EXHIBIT 1.1
ETELECARE GLOBAL SOLUTIONS, INC.
[o]
COMMON SHARES
(PAR VALUE P1.00 PER SHARE)
IN THE FORM OF AMERICAN DEPOSITARY SHARES
UNDERWRITING AGREEMENT
[o], 2007
[o], 2007
XXXXXX XXXXXXX & CO. INCORPORATED
DEUTSCHE BANK SECURITIES INC.
XXXXXX X. XXXXX & CO. INCORPORATED
JMP SECURITIES LLC
As the Representatives of the
several Underwriters named
in Schedule I hereto
c/o: Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
eTelecare Global Solutions, Inc., a corporation organized under the
laws of the Republic of the Philippines (the "COMPANY"), proposes to issue and
sell to Xxxxxx Xxxxxxx & Co. Incorporated ("XXXXXX XXXXXXX"), Deutsche Bank
Securities Inc., Xxxxxx X. Xxxxx & Co. Incorporated and JMP Securities LLC, as
representatives (together, the "REPRESENTATIVES") of the several underwriters
named in Schedule I hereto (the "UNDERWRITERS"), an aggregate of [o] common
shares, par value P1.00 per share, of the Company (the "COMMON SHARES") (the
aggregate of [o] Common Shares to be sold by the Company are hereinafter
referred to as the "FIRM SHARES"). The Company also proposes to issue and sell
to the several Underwriters not more than an additional [o] Common Shares (the
"ADDITIONAL SHARES" and, together with the Firm Shares, the "SHARES"), if and to
the extent that the Representatives shall have determined to exercise, on behalf
of the Underwriters, the right to purchase such Additional Shares granted to the
Underwriters in Section 2 hereof.
The Underwriters will take delivery of the Shares in the form of
American Depositary Shares (the "AMERICAN DEPOSITARY SHARES"). The American
Depositary Shares are to be issued pursuant to a Deposit Agreement, dated as of
[o], 2007, among the Company, each of the Operating Subsidiaries, Deutsche Bank
Trust Company Americas, as Depositary (the "DEPOSITARY"), and the holders from
time to time of the American Depositary Receipts (the "AMERICAN DEPOSITARY
RECEIPTS") issued by the Depositary and evidencing the American Depositary
Shares (the "DEPOSIT AGREEMENT"). Each American Depositary Share will initially
represent the right to receive [o] Common Shares deposited pursuant to the
Deposit Agreement.
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION"): (a) a registration statement, including a prospectus, relating to
the Shares; and (b) a registration statement, including a prospectus, relating
to the American Depositary Shares corresponding to the Shares. The registration
statement relating to the Shares, as amended at the time it becomes effective,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), is hereinafter
referred to as the "REGISTRATION STATEMENT;" the prospectus in the form first
used to confirm sales of Shares (or in the form first made available to the
Underwriters by the Company to meet requests of purchasers pursuant to Rule 173
under the Securities Act) is hereinafter referred to as the "PROSPECTUS." The
registration statement relating to the American Depositary Shares, as amended at
the time it becomes effective, is hereinafter referred to as the "ADR
REGISTRATION STATEMENT." If the Company has filed abbreviated registration
statements to register additional Common Shares and abbreviated registration
statements to register additional American Depositary Shares, in each case
pursuant to Rule 462(b) under the Securities Act (together, the "RULE 462
REGISTRATION STATEMENTS"), then any reference herein to the term "REGISTRATION
STATEMENT" or "ADR REGISTRATION STATEMENT" shall be deemed to include the
applicable corresponding Rule 462 Registration Statement.
Xxxxxx Xxxxxxx has agreed to reserve a portion of the Shares to be
purchased by it under this Agreement for sale to the directors, officers,
employees and business associates of the Company and other parties related to
the Company (together, the "PARTICIPANTS"), as set forth in the Prospectus under
the heading "Underwriters" (the "DIRECTED SHARE PROGRAM"). The Shares to be sold
by Xxxxxx Xxxxxxx and its affiliates pursuant to the Directed Share Program are
referred to hereinafter as the "DIRECTED SHARES". Any Directed Shares not orally
confirmed for purchase by any Participant 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.
For purposes of this agreement (the "AGREEMENT"), "FREE WRITING
PROSPECTUS" has the meaning set forth in Rule 405 under the Securities Act;
"TIME OF SALE PROSPECTUS" means the preliminary prospectus, together with each
free writing prospectus identified in Schedule II hereto, if any; and "BROADLY
AVAILABLE ROAD SHOW" means a "BONA FIDE ELECTRONIC ROAD SHOW" (as defined in
Rule 433(h)(5) under the Securities Act) that has been made available without
restriction to any person. In addition, for purposes of this Agreement, the
terms "REGISTRATION STATEMENT," "PRELIMINARY PROSPECTUS," "TIME OF SALE
PROSPECTUS," "FREE WRITING PROSPECTUS" and "PROSPECTUS" shall include the
documents, if any, incorporated by reference therein, respectively; and the
terms "SUPPLEMENT," "AMENDMENT" and "AMEND," with respect to the Prospectus, the
Time of Sale Prospectus and any free writing prospectus, shall include all
documents subsequently filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), that are
incorporated by reference therein, respectively.
1. Representations and Warranties of the Company and the Operating
Subsidiaries. The Company and each of eTelecare Global Solutions -- U.S., Inc.,
a Delaware corporation (the "DELAWARE OPERATING SUBSIDIARY"), and eTelecare
Global Solutions -- AZ, Inc., an Arizona corporation (the "ARIZONA OPERATING
SUBSIDIARY," and, together with the Delaware Operating Subsidiary, the
"OPERATING SUBSIDIARIES"), hereby jointly and severally represent and warrant to
and agree with each of the Underwriters that:
(a) The Registration Statement and the ADR Registration
Statement have each become effective; no stop order suspending the
effectiveness of the Registration Statement or the ADR Registration
Statement is in effect and no proceedings for such purpose are pending
before or threatened by the Commission.
(b) Each of the Registration Statement and the ADR
Registration Statement, when it became effective, did not contain and,
as amended or supplemented, if applicable,
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will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; the Registration Statement,
the ADR Registration Statement and the Prospectus comply and, as
amended or supplemented, if applicable, will comply in all material
respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder; the Time of Sale Prospectus
does not, and at the time of each sale of the Shares in connection with
the offering when the Prospectus is not yet available to prospective
purchasers and at the Closing Date, the Time of Sale Prospectus, as
then amended or supplemented by the Company, if applicable, will not,
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; each
broadly available road show, if any, when considered together with the
Time of Sale Prospectus, does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and, as of the applicable filing date, the
Closing Date and the Option Closing Date, as the case may be, the
Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this paragraph do not apply to statements or omissions in the
Registration Statement, the ADR Registration Statement, the Time of
Sale Prospectus or the Prospectus based upon information relating to
any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use therein.
(c) The Company is not an "INELIGIBLE ISSUER" in connection
with the offering pursuant to Rules 164, 405 and 433 under the
Securities Act. Any free writing prospectus that the Company is
required to file pursuant to Rule 433(d) under the Securities Act has
been, or will be, filed with the Commission in accordance with the
requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Each free writing prospectus
that the Company has filed, or is required to file, pursuant to Rule
433(d) under the Securities Act or that was prepared by or on behalf of
or used or referred to by the Company complies or will comply in all
material respects with the requirements of the Securities Act and the
applicable rules and regulations of the Commission thereunder. Except
for the free writing prospectuses identified in Schedule II hereto, if
any, and electronic road shows furnished to the Representatives before
first use, if any, the Company has not prepared, used or referred to,
and will not, without the prior consent of the Representatives,
prepare, use or refer to any free writing prospectus.
(d) The Company is a "FOREIGN PRIVATE ISSUER" within the
meaning of Rule 405 under the Securities Act; the Company is eligible
to register the Shares on Form F-1 promulgated under the Securities
Act; and the Company is eligible to register the American Depositary
Shares on Form F-6 promulgated under the Securities Act.
(e) Except as described in the Time of Sale Prospectus, the
Company has not sold, issued or distributed any Common Shares during
the six-month period preceding the date hereof, including any sales
pursuant to Rule 144A under, or Regulation D or Regulation S under, the
Securities Act.
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(f) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
Republic of the Philippines, has the corporate power and authority to
own its property and to conduct its business as described in the
Registration Statement, the ADR Registration Statement, the Time of
Sale Prospectus and the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and each subsidiary of the Company
(together, including the Operating Subsidiaries, the "SUBSIDIARIES"),
taken as a whole (a "MATERIAL ADVERSE EFFECT"). The certificate of
incorporation and bylaws of the Company comply with the requirements of
applicable law of the Republic of the Philippines and are in full force
and effect.
(g) Each Subsidiary has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Registration Statement, the ADR Registration Statement, the Time
of Sale Prospectus or the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a Material
Adverse Effect; all of the issued shares of capital stock of each
Subsidiary have been duly and validly authorized and issued, are fully
paid and non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims;
none of the outstanding shares of capital stock or equity interest in
any Subsidiary was issued in violation of preemptive or similar rights
of any securityholder of such Subsidiary; and the certificate of
incorporation and bylaws or other constitutive or organizational
documents of each Subsidiary comply with the requirements of applicable
law in their respective jurisdictions of incorporation and are in full
force and effect.
(h) Other than the Arizona Operating Subsidiary, the Company
does not have any "SIGNIFICANT SUBSIDIARIES" within the meaning of Rule
1-02(w) of Regulation S-X promulgated under the Securities Act.
(i) Neither the Company nor any of the Subsidiaries is in
violation of its respective certificate of incorporation and bylaws or
other constitutive documents or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which
it is a party or by which it may be bound, or to which any of its
properties or assets is subject, except for the default of any such
obligation, agreement, covenant or condition as would not, individually
or in the aggregate, have a Material Adverse Effect; and none of the
businesses, activities, agreements or commitments of the Company or the
Subsidiaries is unauthorized or exceeds the business scope of its
respective business licenses, except as would not, individually or in
the aggregate, have a Material Adverse Effect.
(j) This Agreement has been duly authorized, executed and
delivered by the Company and each Operating Subsidiary.
(k) The authorized share capital of the Company conforms as to
legal matters
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to the description thereof contained in each of the Time of Sale
Prospectus and the Prospectus; since [o], the Company has not issued
any securities; and all of the Common Shares outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable; and the Shares have been duly
authorized and, when issued and delivered in accordance with the terms
of this Agreement, will be validly issued, fully paid and
non-assessable, and the issuance of such Shares will not be subject to
any preemptive or similar rights.
(l) Except as disclosed in the Time of Sale Prospectus, there
are no outstanding: (i) securities issued by the Company or any
Subsidiary convertible into or exchangeable for, rights, warrants or
options to acquire from the Company or any Subsidiary, or obligations
of the Company or any Subsidiary to issue, Common Shares or any of the
capital stock of the Company or any Subsidiary; or (ii) rights,
warrants or options to acquire, or instruments convertible into or
exchangeable for, any shares of capital stock or direct interest in any
Subsidiary.
(m) The Deposit Agreement has been duly authorized, executed
and delivered by the Company, and, assuming due authorization,
execution and delivery by the Depositary, is a valid and binding
agreement of the Company, except as may be limited by bankruptcy,
insolvency reorganization, moratorium or similar laws relating to or
affecting creditors' rights generally and by general principles of
equity.
(n) The American Depositary Receipts, when issued by the
Depositary against the deposit of the Shares in respect thereof in
accordance with the provisions of the Deposit Agreement, will be duly
authorized and validly issued and the persons in whose names such
American Depositary Receipts are registered will be entitled to the
rights of registered holders of the American Depositary Receipts
specified therein and in the Deposit Agreement.
(o) The Deposit Agreement, the American Depositary Shares and
the American Depositary Receipts conform in all material respects as to
legal matters to the description thereof contained in the Time of Sale
Prospectus.
(p) The Shares and the American Depositary Shares, when
issued, will be freely transferable by the Company to or for the
account of the several Underwriters and (to the extent described in the
Time of Sale Prospectus) the initial purchasers thereof; and, except as
disclosed in the Time of Sale Prospectus, there are no restrictions on
subsequent transfers of the Shares or the American Depositary Shares
under the laws of the Republic of the Philippines or the U.S.
(q) The American Depositary Shares have been approved for
quotation on The Nasdaq Global Market, subject to official notice of
issuance.
(r) The Shares to be sold by the Company, when issued and
delivered against payment heretofore pursuant to this Agreement, will
not be subject to any security interest, other encumbrance or adverse
claims, and have been issued in compliance with all applicable
securities laws. Upon payment of the purchase price in accordance with
this Agreement at each Closing Date, the Depositary or its nominee, as
the registered holder of the Common Shares represented by the American
Depositary Shares, will be, subject to the terms of the Deposit
Agreement, entitled to all the rights of a stockholder conferred by the
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certificate of incorporation and bylaws of the Company; except as
disclosed in the Time of Sale Prospectus and subject to the terms and
provisions of the Deposit Agreement, there are no restrictions on
transfers of Common Shares or the American Depositary Shares under the
laws of the Republic of the Philippines or the U.S., as the case may
be. The Common Shares represented by the American Depositary Shares may
be freely deposited by the Company with the Depositary or its nominee
against issuance of the American Depositary Receipts evidencing the
American Depositary Shares as contemplated by the Deposit Agreement.
(s) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement and
the Deposit Agreement will not (i) contravene any provision of
applicable law or the certificate of incorporation and bylaws, or other
constitutive documents of the Company or its Subsidiaries, (ii)
conflict with, or result in a breach or violation of, any of the terms
or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement, note, lease or other agreement
or instrument binding upon the Company or any of its Subsidiaries, or
to which any of the property or assets of the Company or any of the
Subsidiaries are subject, that is material to the Company and its
Subsidiaries or (iii) contravene, conflict with, or result in a breach
or violation of, or constitute a default under, any judgment, order or
decree of any governmental body, agency or court having jurisdiction
over the Company or any Subsidiary; and no consent, approval,
authorization or order of, or qualification with, any governmental body
or agency is required for the performance by the Company of its
obligations under this Agreement or the Deposit Agreement, except such
as may be required by the securities or Blue Sky laws of the various
states of the U.S. in connection with the offer and sale of the Shares.
(t) There are no legal or governmental proceedings pending or
threatened to which the Company or any of the Subsidiaries is a party
or to which any of the properties of the Company or any of the
Subsidiaries is subject (i) other than proceedings accurately described
in all material respects in the Time of Sale Prospectus and proceedings
that would not have a Material Adverse Effect, or affect on the power
or ability of the Company to perform its obligations under this
Agreement or to consummate the transactions contemplated by the Time of
Sale Prospectus or (ii) that are required to be described in the
Registration Statement, the ADR Registration Statement or the
Prospectus and are not so described; and there are no statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement, the ADR Registration Statement
or the Prospectus or to be filed as exhibits to the Registration
Statement or the ADR Registration Statement that are not described or
filed as required; and each preliminary prospectus filed as part of the
Registration Statement or the ADR Registration Statement, as originally
filed or as part of any amendment thereto, or filed pursuant to Rule
424 under the Securities Act, in each case complied when so filed with
the Securities Act and the applicable rules and regulations of the
Commission thereunder.
(u) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and the Subsidiaries, taken as a whole, from
that set forth in the Time of Sale Prospectus.
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(v) The consolidated balance sheets of the Company and the
Subsidiaries as of December 31, 2005 and 2006, and the related
consolidated statements of operations, changes in stockholders' equity
and cash flows of the Company and the Subsidiaries for each of the
three years in the period ended December 31, 2006 (and the notes
thereto) included in the Registration Statement, the ADR Registration
Statement, the Time of Sale Prospectus and the Prospectus present
fairly the financial position of the Company and the Subsidiaries and
the results of operations and the cash flows of the Company and the
Subsidiaries as of the dates and for the periods specified; such
financial statements have been prepared in conformity with GAAP (as
defined below) on a consistent basis throughout the periods specified;
and Ernst & Young LLP, Independent Registered Public Accounting Firm,
who has expressed an opinion on the consolidated financial statements
of the Company and the Subsidiaries based on its audits, are
independent auditors with respect to the Company within the meaning of
the Securities Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder, respectively.
(w) The balance sheets of the Arizona Operating Subsidiary as
of May 25, 2004 and December 31, 2003 and the related statements of
operations, stockholders' equity, and cash flows of the Arizona
Operating Subsidiary for the year ended December 31, 2003 and the
period from January 1, 2004 through May 25, 2004 (and the notes
thereto) included in the Registration Statement, the ADR Registration
Statement, the Time of Sale Prospectus and the Prospectus present
fairly the financial position of the Arizona Operating Subsidiary and
the results of operations and the cash flows of the Arizona Operating
Subsidiary as of the dates and for the periods specified; such
financial statements have been prepared in conformity with GAAP (as
defined below) on a consistent basis throughout the periods specified;
and Ernst & Young LLP, Independent Registered Public Accounting Firm,
who has expressed an opinion on the financial statements of the Arizona
Operating Subsidiary based on its audits, are independent auditors with
respect to the Arizona Operating Subsidiary within the meaning of the
Securities Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder, respectively.
(x) The unaudited consolidated balance sheets of the Company
and the Subsidiaries as of [ ], 2007, and the related consolidated
statements of operations, changes in stockholders' equity, and cash
flows of the Company and the Subsidiaries for the [ ] months ended [ ],
2006 and [ ], 2007, respectively, include all adjustments, consisting
of normal recurring accruals, necessary for a fair presentation of the
financial position of the Company and the Subsidiaries as of [ ], 2007,
and the results of operations of the Company and the Subsidiaries for
the [ ] months ended [ ], 2006 and [ ], 2007, respectively.
(y) The summary and selected consolidated financial data
included in the Registration Statement, the ADR Registration Statement,
the Time of Sale Prospectus and the Prospectus presents fairly in all
material respects the information shown therein and such summary and
selected consolidated financial data has been compiled on a basis
consistent with the financial statements presented therein and the
books and records of the Company.
(z) The pro forma financial statements and other pro forma
financial information included in the Registration Statement, the ADR
Registration Statement, the
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Time of Sale Prospectus and the Prospectus present fairly in all
material respects the information shown therein, have been prepared in
accordance with the rules and guidelines of the Commission with respect
to pro forma financial statements, have been properly compiled on the
pro forma bases described therein, and, in the opinion of the Company,
the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(aa) With respect to any "NON-GAAP FINANCIAL MEASURE" (as such
term is defined by the rules and regulations of the Commission)
included in the Registration Statement, the ADR Registration Statement,
the Time of Sale Prospectus or the Prospectus: (i) at the time such
financial measure was disclosed or released by the Company, such
financial measure was accompanied with (A) a presentation of the most
directly comparable financial measure of the Company, calculated and
presented in accordance with GAAP and (B) a reconciliation (by schedule
or other clearly understandable method), which was quantitative for
each historical non-GAAP financial measure so disclosed or released,
and quantitative, to the extent available without unreasonable efforts,
for forward-looking information, of the differences between such
non-GAAP financial measure disclosed or released with the most
comparable financial measure or measures, calculated and presented in
accordance with GAAP; and (ii) neither the Company nor any person
acting on behalf of the Company has made public a non-GAAP financial
measure that, taken together with the information accompanying such
non-GAAP financial measure and any other accompanying discussion of
such non-GAAP financial measure, contains an untrue statement of a
material fact or omits to state a material fact necessary in order to
make the presentation of such non-GAAP financial measure, in light of
the circumstances under which it is presented, not misleading; and any
such non-GAAP financial measures comply with Regulation G of the
Exchange Act and Item 10 of Regulation S-K under the Securities Act, to
the extent applicable.
(bb) The Company and each Subsidiary maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that: (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements of the Company
and each Subsidiary in conformity with U.S. generally accepted
accounting principles ("GAAP") and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to
any differences. Since the end of the most recent audited fiscal year
of the Company, there has not occurred any (A) material weakness in the
internal control over financial reporting (whether or not remediated)
of the Company or (B) adverse change in internal control over financial
reporting of the Company that has affected, or is reasonably likely to
affect, the internal control over financial reporting of the Company.
(cc) The Company is not, and after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus will not be, required to
register as an "INVESTMENT COMPANY" as such term is defined in the
Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY
ACT").
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(dd) The Company and the Subsidiaries (i) are in compliance
with any and all applicable domestic and foreign laws and regulations
relating to the protection of human health and safety, the environment
or hazardous or toxic substances or wastes, pollutants or contaminants
(the "ENVIRONMENTAL LAWS"), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) are in compliance with
all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not, individually or in the aggregate, have a Material
Adverse Effect; and there are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, individually or in the
aggregate, have a Material Adverse Effect.
(ee) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company or to
require the Company to include such securities with the Shares
registered pursuant to the Registration Statement or the American
Depositary Receipts registered pursuant to the ADR Registration
Statement.
(ff) Subsequent to the respective dates as of which
information is given in the Registration Statement, the ADR
Registration Statement, the Time of Sale Prospectus and the Prospectus:
(i) neither the Company nor any Subsidiary has incurred any liability
or obligation, direct or contingent, nor entered into any transaction
not in the ordinary course of business; (ii) the Company has not
purchased any of its outstanding capital stock, nor declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock; and (iii) there has not been any change in the capital stock,
short-term debt or long-term debt of the Company.
(gg) Neither the Company nor any Subsidiary owns any real
property that is material to the business and operations of the Company
or any Subsidiary; except as otherwise set forth in the Loan and
Security Agreement made by and among eTelecare International, Inc.,
MacArthur Acquisition Corp., Xxxxx Fargo Foothill, Inc. and the other
lenders party thereto, dated as of May 25, 2004, as amended as of the
date hereof (the "LOAN AGREEMENT"), each of the Company and each
Subsidiary has good and marketable title to all personal property owned
by it which is material to its respective business and operations, in
each case free and clear of all liens, encumbrances and defects or such
as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by
the Company or its Subsidiaries, as the case may be; and, except as
otherwise set forth in the Loan Agreement, any real property and
buildings held under lease by the Company or the Subsidiaries are held
by it under valid, subsisting and enforceable leases, with such
exceptions as are not material and do not interfere with the use
proposed to be made of such real properties and buildings by the
Company and the Subsidiaries.
(hh) The Company and the Subsidiaries each own or possess the
right to use all
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patents, patent rights, trademarks, trade names, service marks, service
names, copyrights, license rights, know-how (including trade secrets
and other unpatented and unpatentable proprietary or confidential
information, systems or procedures) and other intellectual property
rights necessary to carry on their business as currently conducted and
as described in the Registration Statement, the ADR Registration
Statement, the Time of Sale Prospectus and the Prospectus (the
"INTELLECTUAL PROPERTY"). The Company and the Subsidiaries have taken
all reasonable steps to secure and protect their interests in the
Intellectual Property used in their business, including but not limited
to securing valid and enforceable assignments from their respective
employees and contractors. The Intellectual Property owned by or
licensed to the Company or the Subsidiaries has not been adjudged
invalid or unenforceable, except as disclosed in the Time of Sale
Prospectus, and there is no pending or threatened action, suit,
proceeding or claim challenging either the scope or validity of such
Intellectual Property or the Company's or its Subsidiaries' right to
use such Intellectual Property which, if determined adversely to the
Company or its Subsidiaries, as the case may be, would reasonably be
expected to have a Material Adverse Effect, and the Company is unaware
of any facts that would form a reasonable basis for any such claim.
There are no outstanding options, licenses or agreements of any kind
relating to the Intellectual Property of the Company or the
Subsidiaries that are required to be described in the Registration
Statement, the ADR Registration Statement, the Time of Sale Prospectus
and the Prospectus and which are not described therein in all material
respects. Neither the Company nor any of the Subsidiaries is a party to
or bound by any options, licenses or agreements with respect to the
Intellectual Property of any other person or entity that are required
to be set forth in the Registration Statement, the ADR Registration
Statement, the Time of Sale Prospectus or the Prospectus and which are
not described therein in all material respects. None of the
technologies employed by the Company or the Subsidiaries has been
obtained or is being used by the Company or the Subsidiaries in
violation of any contractual obligation binding on the Company, the
Subsidiaries or any of their respective officers, directors or
employees, or otherwise in violation of the rights of any persons.
Except as disclosed in the Time of Sale Prospectus, neither the Company
nor any of the Subsidiaries has received any written or oral
communications alleging that the Company or any of the Subsidiaries has
violated, misappropriated, infringed or conflicted with, or, by
conducting its business as set forth in the Registration Statement, the
ADR Registration Statement, the Time of Sale Prospectus and the
Prospectus, would violate, misappropriate, infringe or conflict with,
any of the Intellectual Property of any other person or entity and
neither the Company nor any of the Subsidiaries is aware of any facts
that would form a reasonable basis for any such claim. Except as
disclosed in the Registration Statement, the ADR Registration
Statement, the Time of Sale Prospectus and the Prospectus, neither the
Company nor any of the Subsidiaries knows of any infringement by others
of Intellectual Property owned by or licensed to the Company or its
Subsidiaries.
(ii) Except as would not, individually or in the aggregate,
have a Material Adverse Effect: (i) the Company and the Subsidiaries
are in compliance with all presently applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended, including
the regulations and published interpretations thereunder ("ERISA");
(ii) no "REPORTABLE EVENT" (as defined in ERISA) has occurred with
respect to any "PENSION PLAN" (as defined in ERISA) for which the
Company or any Subsidiary would have any liability; neither the Company
nor any of the Subsidiaries has incurred, nor does the Company or the
Subsidiaries expect to incur, liability
10
under (A) Title IV of ERISA with respect to termination of, or
withdrawal from, any "PENSION plan" or (B) Section 412 or 4971 of the
Internal Revenue Code 1986, as amended (the "CODE"), including the
regulations and published interpretations thereunder; and each "PENSION
PLAN" for which the Company or any of the Subsidiaries that is intended
to be qualified under Section 401(a) of the Code is so qualified and
nothing has occurred, whether by action or by failure to act, which
would cause the loss of such qualification; (iii) no labor dispute with
the employees of the Company or any Subsidiary exists or is imminent;
and (iv) the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees of any of the principal
suppliers, manufacturers or contractors of the Company or any
Subsidiary.
(jj) All U.S. federal, state and local tax returns, reports
and statements required to be filed by or on behalf of the Company and
each of the Subsidiaries have been filed with the appropriate U.S.
governmental authorities in all U.S. jurisdictions in which such
returns, reports and statements are required to be filed, except as set
forth on Schedule III hereto, and all such tax returns, reports and
statements are true, correct and complete in all material respects; all
taxes (including real property taxes) and other charges shown to be due
and payable pursuant to such returns, reports and statements, or
otherwise, have been timely paid prior to the date on which any fine,
penalty, interest, late charge or loss may be added thereto for
nonpayment thereof; all U.S. state and local sales and use taxes
required to be paid by the Company and each of the Subsidiaries have
been paid, except as would not, individually or in the aggregate, have
a Material Adverse Effect; and all U.S. federal and state returns have
been filed by the Company and the Subsidiaries for all periods for
which returns were due with respect to employee income tax withholding,
social security and unemployment taxes and the amounts shown thereon to
be due and payable have been paid in full, except as would not,
individually or in the aggregate, have a Material Adverse Effect.
(kk) The Company and each of the Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; neither the Company nor any
Subsidiary has been refused any insurance coverage sought or applied
for; and neither the Company nor any Subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.
(ll) The Company and each of the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct
their respective businesses or received any notice of proceedings
relating to the revocation or modification of any such certificate,
authority or permit received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or
permit which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a Material Adverse
Effect.
(mm) There are no material relationships, direct or indirect,
or material transactions exist between any of the Company or the
Subsidiaries, on the one hand, and their respective affiliates,
officers, directors, stockholders, customers or suppliers, on the
11
other hand.
(nn) There is no contract, agreement or understanding 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 the offer and
sale of the Shares contemplated by this Agreement.
(oo) All local and national Philippine tax waivers and other
local and national Philippine tax relief, concession and preferential
treatment are valid, binding and enforceable and do not violate any
provision of any law or statute or any order, rule or regulation of any
local or national governmental agency.
(pp) Except as disclosed in the Time of Sale Prospectus, under
the current laws and regulations of the Republic of the Philippines,
all dividends and other distributions declared and payable on the
Common Shares in cash may be freely transferred out of the Republic of
the Philippines and may be freely converted into U.S. dollars, in each
case without there being required any consent, approval, authorization
or order of, or qualification with, any court or governmental agency or
body in the Republic of the Philippines; all such dividends and other
distributions will not be subject to withholding, value added or other
taxes under the laws and regulations of the Republic of the
Philippines; none of the Subsidiaries is currently prohibited, directly
or indirectly, from (i) the payment of any dividends or other
distribution on the equity interest of such Subsidiary, (ii) the
repayment to the Company on account of any indebtedness owed to the
Company, (iii) the payment of any advance to the Company or (iv) the
transfer of any property or assets of such Subsidiary to the Company or
any other Subsidiary; except as set forth in the Time of Sale
Prospectus, all dividends and other distributions declared and payable
upon the equity interests of the Company in the Subsidiaries may be
converted into foreign currency that may be freely transferred out of
the Republic of the Philippines or its jurisdiction of incorporation
and all such dividends and other distributions are not and will not be
subject to withholding or other taxes under the laws and regulations of
the Republic of the Philippines or its jurisdiction of incorporation
and otherwise free and clear of any other tax, withholding or deduction
in the Republic of the Philippines or its jurisdiction of
incorporation, in each case without the necessity of obtaining any
governmental authorization in the Republic of the Philippines or its
jurisdiction of incorporation.
(qq) No stamp or other issuance or transfer taxes or duties
are payable by or on behalf of the Underwriters to any governmental
authority of the Republic of the Philippines or any political
subdivision or taxing authority thereof in connection with (i) the
issuance, sale or delivery of the Shares to the Underwriters, whether
in the form of Common Shares or American Depositary Shares or (ii) the
deposit with the Depositary of any Shares against the issuance of the
corresponding American Depositary Shares and the related American
Depositary Receipts.
(rr) Based on the projected composition of the income of the
Company and valuation of the assets of the Company, the Company is not
a "PASSIVE FOREIGN INVESTMENT COMPANY" within the meaning of Section
1297 of the U.S. Internal Revenue Code of 1986, as amended (a "PASSIVE
FOREIGN INVESTMENT COMPANY"), for the fiscal year ended December 31,
2006, and does not expect to become a Passive Foreign Investment
Company at any time thereafter; each of the Company and each Subsidiary
has filed with
12
all appropriate taxing authorities all income, franchise or other tax
returns required to be filed through the date hereof; and no tax
deficiency has been determined adversely to the Company or any
Subsidiary, except for any such adverse tax deficiency determination as
would not, individually or in the aggregate, have a Material Adverse
Effect.
(ss) None of the Company, any Subsidiary or any director,
officer, agent, employee or affiliate of the Company or any Subsidiary
is currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Department of the Treasury (the
"OFFICE OF FOREIGN ASSETS CONTROL").
(tt) None of the Company and the Subsidiaries nor any of their
properties, assets or revenues are entitled to any right of immunity on
the grounds of sovereignty from any legal action, suit or proceeding,
from set-off or counterclaim, from the jurisdiction of any court, from
services of process, from attachment prior to or in aid of execution of
judgment, or from other legal process or proceeding for the giving of
any relief or for the enforcement of any judgment. The irrevocable and
unconditional waiver and agreement of the Company in this Agreement and
the Deposit Agreement not to plead or claim any such immunity in any
legal action, suit or proceeding based on this Agreement and the
Deposit Agreement is valid and binding under the laws of [the Republic
of the Philippines].
(uu) None of the Company or any of the Subsidiaries, nor any
of their respective officers, directors, managers, agents or employees,
have, directly or indirectly made or authorized any contribution,
payment or gift of funds, or property to any official, employee or
agent of any governmental agency, authority or instrumentality in the
Republic of the Philippines or any other jurisdiction where either the
payment or gift or the purpose of such contribution, payment or gift
was, is, or would, after the registration of the Shares and the
American Depositary Shares under the Exchange Act be prohibited under
applicable law, rule or regulation of any relevant locality, including
but not limited to, the U.S. Foreign Corrupt Practices Act of 1977, as
amended, or the rules and regulations promulgated thereunder.
(vv) The choice of the laws of the State of New York as the
governing law of this Agreement is a valid choice of law under the laws
of the Republic of the Philippines and will be honored by courts in the
Republic of the Philippines. The Company has the power to submit, and
pursuant to Section 13 of this Agreement, has legally, validly,
effectively and irrevocably submitted, to the personal jurisdiction of
each New York State and U.S. federal court sitting in The City of New
York (each, a "NEW YORK COURT") and has validly and irrevocably waived
any objection to the laying of venue of any suit, action or proceeding
brought in any such court; and the Company has the power to designate,
appoint and empower, and pursuant to Section 13 of this Agreement, has
legally, validly, effectively and irrevocably designated, appointed and
empowered, an authorized agent for service of process in any action
arising out of or relating to this Agreement, the Time of Sale
Prospectus, the Prospectus, the Registration Statement, the ADR
Registration Statement or the offering of the Shares or the American
Depositary shares in any New York Court, and service of process
effected on such authorized agent will be effective to confer valid
personal jurisdiction over the Company as provided in Section 13 of
this Agreement.
(ww) Any final judgment for a fixed or readily calculable sum
of money rendered by a New York Court having jurisdiction under its own
domestic laws in respect
13
of any suit, action or proceeding against the Company based upon this
Agreement or the Deposit Agreement and any instruments or agreements
entered into for the consummation of the transactions contemplated
herein and therein would be declared enforceable against the Company
without re-examination or review of the merits of the cause of action
in respect of which the original judgment was given or re-litigation of
the matters adjudicated upon or payment of any stamp, registration or
similar tax or duty by the courts of the Republic of the Philippines,
provided that (i) adequate service of process has been effected and the
defendant has had a reasonable opportunity to be heard, (ii) such
judgments or the enforcement thereof are not contrary to the law,
public policy, security or sovereignty of the Republic of the
Philippines, (iii) such judgments were not obtained by fraudulent means
and do not conflict with any other valid judgment in the same matter
between the same parties and (iv) an action between the same parties in
the same matter is not pending in any Philippine court at the time the
lawsuit is instituted in the foreign court. The Company is not aware of
any reason why the enforcement in the Republic of the Philippines of
such a New York Court judgment would be, as of the date hereof,
contrary to public policy of the Republic of the Philippines.
(xx) The Registration Statement, the Prospectus and any
preliminary prospectus comply, and any amendments or supplements
thereto will comply, with any applicable laws or regulations of foreign
jurisdictions in which the Prospectus or any preliminary prospectus, as
amended or supplemented, if applicable, are distributed in connection
with the Directed Share Program; and the Company has not offered, or
caused Xxxxxx Xxxxxxx to offer, the Shares 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 level
or type of business of such customer or supplier with the Company or
(ii) a trade journalist or publication to write or publish favorable
information about the Company or its products.
2. Agreements to Sell and Purchase. The Company and the Operating
Subsidiaries hereby agree to sell to the several Underwriters, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally
and not jointly, to purchase from the Company and the Operating Subsidiaries,
the respective numbers of Firm Shares set forth in Schedule I hereto opposite
its name at $[o] per Share or $[o] per American Depositary Share (the "PURCHASE
PRICE").
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company and the
Operating Subsidiaries agree to sell to the Underwriters the Additional Shares,
and the Underwriters shall have the right to purchase, severally and not
jointly, up to [o] Additional Shares at the Purchase Price. The Representatives
may exercise this right on behalf of the Underwriters in whole or from time to
time in part by giving written notice not later than 30 days after the date of
this Agreement. Any exercise notice shall specify the number of Additional
Shares to be purchased by the Underwriters and the Option Closing Date (as
defined below) on which such Additional Shares are to be purchased. Each Option
Closing Date must be at least one business day after the written notice is given
and may not be earlier than the Closing Date for the Firm Shares or later than
ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. On each
Option Closing Date, if any, each Underwriter agrees, severally and not jointly,
to purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional securities as the Representatives may determine) that bears
the same proportion to the total number of
14
Additional Shares to be purchased on such Option Closing Date as the number of
Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter
bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated, it will not, during the period ending 180
days after the date of the Prospectus: (a) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any Common Shares, American
Depositary Shares or any securities convertible into or exercisable or
exchangeable for Common Shares or American Depositary Shares; (b) file any
registration statement with the Commission relating to the offering of any
Common Shares, American Depositary Shares or any securities convertible into or
exercisable or exchangeable for Common Shares or American Depositary Shares; or
(c) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the Common Shares
or American Depositary Shares, whether any such transaction described in clause
(a), (b) or (c) above is to be settled by delivery of Common Shares or American
Depositary Shares or such other securities, in cash or otherwise.
The restrictions contained in the preceding paragraph shall not apply
to (i) the issuance of Common Shares in connection with the exercise of any
options or restricted shares awarded under the 2004 Amended and Restated Key
Employees Stock Option Plan of the Company, as amended as of the date hereof,
outstanding on the date of the Prospectus and of which the Underwriters have
been advised in writing, (ii) the issuance of any options or restricted shares
awarded under the 2006 Stock Incentive Plan of the Company, as amended as of the
date hereof, or (iii) the issuance of Common Shares issuable upon the exercise
of any warrant, or the conversion of any convertible security, of the Company
outstanding on the date of the Prospectus and of which the Underwriters have
been advised in writing.
3. Terms of Public Offering. The Company is advised by the
Representatives that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement and
this Agreement have become effective as in the judgment of the Representatives
is advisable. The Company is further advised by the Representatives that the
Shares are to be offered to the public initially at $[o] a Share and $[o] an
American Depositary Share (the "PUBLIC OFFERING PRICE") and to certain dealers
selected by the Representatives at a price that represents a concession not in
excess of $[o] per Share or $[o] per American Depositary Share under the Public
Offering Price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of $[o] per Share or $[o] per American
Depositary Share, to any Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to
the Company in U.S. federal or other funds immediately available in The City of
New York to an account designated by the Company against delivery of the Firm
Shares for the respective accounts of the several Underwriters, at 10:00 a.m.,
New York City time, on [o], 2007, or at such other time on the same or such
other date, not later than [o], 2007, as shall be designated in writing by the
Representatives (the "INITIAL CLOSING Date"). Payment for any Additional Shares
shall be made to the in U.S. federal or other funds immediately available in The
City of New York to the account or accounts designated previously pursuant to
the foregoing provisions of this Section against delivery of such Additional
Shares for the respective accounts of the several Underwriters, at 10:00 a.m.,
New York City time, on the date specified in the corresponding notice described
in
15
Section 2 hereof or at such other time on the same or on such other date, in any
event not later than [o], 2007, as shall be designated in writing by the
Representatives (the "OPTION CLOSING DATE"). The American Depositary Receipts
evidencing the American Depositary Shares representing the Shares shall be
registered in such names and in such denominations as the Representatives shall
request in writing not later than one full business day prior to the applicable
Closing Date and shall be delivered to the Representatives on the applicable
Closing Date for the respective accounts of the several Underwriters, with any
transfer taxes payable in connection with the transfer of the Shares and the
American Depositary Shares to the Underwriters duly paid, against payment of the
Purchase Price therefor. As used in this Agreement, the term "CLOSING DATE"
shall mean, collectively, the time and date for delivery of the Firm Shares on
the Initial Closing Date and any time and date for delivery of the Additional
Shares on any Option Closing Date.
5. Conditions to the Underwriter Obligations. The obligations of the
Company to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date are
subject to the condition that the Registration Statement and the ADR
Registration Statement each shall have become effective not later than 4:00 p.m.
New York City time on the date hereof. In addition, the several obligations of
the Underwriters are subject to the following further conditions set forth
below.
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date: (i) there shall not have occurred any
downgrading, nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible change that does
not indicate the direction of the possible change, in the rating
accorded any of the securities of the Company or any of the
Subsidiaries by any "NATIONALLY RECOGNIZED STATISTICAL RATING
ORGANIZATION," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and (ii) there shall not have occurred any
change, or any development involving a prospective change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and the Subsidiaries, taken as a whole, from
that set forth in the Time of Sale Prospectus that, in the judgment of
the Representatives, is material and adverse and that makes it, in the
judgment of the Representatives, impracticable to market the Shares on
the terms and in the manner contemplated in the Time of Sale
Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer
of the Company and each Operating Subsidiary, to the effect set forth
in Section 5(a)(i) above and to the effect that the representations and
warranties of the Company and the Operating Subsidiaries contained in
this Agreement are true and correct as of the Closing Date and that the
Company and each Operating Subsidiary has complied with all of the
agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date. The
officers signing and delivering such certificate may rely upon the best
of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date,
the opinion of Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP, counsel to the
Company and the Delaware Operating Subsidiary, dated the Closing Date,
in form and substance acceptable to the Underwriters, and to the effect
set forth in Exhibit A hereto.
(d) The Underwriters shall have received on the Closing Date
the opinion of
16
Xxxxxx Buyco Tan Fider & Xxxxxx, Philippine counsel to the Company,
dated the Closing Date, in form and substance acceptable to the
Underwriters, and to the effect set forth in Exhibit B hereto.
(e) The Underwriters shall have received on the Closing Date
the opinion of Xxxxx & Xxxxxx LLP, counsel to the Arizona Operating
Subsidiary, dated the Closing Date, in form and substance acceptable to
the Underwriters, and to the effect set forth in Exhibit C hereto.
(f) The Underwriters shall have received on the Closing Date
the opinion of White & Case LLP, counsel to the Depositary, dated the
Closing Date, in form and substance reasonably acceptable to the
Underwriters, and to the effect set forth in Exhibit D hereto.
(g) The Underwriters shall have received on the Closing Date
the opinion of SyCip Xxxxxxx Xxxxxxxxx & Xxxxxxxxx, Philippines counsel
to the Underwriters, dated the Closing Date, in form and substance
reasonably acceptable to the Underwriters and to the effect set froth
in Exhibit E hereto.
(h) The Underwriters shall have received on the Closing Date
the opinion of Xxxxxx & Xxxxxxx LLP, U.S. counsel to the Underwriters,
dated the Closing Date, in form and substance reasonably acceptable to
the Underwriters.
The opinions described in Sections 5(c) through 5(f) above shall be
rendered to the Underwriters at the request of the Company and shall so state
therein.
(i) The Underwriters shall have received, on each of the date
hereof, the date on which the first sale of the Shares is confirmed if
such date is not the same as the date hereof and the Closing Date, a
letter dated the date hereof, the date on which the first sale of the
Shares is confirmed or the Closing Date, as the case may be, in form
and substance satisfactory to the Underwriters, from Ernst & Young LLP,
Independent Registered Public Accounting Firm, containing statements
and information of the type ordinarily included in accountants'
"COMFORT LETTERS" to underwriters with respect to the financial
statements and certain financial information contained in the
Registration Statement, the ADR Registration Statement, the Time of
Sale Prospectus and the Prospectus, provided that the letter delivered
on the Closing Date shall use a "cut-off date" not earlier than the
date hereof.
(j) The "lock-up" agreements, each substantially in the form
of Annex A-1 hereto, among the Representatives and certain
stockholders, officers and directors of the Company, relating to sales
and certain other dispositions of Common Shares or certain other
securities, delivered to the Representative on or before the date
hereof, shall be in full force and effect on the Closing Date; and the
"lock-up" agreements, each substantially in the form of Annex A-2
hereto, among the Representatives and the stockholders of the Company
set forth on Annex A-3 hereto, relating to sales and certain other
dispositions of Common Shares or certain other securities, delivered to
the Representatives on or before the date hereof, shall be in full
force and effect on the Closing Date.
(k) The Company and the Subsidiaries shall have received the
written waiver and consent of the Required Lenders (as defined in the
Loan Agreement) with respect to
17
the waiver by the Required Lenders of certain specified provisions set
forth in the Loan Agreement and indicating therein the consent of the
Required Lenders to the consummation of the transactions contemplated
by this Agreement, in form and substance reasonably acceptable to the
Underwriters.
(l) The aggregate amount of indebtedness outstanding under (i)
the promissory note of the Company, dated April 10, 2004, issued to
Xxxxx X. Xxxxxx, and (ii) the promissory note of the Company, dated
April 10, 2004, shall have been, in each case, repaid in full; and each
such promissory note shall have been terminated and shall be of no
further force or effect.
(m) The Stockholders Agreement, dated November 2003, by and
among the holders of Common Shares specified therein and party thereto
(the "STOCKHOLDERS AGREEMENT"), shall have been amended to provide that
the Stockholders Agreement shall terminate and be of no further force
or effect immediately upon the consummation of the transactions
contemplated by this Agreement, which such amendment shall be in form
and substance reasonably acceptable to the Underwriters.
(n) The Warrant Agreement, dated as of September 2003, by and
between the Company and SPI Technologies, Inc. (the "WARRANT
AGREEMENT"), shall have been terminated and be of no further force or
effect, and there shall be no Rights (as defined in the Warrant
Agreement) or Warrants (as defined in the Warrant Agreement)
outstanding.
(o) The holders of the Common Shares shall have duly approved
and adopted in accordance with the law of the Republic of the
Philippines the Amended Certificate of Incorporation of the Company and
the Amended Bylaws of the Company, in each case in the form presented
to holders of the Common Shares for approval thereby, in form and
substance reasonably acceptable to the Underwriters, at or prior to the
consummation of the transactions contemplated by this Agreement; and
such Amended Certificate of Incorporation and Amended Bylaws shall be
in full force and effect at or prior to the consummation of the
transactions contemplated by this Agreement.
(p) The American Depositary Shares representing the Shares
shall have been approved for quotation on The Nasdaq Global Market,
subject only to official notice of issuance; and the Shares shall be
eligible for clearance and settlement through the facilities of DTC.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to the Representatives on the
applicable Option Closing Date of such documents as the Representatives may
reasonably request with respect to the good standing of the Company, the due
authorization and issuance of the Additional Shares to be sold on such Option
Closing Date and other matters related to the issuance of such Additional
Shares.
6. Covenants of the Company and the Operating Subsidiaries. The Company
and each Operating Subsidiary, as applicable, further covenants with each
Underwriter as follows:
(a) To furnish to the Representatives, without charge, ten
signed copies of each of the Registration Statement and the ADR
Registration Statement (including in each case exhibits thereto) and
for delivery to each other Underwriter a conformed copy of each of the
Registration Statement and the ADR Registration Statement (in each case
without
18
exhibits thereto) and to furnish to the Representatives in The City of
New York, without charge, prior to 10:00 a.m. New York City time on the
business day next succeeding the date of this Agreement and during the
period mentioned in Section 6(e) or (f) below, as many copies of the
Time of Sale Prospectus, the Prospectus and any supplements and
amendments thereto or to the Registration Statement as the
Representatives may reasonably request.
(b) Before amending or supplementing the Registration
Statement, the ADR Registration Statement, the Time of Sale Prospectus
or the Prospectus, to furnish to the Representatives a copy of each
such proposed amendment or supplement and not to file any such proposed
amendment or supplement to which the Representatives reasonably object,
and to file with the Commission within the applicable period specified
in Rule 424(b) under the Securities Act any prospectus required to be
filed pursuant to such Rule.
(c) To furnish to the Representatives copies of each proposed
free writing prospectus to be prepared by or on behalf of, used by, or
referred to by the Company and not to use or refer to any proposed free
writing prospectus to which the Representatives reasonably object.
(d) Not to take any action that would result in an Underwriter
or the Company being required to file with the Commission pursuant to
Rule 433(d) under the Securities Act any free writing prospectus
prepared by or on behalf of the Underwriter that the Underwriter
otherwise would not have been required to file thereunder.
(e) If the Time of Sale Prospectus is being used to solicit
offers to buy the Shares at a time when the Prospectus is not yet
available to prospective purchasers and any event shall occur or
condition exist as a result of which it is necessary to amend or
supplement the Time of Sale Prospectus in order to make the statements
therein, in the light of the circumstances, not misleading, or if any
event shall occur or condition exist as a result of which the Time of
Sale Prospectus conflicts with the information contained in the
Registration Statement then on file, or if, in the opinion of counsel
for the Underwriters, it is necessary to amend or supplement the Time
of Sale Prospectus to comply with applicable law, forthwith to prepare,
file with the Commission and furnish, at its own expense, to the
Underwriters and to any dealer upon request, either amendments or
supplements to the Time of Sale Prospectus so that the statements in
the Time of Sale Prospectus as so amended or supplemented will not, in
the light of the circumstances when delivered to a prospective
purchaser, be misleading or so that the Time of Sale Prospectus, as
amended or supplemented, will no longer conflict with the Registration
Statement, or so that the Time of Sale Prospectus, as amended or
supplemented, will comply with applicable law.
(f) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the
Underwriters the Prospectus (or in lieu thereof the notice referred to
in Rule 173(a) under the Securities Act) is required by law to be
delivered in connection with sales by an Underwriter or dealer, any
event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the
Prospectus (or in lieu thereof the notice referred to in Rule 173(a)
under the Securities Act) is delivered to a purchaser, not misleading,
or if, in the opinion of counsel
19
for the Underwriters, it is necessary to amend or supplement the
Prospectus to comply with applicable law, forthwith to prepare, file
with the Commission and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses the
Representatives will furnish to the Company) to which Shares may have
been sold by the Representatives on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus (or in lieu thereof the notice referred to in Rule 173(a)
under the Securities Act) is delivered to a purchaser, be misleading or
so that the Prospectus, as amended or supplemented, will comply with
law.
(g) To endeavor to qualify the Shares and the American
Depositary Shares for offer and sale under the securities or Blue Sky
laws of such jurisdictions as the Representatives shall reasonably
request.
(h) To make generally available to the Company's security
holders and to the Representatives as soon as practicable an earning
statement covering a period of at least twelve-months beginning the
first fiscal quarter of the Company occurring after the date of this
Agreement which shall satisfy the provisions of Section 11(a) of the
Securities Act and the rules and regulations of the Commission
thereunder.
(i) To not directly or indirectly use the proceeds of the
American Depositary Shares hereunder, or lend, contribute or otherwise
make available such proceeds to any Subsidiary, joint venture partner
or other person or entity, for the purpose of financing the activities
of any person currently subject to any U.S. sanctions administered by
the Office of Foreign Assets Control.
(j) To comply with the terms of the Deposit Agreement so that
the American Depositary Receipts evidencing the American Depositary
Shares will be executed by the Depositary and delivered to the
Underwriters pursuant to this Agreement at each Closing Date.
(k) To comply with all applicable securities and other laws,
rules and regulations in each jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program
7. Expenses.
(a) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company
and the Operating Subsidiaries agree to pay or cause to be paid all
expenses incident to the performance of their obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the
counsel to the Company and the accountants of the Company in connection
with the registration and delivery of the Shares under the Securities
Act and all other fees or expenses in connection with the preparation
and filing of the Registration Statement, the ADR Registration
Statement, any preliminary prospectus, the Time of Sale Prospectus, the
Prospectus, any free writing prospectus prepared by or on behalf of,
used by, or referred to by the Company, and amendments and supplements
to any of the foregoing, including all printing costs associated
therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified; (ii)
all costs and
20
expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon;
(iii) the cost of printing or producing any Blue Sky or legal
investment memorandum in connection with the offer and sale of the
Shares under state securities laws and all expenses in connection with
the qualification of the Shares for offer and sale under state
securities laws as provided in Section 6(g) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection
with the Blue Sky or legal investment memorandum; (iv) all filing fees
and the reasonable fees and disbursements of counsel to the
Underwriters incurred in connection with the review and qualification
of the offering of the Shares by the NASD; (v) all fees and expenses in
connection with the preparation and filing of the ADR Registration
Statement and all costs and expenses incident to listing the Shares on
The Nasdaq Global Market and the Philippines Stock Exchange, if
applicable; (vi) the cost of printing certificates representing the
Shares and the American Depositary Receipts; (vii) the costs and
charges of any transfer agent, registrar or depositary, including the
Depositary; (viii) the costs and expenses of the Company and the
Operating Subsidiaries relating to investor presentations on any "road
show" undertaken in connection with the marketing of the offering of
the Shares, including, without limitation, expenses associated with the
preparation or dissemination of any electronic roadshow, expenses
associated with the production of road show slides and graphics, fees
and expenses of any consultants engaged in connection with the road
show presentations with the prior approval of the Company, travel and
lodging expenses of the representatives and officers of the Company and
any such consultants, and the cost of any aircraft chartered in
connection with the road show; (ix) the document production charges and
expenses associated with printing this Agreement and the Deposit
Agreement; (x) all fees and disbursements of counsel incurred by the
Underwriters in connection with the Directed Share Program and stamp
duties, similar taxes or duties or other taxes, if any, incurred by the
Underwriters in connection with the Directed Share Program; and (xi)
all other costs and expenses incident to the performance of the
obligations of Company and the Operating Subsidiaries hereunder for
which provision is not otherwise made in this Section. It is
understood, however, that except as provided in this Section, Section 8
hereof, Section 9 hereof and Section 12 hereof, the Underwriters will
pay all of their costs and expenses, including fees and disbursements
of their counsel, stock transfer taxes payable on resale of any of the
Shares or the American Depositary Shares by them and any advertising
expenses connected with any offers they may make.
(b) The provisions of this Section shall not supersede or
otherwise affect any agreement that the Company and the Operating
Subsidiaries may otherwise have for the allocation of such expenses
among themselves.
8. Indemnity and Contribution.
(a) The Company and the Operating Subsidiaries agree to
indemnify and hold harmless each Underwriter, each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, and each affiliate of
any Underwriter within the meaning of Rule 405 under the Securities Act
from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement, the ADR
Registration
21
Statement or any amendment thereof, any preliminary prospectus, the
Time of Sale Prospectus, any issuer free writing prospectus as defined
in Rule 433(h) under the Securities Act, any Company information that
the Company has filed, or is required to file, pursuant to Rule 433(d)
under the Securities Act, or the Prospectus or any amendments or
supplements thereto, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar
as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission
based upon information relating to any Underwriter furnished to the
Company in writing by such Underwriter through Xxxxxx Xxxxxxx & Co.
Incorporated expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the directors of the Company,
the officers of the Company who sign the Registration Statement and the
ADR Registration Statement and each person, if any, who controls the
Company within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act from and against any and all losses,
claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus, the Time of Sale Prospectus, any issuer free
writing prospectus as defined in Rule 433(h) under the Securities Act,
any Company information that the Company has filed, or is required to
file, pursuant to Rule 433(d) under the Securities Act, or the
Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use in the Registration Statement, any
preliminary prospectus, the Time of Sale Prospectus, any issuer free
writing prospectus or the Prospectus or any amendment or supplement
thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 8(a) or (b) hereof,
respectively, such person (the "INDEMNIFIED PARTY") shall promptly
notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PARTY") in writing and the Indemnifying Party, upon
request of the Indemnified Party, shall retain counsel reasonably
satisfactory to the Indemnified Party to represent the Indemnified
Party and any others the Indemnifying Party may designate in such
proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any Indemnified
Party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such Indemnified
Party unless (i) the Indemnifying Party and the Indemnified Party shall
have mutually agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties)
include both the Indemnifying Party and the Indemnified Party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. It is understood that the Indemnifying Party shall not, in
respect of the legal expenses of any Indemnified Party in connection
with any proceeding or related proceedings in the same jurisdiction, be
22
liable for (A) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if
any, who control any Underwriter within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act or who are
affiliates of any Underwriter within the meaning of Rule 405 under the
Securities Act and (B) the fees and expenses of more than one separate
firm (in addition to any local counsel) for the Company, its directors,
its officers who sign the Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act. In the case of
any such separate firm for the Underwriters and such control persons
and affiliates of any Underwriters, such firm shall be designated in
writing the Representatives. In the case of any such separate firm for
the Company, and such directors, officers and control persons of the
Company, such firm shall be designated in writing by the Company. The
Indemnifying Party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with
such consent or if there be a final judgment for the plaintiff, the
Indemnifying Party agrees to indemnify the Indemnified Party from and
against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an Indemnified
Party shall have requested an Indemnifying Party to reimburse the
Indemnified Party for fees and expenses of counsel as contemplated by
the second and third sentences of this paragraph, the Indemnifying
Party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (1) settlement is
entered into more than 30 days after receipt by such Indemnifying Party
of the aforesaid request and (2) such Indemnifying Party shall not have
reimbursed the Indemnified Party in accordance with such request prior
to the date of such settlement. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of which
any Indemnified Party is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Party, unless such
settlement includes an unconditional release of such Indemnified Party
from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in Section
8(a) or 8(b) is unavailable to an Indemnified Party or insufficient in
respect of any losses, claims, damages or liabilities referred to
therein, then each Indemnifying Party under such paragraph, in lieu of
indemnifying such Indemnified Party thereunder, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company
and the Operating Subsidiaries, on the one hand, and the Underwriters,
on the other hand, from the offering of the Shares or (ii) if the
allocation provided by clause (d)(i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (d)(i) above but also
the relative fault of the Company and the Operating Subsidiaries, on
the one hand, and of the Underwriters, on the other hand, in connection
with the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Operating Subsidiaries, on the one hand, and the Underwriters, on the
other hand, in connection with the offering of the Shares shall be
deemed to be in the same respective proportions as the net proceeds
from the offering of the Shares (before deducting expenses) received by
the Company and the Operating Subsidiaries and the total underwriting
discounts and commissions received by the Underwriters, in each case as
set forth in the table on the
23
cover of the Prospectus, bear to the aggregate Public Offering Price of
the Shares. The relative fault of the Company and the Operating
Subsidiaries, on the one hand, and the Underwriters, on the other hand,
shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information
supplied by the Company and the Operating Subsidiaries or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Underwriters' respective obligations to contribute
pursuant to this Section 8 are several in proportion to the respective
number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Operating Subsidiaries and the
Underwriters agree that it would not be just or equitable if
contribution pursuant to this Section 8 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 8(d)
hereof. The amount paid or payable by an Indemnified Party as a result
of the losses, claims, damages and liabilities referred to in Section
8(d) hereof shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 8,
no Underwriter shall be required to contribute any amount in excess of
the amount by which the total price at which the Shares underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages that such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section
8 hereof are not exclusive and shall not limit any rights or remedies
that may otherwise be available to any Indemnified Party at law or in
equity.
(f) The indemnity and contribution provisions contained in
this Section 8 hereof and the representations, warranties and other
statements of the Company and the Operating Subsidiaries contained
elsewhere in this Agreement shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Underwriter, any person
controlling any Underwriter or any affiliate of any Underwriter or by
or on behalf of the Company and the Operating Subsidiaries, their
officers or directors or any person controlling the Company and the
Operating Subsidiaries, and (iii) the acceptance of and payment for any
of the Shares.
9. Directed Share Program.
(a) The Company and the Operating Subsidiaries agree to
indemnify and hold harmless Xxxxxx Xxxxxxx, each person, if any, who
controls Xxxxxx Xxxxxxx within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act and each affiliate of
Xxxxxx Xxxxxxx within the meaning of Rule 405 of the Securities Act
(together, the "XXXXXX XXXXXXX ENTITIES") from and against any and all
losses, claims, damages and liabilities (including, without limitation,
any legal or other
24
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, other than losses,
claims, damages or liabilities (or expenses relating thereto) that are
finally judicially determined to have resulted from the bad faith or
gross negligence of Xxxxxx Xxxxxxx Entities.
(b) In case any proceeding (including any governmental
investigation) shall be instituted involving any Xxxxxx Xxxxxxx Entity
in respect of which indemnity may be sought pursuant to Section 9(a)
above, the Xxxxxx Xxxxxxx Entity seeing indemnity, shall promptly
notify the Company in writing and the Company and the Operating
Subsidiaries, upon request of the Xxxxxx Xxxxxxx Entity, shall retain
counsel reasonably satisfactory to the Xxxxxx Xxxxxxx Entity to
represent the Xxxxxx Xxxxxxx Entity and any others the Company may
designate in such proceeding and shall pay the fees and disbursements
of such counsel related to such proceeding. In any such proceeding, any
Xxxxxx Xxxxxxx Entity shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense of
such Xxxxxx Xxxxxxx Entity unless (i) the Company shall have agreed to
the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Company
and the Xxxxxx Xxxxxxx Entity and representation of both parties by the
same counsel would be inappropriate due to actual or potential
differing interests between them. The Company shall not, in respect of
the legal expenses of the Xxxxxx Xxxxxxx Entities in connection with
any proceeding or related proceedings in the same jurisdiction, be
liable for the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Xxxxxx Xxxxxxx Entities. Any
such separate firm for the Xxxxxx Xxxxxxx Entities shall be designated
in writing by Xxxxxx Xxxxxxx. The Company shall not be liable for any
settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the
plaintiff, the Company and the Operating Subsidiaries agree to
indemnify the Xxxxxx Xxxxxxx Entities from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time a Xxxxxx Xxxxxxx Entity shall have
requested the Company or the Operating Subsidiaries to reimburse it for
fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the Company agrees that it shall be liable
for any settlement of any proceeding effected without its written
consent if (A) such settlement is entered into more than 30 days after
receipt by the Company of the aforesaid request and (B) the Company
shall not have reimbursed the Xxxxxx Xxxxxxx Entity in accordance with
such request prior to the date of such settlement. Neither the Company
nor the Operating Subsidiaries shall, without the prior written consent
of Xxxxxx Xxxxxxx, effect any settlement of any pending or threatened
proceeding in respect of which any Xxxxxx Xxxxxxx Entity is or could
have been a party and indemnity could have been sought hereunder by
such Xxxxxx Xxxxxxx Entity, unless such settlement includes an
unconditional release of the Xxxxxx Xxxxxxx Entities from all liability
on claims that are the subject matter of such proceeding.
25
(c) To the extent the indemnification provided for in Section
9(a) above is unavailable to a Xxxxxx Xxxxxxx Entity or insufficient in
respect of any losses, claims, damages or liabilities referred to
therein, then the Company and the Operating Subsidiaries, in lieu of
indemnifying the Xxxxxx Xxxxxxx Entity thereunder, shall contribute to
the amount paid or payable by the Xxxxxx Xxxxxxx Entity as a result of
such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company
and the Operating Subsidiaries, on the one hand, and the Xxxxxx Xxxxxxx
Entities, on the other hand, from the offering of the Directed Shares
or (ii) if the allocation provided by clause (c)(i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (c)(i)
above, but also the relative fault of the Company and the Operating
Subsidiaries, on the one hand, and of the Xxxxxx Xxxxxxx Entities, on
the other hand, in connection with any statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received
by the Company and the Operating Subsidiaries, on the one hand, and the
Xxxxxx Xxxxxxx Entities, on the other hand, in connection with the
offering of the Directed Shares shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the
Directed Shares (before deducting expenses) and the total underwriting
discounts and commissions received by the Xxxxxx Xxxxxxx Entities for
the Directed Shares, bear to the aggregate Public Offering Price of the
Directed Shares. If the loss, claim, damage or liability is caused by
an untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact, the relative
fault of the Company and the Operating Subsidiaries, on the one hand,
and the Xxxxxx Xxxxxxx Entities, on the other hand, shall be determined
by reference to, among other things, whether the untrue or alleged
untrue statement or the omission or alleged omission relates to
information supplied by the Company or by the Xxxxxx Xxxxxxx Entities
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(d) The Company, the Operating Subsidiaries and the Xxxxxx
Xxxxxxx Entities agree that it would not be just or equitable if
contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Xxxxxx Xxxxxxx Entities were treated as one
entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in Section
9(c) hereof. The amount paid or payable by the Xxxxxx Xxxxxxx Entities
as a result of the losses, claims, damages and liabilities referred to
in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by the Xxxxxx Xxxxxxx Entities in connection with
investigating or defending any such action or claim. Notwithstanding
the provisions of this Section 9, no Xxxxxx Xxxxxxx Entity shall be
required to contribute any amount in excess of the amount by which the
total price at which the Directed Shares distributed to the public were
offered to the public exceeds the amount of any damages that such
Xxxxxx Xxxxxxx Entity has otherwise been required to pay. The remedies
provided for in this Section 9 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(e) The indemnity and contribution provisions contained in
this Section 9 shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Xxxxxx Xxxxxxx Entity, the
26
Company, its officers or directors or any person controlling the
Company, or the Operating Subsidiaries, their respective officers or
directors or any person controlling any Operating Subsidiary, and (iii)
acceptance of and payment for any of the Directed Shares.
10. Termination. The Underwriters may terminate this Agreement by
notice given by the Representatives to the Company, if after the execution and
delivery of this Agreement and prior to the Closing Date (a) trading generally
shall have been suspended or materially limited on, or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange, The Nasdaq
Global Market or the Philippines Stock Exchange, (b) trading of any securities
of the Company shall have been suspended on any exchange or in any
over-the-counter market, (c) a material disruption in securities settlement,
payment or clearance services in the U.S. or the Republic of the Philippines
shall have occurred, (d) any moratorium on commercial banking activities shall
have been declared by federal or New York State or Philippines authorities or
(e) there shall have occurred any outbreak or escalation of hostilities, or any
change in financial markets, currency exchange rates or controls or any calamity
or crisis that, in the judgment of the Representatives, is material and adverse
and which, individually or together with any other event specified in this
clause (e), makes it, in the judgment of the Representatives, impracticable or
inadvisable to proceed with the offer, sale or delivery of the Shares on the
terms and in the manner contemplated in the Time of Sale Prospectus or the
Prospectus.
11. Effectiveness. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
12. Defaulting Underwriters.
(a) If, on the Closing Date or an Option Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse
to purchase the Shares that it has or they have agreed to purchase
hereunder on such date, and the aggregate number of the Shares which
such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters
shall be obligated severally, in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I
bears to the aggregate number of Firm Shares set forth opposite the
names of all such non-defaulting Underwriters, or in such other
proportions as the Representatives may specify, to purchase the Shares
which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date, provided that in no event shall the
number of Shares that any Underwriter has agreed to purchase pursuant
to this Agreement be increased pursuant to this Section 12(a) by an
amount in excess of one-ninth of such number of the Shares without the
written consent of such Underwriter.
(b) If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase the Shares and the aggregate number of
the Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of the Shares to be purchased on such
date, and arrangements satisfactory to the Representatives and the
Company, as applicable, for the purchase of such Shares are not made
within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the
Company, as applicable. In any such case either the Representatives or
the Company, as applicable, shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that
the required changes, if any, in the Registration Statement, the ADR
Registration Statement, the Time of Sale
27
Prospectus or the Prospectus, or in any other documents or
arrangements, may be effected.
(c) If, on an Option Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased on such Option Closing Date, the
non-defaulting Underwriters shall have the option to (a) terminate
their obligation hereunder to purchase the Additional Shares to be sold
on such Option Closing Date or (b) purchase not less than the number of
Additional Shares that such non-defaulting Underwriters would have been
obligated to purchase in the absence of such default. Any action taken
under this Section 12(c) shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
(d) If this Agreement shall be terminated by the Underwriters,
or any of them, because of any failure or refusal on the part of the
Company or any Operating Subsidiary to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason
the Company or any Operating Subsidiary shall be unable to perform its
obligations under this Agreement, the Company or such Operating
Subsidiary will reimburse the Underwriters or such Underwriters as have
so terminated this Agreement with respect to themselves, severally, for
all out-of-pocket expenses (including the fees and disbursements of
their counsel) reasonably incurred by such Underwriters in connection
with this Agreement or the offering contemplated hereunder.
13. Submission to Jurisdiction; Agent for Service.
(a) The Company and the Operating Subsidiaries irrevocably
submit to the non-exclusive jurisdiction of any New York Court over any
suit, action or proceeding arising out of or relating to this
Agreement, the Time of Sale Prospectus, the Prospectus, the
Registration Statement, the ADR Registration Statement or the offering
of the Shares or the American Depositary Shares. The Company and the
Operating Subsidiaries irrevocably waive, to the fullest extent
permitted by law, any objection which they may now or hereafter have to
the laying of venue of any such suit, action or proceeding brought in
such a court and any claim that any such suit, action or proceeding
brought in such a court has been brought in an inconvenient forum. To
the extent that the Company or any Operating Subsidiary has or
hereafter may acquire any immunity (on the grounds of sovereignty or
otherwise) from the jurisdiction of any court or from any legal process
with respect to itself or its property, the Company and each of the
Operating Subsidiaries irrevocably waives, to the fullest extent
permitted by law, such immunity in respect of any such suit, action or
proceeding.
(b) The Company and the Operating Subsidiaries hereby
irrevocably appoint CT Corporation System, with offices at 000 Xxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as their agent for service of process
in any suit, action or proceeding described in the preceding paragraph
and agrees that service of process in any such suit, action or
proceeding may be made thereupon at the office of such agent. The
Company and the Operating Subsidiaries waive, to the fullest extent
permitted by law, any other requirements of or objections to personal
jurisdiction with respect thereto; the Company and the Operating
Subsidiaries represent and warrant, jointly and severally, that such
agent has agreed to act as their agent for service of process; and the
Company and the Operating Subsidiaries agree, jointly and severally, to
take any and all action, including the filing of
28
any and all documents and instruments, that may be necessary to
continue such appointment in full force and effect.
14. Judgment Currency. If for the purposes of obtaining judgment in any
court it is necessary to convert a sum due hereunder into any currency other
than U.S. dollars, the parties hereto agree, to the fullest extent permitted by
law, that the rate of exchange used shall be the rate at which in accordance
with normal banking procedures the Underwriters could purchase U.S. dollars with
such other currency in The City of New York on the business day preceding that
on which final judgment is given. The obligation of the Company and the
Operating Subsidiaries with respect to any sum due from it to any Underwriter or
any person controlling any Underwriter shall, notwithstanding any judgment in a
currency other than U.S. dollars, not be discharged until the first business day
following receipt by such Underwriter or controlling person of any sum in such
other currency, and only to the extent that such Underwriter or controlling
person may in accordance with normal banking procedures purchase U.S. dollars
with such other currency. If the U.S. dollars so purchased are less than the sum
originally due to such Underwriter or controlling person hereunder, the Company
and the Operating Subsidiaries agree as a separate obligation and
notwithstanding any such judgment to indemnify such Underwriter or controlling
person against such loss. If the U.S. dollars so purchased are greater than the
sum originally due to such Underwriter or controlling person hereunder, such
Underwriter or controlling person agrees to pay to Company and the Operating
Subsidiaries, as applicable, an amount equal to the excess of the dollars so
purchased over the sum originally due to such Underwriter or controlling person
hereunder.
15. Foreign Taxes. All payments made by the Company and the Operating
Subsidiaries under this Agreement will be made without withholding or deduction
for or on account of any present or future taxes, duties, assessments or
governmental charges of whatever nature imposed or levied by or on behalf of the
Republic of the Philippines or any political subdivision or any taxing authority
thereof or therein unless the Company and the Operating Subsidiaries are or
become required by law to withhold or deduct such taxes, duties, assessments or
other governmental charges. In such event, the Company and the Operating
Subsidiaries will pay such additional amounts as will result, after such
withholding or deduction, in the receipt by each Underwriter and each person
controlling any Underwriter, as the case may be, of the amounts that would
otherwise have been receivable in respect thereof, except to the extent such
taxes, duties, assessments or other governmental charges are imposed or levied
by reason of such Underwriter's or controlling person's being connected with the
Republic of the Philippines other than by reason of its being an Underwriter or
a person controlling any Underwriter under this Agreement.
16. Entire Agreement.
(a) This Agreement, together with any contemporaneous written
agreements and any prior written agreements (to the extent not
superseded by this Agreement) that relate to the offering of the
Shares, including without limitation the Deposit Agreement, represents
the entire agreement between the Company and the Operating Subsidiaries
and the Underwriters with respect to the preparation of any preliminary
prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of
the offering and the purchase and sale of the Shares.
29
(b) The Company and the Operating Subsidiaries acknowledge
that in connection with the offering of the Shares and the American
Depositary Shares: (i) the Underwriters have acted at arms length, are
not agents of, and owe no fiduciary duties to, the Company or the
Operating Subsidiaries or any other person; (ii) the Underwriters owe
the Company and the Operating Subsidiaries only those duties and
obligations set forth in this Agreement and prior written agreements
(to the extent not superseded by this Agreement), if any; (iii) the
Underwriters may have interests that differ from those of Company and
the Operating Subsidiaries; and (iv) the Company and the Operating
Subsidiaries each waive to the full extent permitted by applicable law
any claims they may have against the Underwriters arising from an
alleged breach of fiduciary duty in connection with the offering of the
Shares.
17. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
18. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.
19. Notices. All communications hereunder shall be in writing and
delivered by U.S. mail or facsimile, and effective only upon receipt, as
follows:
(a) if to the Underwriters, to:
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Bank Securities Inc.
Xxxxxx X. Xxxxx & Co. Incorporated
JMP Securities LLC
c/o: Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Equity Capital Markets Syndicate Desk
Facsimile: (000) 000-0000
with a copy thereof delivered to:
Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxx
Xxxxx Xxxx, Xxxxxxxxxx
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq. and
Xxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
(000) 000-0000
and:
SyCip Xxxxxxx Xxxxxxxxx & Xxxxxxxxx
105 Xxxxx xx Xxxxx
Xxxxxx Xxxx, Xxxxx Xxxxxx 0000
Xxxxxxxx of the Philippines
30
Attention: Mia G. Gentugaya
Facsimile: (000) 000-0000
(b) if to the Company or any Operating Subsidiary, to:
eTelecare Global Solutions, Inc.
0000 X. Xxxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxx
Facsimile: (000) 000-0000
with a copy thereof delivered to:
Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP
0000 Xxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. del Xxxxx, Esq. and
Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
and to:
Xxxxxx Xxxxx Tan Xxxxx & Xxxxxx
104 H. V. de la Costa Street
Liberty Center, Xxxxxxx Village
Makati City, Metro Manila 1227
Republic of the Philippines
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
20. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
[Intentionally Left Blank]
31
If the foregoing Agreement is in accordance with the understanding of
the Underwriters, upon the execution and acceptance of this Agreement by the
Representatives, individually and on behalf of the several Underwriters, this
Agreement shall constitute a binding agreement among each of the Underwriters,
the Company and the Operating Subsidiaries.
Very truly yours,
ETELECARE GLOBAL
SOLUTIONS, INC.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
[Intentionally Left Blank]
Very truly yours,
ETELECARE GLOBAL
SOLUTIONS -- U.S., INC.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
[Intentionally Left Blank]
Very truly yours,
ETELECARE GLOBAL
SOLUTIONS -- AZ, INC.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
[Intentionally Left Blank]
Accepted as of the date hereof:
XXXXXX XXXXXXX & CO. INCORPORATED
DEUTSCHE BANK SECURITIES INC.
XXXXXX X. XXXXX & CO. INCORPORATED
JMP SECURITIES LLC
Severally on behalf of the several
Underwriters named in SCHEDULE I hereto
By: Xxxxxx Xxxxxxx & Co. Incorporated
Severally on behalf of the several
Underwriters named in SCHEDULE I hereto
By:
--------------------------------------
Name:
Title:
SCHEDULE I
Underwriter Shares
---------------------------------------------------------------------------------- -----------------
Xxxxxx Xxxxxxx & Co. Incorporated ............................................ [o]
Deutsche Bank Securities Inc. ................................................ [o]
Xxxxxx X. Xxxxx & Co. Incorporated ........................................... [o]
JMP Securities LLC ........................................................... [o]
-----------------
Total ............................................................... [o]
=================
