Sky laws of the various States in connection with the offer and sale
of the Shares; and
(v) such counsel (A) is of the opinion that the Registration
Statement and Prospectus (except for financial statements and schedules
and other financial and statistical data included therein as to which
such counsel need not express any opinion) comply as to form in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder, (B)has no reason to believe
that (except for financial statements and schedules and other financial
and statistical data as to which such counsel need not express any
belief) the Registration Statement and the prospectus included therein at
the time the Registration Statement became effective contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading and (C) has no reason to believe that (except for
financial statements and schedules and other financial and statistical
data as to which such counsel need not express any belief) the Prospectus
contains any untrue statement of a material fact or omits 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.
The opinion specified in clause (ii) above may be delivered by Xxxx
X. Xxxxxx, Senior Vice President and General Counsel of the Company, in lieu of
Cravath, Swaine & Xxxxx.
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(c) At or prior to the Option Closing Date, the Underwriter shall
have received from Xxxxx Xxxx & Xxxxxxxx an opinion to the effect specified in
clauses (i), (iii), (iv) and (v) of subparagraph (b) above.
(d) The Selling Stockholder shall have requested and caused Xxxxx
Xxxx & Xxxxxxxx, counsel for the Selling Stockholder, to have furnished to the
Underwriter its opinion dated the Option Closing Date and addressed to the
Underwriter, to the effect that:
(i) this Agreement has been duly authorized, executed and delivered
by the Selling Stockholder and the Selling Stockholder has full legal
right and authority to sell, transfer and deliver in the manner provided
in this Agreement the Shares being sold by such Selling Stockholder
hereunder;
(ii) the Selling Stockholder has good and valid title to the Shares,
free and clear of any liens, claims, equities, encumbrances, security
interests, options, charges or restrictions of any kind. Other than this
Agreement, the Shares are not subject to any voting trust agreement or
other contract, agreement, arrangement, commitment or understanding,
including any such agreement, arrangement, commitment or understanding
restricting or otherwise relating to the voting, dividend rights or
disposition of the Shares.
(iii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the
Selling Stockholder of the transactions contemplated herein, except such
as may have been obtained under the Act and such as may be required under
the blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Shares by the Underwriter and such other approvals
(specified in such opinion) as have been obtained; and
(iv) neither the sale of the Shares being sold by the Selling
Stockholder nor the consummation of any other of the transactions herein
contemplated by the Selling Stockholder or the fulfillment of the terms
hereof by the 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 of the
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Selling Stockholder or the terms of any indenture or other agreement or
instrument known to such counsel and to which the Selling Stockholder or
any of its subsidiaries is a party or bound, or any judgment, order or
decree known to such counsel to be applicable to the Selling Stockholder
or any of its subsidiaries of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over the
Selling Stockholder or any of its subsidiaries.
(e) At the date hereof and at or prior to the Option Closing Date,
the Underwriter shall have received an executed copy of (1) a letter of
PricewaterhouseCoopers LLP, addressed to the Company and to the
Underwriter, to the effect that (i) they are independent public
accountants as required by the Act and the applicable published rules and
regulations of the Commission thereunder; (ii) the audited financial
statements of the Company contained in the Registration Statement comply
as to form in all material respects with the applicable accounting
requirements of the Act and the applicable published rules and regulations
of the Commission thereunder; and (iii) nothing has come to their
attention as the result of specified procedures not constituting an audit
that caused them to believe (A) that the unaudited financial statements,
contained in or incorporated by reference as aforesaid, do not so comply
and are not fairly presented in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
that of the audited financial statements contained as aforesaid, (B) that
there was any change in the capital stock or long term debt of the
Company, or any decrease in net assets, from the date of the latest
balance sheet which is contained in the Registration Statement, to a date
not more than five days prior to the date of such letter or (C) that there
were any decreases, as compared with the corresponding period in the
preceding year, in revenue, operating income or net income from the date
of the latest figures for such items contained in the Registration
Statement to the date of the latest available financial statements of the
Company; provided that, with respect to any of the items specified in
clause (iii), such letter may contain an exception for matters which the
Registration Statement discloses have occurred or may occur; and provided
further that the letter may vary from the
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requirements specified in this subparagraph in such manner as the
Underwriter in its sole discretion may determine to be immaterial or in
such manner as may be acceptable to the Underwriter; and (2) a letter of
KPMG LLP, addressed to the Company and to the Representatives, to the
effect that (i) they are independent public accountants as required by the
Act and the applicable published rules and regulations of the Commission
thereunder; and (ii) the audited financial statements of Xxxxx Corporation
contained in the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the Act and the
applicable published rules and regulations of the Commission thereunder.
(f) Except as reflected in or contemplated by the Registration
Statement and the Prospectus, since the respective dates as of which information
is given in the Registration Statement and the Prospectus there shall not have
been, at the Option Closing Date, any material adverse change, financial or
otherwise, in the condition of the Company from that set forth in the
Registration Statement and the Prospectus; the representations and warranties of
the Company herein shall be true at the Option Closing Date; the Company shall
not have failed, at or prior to the Option Closing Date, to have performed all
agreements herein contained which should have been performed by it at or prior
to such time; and the Underwriter shall have received, at the Option Closing
Date, a certificate to the foregoing effect dated the day of the closing and
signed by a Vice President of the Company.
(g) The New York Stock Exchange shall have approved the Shares for
listing, subject only to official notice of issuance.
(h) The Underwriter shall have received a certificate, dated the
Option Closing Date and signed by a Vice President or the Treasurer of Lucent,
to the effect that:
(i) the Separation and Distribution Agreement and each of the
Ancillary Agreements have been duly authorized, executed and delivered by
Lucent and each such agreement constitutes a valid and binding agreement
of Lucent; and
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(ii) the compliance by Lucent with all of the provisions of the
Separation and Distribution Agreement and each of the Ancillary Agreements
will not conflict with or result in a breach or the violation of any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
to which Lucent or any of its subsidiaries is bound or to which Lucent or
any of its subsidiaries is subject, nor will such actions result in any
violation of the provisions of the certificate of incorporation or by-laws
of Lucent or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over Lucent or any of its
subsidiaries or any of their properties or assets (except for such
conflicts, breaches, violations and defaults as would not have a material
adverse effect on the Company and its subsidiaries taken as a whole); and
no consent, approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body is required for the
execution and delivery by Lucent of, and compliance by Lucent with, the
provisions of the Separation and Distribution Agreement and each of the
Ancillary Agreements (except for such consents, approvals, authorizations,
orders, filings, registrations and qualifications the failure to obtain
which would not have a material adverse effect on the Company and its
subsidiaries taken as a whole); and
(iii) the separation of the Company's businesses from Lucent has
occurred as described in the Prospectus.
In case any of the conditions specified above in this Section 8 shall not have
been fulfilled, this Agreement may be terminated by the Underwriter by
delivering written notice of termination to the Selling Stockholder and the
Company. Any such termination shall be without liability of any party to any
other party except to the extent provided in subparagraphs (i)(d) and (i)(e) of
Section 7 hereof.
9. Conditions of Selling Stockholder's Obligation. The obligation of
the Selling Stockholder to deliver the Shares upon payment therefor shall be
subject to the condition that at the Option Closing Date no stop order
suspending the effectiveness of the Registration Statement, as amended from time
to time, shall be in effect and no proceedings for that purpose shall then be
pending before, or threatened by, the Commission.
In case any of the conditions specified above in this Section
9 shall not have been fulfilled, this Agreement may be terminated by the Selling
Stockholder by delivering written notice of termination to the Underwriter. Any
such termination shall be without liability of any party to any other party
except to the extent provided in subparagraphs (i)(d) and (i)(e) of Section 7
hereof.
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10. Termination of Agreement. This Agreement may be terminated by
the Underwriter by delivering written notice of termination to the Company and
the Selling Stockholder at any time prior to the Option Closing Date, if after
the signing of this Agreement trading in securities generally on the New York
Stock Exchange shall have been materially suspended or materially limited or
minimum prices shall have been established on such Exchange (which shall not
include trading suspensions or limitations resulting from the operation of
General Rules 80A and 80B of such Exchange, as amended or supplemented), or a
banking moratorium shall have been declared by either Federal or New York State
authorities.
A termination of this Agreement pursuant to this Section 10
shall be without liability of any party to any other party.
11. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold the Underwriter, and each person, if any, who controls the
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, harmless from and against any and all losses, claims, damages and
liabilities with respect to the Shares or any other securities of the Company
arising because the Registration Statement, any preliminary prospectus used in
connection with the offering of the Shares or the Prospectus (if used within the
period set forth in Section 7(i)(g) hereof and if used, as amended or
supplemented by all amendments or supplements thereto which have been furnished
to the Underwriter) contained or is alleged to have contained any untrue
statement of a material fact or omitted or is alleged to have omitted to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except as to losses, claims, damages or liabilities
caused by any such untrue statement or omission or alleged untrue statement or
omission made in reliance upon information furnished to the Company herein or
otherwise in writing by or on behalf of the Underwriter for use in connection
with the preparation of any preliminary prospectus, the Registration Statement
or the Prospectus or any amendment or supplement thereof, provided that the
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of the Underwriter (or to the benefit of any person controlling
the Underwriter) on account of any losses, claims, damages or liabilities
arising from the sale of Shares to any person if a copy of the Prospectus (as
amended or supplemented by all amendments or supplements thereto which have been
furnished to the Underwriter, but without exhibits) shall not have been sent,
mailed or given to such person, if required by the Act, at or prior to the
written confirmation of the sale of such Shares to such person.
The Company agrees to indemnify and hold the Selling Stockholder and each
person, if any, who controls the selling Stockholder within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, harmless from and
against any and all losses, claims, damages and liabilities arising because the
Registration Statement or any preliminary prospectus relating to the Shares, or
the Prospectus or any amendment or supplement
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thereto contained or is alleged to have contained any untrue statement of a
material fact or omitted or is alleged to have omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except as to losses, claims, damages or liabilities caused by any
such untrue statement or omission or alleged untrue statement or omission made
in reliance upon information furnished to the Company herein or otherwise in
writing by or on behalf of the Selling Stockholder for use in connection with
the preparation of any preliminary prospectus, the Registration Statement or the
Prospectus or any amendment or supplement thereto.
(b) The Selling Stockholder agrees to indemnify and hold the
Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, harmless
from and against any and all loses, claims, damages and liabilities arising
because the Registration Statement or any preliminary prospectus relating to the
Shares, or the Prospectus or any amendment or supplement thereto contained or is
alleged to have contained any untrue statement of a material fact or omitted or
is alleged to have omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, which untrue
statement or omission was made in any such preliminary prospectus or in the
Registration Statement or Prospectus or any amendment or supplement thereto in
reliance upon information furnished to the Company herein or otherwise in
writing by or on behalf of the Selling Stockholder for use in connection with
the preparation thereof, provided that the indemnity agreement with respect to
any preliminary prospectus shall not inure to the benefit of the Selling
Stockholder (or to the benefit of any person controlling the Selling
Stockholder) on account of any losses, claims, damages or liabilities arising
from the sale of Shares to any person if a copy of the Prospectus (as amended or
supplemented by all amendments or supplements thereto which have been furnished
to the Selling Stockholder, but without exhibits) shall not have been sent,
mailed or given to such person, if required by the Act, at or prior to the
written confirmation of the sale of such Shares to such person.
(c) The Underwriter agrees to indemnify and hold the Company, its
directors, its officers who sign the registration statement, and each person, if
any, who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the Selling Stockholder and each person, if
any, who controls the Selling Stockholder within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act harmless from and against any and all
losses, claims, damages and liabilities arising because the Registration
Statement or any preliminary prospectus relating to the Shares, or the
Prospectus or any amendment or supplement thereto contained or is alleged to
have contained any untrue statement of a material fact or omitted or is alleged
to have omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, which untrue statement
or omission or alleged untrue statement or omission was made in any such
preliminary prospectus or in the Registration Statement or Prospectus or any
amendment or
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supplement thereto in reliance upon information furnished to the Company herein
or otherwise in writing by or on behalf of the Underwriter for use in connection
with the preparation thereof.
(d) The Company, the Selling Stockholder and the Underwriter agree
that upon the commencement of any action against it, its directors, its officers
who sign the registration statement, or any person controlling it as aforesaid
in respect of which indemnity may be sought on account of any indemnity
agreement contained herein, it will promptly give written notice of the
commencement thereof to the party or parties against whom indemnity shall be
sought, but the omission so to notify such indemnifying party or parties of any
such action shall not relieve such indemnifying party or parties from any
liability which it or they may have to the indemnified party or parties
otherwise than on account of such indemnity agreement. In case such notice of
any such action shall be so given, such indemnifying party or parties shall be
entitled to participate at its or their own expense in the defense of such
action, or, if it or they so elect, to assume the defense of such action, and in
the latter event such defense shall be conducted by counsel chosen by such
indemnifying party or parties and satisfactory to the indemnified party or
parties who shall be defendant or defendants in such action, and such defendant
or defendants shall bear the fees and expenses of any additional counsel
retained by them; but if the indemnifying party or parties shall not elect to
assume the defense of such action, such indemnifying party or parties will
reimburse such indemnified party or parties for the reasonable fees and expenses
of any counsel retained by them. In the event that the parties to any such
action (including impleaded parties) include both the indemnifying party and the
indemnified party and either (i) the indemnifying party or parties and
indemnified party or parties mutually agree or (ii) representation of both the
indemnifying party or parties and the indemnified party or parties by the same
counsel is inappropriate under applicable standards of professional conduct due
to actual or potential differing interests between them, then the indemnifying
party or parties shall not have the right to assume the defense of such action
on behalf of such indemnified party or parties and will reimburse such
indemnified party or parties for the reasonable fees and expenses of any counsel
retained by them and satisfactory to the indemnifying party or parties, it being
understood that the indemnifying party or parties shall not, in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys for all such indemnified parties, which firm shall be designated in
writing by the Underwriter in the case of an action in which the Underwriter or
one or more controlling persons are indemnified parties and by the Company in
the case of an action in which the Company or any of its directors, officers or
controlling persons are indemnified parties. The indemnifying party or parties
shall not be liable under this Agreement with respect to any settlement made by
any indemnified party or parties without prior written consent by the
indemnifying party or parties to such settlement.
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(e) If the indemnification provided for in subparagraphs (a), (b)
or (c) of this Section 11 is unavailable to an indemnified party in respect of
any losses, claims, damages, or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect primarily the
relative benefits received by the Company, the Selling Stockholder and the
Underwriter from the offering of the Shares and also to reflect where
appropriate the relative fault of the Company, the Selling Stockholder and the
Underwriter in connection with the statement or omissions or alleged statements
or omissions which resulted in such losses, claims, damages, or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company, the Selling Stockholder and of the Underwriter shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriter and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the Selling
Stockholder and the Underwriter agree that it would not be just and equitable if
contribution pursuant to this subparagraph (d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subparagraph (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in this subparagraph (d) shall be
deemed to include, subject to the limitations set forth above in this Section
11, any legal or other expenses reasonably incurred by such indemnified party in
connection with defending any such action or claim. Notwithstanding the
provisions of this subparagraph (d), the Underwriter shall not be required to
contribute any amount in excess of the amount by which the total price at which
the shares of Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which the Underwriter
has been required to pay, otherwise than pursuant to this subparagraph (d), by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(f) The liability of the Selling Stockholder under the Selling
Stockholder's representations and warranties contained in Section 3 hereof and
under the indemnity and contribution agreements contained in this Section 11
shall be limited to an amount equal to the initial public offering price of the
Shares sold by the Selling Stockholder to the Underwriter.
12. Miscellaneous. This Agreement shall inure to the benefit of the
Company, its directors, its officers who sign the Registration Statement, the
Selling Stockholder, the Underwriter and each controlling person referred to in
Section 11 hereof
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and their respective successors. Nothing in this Agreement is intended or shall
be construed to give to any other person, firm or corporation any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. The term "successor" as used in this Agreement shall
not include any purchaser of any of the Shares from the Underwriter.
13. Notices. All communications hereunder shall be in writing, and
if to the Underwriter, unless otherwise provided, shall be mailed or delivered
to the Underwriter, in care of Xxxxxx Xxxxxxx & Co. Incorporated, Attention:
Managing Director, Equity Syndicate Department, 0000 Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, and if to the Company, unless otherwise provided, shall be mailed or
delivered to the Company attention: Chief Financial Officer, 000 Xxxxx
Xxxxxxxxx, Xxxxxxxxx, XX 00000, and if to the Selling Stockholder, in care of
Xxxxxx Xxxxxxx & Co. Incorporated, Attention: Managing Director, Equity
Syndicate Department, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
14. Governing Law. The validity and interpretation of this
Agreement shall be governed by the laws of the State of New York.
15. Survival Clause. The indemnity and contribution agreement
contained in Section 11 hereof and the representations and warranties of the
Company and the Selling Stockholder set forth in this Agreement or in any
certificate furnished pursuant hereto shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of the Underwriter or any person controlling
the Underwriter, or (iii) acceptance of and payment for the Shares.
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Please sign and return to us the enclosed duplicate of this letter,
whereupon this letter will become a binding agreement between the Company, the
Selling Stockholder and the Underwriter, in accordance with its terms.
Very truly yours,
Agere Systems Inc.
by _________________________
Name:
Title:
Xxxxxx Xxxxxxx & Co. Incorporated,
in its capacity as Selling
Stockholder
by _________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written.
by Xxxxxx Xxxxxxx & Co.
Incorporated, in its
capacity as Underwriter
by _____________________
Name:
Title:
