EXHIBIT 1.1
DRAFT OF MARCH 24, 2000
14,800,000 Shares
AltaVista Company
Common stock, par value $.01
FORM OF
UNDERWRITING AGREEMENT
__________, 2000
_____________, 2000
Xxxxxx Xxxxxxx & Co. Incorporated
Chase Securities Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx Inc.
Prudential Securities Incorporated
Wit SoundView Corporation
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
Chase Securities Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx International Ltd
Prudential-Bache International Limited
Wit SoundView Corporation
c/o Morgan Xxxxxxx & Co. International Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
Xxxxxxx
Dear Sirs and Mesdames:
AltaVista Company, a Delaware corporation (the "Company"), proposes to
issue and sell to the several Underwriters (as defined below) 14,800,000 shares
of its Common stock, par value $.01 (the "Firm Shares").
It is understood that, subject to the conditions hereinafter stated,
11,840,000 Firm Shares (the "U.S. Firm Shares") will be sold to the several U.S.
Underwriters named in Schedule I hereto (the "U.S. Underwriters") in connection
with the offering and sale of such U.S. Firm Shares in the United States and
Canada to United States and Canadian Persons (as such terms are defined in the
Agreement Between U.S. and International Underwriters of even date herewith),
and 2,960,000 Firm Shares (the "International Shares") will be sold to the
several International Underwriters named in Schedule II hereto (the
"International Underwriters") in connection with the offering and sale of such
International Shares outside the United States and Canada to persons other than
United States and Canadian Persons. Xxxxxx Xxxxxxx & Co. Incorporated, Chase
Securities Inc., FleetBoston Xxxxxxxxx Xxxxxxxx Inc., Prudential Securities
1
Incorporated, and Wit SoundView Corporation shall act as representatives (the
"U.S. Representatives") of the several U.S. Underwriters, and Xxxxxx Xxxxxxx &
Co. International Limited, Chase Securities Inc., FleetBoston Xxxxxxxxx Xxxxxxxx
International Ltd, Prudential-Bache International Limited and SoundView
Technology Group, Inc. shall act as representatives (the "International
Representatives") of the several International Underwriters. The U.S.
Underwriters and the International Underwriters are hereinafter collectively
referred to as the Underwriters.
The Company also proposes to issue and sell to the several U.S.
Underwriters not more than an additional 2,220,000 shares of its Common stock,
par value $.01 (the "Additional Shares") if and to the extent that the U.S.
Representatives shall have determined to exercise, on behalf of the U.S.
Underwriters, the right to purchase such shares of common stock granted to the
U.S. Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares
are hereinafter collectively referred to as the "Shares." The shares of Common
stock, par value $.01 per share, of the Company to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"Common Stock."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement relating to the Shares. The registration
statement contains two prospectuses to be used in connection with the offering
and sale of the Shares: the U.S. prospectus, to be used in connection with the
offering and sale of Shares in the United States and Canada to United States and
Canadian Persons, and the international prospectus, to be used in connection
with the offering and sale of Shares outside the United States and Canada to
persons other than United States and Canadian Persons. The international
prospectus is identical to the U.S. prospectus except for the outside front
cover page. The registration statement as amended at the time it becomes
effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities Act of 1933, as amended (the "Securities Act"), is hereinafter
referred to as the "Registration Statement"; the U.S. prospectus and the
international prospectus in the forms first used to confirm sales of Shares are
hereinafter collectively referred to as the "Prospectus." If the Company has
filed an abbreviated registration statement to register additional shares of
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.
Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx"), and Wit Soundview
Corporation ("Wit SoundView") have agreed to reserve an aggregate of 2,960,000
Shares to be purchased by them under this Agreement to be offered
2
for sale to the Company's directors, officers, employees and business associates
and other parties related to the Company, and to certain stockholders of CMGI,
Inc. (collectively, "Participants"), as set forth in the Prospectus under the
heading "Underwriters" (the "Directed Share Program"). The Shares to be sold by
Xxxxxx Xxxxxxx or its affiliates, and Wit SoundView or its affiliates, pursuant
to the Directed Share Program are referred to hereinafter as the "Directed
Shares." Any Directed Shares not orally confirmed for purchase by any
Participants by the end of the business day on which this Agreement is executed
will be offered to the public by the Underwriters as set forth in the
Prospectus.
1. Representations and Warranties. The Company represents and warrants
to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission.
(b) (i) The Registration Statement, when it became effective,
did not contain and, as amended or supplemented, if applicable, will
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration Statement and
the Prospectus comply and, as amended or supplemented, if applicable,
will comply in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder and (iii)
the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this paragraph do not apply to statements or omissions in the
Registration Statement or the Prospectus based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so
3
qualified or be in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole; all of the issued shares of capital
stock of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned
directly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.
(g) The shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable.
(h) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of such
Shares will not be subject to any preemptive or similar rights.
(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries, or any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, except where
such contravention would not singly or in the aggregate have a material
adverse effect on the Company and its Subsidiaries, taken as a whole,
and no consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the performance
by the Company of its obligations under this Agreement, except such as
may be
4
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares.
(j) There has not occurred any material adverse change or any
development involving a prospective material adverse change, in the
condition of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party
or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or
any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement
that are not described or filed as required.
(l) Each preliminary prospectus filed as part of the
registration statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder.
(m) The Company is not, and after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus will not be, required to
register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
(n) The Company and its subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
5
(o) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(p) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration
Statement.
(q) The Company and its subsidiaries own or possess, or can
acquire on reasonable terms, all material patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and
trade names (the "Intellectual Property") currently employed by them in
connection with the business now operated by them, except where the
failure to own, possess or be able to acquire on reasonable terms such
Intellectual Property would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole, and neither the Company nor any of its subsidiaries has received
any notice of infringement of or conflict with asserted rights of
others with respect to any of the foregoing which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in any material adverse effect on the Company and
its subsidiaries, taken as a whole.
(r) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, (i) the
Company and its subsidiaries have not incurred any material liability
or obligation, direct or contingent, nor entered into any material
transaction not in the ordinary course of business; (ii) the Company has
not purchased any of its outstanding capital stock, nor declared, paid
or otherwise made any dividend or distribution of any kind on its
capital stock other than ordinary and customary dividends; and (iii)
there has not been any material change in the capital stock, short-term
debt or long-term debt of the Company and its consolidated
subsidiaries, except in each case as described in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement).
6
(s) The Company and its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title
to all personal property owned by them which is material to the
business of the Company and its subsidiaries, in each case free and
clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its subsidiaries, in
each case except as described in the Prospectus.
(t) No material labor dispute with the employees of the Company
or any of its subsidiaries exists, except as described in the
Prospectus, or, to the knowledge of the Company, is imminent; and the
Company is not aware of any existing, threatened or imminent labor
disturbance by the employees of any of its principal suppliers,
manufacturers or contractors that could result in any material adverse
effect on the Company and its subsidiaries, taken as a whole.
(u) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; neither the Company nor any such
subsidiary has been refused any insurance coverage sought or applied
for; and neither the company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely effect the
Company and its subsidiaries, taken as a whole, except as described in
the Prospectus.
(v) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any such subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit, which
failure of the Company or subsidiary to possess, or which revocation or
modification if the subject of an unfavorable decision, ruling or
finding would, singly or in the aggregate, result in a material adverse
effect on the Company and its subsidiaries, taken as a whole, except as
described in the Prospectus.
7
(w) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(x) The Registration Statement, the Prospectus and any
preliminary prospectus comply, and any amendments or supplements
thereto will comply, with any applicable laws or regulations of foreign
jurisdictions in which the Prospectus or any preliminary prospectus, as
amended or supplemented, if applicable, are distributed in connection
with the Directed Share Program.
(y) The Company has not offered, or caused Xxxxxx Xxxxxxx, or
Wit SoundView, or any affiliate of either, to offer, Shares to any
person pursuant to the Directed Share Program with the intent to
unlawfully influence (i) a customer or supplier of the Company to alter
the customer's or supplier's level or type of business with the
Company, or (ii) a trade journalist or publication to write or publish
favorable information about the Company or its products.
(z) Except as described in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement), the Company has not sold, issued or distributed any shares
of Common Stock during the six-month period preceding the date hereof,
including any sales pursuant to Rule 144A under, or Regulation D or S
of, the Securities Act, other than shares issued pursuant to employee
benefit plans, qualified stock option plans or other employee
compensation plans or pursuant to outstanding options, rights or
warrants.
(aa) The schedule of Applicable Contracts (as defined herein)
to the opinion of counsel referred to in Section 5(c) hereof contains a
list of all agreements to which the Company is a party (x) pursuant to
which the Shares are subject to preemptive or similar rights, or (y)
where the performance by the Company of its obligations under this
Agreement would conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under any such
material agreement
8
and such conflict, breach, violation or default, singly or in the
aggregate, would result in a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(bb) The schedule of Applicable Orders (as defined herein) to
the opinion of counsel referred to in Section 5(c) hereof contains a
list of all orders or decrees of governmental authorities the execution
and delivery by the Company of, and the performance by the Company of
its obligations under this Agreement would contravene, except where
such contravention would not result in a material adverse effect on the
Company and its subsidiaries, taken as a whole.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell
to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedules I and II
hereto opposite its names at U.S.$_____ a share ("Purchase Price").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the U.S. Underwriters the Additional Shares, and the U.S. Underwriters shall
have a one-time right to purchase, severally and not jointly, up to 2,220,000
Additional Shares at the Purchase Price. If the U.S. Representatives, on behalf
of the U.S. Underwriters, elect to exercise such option, the U.S.
Representatives shall so notify the Company in writing not later than 30 days
after the date of this Agreement, which notice shall specify the number of
Additional Shares to be purchased by the U.S. Underwriters and the date on which
such shares are to be purchased. Such date may be the same as the Closing Date
(as defined below) but not earlier than the Closing Date nor later than ten
business days after the date of such notice. Additional Shares may be purchased
as provided in Section 4 hereof solely for the purpose of covering over-
allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each U.S. Underwriter agrees, severally
and not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as the U.S. Representatives may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of U.S. Firm Shares set forth in Schedule I
hereto opposite the name of such U.S. Underwriter bears to the total number of
U.S. Firm Shares.
The Company hereby agrees that, without the prior written consent of Xxxxxx
Xxxxxxx & Co. Incorporated on behalf of the Underwriters, it will not, during
the period ending 180 days after the date of the Prospectus, (i) offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
9
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
Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock or (ii) enter into any swap or other arrangement that transfers
to another, in whole or in part, any of the economic consequences of ownership
of the Common Stock, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply to (A)
the Shares to be sold hereunder, (B) the issuance by the Company of shares of
Common Stock upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof of which the Underwriters have been
advised in writing, (C) shares of Common Stock or options to purchase Common
stock that may be issued by the Company in connection with a merger or the
acquisition by the Company of the capital stock or assets of another entity,
and (D) the issuance of purchase rights, shares of Common Stock and the grant
of options to purchase shares of Common Stock pursuant to the Company's 1999
Employee Stock Purchase Plan, the 1999 Stock Option Plan, the 1999 Equity
Incentive Plan, the 1999 Stock Option Plan for Non-Employee Directors, and the
Amended and Restated 1999 Stock Option Plan for Non-Employee Directors;
provided that with respect to clauses (C) and (D) the recipient of such shares
-------------
of Common stock or options to purchase Common Stock shall have agreed to
restrictions on transfer substantially similar to the foregoing. The Company
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx & Co.
Incorporated on behalf of the Underwriters, it will not, during the period
ending 180 days after the date of the Prospectus, consent to the waiver of, or
release any party from, an agreement not to engage in any transaction
described in clause (i) or (ii) of the preceding sentence.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at
U.S.$_____ a share (the "Public Offering Price") and to certain dealers selected
by you at a price that represents a concession not in excess of U.S.$____ a
share under the Public Offering Price. No Underwriter may allow, and no dealer
may reallow, a concession to other underwriters or dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on ____________, 2000, or at
such other time on the same or such other date, not later than _________, 2000,
as shall be designated in writing by you. The time and date of such payment are
hereinafter referred to as the "Closing Date."
10
Payment for any Additional Shares shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several Underwriters at
10:00 a.m., New York City time, on the date specified in the notice described in
Section 2 or at such other time on the same or on such other date, in any event
not later than _______, 2000, as shall be designated in writing by the U.S.
Representatives. The time and date of such payment are hereinafter referred to
as the "Option Closing Date."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The obligations of the
Company to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date are
subject to the condition that the Registration Statement shall have become
effective not later than 4:30 p.m. (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a
whole, from that set
11
forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement)
that, in your judgment, is material and adverse and that makes it,
in your judgment, impracticable to market the Shares on the terms
and in the manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 5(a)(i) above and to the
effect that the representations and warranties of the Company contained in
this Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied hereunder on or before
the Closing Date. The officer signing and delivering such certificate may
rely upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP, special outside
counsel for the Company, provided that opinions of non-U.S. counsel
--------
reasonably acceptable to the Underwriters may be provided as to non-U.S.
subsidiaries, dated the Closing Date, to the effect that:
(i) the Company is a corporation validly existing and in
good standing under the laws of the State of Delaware with
corporate power and authority to own its properties and conduct
its business as described in the Prospectus, and the Company is
duly qualified to do business as a foreign corporation in good
standing in California, Maryland, Massachusetts, New York, Texas
and Virginia;
(ii) each subsidiary of the Company is a corporation
validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with corporate power and
authority to own its properties and to conduct its business as
described in the Prospectus;
12
(iii) the authorized capital stock of the Company
conforms in all material respects as to legal matters to the
description thereof contained in the Prospectus;
(iv) the shares of Common Stock outstanding prior to
the issuance of the Shares have been duly authorized and are
validly issued, fully paid and non-assessable;
(v) all of the issued shares of capital stock of each
subsidiary of the Company have been duly authorized and validly
issued, and are fully paid and non-assessable and are owned
directly or indirectly by the Company;
(vi) the Shares have been duly authorized and, when
issued and delivered against payment therefor in accordance with
the terms of this Agreement, will be validly issued, fully paid
and non-assessable, and the issuance of such Shares will not be
subject to any preemptive or other rights to subscribe for or to
purchase such Shares pursuant to the Company's certificate of
incorporation or by-laws or any agreement or other instrument
listed on the schedule of Applicable Contracts (as defined
herein) to the opinion of counsel referred to in this Section
5(c);
(vii) this Agreement has been duly authorized, executed
and delivered by the Company;
(viii) the execution and delivery by the Company of,
and the performance by the Company of its obligations (except
for any such obligations with respect to indemnification) under
this Agreement will not contravene any provision of Applicable
Law or Applicable Order or the certificate of incorporation or
by-laws of the Company; and will not conflict with or result in
a breach of violation of any of the terms or provisions of, or
constitute a default under, any Applicable Contract, except to
the extent such conflict, breach, violation or default has not
had or would not reasonably be expected to have, a material
adverse effect on the consolidated financial condition, results
of operation or business of the Company and its subsidiaries,
taken as a whole; and, except for the registration of the Shares
under the Securities Act and such consents, approvals, filings,
authorizations, registrations or
13
qualifications as may be required under the Exchange Act and
applicable state securities laws, as to which counsel need express
no opinion, in connection with the purchase and distribution or
the Shares by the U.S. Underwriters, no Governmental Approval is
required for the execution, delivery and performance of this
Agreement and the issuance and sale of the Shares, except for such
Governmental Approvals as have been obtained or made; and
The term "Applicable Contracts" means those agreements
which are specifically identified to counsel by the Company and
listed on a Schedule to counsel's opinion and "Applicable Laws"
means the General Corporation Law of the State of Delaware, the
Business Corporation Law of the State of New York and those laws,
rules and regulations of the federal laws of the United States of
America which, in counsel's experience, are normally applicable to
transactions of the type contemplated by this Agreement but
without counsel's having made any special investigation concerning
any other laws, rules or regulations; provided that the term
"Applicable Laws" does not include the securities or antifraud
laws of any jurisdiction or the rules and regulations of the
National Association of Securities Dealers, Inc. The term
"Applicable Orders" mean those orders or decrees of governmental
authorities specifically identified to counsel by the Company and
listed on a Schedule to counsel's opinion. The term "Government
Approvals" means any consent, approval, license, authorization or
validation of, or notice to, any filing, recording or registration
with, any Delaware or federal executive, legislative, judicial,
administrative or regulatory body pursuant to Applicable Laws.
(ix) the statements (A) in the Prospectus under the
caption "Description of Capital Stock" and (B) in the
Registration Statement in Items 14 and 15, in each case insofar
as such statements constitute summaries of matters of law,
documents or proceedings referred to therein, fairly present the
information called for with respect to such legal matters,
documents or proceedings and fairly summarize the matters
referred to therein in all material respects;
(x) Although the discussion set forth in the Prospectus
under the caption "Material Federal Income Tax Considerations for
Non-United States Stockholders" does not purport to discuss all
possible United States federal income tax consequences of the
purchase, ownership and disposition of Shares, such discussion
constitutes, in all material respects, a fair summary of the
United States federal income tax consequences to non-U.S.
stockholders of the purchase, ownership and disposition of Shares
under current law;
14
(xi) the Company is not, and, after giving effect to the
offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be, an
"investment company" as such term is defined in the Investment
Company Act of 1940, as amended.
(xii) The Registration Statement, as of its effective
date, and the Prospectus, as of its date, appeared on their face
to be appropriately responsive in all material respects to the
requirements of the Securities Act and the rules and regulations
thereunder, except that in each case we express no opinion as to
the financial statements, schedules and other financial and
statistical data included therein or excluded therefrom or the
exhibits to the Registration Statement, and we do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the
Prospectus except for those made under the captions "Material
Federal Income Tax Considerations for Non-United States
Stockholders" and "Description of Common Stock" in the Prospectus
insofar as they relate to provisions of documents therein
described;
(xiii) In rendering such opinion, such counsel may state
that their opinion is limited to matters governed by the Federal
laws of the United States of America, to the extent specifically
referred to therein, the General Corporation Law of the State of
Delaware, and the Business Corporation Law of the State of New
York. Such opinion shall also be to the effect that such counsel
has acted as special counsel to the Company in connection with the
preparation of the Registration Statement, and based on the
foregoing, no facts have come to the attention of such counsel
which lead them to believe that the Registration Statement (except
for the financial statements and financial schedules and other
financial and statistical data included therein, as to which such
counsel need express no belief) as of the date it became
effective, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading,
or that the Prospectus, as of its date and as of the Closing Date,
contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading (except for the financial statements and financial
schedules and other financial and statistical data included
therein, as to which such counsel need express no belief). The
foregoing opinion and statement may be qualified by a statement to
the effect that such counsel is not passing upon and is not
assuming any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement
or the Prospectus and has not made any independent check or
verification thereof.
(d) The Underwriters shall have received on the Closing
Date an opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the
Underwriters, dated
15
the Closing Date, covering the matters referred to in Sections
5(c)(vi), 5(c)(vii), 5(c)(ix) (but only as to the statements in
the Prospectus under "Description of Capital Stock" and
"Underwriters") and 5(c)(xii) above.
(e) The Underwriters shall have received on the Closing
Date a written statement, dated the Closing Date and signed by
Xxxxxxxxx Xxxxx, General Counsel of the Company that after due
inquiry, such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of
the Company is subject that are required to be described in the
Registration Statement or the Prospectus and are not so
described or of any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement and are not described or filed as
required.
The opinion of Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP
described in Section 5(c) above shall be rendered to the Underwriters at
the request of the Company and shall so state therein.
(f) The Underwriters shall have received, on each of
the date hereof and the Closing Date, letters dated the date
hereof or the Closing Date, as the case may be, in form and
substance satisfactory to the Underwriters, from each of
PriceWaterhouseCoopers LLP and KPMG LLP, independent public
accountants, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and
certain financial information contained in the Registration
Statement and the Prospectus; provided that each of the letters
delivered on the Closing Date shall use a "cut-off date" not
earlier than the date hereof.
(g) The "lock-up" agreements, each substantially in the
form of A hereto, between you and certain shareholders, officers
and directors of the Company relating to sales and certain other
dispositions of shares of Common Stock or certain other
securities, delivered to you on or before the date hereof, shall
be in full force and effect on the Closing Date.
16
(h) The several obligations of the U.S. Underwriters to
purchase Additional Shares hereunder are subject to the delivery
to the U.S. Representatives on the Option Closing Date of such
documents as they may reasonably request with respect to the
good standing of the Company, the due authorization and issuance
of the Additional Shares and other matters related to the
issuance of the Additional Shares.
6. Covenants of the Company. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants
with each Underwriter as follows:
(a) To furnish to you, without charge, 11 signed copies
of the Registration Statement (including exhibits thereto) and
for delivery to each other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto) and to furnish
to you in New York City, without charge, prior to 10:00 a.m. New
York City time on the business day next succeeding the date of
this Agreement and during the period mentioned in Section 6(c)
below, as many copies of the Prospectus and any supplements and
amendments thereto or to the Registration Statement as you may
reasonably request.
(b) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each
such proposed amendment or supplement and not to file any such
proposed amendment or supplement to which you reasonably object,
and to file with the Commission within the applicable period
specified in Rule 424(b) under the Securities Act any prospectus
required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the
public offering of the Shares as in the opinion of counsel for
the Underwriters the Prospectus is required by law to be
delivered in connection with sales by an Underwriter or dealer,
any event shall occur or condition exist as a result of which it
is necessary to amend or supplement the Prospectus in order to
make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading,
or if, in the opinion of counsel for the Underwriters, it is
necessary to amend or supplement the Prospectus to comply with
applicable law, forthwith to prepare, file with the Commission
and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the
Company) to which Shares may have been sold by you on behalf of
the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the
statements in the Prospectus as so amended or supplemented will
not, in the light of the
17
circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented,
will comply with law.
(d) To endeavor to qualify the Shares for offer and
sale under the securities or Blue Sky laws of such jurisdictions
as you shall reasonably request, provided that in connection
therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of
process or to take any action that would subject the Company to
service of process in suits in any jurisdiction other than those
arising out of the offering or sale of the Shares in such
jurisdiction or to register as a dealer in securities or to
become subject to taxation in any jurisdiction.
(e) To make generally available to the Company's
security holders and to you as soon as practicable an earning
statement covering the twelve-month period ending July 31, 2001
that satisfies the provisions of Section 11(a) of the Securities
Act and the rules and regulations of the Commission thereunder.
(f) Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated,
to pay or cause to be paid all expenses incident to the
performance of its obligations under this Agreement, including:
(i) the fees, disbursements and expenses of the Company's
counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act
and all other fees or expenses in connection with the
preparation and filing of the Registration Statement, any
preliminary prospectus, the Prospectus and amendments and
supplements to any of the foregoing, including all printing
costs associated therewith, and the mailing and delivering of
copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses
related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable
thereon, (iii) the cost of printing or producing any Blue Sky or
Legal Investment memorandum in connection with the offer and
sale of the Shares under state securities laws and all expenses
in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 6(d)
hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky or Legal
Investment memorandum, (iv) all filing fees and the reasonable
fees and disbursements of counsel to the Underwriters incurred
in connection with the review and qualification of the offering
of the Shares by the National Association of Securities Dealers,
Inc., (v) all fees and expenses in connection with the
preparation and filing of the registration statement on
18
Form 8-A relating to the Common Stock and all costs and expenses
incident to listing the Shares on the Nasdaq National Market, (vi)
the cost of printing certificates representing the Shares, (vii)
the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses of the Company relating
to investor presentations on any "road show" undertaken in
connection with the marketing of the offering of the Shares,
including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of
any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and
lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft
chartered in connection with the road show, (ix) all fees and
disbursements of counsel incurred by the Underwriters in
connection with the Directed Share Program and stamp duties,
similar taxes or duties or other taxes, if any, incurred by the
Underwriters in connection with the Directed Share Program, (x)
all expenses in connection with any offer and sale of the Shares
outside of the United States, including filing fees and the
reasonable fees and disbursements of counsel for the Underwriters
in connection with offers and sales outside of the United States,
and (xi) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which
provision is not otherwise made in this Section. It is understood,
however, that except as provided in this Section, Section 7
entitled "Indemnity and Contribution", and the last paragraph of
Section 10 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them and
any advertising expenses connected with any offers they may make.
(g) To place stop transfer orders on any Directed
Shares that have been sold to Participants subject to the three
month restriction on sale, transfer, assignment, pledge or
hypothecation imposed by NASD Regulation, Inc. under its
Interpretative Material 2110-1 on free-riding and withholding to
the extent necessary to ensure compliance with the three month
restrictions.
(h) To comply with all applicable securities and other
applicable laws, rules and regulations in each jurisdiction in
which the Directed Shares are offered in connection with the
Directed Share Program.
7. Indemnity and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of either Section 15 of
the Securities Act or Section 20 of the Securities Exchange Act of 1934,
as amended (the "Exchange
19
Act"), from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
any amendment thereof, any preliminary prospectus or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use therein;
provided, that the foregoing indemnity agreement with respect to any
preliminary prospectus shall not inure to the benefit of any Underwriter
from whom the person asserting any such losses, claims, damages or
liabilities purchased Shares, or any person controlling such Underwriter,
if a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was
not sent or given by or on behalf of such Underwriter to such person, if
required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Shares to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities, unless such
failure is the result of noncompliance by the Company with Section 6(a)
hereof.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who
sign the Registration Statement and each person, if any, who controls
the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Underwriter, but only with
reference to information relating to such Underwriter furnished to the
Company in writing by such Underwriter through you expressly for use in
the Registration Statement, any preliminary prospectus, the Prospectus
or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 7(a) or 7(b), such
person (the "indemnified party") shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying party") in
writing and the indemnifying party, upon request of the indemnified party,
shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified
20
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have
mutually agreed to the retention of such counsel or (ii) the named parties
to any such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the fees and expenses of more than
one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing
by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of parties indemnified
pursuant to Section 7(a), and by the Company, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section
7(a) or 7(b) is unavailable to an indemnified party or insufficient 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 (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Underwriters on the other hand from the offering of the Shares or (ii) if
the allocation provided by clause 7(d)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause 7(d)(i) above but also the
relative fault of the Company on the one hand and of the Underwriters on
the other hand in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received by
the Company on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the
Shares (before deducting expenses) received by the Company and the total
underwriting
21
discounts and commissions received by the Underwriters, in each case as
set forth in the table on the cover of the Prospectus, bear to the
aggregate Public Offering Price of the Shares. The relative fault of the
Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be
just or equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred to
in Section 7(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Shares underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 7 are not exclusive and shall not limit any
rights or remedies which may otherwise be available to any indemnified
party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of
the Company contained in this Agreement shall remain operative and in
full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any Underwriter
or any person controlling any Underwriter or by or on behalf of the
Company, its officers or directors or any person controlling the Company
and (iii) acceptance of and payment for any of the Shares.
8. Directed Share Program. (a) The Company agrees to indemnify
and hold harmless Xxxxxx Xxxxxxx, its affiliates, and each person, if
any, who controls Xxxxxx Xxxxxxx or its affiliates within the meaning of
either Section 15 of the
22
Securities Act or Section 20 of the Exchange Act ("Xxxxxx Xxxxxxx
Entities"), and Wit SoundView, its affiliates, and each person, if any,
who controls Wit SoundView or its affiliates within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act ("Wit
SoundView Entities," and together with the Xxxxxx Xxxxxxx Entities, the
"DSP Entities") from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) (i) caused by any untrue statement or alleged untrue
statement of a material fact contained in any material prepared by or with
the consent of the Company for distribution to Participants in connection
with the Directed Share Program, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; (ii caused by the
failure of any Participant to pay for and accept delivery of Directed
Shares that the Participant has agreed to purchase; or (ii related to,
arising out of, or in connection with the Directed Share Program other
than losses, claims, damages or liabilities (or expenses relating thereto)
that are finally judicially determined to have resulted from the bad faith
or gross negligence of such Xxxxxx Xxxxxxx Entity or Wit SoundView Entity,
as applicable.
(b) In case any proceeding (including any governmental
investigation) shall be instituted involving any DSP Entity in respect
of which indemnity may be sought pursuant to Section 8(a), the DSP
Entity seeking indemnity shall promptly notify the Company in writing
and the Company, upon request of the DSP Entity, shall retain counsel
reasonably satisfactory to the DSP Entity to represent the DSP Entity
and any other the Company may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any DSP Entity shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at
the expense of such DSP Entity unless (i) the Company shall have agreed
to the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Company and
the DSP Entity and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests
between them. The Company shall not, in respect of the legal expenses of
the DSP Entities in connection with any proceeding or related
proceedings the same jurisdiction, be liable for the fees and expenses
of more than one separate firm (in addition to any local counsel) for
all DSP Entities. Any such firm for the DSP Entities shall be designated
in writing by Xxxxxx Xxxxxxx. The Company shall not be liable for any
settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the
plaintiff, the Company agrees to indemnify the DSP Entities from and
against any loss or liability by reason of such settlement or judgment.
The Company shall not, without the prior written consent of Xxxxxx
Xxxxxxx and/or Wit SoundView, as applicable, effect any settlement of
any pending or threatened proceeding in
23
respect of which any DSP Entity is or could have been a party and
indemnity could have been sought hereunder by such DSP Entity, unless such
settlement includes an unconditional release of the DSP Entities from all
liability on claims that are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section
8(a) is unavailable to a DSP Entity or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then the
Company, in lieu of indemnifying the DSP Entity thereunder, shall
contribute to the amount paid or payable by the DSP Entity as a result
of such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company
on the one hand and the DSP Entities on the other hand from the offering
of the Directed Shares or (ii) if the allocation provided by clause
8(c)(i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in
clause 8(c)(i) above but also the relative fault of the Company on the
one hand and of the DSP Entities on the other hand in connection with
the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and of the DSP Entities on the other hand in connection with the
offering of the Directed Shares shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the
Directed Shares (before deducting expenses) and the total underwriting
discounts and commissions received by the DSP Entities for the Directed
Shares, bear to the aggregate Public Offering Price of the Shares. If
the loss, claim, damage or liability is caused by an untrue or alleged
untrue statement of a material fact, the relative fault of the Company
on the one hand and the DSP Entities on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement or the omission or alleged omission relates to
information supplied by the Company or by the DSP Entities and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(d) The Company and the DSP Entities agree that it would not be
just or equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the DSP Entities were treated
as one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred to
in Section 8(c). The amount paid or payable by the DSP Entities as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by the DSP Entities in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 8, no DSP Entity shall be required to contribute any amount
in excess of the amount by which the total price at which the Directed
Shares distributed to the public were offered to the public
24
exceeds the amount of any damages that such DSP Entity has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. The remedies provided for in this Section 8
are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any DSP Entity at law or in equity.
(e) The indemnity and contribution provisions contained in this
Section 8 shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by
or on behalf of any DSP Entity or the Company, its officers or directors
or any person controlling the Company and (iii) acceptance of and
payment for any of the Directed Shares.
9. Termination. This Agreement shall be subject to termination
by notice given by you to the Company, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange or the National Association of Securities Dealers, Inc., (ii)
trading of any securities of the Company shall have been suspended on
any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or (iv) there
shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in your
judgment, is material and adverse and (b) in the case of any of the
events specified in clauses 9(a)(i) through 9(a)(iv), such event, singly
or together with any other such event, makes it, in your judgment,
impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
10. Effectiveness; Defaulting Underwriters. This Agreement
shall become effective upon the execution and delivery hereof by the
parties hereto.
If, on the Closing Date or the Option Closing Date, as the case
may be, any one or more of the Underwriters shall fail or refuse to
purchase Shares that it has or they have agreed to purchase hereunder on
such date, and the aggregate number of Shares which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is
not more than one-tenth of the aggregate number of the Shares to be
purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule I or Schedule II bears to
the aggregate number of Firm Shares set forth opposite the names of all
such non-defaulting Underwriters, or in such other proportions as you
may specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date;
provided that in no event shall the number of Shares that any
Underwriter has agreed to purchase pursuant to this Agreement be increased
25
pursuant to this Section 10 by an amount in excess of one-
ninth of such number of Shares without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Firm Shares and the aggregate number of
Firm Shares with respect to which such default occurs is more than one-
tenth of the aggregate number of Firm Shares to be purchased, and
arrangements satisfactory to you and the Company for the purchase of
such Firm Shares are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-
defaulting Underwriter or the Company. In any such case either you or
the Company shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. If, on the Option Closing
Date, any Underwriter or Underwriters shall fail or refuse to purchase
Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the
aggregate number of Additional Shares to be purchased, the non-
defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase Additional Shares or (ii) purchase not
less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase in the absence of
such default. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the
Company to comply with the terms or to fulfill any of the conditions of
this Agreement, or if for any reason the Company shall be unable to
perform its obligations under this Agreement, the Company will reimburse
the Underwriters or such Underwriters as have so terminated this
Agreement with respect to themselves, severally, for all out-of-pocket
expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this
Agreement or the offering contemplated hereunder.
11. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be
deemed a part of this Agreement.
26
Very truly yours,
AltaVista Company
By:
____________________________________
Name:
Title:
Accepted as of the date hereof
XXXXXX XXXXXXX & CO.
INCORPORATED
CHASE SECURITIES INC.
FLEETBOSTON XXXXXXXXX XXXXXXXX
INC.
PRUDENTIAL SECURITIES
INCORPORATED
WIT SOUNDVIEW CORPORATION
Acting severally on behalf of themselves and the
several U.S. Underwriters named in Schedule
I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
__________________________________
Name:
Title:
XXXXXX XXXXXXX & CO.
INTERNATIONAL LIMITED
CHASE SECURITIES INC.
FLEETBOSTON XXXXXXXXX XXXXXXXX
INTERNATIONAL LTD
PRUDENTIAL-BACHE INTERNATIONAL LIMITED
WIT SOUNDVIEW CORPORATION
Acting severally on behalf of themselves and the
several InternationalUnderwriters named in
Schedule II hereto.
27
By: Xxxxxx Xxxxxxx & Co. International Limited
By:
--------------------------------
Name:
Title:
28
SCHEDULE I
U.S. UNDERWRITERS
Number of Firm
Shares
Underwriter To Be Purchased
---------------------------------------------------------
Xxxxxx Xxxxxxx & Co. Incorporated.......
Chase Securities Inc....................
FleetBoston Xxxxxxxxx Xxxxxxxx Inc......
Prudential Securities Incorporated......
Wit SoundView Corporation...............
--------------
Total U.S. Firm Shares............. 11,840,000
==============
SCHEDULE II
INTERNATIONAL UNDERWRITERS
Number of
Firm
Shares To Be
Underwriter Purchased
-----------------------------------------------------------------
Xxxxxx Xxxxxxx & Co. International Limited.......
Chase Securities Inc.............................
FleetBoston Xxxxxxxxx Xxxxxxxx International Ltd.
Prudential-Bache International Limited...........
Wit SoundView Corporation........................
-------------------
Total International Firm Shares.................. 2,960,000
===================
EXHIBIT A
FORM OF LOCK-UP LETTER
[DATE]
Xxxxxx Xxxxxxx & Co. Incorporated
Chase Securities Inc.
FleetBoston Xxxxxxxxx Xxxxxxxx Inc.
Prudential Securities Incorporated
Wit SoundView Corporation
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx
Xxxxxxx") proposes to enter into an Underwriting Agreement (the "Underwriting
Agreement") with AltaVista Company, a Delaware corporation (the "Company")
providing for the public offering (the "Public Offering" by the several
Underwriters, including Xxxxxx Xxxxxxx (the "Underwriters"), of a number to
shares to be determined (the "Shares") of the Common stock, par value $.01, of
the Company (the "Common Stock").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the final prospectus relating
to the Public Offering (the "Prospectus"), (1) offer, 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 Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
or (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of Common Stock,
whether any such transaction described in clause (1) or (2) above
1
is to be settled by delivery of Common Stock or such other securities, in cash
or otherwise. The foregoing sentence shall not apply to the sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement, or transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after the completion of the Public Offering. In addition, the
undersigned agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the Prospectus, make any
demand for or exercise any right with respect to, the registration of any shares
of Common Stock or any security convertible into or exercisable or exchangeable
for Common Stock.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters. In the event that (a) the
Underwriting Agreement has not been signed on or before July 1, 2000, (b) the
Underwriting Agreement terminates prior to delivery of certificates for the
Shares to the Underwriters and payment therefor, or (c) the Company provides
written notification to Xxxxxx Xxxxxxx of the Company's intent to discontinue
proceeding with the Public Offering, this Agreement shall be of no further force
or effect.
Very truly yours,
_____________________
(Name)
_______________________
(Address)
2
