EXHIBIT 1.1
5,500,000 SHARES
AvantGo, Inc.
COMMON STOCK
UNDERWRITING AGREEMENT
September ___, 2000
Credit Suisse First Boston Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
CIBC World Markets Corp.
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
1. Introductory. AvantGo, Inc., a Delaware corporation ("Company"),
proposes to issue and sell 5,500,000 shares ("Firm Securities") of its Common
Stock ("Securities") and also proposes to issue and sell to the Underwriters, at
the option of the Underwriters, an aggregate of not more than 825,000 additional
shares ("Optional Securities") of its Securities as set forth below. The Firm
Securities and the Optional Securities are herein collectively called the
"Offered Securities". As part of the offering contemplated by this Agreement,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (the "Designated
Underwriter") has agreed to reserve out of the Firm Securities purchased by it
under this Agreement, up to ___________ shares, for sale to the Company's
directors, officers, employees and other parties associated with the Company
(collectively, "Participants"), as set forth in the Prospectus (as defined
herein) under the heading "Underwriting" (the "Directed Share Program"). The
Firm Securities to be sold by the Designated Underwriter pursuant to the
Directed Share Program (the "Directed Shares") will be sold by the Designated
Underwriter pursuant to this Agreement at the public offering price. Any
Directed Shares not subscribed for 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. The Company hereby agrees with the several
Underwriters named in Schedule A hereto ("Underwriters") as follows:
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333- 38888) relating to the Offered
Securities, including a form of prospectus, has been filed with the Securities
and Exchange Commission ("Commission") and either (i) has been declared
effective under the Securities Act of 1933 ("Act") and is not proposed to be
amended or (ii) is proposed to be amended by amendment or post-effective
amendment. If such registration statement ("initial registration statement") has
been declared effective, either (i) an additional registration statement
("additional registration statement") relating to the Offered Securities may
have been filed with the Commission pursuant to Rule 462(b) ("Rule 462(b)")
under the Act and, if so filed, has become effective upon filing pursuant to
such Rule and the Offered Securities all have been duly registered under the Act
pursuant to the initial registration statement and, if applicable, the
additional registration statement or (ii) such an additional registration
statement is proposed to be filed with the Commission pursuant to Rule 462(b)
and will become effective upon filing pursuant to such Rule and upon such filing
the Offered Securities will all have been duly registered under the Act pursuant
to the initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial registration
statement or if an additional registration statement has been filed and the
Company does not propose to amend it, and if any post-effective amendment to
either such registration statement has been filed with the Commission prior to
the execution and delivery of this Agreement, the most recent amendment (if any)
to each such registration statement has been declared effective by the
Commission or has become effective upon filing pursuant to Rule 462(c) ("Rule
462(c)") under the Act or, in the case of the additional registration statement,
Rule 462(b). For purposes of this Agreement, "Effective Time" with respect to
the initial registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement means (i) if
the Company has advised the Representatives that it does not propose to amend
such registration statement, the date and time as of which such registration
statement, or the most recent post-effective amendment thereto (if any) filed
prior to the execution and delivery of this Agreement, was declared effective by
the Commission or has become effective upon filing pursuant to Rule 462(c), or
(ii) if the Company has advised the Representatives that it proposes to file an
amendment or post-effective amendment to such registration statement, the date
and time as of which such registration statement, as amended by such amendment
or post-effective amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed prior to
the execution and delivery of this Agreement but the Company has advised the
Representatives that it proposes to file one, "Effective Time" with respect to
such additional registration statement means the date and time as of which such
registration statement is filed and becomes effective pursuant to Rule 462(b).
"Effective Date" with respect to the initial registration statement or the
additional registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its Effective Time,
including all information contained in the additional registration statement (if
any) and deemed to be a part of the initial registration statement as of the
Effective Time of the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all information (if
any) deemed to be a part of the initial registration statement as of its
Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act, is
hereinafter referred to as the "Initial Registration Statement". The additional
registration statement, as amended at its Effective Time, including the contents
of the initial registration statement incorporated by reference therein and
including all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule 430A(b), is
hereinafter referred to as the "Additional Registration Statement". The Initial
Registration Statement and the Additional Registration Statement are herein
referred to
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collectively as the "Registration Statements" and individually as a
"Registration Statement". The form of prospectus relating to the Offered
Securities, as first filed with the Commission pursuant to and in accordance
with Rule 424(b) ("Rule 424(b)") under the Act or (if no such filing is
required) as included in a Registration Statement, is hereinafter referred to as
the "Prospectus". No document has been or will be prepared or distributed in
reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (i) on the Effective
Date of the Initial Registration Statement, the Initial Registration Statement
conformed in all material respects to the requirements of the Act and the rules
and regulations of the Commission ("Rules and Regulations") and did not include
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, (ii) on the Effective Date of the Additional Registration Statement
(if any), each Registration Statement conformed, or will conform, in all
material respects to the requirements of the Act and the Rules and Regulations
and did not include, or will not include, any untrue statement of a material
fact and did not omit, or will not omit, to state any material fact required to
be stated therein or necessary to make the statements therein not misleading and
(iii) on the date of this Agreement and at the First Closing Date and the
Optional Closing Date, if any, the Initial Registration Statement and, if the
Effective Time of the Additional Registration Statement is prior to the
execution and delivery of this Agreement, the Additional Registration Statement
each conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included, each
Registration Statement and the Prospectus will conform, in all material respects
to the requirements of the Act and the Rules and Regulations, and neither of
such documents includes, or will include, any untrue statement of a material
fact or omits, or will omit, to state any material fact required to be stated
therein or necessary to make the statements therein not misleading. If the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the Prospectus
will conform in all material respects to the requirements of the Act and the
Rules and Regulations, neither of such documents will include any untrue
statement of a material fact or will omit to state any material fact required to
be stated therein or necessary to make the statements therein not misleading,
and no Additional Registration Statement has been or will be filed. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus based upon written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only such
information is that described as such in Section 7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with power
and authority (corporate and other) to own its properties and conduct its
business as presently conducted and as described in the Prospectus; and the
Company is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on the
business, properties, prospects, condition (financial or other) or results of
operations of the Company and its subsidiaries, taken as a whole ("Material
Adverse Effect").
(d) Each subsidiary of the Company has been duly incorporated and is
an existing corporation in good standing under the laws of the jurisdiction of
its incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as presently conducted and as described in
the Prospectus; and each subsidiary of the Company is duly qualified to
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do business as a foreign corporation in good standing in all other jurisdictions
in which its ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so qualified would
not have a Material Adverse Effect; all of the issued and outstanding capital
stock of each subsidiary of the Company has been duly authorized and validly
issued and is fully paid and nonassessable; and the capital stock of each
subsidiary is owned by the Company free from liens, encumbrances and defects.
(e) The authorized, issued and outstanding capital stock of the
Company as of the date indicated is as set forth on page ___ in the Prospectus
under the heading "Actual" under the caption "Capitalization", and, after giving
effect to the conversion of all preferred stock of the Company into Common
Stock, will be as set forth "Pro Forma", and after giving effect to the offering
will be as set forth under the heading "Pro Forma, As Adjusted", in each case
under the caption "Capitalization" (except for subsequent issuances, if any,
pursuant to this Agreement, pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectus or pursuant to the exercise of
convertible securities or options referred to in the Prospectus). The shares of
issued and outstanding capital stock of the Company have been issued in
compliance, in all material respects, with all federal and state securities
laws. Except as disclosed in the Prospectus, there are no outstanding options
to purchase, or any preemptive rights or other rights to subscribe for or to
purchase, any securities or obligations convertible into, or any contracts or
commitments to issue or sell, shares of the Company's or any of its
subsidiaries' capital stock or any such options, rights, convertible securities
or obligations, other than options issued pursuant to the Company's employee
stock purchase and stock option plans in the ordinary course of business. Since
August 31, 2000, the Company has not issued any securities other than (i) Common
Stock of the Company pursuant to the exercise of previously outstanding and
privately granted options pursuant to the 1997 Stock Option Plan and the 2000
Stock Incentive Compensation Plan (collectively, the "Plans"), (ii) options
granted pursuant to the Plans, and (iii) the Securities and the Optional
Securities. The description of the Company's stock option and purchase plans
and the options or other rights granted and exercised thereunder set forth in
the Prospectus accurately and fairly describe, in all material respects, the
information required to be shown with respect to such plans, arrangements,
options and rights.
(f) The Offered Securities and all other outstanding shares of capital
stock of the Company have been duly authorized; all outstanding shares of
capital stock of the Company are, and when the Offered Securities have been
delivered and paid for in accordance with this Agreement on each Closing Date
(as defined below), such Offered Securities will have been, validly issued,
fully paid and nonassessable and will conform to the description thereof
contained in the Prospectus; and the stockholders of the Company have no
preemptive rights with respect to the Securities.
(g) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would give
rise to a valid claim against the Company or any Underwriter for a brokerage
commission, finder's fee or other like payment in connection with this offering
or, to the Company's knowledge, any other arrangements, agreements,
understandings, payments or issuance with respect to the Company or any of its
officers, directors, shareholders, partners, employees, subsidiaries or
affiliates that may affect the Underwriters' compensation as determined by the
National Association of Securities Dealers, Inc. (the "NASD").
(h) 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 Act with respect to any securities of
the Company owned or to be owned by such
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person or to require the Company to include such securities in the securities
registered pursuant to a registration statement, except such as described in the
Registration Statement and as have been validly waived with respect to the
transactions contemplated by the Registration Statement.
(i) The Offered Securities have been approved for listing on the
Nasdaq Stock Market's National Market, subject to notice of issuance.
(j) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the consummation of
the transactions contemplated by this Agreement in connection with the issuance
and sale of the Offered Securities by the Company, except such as have been
obtained and made under the Act and such as may be required under the Act and
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and such as
may be required under state securities law.
(k) The execution, delivery and performance of this Agreement, and the
issuance and sale of the Offered Securities will not result in a breach or
violation of any of the terms and provisions of, or constitute a default under,
any statute, any rule, regulation or order of any governmental agency or body or
any court, domestic or foreign, having jurisdiction over the Company or any
subsidiary of the Company or any of their respective properties, or any
agreement or instrument to which the Company or any such subsidiary is a party
or by which the Company or any such subsidiary is bound or to which any of the
properties of the Company or any such subsidiary is subject, except where such
breach, violation or default would not have a Material Adverse Effect, or the
charter or by-laws of the Company or any such subsidiary, and the Company has
full power and authority to authorize, issue and sell the Offered Securities as
contemplated by this Agreement.
(l) This Agreement has been duly authorized, executed and delivered by
the Company.
(m) Except as disclosed in the Prospectus, each of the Company and its
subsidiaries has good and marketable title to all real properties and all other
properties and assets owned by it, in each case free from liens, encumbrances
and defects that would have a Material Adverse Effect on the value thereof or
the use made or to be made thereof by it; and except as disclosed in the
Prospectus, each of the Company and its subsidiaries holds any leased real or
personal property under valid and enforceable leases with no exceptions that
would have a Material Adverse Effect on the use made or to be made thereof by
it.
(n) Each of the Company and its subsidiaries possesses adequate
certificates, authorities or permits issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by it, except where the
failure to possess any such certificate, authority or permit would not,
individually or in the aggregate, have a Material Adverse Effect, and has not
received any notice of proceedings relating to the revocation or modification of
any such certificate, authority or permit that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate have
a Material Adverse Effect.
(o) No labor dispute with the employees of the Company or any
subsidiary of the Company exists or, to the knowledge of the Company and its
subsidiaries, is imminent that might have a Material Adverse Effect.
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(p) Each of the Company and its subsidiaries owns or possesses
adequate trademarks, trade names and other rights to inventions, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary
information, systems or procedures), patents, copyrights and other intellectual
property (collectively, "intellectual property rights") necessary to conduct the
business now operated by it or proposed to be operated by it as described in the
Prospectus, or presently employed by it, and has not received any notice of
infringement of or conflict with asserted rights of others with respect to any
of its material intellectual property rights that, if determined adversely to
the Company or any of its subsidiaries, would individually or in the aggregate
have a Material Adverse Effect and knows of no facts or circumstances which
would render any of its material intellectual property invalid or inadequate to
protect the interest of the Company.
(q) Except as disclosed in the Prospectus, neither the Company nor any
of its subsidiaries is in violation of any statute, rule, regulation, decision
or order of any governmental agency or body or any court, domestic or foreign,
relating to the use, disposal or release of hazardous or toxic substances or
relating to the protection or restoration of the environment or human exposure
to hazardous or toxic substances (collectively, "environmental laws"), owns or
operates any real property contaminated with any substance that is subject to
any environmental laws, is liable for any off-site disposal or contamination
pursuant to any environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim would
individually or in the aggregate have a Material Adverse Effect; and neither the
Company nor any of its subsidiaries is aware of any pending investigation that
might lead to such a claim.
(r) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if determined adversely
to the Company or any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect, or would materially and adversely
affect the ability of the company to perform its obligations under this
Agreement, or which are otherwise material in the context of the sale of the
Offered Securities; and, to the Company's knowledge, no such actions, suits or
proceedings are threatened or contemplated.
(s) The financial statements included in each Registration Statement
and the Prospectus present fairly the financial position of each of the Company
and its subsidiaries as of the dates shown and their results of operations and
cash flows for the periods shown, and such financial statements have been
prepared in conformity with the generally accepted accounting principles in the
United States applied on a consistent basis; and the schedules included in each
Registration Statement present fairly the information required to be stated
therein; and the assumptions used in preparing the pro forma financial
statements included in each Registration Statement and the Prospectus provide a
reasonable basis for presenting the significant effects directly attributable to
the transactions or events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma columns therein
reflect the proper application of those adjustments to the corresponding
historical financial statement amounts. No financial statements are required to
be included in the Registration Statement that have not been so included.
(t) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus, there has been
no material adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or otherwise), business,
properties or results of operations of the Company and its subsidiaries, taken
as one enterprise, and except as disclosed in or contemplated by the Prospectus,
there has been no
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dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(u) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as defined in
the Investment Company Act of 1940.
(v) The Company represents and warrants to the Underwriters that (i)
the Registration Statement, the Prospectus and any preliminary prospectus
comply, and any further 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, and that (ii) no
authorization, approval, consent, license, order, registration or qualification
of or with any government, governmental instrumentality or court, other than
such as have been obtained, is necessary under the securities law and
regulations of foreign jurisdictions in which the Directed Shares are offered
outside the United States.
(w) The Company has not offered, or caused the Underwriters to offer,
any offered Securities to any person pursuant to the Directed Share Program with
the specific 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.
(x) The Agreement and Plan of Merger dated May 26, 2000 (the "Plan of
Merger") by and among the Company and GC Acquisition, Inc., an Illinois
corporation, Globalware computing, Inc., and Illinois corporation ("Globalware")
and Globalware's stockholders, has been duly authorized by all necessary board
of directors and stockholder action on the part of the Company and Globalware
and has been duly executed and delivered by each of the parties thereto. The
execution and delivery of the Plan of Merger and the consummation of the merger
contemplated thereby does not contravene any provision of applicable Federal,
California or Delaware corporate law or the articles of incorporation or bylaws
of Globalware or the certificate of incorporation or bylaws of the Company, or
any judgment or decree of any governmental body, agency or court having
jurisdiction over the Company or Globalware, and no consent, approval,
authorization or order of or qualification with any governmental body or agency
is required for the performance by the Company and Globalware of their
respective obligations under the Plan of Merger except such as have been
obtained. The merger contemplated by the Plan of Merger is effective under the
laws of the State of Illinois and the State of Delaware.
(y) The offer, sale and issuance of the shares of Series E Preferred
Stock of the Company issued pursuant to the terms of the Plan of Merger, and the
issuance of the Common Stock to be issued upon conversion thereof, constitute
transactions exempt from the registration requirements of Section 5 of the
Securities Act and exempt from the qualification requirements of the California
Corporate Securities Law of 1968, as amended.
(z) Except as disclosed in the Preliminary Prospectus, all Tax returns
required to be filed by the Company and each of its subsidiaries have been filed
and all such returns are true, complete, and correct in all material respects.
All material Taxes that are due or claimed to be due from the Company and each
of its subsidiaries have been paid other than those (i) currently payable
without penalty or interest or (ii) being contested in good faith and by
appropriate proceedings and for
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which, in the case of both clauses (i) and (ii), adequate reserves have been
established on the books and records of the Company and each of its subsidiaries
in accordance with GAAP. To the knowledge of each of the Company and its
subsidiaries, there are no proposed, material Tax assessments against each of
the Company and its subsidiaries, respectively. To the knowledge of each of the
Company and its subsidiaries, the accruals and reserves on the books and records
of each of the Company and its subsidiaries, respectively, in respect of any
material Tax liability for any taxable period not finally determined are
adequate to meet any assessments of Tax for any such period. For purposes of
this Agreement, the term "Tax" and "Taxes" shall mean all Federal, state, local,
and foreign taxes, and other assessments of a similar nature (whether imposed
directly or through withholding), including any interest, additions to tax, or
penalties applicable thereto.
(aa) Neither the Company, nor any of its affiliates or subsidiaries,
has taken, directly or indirectly, any action designed to cause or result in,
or which has constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the shares of the Securities
to facilitate the sale or resale of the Offered Securities.
(bb) To the knowledge of the Company, Ernst & Young LLP, who has
certified the financial statements filed with the Commission as part of each
Registration Statement, are independent public auditors with respect to each of
the Company and its subsidiaries as required by the Act and the Rules and
Regulations. Each of he Company and its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
accountability for assets; and (iii) access to assets is permitted only in
accordance with management's general or specific authorization.
(cc) Each of the Company and its subsidiaries carries, or is covered
by, insurance in such amounts and covering such risks as is reasonably adequate
for the conduct of its businesses and the value of its properties and as is
customary for companies engaged in similar industries.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $ _____ per share, the respective
numbers of shares of Firm Securities set forth opposite the names of the
Underwriters in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives for the
accounts of the Underwriters, against payment of the purchase price in Federal
(same day) funds by wire transfer to an account at a bank acceptable to Credit
Suisse First Boston Corporation drawn to the order of the Company at the office
of Xxxxxxx Coie, LLP, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxx Xxxx, Xxxxxxxxxx
00000, at 10:00 A.M., New York time, on ____________ , or at such other time not
later than seven (7) full business days thereafter as CSFBC and the Company
determine, such time being herein referred to as the "First Closing Date". For
purposes of Rule 15c6-1 under the Securities Exchange Act of 1934, the First
Closing Date (if later than the otherwise applicable settlement date) shall be
the settlement date for payment of funds and delivery of securities for all the
Offered Securities sold pursuant to the offering. The certificates for the Firm
Securities so to be delivered will be in definitive form, in such denominations
and registered in such names as CSFBC requests and will
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be made available for checking and packaging at the above office of Xxxxxxx
Coie, LLP at least twenty-four (24) hours prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company from time
to time not more than thirty (30) days subsequent to the date of the Prospectus,
the Underwriters may purchase all or less than all of the Optional Securities at
the purchase price per Security to be paid for the Firm Securities. The Company
agrees to sell to the Underwriters the number of shares of Optional Securities
specified in such notice and the Underwriters agree, severally and not jointly,
to purchase such Optional Securities. Such Optional Securities shall be
purchased for the account of each Underwriter in the same proportion as the
number of shares of Firm Securities set forth opposite such Underwriter's name
bears to the total number of shares of Firm Securities (subject to adjustment
by CSFBC to eliminate fractions) and may be purchased by the Underwriters only
for the purpose of covering over-allotments made in connection with the sale of
the Firm Securities. No Optional Securities shall be sold or delivered unless
the Firm Securities previously have been, or simultaneously are, sold and
delivered. The right to purchase the Optional Securities or any portion thereof
may be exercised from time to time and to the extent not previously exercised
may be surrendered and terminated at any time upon notice by CSFBC to the
Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by CSFBC
but shall be not later than five (5) full business days after written notice of
election to purchase Optional Securities is given. The Company will deliver the
Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, against payment of
the purchase price therefor in Federal (same day) funds by official bank check
or checks or wire transfer to an account at a bank acceptable to CSFBC drawn to
the order of the Company, at the above office of Xxxxxxx Coie, LLP. The
certificates for the Optional Securities being purchased on each Optional
Closing Date will be in definitive form, in such denominations and registered in
such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the above
office of Xxxxxxx Coie, LLP at a reasonable time in advance of such Optional
Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
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5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will file the
Prospectus with the Commission pursuant to and in accordance with Rule 424(b)
not later than the earlier of (i) the second business day following the
execution and delivery of this Agreement or (ii) the fifteenth business day
after the Effective Date of the Initial Registration Statement.
The Company will advise CSFBC promptly of any such filing pursuant to Rule
424(b). If the Effective Time of the Initial Registration Statement is prior to
the execution and delivery of this Agreement and an additional registration
statement is necessary to register a portion of the Offered Securities under the
Act but the Effective Time thereof has not occurred as of such execution and
delivery, the Company will file the additional registration statement or, if
filed, will file a post-effective amendment thereto with the Commission pursuant
to and in accordance with Rule 462(b) on or prior to 10:00 P.M., New York time,
on the date of this Agreement or, if earlier, on or prior to the time the
Prospectus is printed and distributed to any Underwriter, or will make such
filing at such later date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to amend or
supplement the initial or any additional registration statement as filed or the
related prospectus or the Initial Registration Statement, the Additional
Registration Statement (if any) or the Prospectus and will not effect such
amendment or supplementation without CSFBC's consent; and the Company will also
advise CSFBC promptly of the effectiveness of each Registration Statement (if
its Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a Registration Statement
or the Prospectus and of the institution by the Commission of any stop order
proceedings in respect of a Registration Statement and will use its best efforts
to prevent the issuance of any such stop order and to obtain as soon as possible
its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with sales by
any Underwriter or dealer, any event occurs as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if it is necessary at any time to amend the Prospectus to comply
with the Act, the Company will promptly notify CSFBC of such event and will
promptly prepare and file with the Commission, at its own expense, an amendment
or supplement which will correct such statement or omission or an amendment
which will effect such compliance. Neither CSFBC's consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall constitute a
waiver of any of the conditions set forth in Section 6.
10
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its security
holders an earnings statement covering a period of at least twelve (12) months
beginning after the Effective Date of the Initial Registration Statement (or, if
later, the Effective Date of the Additional Registration Statement) which will
satisfy the provisions of Section 11(a) of the Act. For the purpose of the
preceding sentence, "Availability Date" means the 45th day after the end of the
fourth fiscal quarter following the fiscal quarter that includes such Effective
Date, except that, if such fourth fiscal quarter is the last quarter of the
Company's fiscal year, "Availability Date" means the 90th day after the end of
such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement, three of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under the Act in
connection with sales by any Underwriter or dealer, the Prospectus and all
amendments and supplements to such documents, in each case in such quantities as
CSFBC requests. The Prospectus shall be so furnished on or prior to 3:00 P.M.,
New York time, on the business day following the later of the execution and
delivery of this Agreement or the Effective Time of the Initial Registration
Statement. All other documents shall be so furnished as soon as available. The
Company will pay the expenses of printing and distributing to the Underwriters
all such documents.
(f) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC designates and
will continue such qualifications in effect so long as required for the
distribution; provided, however, that the Company shall not be required to
qualify as a foreign corporation in any jurisdiction in which it is not so
qualified or to take any action that would subject it to general consent to
service of process or taxation other than as to matters and transactions
relating to the Prospectus, the Registration Statement, any preliminary
prospectus or the offering or sale of the Offered Securities, in any
jurisdiction in which it is not so subject.
(g) During the period of five (5) years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a copy
of its annual report to stockholders for such year; and the Company will furnish
to the Representatives (i) as soon as available, a copy of each report and any
definitive proxy statement of the Company filed with the Commission under the
Securities Exchange Act of 1934 or mailed to stockholders, and (ii) from time to
time, such other publicly available information concerning the Company as CSFBC
may reasonably request.
(h) The Company will pay all expenses incident to the performance of
its obligations under this Agreement, for any filing fees and other expenses
(including fees and disbursements of counsel) incurred in connection with
qualification of the Offered Securities for sale under the laws of such
jurisdictions as CSFBC designates and the printing of memoranda relating thereto
for the filing fee incident to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review by the National
Association of Securities Dealers, Inc. of the Offered Securities, for any
travel expenses of the Company's officers and employees and any other expenses
of the Company in connection with attending or hosting meetings with prospective
purchasers of the Offered Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including any amendments and
supplements thereto) to the Underwriters.
(i) For a period of one hundred eighty (180) days after the date of
the initial public offering of the Offered Securities, the Company will not
offer, sell, contract to sell, pledge or
11
otherwise dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to, any additional shares of its
Securities or securities convertible into or exchangeable or exercisable for any
shares of its Securities, or publicly disclose the intention to make any such
offer, sale, pledge, disposition or filing, without the prior written consent of
CSFBC, except issuances of Securities pursuant to the conversion or exchange of
convertible or exchangeable securities or the exercise of warrants or options,
in each case outstanding on the date hereof, grants of stock options or stock
purchase rights pursuant to the terms of a plan described in the Prospectus, or
issuances of Securities pursuant to the exercise of such options.
(j) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required by the
NASD or the NASD rules from sale, transfer, assignment, pledge or hypothecation
for a period of three (3) months following the date of the effectiveness of the
Registration Statement. The Designated Underwriter will notify the Company as to
which Participants will need to be so restricted. The Company will direct the
transfer agent to place stop transfer restrictions upon such securities for such
period of time.
(k) The Company will pay all fees and disbursements of counsel
incurred by the Underwriters in connection with the Directed Shares Program and
stamp duties, similar taxes or duties or other taxes, if any, incurred by the
Underwriters in connection with the Directed Share Program.
Furthermore, the Company covenants with the Underwriters that the Company
will comply with all applicable securities and other applicable laws, rules and
regulations in each foreign jurisdiction in which the Directed Shares are
offered, if any, in connection with the Directed Share Program.
6. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, shall be on
or prior to the date of this Agreement or, if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or post-effective
amendment to the registration statement to be filed shortly prior to such
Effective Time), of Ernst & Young LLP confirming that they are independent
public accountants with respect to each of the Company and its subsidiaries
within the meaning of the Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements comply as to form
in all material respects with the applicable accounting requirements of the Act
and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of interim
financial information as described in
12
Statement of Auditing Standards No. 71, Interim Financial Information, on the
unaudited financial statements included in the Registration Statements;
(iii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of pro forma
financial information as described in Statement of Auditing Standards No. 1,
Reporting on Pro Forma Financial Statements, on the unaudited financial
statements included in the Registration Statements;
(iv) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements of the
Company and each of its subsidiaries, inquiries of officials of the Company and
each of its subsidiaries who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their attention that
caused them to believe that:
(A) the unaudited financial statements included in the
Registration Statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the related published
Rules and Regulations or any material modifications should be made to such
unaudited financial statements for them to be in conformity with generally
accepted accounting principles;
(B) at the date of the latest available balance sheets
read by such accountants, or at a subsequent specified date not more than three
(3) business days prior to the date of this Agreement, there was any change in
the capital stock or any increase in short-term indebtedness or long-term debt
of the Company and its subsidiaries or, at the date of the latest available
balance sheets read by such accountants, there was any decrease in consolidated
net current assets or net assets, as compared with amounts shown on the latest
balance sheets included in the Prospectus;
(C) for the period from the closing date of the latest
income statements included in the Prospectus to the closing date of the latest
available income statements read by such accountants there were any decreases,
as compared with the corresponding periods of the previous year and with the
periods of corresponding length ended the date of the latest income statements
included in the Prospectus, in consolidated net sales, or net operating income
in the total or per share amounts of consolidated net income; or
(D) the pro forma financial statements included in the
Prospectus do not comply as to form in all material respects with applicable
accounting requirements, including Rule 11-02 of Regulation S-X, and that the
pro forma adjustments have not been properly applied to the historical amounts
in the compilation of these statements, except in all cases set forth in clauses
(B) and (C) above for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such letter; and
(v) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial information
contained in the Registration Statements (in each case to the extent that such
dollar amounts, percentages and other financial information are derived from the
general accounting records of the Company and its subsidiaries subject to the
internal controls of the Company's and such subsidiaries' accounting systems or
are derived directly from such records by analysis or computation) with the
results obtained from inquiries, a reading of such general accounting records
and other procedures specified in such letter
13
and have found such dollar amounts, percentages and other financial information
to be in agreement with such results, except as otherwise specified in such
letter.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration is
subsequent to such execution and delivery, "Registration Statements" shall mean
the Initial Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the post-effective
amendment to be filed shortly prior to its Effective Time, and (iii)
"Prospectus" shall mean the prospectus included in the Registration Statements.
(b) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, shall be on
or prior to the date of this Agreement or, if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or post-effective
amendment to the registration statement to be filed shortly prior to such
Effective Time), of Ernst & Young LLP confirming that they are independent
public accountants with respect to each of Globalware Computing, Inc. and its
subsidiaries within the meaning of the Act and the applicable published Rules
and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements comply as to form
in all material respects with the applicable accounting requirements of the Act
and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards No. 71,
Interim Financial Information, on the unaudited financial statements included in
the Registration Statements;
(iii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of pro forma
financial information as described in Statement of Auditing Standards No. 1,
Reporting on Pro Forma Financial Statements, on the unaudited financial
statements included in the Registration Statements;
14
(iv) on the basis of the review referred to in clause (ii) above, a
reading of the latest available interim financial statements of the Company and
each of its subsidiaries, inquiries of officials of the Company and each of its
subsidiaries who have responsibility for financial and accounting matters and
other specified procedures, nothing came to their attention that caused them to
believe that:
(A) the unaudited financial statements included in the
Registration Statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the related published
Rules and Regulations or any material modifications should be made to such
unaudited financial statements for them to be in conformity with generally
accepted accounting principles;
(B) at the date of the latest available balance sheets read by
such accountants, or at a subsequent specified date not more than three (3)
business days prior to the date of this Agreement, there was any change in the
capital stock or any increase in short-term indebtedness or long-term debt of
the Company and its subsidiaries or, at the date of the latest available balance
sheets read by such accountants, there was any decrease in consolidated net
current assets or net assets, as compared with amounts shown on the latest
balance sheets included in the Prospectus;
(C) for the period from the closing date of the latest income
statements included in the Prospectus to the closing date of the latest
available income statements read by such accountants there were any decreases,
as compared with the corresponding periods of the previous year and with the
periods of corresponding length ended the date of the latest income statements
included in the Prospectus, in consolidated net sales, or net operating income
in the total or per share amounts of consolidated net income; or
(D) the pro forma financial statements included in the Prospectus
do not comply as to form in all material respects with applicable accounting
requirements, including Rule 11-02 of Regulation S-X, and that the pro forma
adjustments have not been properly applied to the historical amounts in the
compilation of these statements,
except in all cases set forth in clauses (B) and (C) above for changes,
increases or decreases which the Prospectus discloses have occurred or may occur
or which are described in such letter; and
(v) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained in
the Registration Statements (in each case to the extent that such dollar
amounts, percentages and other financial information are derived from the
general accounting records of the Company and its subsidiaries subject to the
internal controls of the Company's and such subsidiaries' accounting systems or
are derived directly from such records by analysis or computation) with the
results obtained from inquiries, a reading of such general accounting records
and other procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
15
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration is
subsequent to such execution and delivery, "Registration Statements" shall mean
the Initial Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the post-effective
amendment to be filed shortly prior to its Effective Time, and (iii)
"Prospectus" shall mean the prospectus included in the Registration Statements.
(c) The Representatives shall have received a letter, dated such
Closing Date, of Ernst & Young LLP which meets the requirements of subsection
(a) of this Section, except that the specified date referred to in such
subsection will be a date not more than three (3) days prior to such Closing
Date for the purposes of this subsection.
(d) The Representatives shall have received a letter, dated such
Closing Date, of Ernst & Young LLP which meets the requirements of subsection
(b) of this Section, except that the specified date referred to in such
subsection will be a date not more than three (3) days prior to such Closing
Date for the purposes of this subsection.
(e) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time shall
have occurred not later than 10:00 P.M., New York time, on the date of this
Agreement or such later date as shall have been consented to by CSFBC. If the
Effective Time of the Additional Registration Statement (if any) is not prior to
the execution and delivery of this Agreement, such Effective Time shall have
occurred not later than 10:00 P.M., New York time, on the date of this Agreement
or, if earlier, the time the Prospectus is printed and distributed to any
Underwriter, or shall have occurred at such later date as shall have been
consented to by CSFBC. If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, the
Prospectus shall have been filed with the Commission in accordance with the
Rules and Regulations and Section 5(a) of this Agreement. Prior to such Closing
Date, no stop order suspending the effectiveness of a Registration Statement
shall have been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company or the Representatives, shall be
contemplated by the Commission.
(f) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event involving a
prospective change, in the condition (financial or other), business, properties
or results of operations of the Company and its subsidiaries, taken as one
enterprise, which, in the judgment of a majority in interest of the Underwriters
including the Representatives, is material and adverse and makes it impractical
or inadvisable to proceed with completion of the public offering or the sale of
and payment for the Offered Securities; (ii) any downgrading in the rating of
any debt securities or preferred stock of the Company by any "nationally
recognized statistical rating organization" (as defined for purposes of Rule
436(g) under the Act), or any public announcement that any such organization has
under surveillance or review its rating of any debt securities or preferred
stock of the Company (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of such
rating); (iii) any material suspension or material limitation of trading in
securities generally on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in
16
the over-the-counter market; (iv) any banking moratorium declared by U.S.
Federal or, New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the Underwriters
including the Representatives, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment for
the Offered Securities.
(g) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxxxx Coie, LLP, counsel for the Company, (subject to
customary qualifications) to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation 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 transact
business as a foreign corporation in good standing in California, Illinois, Ohio
and Washington.
(ii) Globalware has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Illinois, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus; all of the issued and outstanding capital stock of
Globalware has been duly authorized and, to such counsel's knowledge, validly
issued and is fully paid and nonassessable; and, to such counsel's knowledge,
the capital stock of Globalware is owned by the Company free from liens,
encumbrances and defects;
(iii) The authorized capital stock of the Company conforms as to
all legal matters to the description thereof set forth in the Prospectus. To
such counsel's knowledge, except as disclosed in the Prospectus, there are no
outstanding options to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, any securities or obligations convertible into, or
any contracts or commitments to issue or sell, shares of the Company's or any of
its subsidiaries' capital stock or any such options, rights, convertible
securities or obligations, other than options issued pursuant to the Company's
employee stock purchase and stock option plans since the date of the information
in the Prospectus;
(iv) The Offered Securities have been duly authorized and, when
issued and delivered to the Underwriters against payment therefor in accordance
with the terms of this Agreement, will be validly issued, fully paid and
nonassessable and will conform to the description thereof contained in the
Prospectus; all other outstanding shares of the Common Stock of the Company have
been duly authorized and validly issued, are, to such counsel's knowledge, fully
paid and nonassessable and conform to the description thereof contained in the
Prospectus; and the stockholders of the Company have no preemptive rights with
respect to the Offered Securities under the Company's charter or by-laws, as
amended and restated, or the Delaware General Corporation Law, and, to such
counsel's knowledge, the stockholders of the Company have no other similar
contractual rights with respect to the Securities, except for such rights which
have been validly waived;
(v) There are no contracts, agreements or understandings known
to such counsel between the Company and any person granting such person the
right (A) to require the Company to file a registration statement under the Act
with respect to any securities of the Company
17
owned or to be owned by such person in connection with the registration and
sale of the Offered Securities or (B) to require the Company to include
such securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act, except in the case of
clause (A) or (B) for such rights which have been waived with respect to the
Registration Statements;
(vi) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940;
(vii) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in connection
with the issuance or sale of the Offered Securities by the Company, except such
as have been obtained and made under the Act and the Exchange Act and such as
may be required under state securities laws;
(viii) The execution, delivery and performance of this Agreement
and the issuance and sale of the Offered Securities will not result in a breach
or violation of any of the terms and provisions of, or constitute a default
under, any statute, any rule, regulation (other than applicable state Blue Sky
laws, to which no opinion is expressed) or, to such counsel's knowledge, order
of any governmental agency or body or any court having jurisdiction over the
Company or any subsidiary of the Company or any of their properties, or any
agreement or instrument to which the Company or Globalware is a party or by
which the Company or Globalware is bound or to which any of the properties of
the Company or Globalware is subject and which is listed as an exhibit to the
Registration Statement, or the charter or by-laws of the Company or Globalware,
and the Company has full power and authority to authorize, issue and sell the
Offered Securities as contemplated by this Agreement;
(ix) Based solely on communications (written and oral) received
from the Commission, the Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the Additional
Registration Statement (if any) was filed and became effective under the Act as
of the date and time (if determinable) specified in such opinion, the Prospectus
either was filed with the Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration Statement (as the
case may be), and, to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of a Registration Statement or any part thereof has
been issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Act; and that such counsel has participated in
conferences with certain officers and other representatives of the Company, its
independent public accountants, the Underwriters and the Underwriters' counsel
at which the contents of the Registration Statement, the Prospectus and related
matters were discussed, and that such counsel is not, however, passing upon, and
does not assume any responsibility for, and such counsel has not independently
checked or verified, the accuracy, completeness or fairness of the information
contained in the Registration Statement and the Prospectus, and such counsel has
not independently checked or verified, the accuracy, completeness or fairness of
the information contained in the Registration Statement and the Prospectus with
respect to such issues, and that such counsel may state, however, that based
upon its participation as described in the preceding paragraph, (A) it is of the
opinion that the Registration Statement and the Prospectus (other than the
financial statements, including the notes and schedules thereto, and the other
financial data and statistical data derived from financial statements included
in the Registration Statement and the Prospectus, as to which no opinion
expressed), as of the effective
18
date of the Registration Statement, complied as to form in all material respects
with the requirements of the Act and the applicable rules and regulations
thereunder; (B) it confirms that it has no reason to believe that any part of
the Registration Statement (other than the financial statements, including the
notes and schedules thereto, and the other financial data and statistical data
derived from financial statements included in the Registration Statement, as to
which no opinion is expressed), 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) it confirms that such counsel has no
reason to believe that the Prospectus (other than the financial statements,
including the notes and schedules thereto, and the other financial data and
statistical data derived from financial statements, included in the Prospectus,
as to which no opinion is expressed), as of its date and on the date hereof,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(x) This Agreement has been duly authorized, executed and
delivered by the Company;
(xi) The Agreement and Plan of Merger has been duly authorized
by all necessary board of directors and stockholder action on the part of the
Company and has been duly executed and delivered by the Company. To the best
knowledge of such counsel, the execution and delivery of the Plan of Merger by
the Company and the consummation of the merger contemplated thereby does not
contravene any provision of applicable federal, Illinois or Delaware corporate
law or the certificate of incorporation or bylaws of the Company, or any
judgment or decree of any governmental body, agency or court having jurisdiction
over the Company, 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 the Plan of Merger except
such as have been obtained. The merger contemplated by the Plan of Merger is
effective under the laws of the State of Illinois and the State of Delaware;
(xii) To such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened to which the Company or
Globalware is a party or to which the property of the Company or Globalware is
subject which, singly or in the aggregate, are required to be disclosed in the
Registration Statement;
(xiii) The form of the certificate used to evidence each of the
Securities is in due and proper form and complies with all applicable statutory
requirements of Delaware law; and
(xiv) The information required to be set forth in the
Registration Statement under the second, fourth, fifth, sixth, seventh and
eighth paragraphs set forth under the caption "Shares Eligible for Future Sale"
to the extent such information relates to legal matters is accurately and
adequately set forth therein in all material respects.
(h) The Representatives shall have received an opinion, dated such
Closing Date, of Sterne, Kessler, Xxxxxxxxx & Xxx P.L.L.C., patent counsel for
the Company, to the effect that: Such counsel is familiar with the technology
used by the Company in its business and the manner of its use thereof and has
read the Registration Statement and the Prospectus:
19
(i) The Company is listed on the records of the United States
Patent and Trademark Office as the assignee of each of the patent applications
listed on a schedule to such opinion (the "Applications"). To the knowledge of
such counsel, there are no claims of third parties to any ownership interest or
lien with respect to any of the Applications or the subject matter claimed
therein. Such counsel is not aware of any material defect in form in the
preparation or filing of the Applications on behalf of the Company. To the
knowledge of such counsel, the Applications are being pursued by the Company. To
the knowledge of such counsel, the Company owns the Applications as its sole
property;
(ii) As to the statements under the captions "Risk Factors -- We
depend on our enterprise software as a primary source of our revenues, and we do
not know if this product suite will generate revenue in the future," "Risk
Factors -- We rely on intellectual property and proprietary rights, and we may
not obtain patent protection for them," "Risk Factors -- We may be sued by third
parties for infringement of their proprietary rights, and litigation or
threatened litigation could require us to incur significant litigation or
licensing expenses, prevent us from selling our software or require us to make
expensive modifications to our software" and "Business - Intellectual Property,"
nothing has come to the attention of such counsel which has caused them to
believe that the above-mentioned sections of the Registration Statement and any
amendment or supplement thereto, at the time the Registration Statement became
effective and at all times subsequent thereto up to and on the Closing date, has
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading; and
(iii) Except as disclosed in the Registration Statement and the
Prospectus, such counsel does not know of (and has no reason to know of) any
material action, suit, claim or proceeding relating to patents or patent rights.
(i) The Representatives shall have received from Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the Underwriters, such opinion or opinions,
dated such Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to pass
upon such matters.
(j) The Representatives shall have received a certificate, dated such
Closing Date, of the Chief Executive Officer and a principal financial or
accounting officer of the Company in which such officers, to the best of their
knowledge after reasonable investigation, shall state that: the representations
and warranties of the Company in this Agreement are true and correct; the
Company has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to such Closing Date; no
stop order suspending the effectiveness of any Registration Statement has been
issued and no proceedings for that purpose have been instituted or, to the
Company's knowledge, are contemplated by the Commission; the Additional
Registration Statement (if any) satisfying the requirements of subparagraphs (1)
and (3) of Rule 462(b) was filed pursuant to Rule 462(b), including payment of
the applicable filing fee in accordance with Rule 111(a) or (b) under the Act,
prior to the time the Prospectus was printed and distributed to any Underwriter;
and, subsequent to the dates of the most recent financial statements in the
Prospectus, there has been no material adverse change, nor any development or
event involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of the
20
Company and its subsidiaries, taken as a whole, except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(k) On or prior to the date of this Agreement, the Representatives
shall have received lock-up letters from (i) each of the executive officers and
directors of the Company and (ii) at least ninety-seven percent (97%) of all
security holders of the Company.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder,
whether in respect of an Optional Closing Date or otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter, its partners, directors and officers and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Act, against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (b) below.
The Company agrees to indemnify and hold harmless the Designated
Underwriter and each person, if any, who controls the Designated Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act (the "Designated 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 agreed to purchase; or (iii) related to, arising out of, or
in connection with the Directed Share Program.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any who
controls the Company within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or
21
alleged untrue statement of any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. Notwithstanding anything contained herein to
the contrary, if indemnity may be sought pursuant to the last paragraph in
Section 7(a) hereof in respect of such action or proceeding, then in addition to
such separate firm for the indemnified parties, the indemnifying party shall be
liable for the reasonable fees and expenses of not more than one separate firm
(in addition to any local counsel) for the Designated Underwriter for the
defense of any losses, claims, damages and liabilities arising out of the
Directed Share Program, and all persons, if any, who control the Designated
Underwriter within the meaning of either Section 15 of the Act of Section 20 of
the Exchange Act. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action 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 (i) includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action and (ii) does not include a statement as to, or an admission of,
fault, culpability or a failure to act by or on behalf of an indemnified party.
(d) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (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 from the offering of the Securities
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which 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
22
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
bear to the total underwriting discounts and commissions received by the
Underwriters. The relative fault 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 the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which 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 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed a Registration Statement and to each person, if any, who controls
the Company within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on either the
First or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed ten percent (10%) of the total number of shares of
Offered Securities that the Underwriters are obligated to purchase on such
Closing Date, CSFBC may make arrangements satisfactory to the Company for the
purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
ten percent (10%) of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date and arrangements
satisfactory to CSFBC and the Company for the purchase of such Offered
Securities by other persons are not made within thirty-six (36) hours after such
default, this Agreement will terminate without liability on the part of any non-
defaulting Underwriter or the Company, except as provided in Section 9 (provided
that if such default occurs with respect to Optional Securities after the First
Closing Date, this Agreement will not terminate as to the Firm Securities or any
Optional Securities purchased prior to such termination). As used in this
Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
23
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to Section 7 shall
remain in effect, and if any Offered Securities have been purchased hereunder
the representations and warranties in Section 2 and all obligations under
Section 5 shall also remain in effect. If the purchase of the Offered Securities
by the Underwriters is not consummated for any reason other than solely because
of the termination of this Agreement pursuant to Section 8 or the occurrence of
any event specified in clause (iii), (iv) or (v) of Section 6(c), the Company
will reimburse the Underwriters for all out-of-pocket expenses (including fees
and disbursements of counsel) reasonably incurred by them in connection with the
offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
the Representatives, c/o Credit Suisse First Boston Corporation, Eleven Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Investment Banking
Department-Transactions Advisory Group, with a copy to Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, 000 Xxxxxxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000,
Attention: Xxxxxxx X. Xxxxx, or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at , Attention: ; provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.
12. Representations of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to principles
of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
24
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
AvantGo, Inc.
By: _______________________________
Name:
Title:
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above written.
Credit Suisse First Boston Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
CIBC World Markets Corp.
Acting on behalf of themselves and as the
Representatives of the several Underwriters
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By: _________________________________________
Name:
Title:
25
SCHEDULE A
UNDERWRITER NUMBER OF FIRM
----------- --------------
SECURITIES
----------
Credit Suisse First Boston Corporation
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
CIBC World Markets Corp.
--------------
Total
==============
26
