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EXHIBIT 1.1
WITNESS SYSTEMS, INC.
3,800,000 SHARES(1)
COMMON STOCK
UNDERWRITING AGREEMENT
______________, 0000
XXXXXXXXX & XXXXX LLC
U.S. Bancorp Xxxxx Xxxxxxx Inc.
SoundView Technology Group, Inc.
x/x Xxxxxxxxx & Xxxxx LLC
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
Witness Systems, Inc., a Delaware corporation (herein called the
Company), proposes to issue and sell 3,800,000 shares of its authorized but
unissued Common Stock, $.01 par value (herein called the Common Stock) (said
shares of Common Stock being herein called the Underwritten Stock). The Company
and the stockholders of the Company named in Schedule II hereto (herein
collectively called the Selling Securityholders), propose to grant to the
Underwriters (as hereinafter defined) an option to purchase up to 570,000
additional shares of Common Stock (herein called the Option Stock and with the
Underwritten Stock herein collectively called the Stock). The Common Stock is
more fully described in the Registration Statement and the Prospectus
hereinafter mentioned.
The Company and the Selling Securityholders severally hereby confirm
the agreements made with respect to the purchase of the Stock by the several
underwriters, for whom you are acting, named in Schedule I hereto (herein
collectively called the Underwriters, which term shall also include any
underwriter purchasing Stock pursuant to Section 3(b) hereof). You represent and
warrant that you have been authorized by each of the other Underwriters to enter
into this Agreement on its behalf and to act for it in the manner herein
provided.
1. REGISTRATION STATEMENT. The Company has filed with the Securities
and Exchange Commission (herein called the Commission) a registration statement
on Form S-1 (No. 333-91383), including the related preliminary prospectus, for
the registration under the Securities Act of 1933, as amended (together with the
rules and regulations of the Commission thereunder, herein called the Securities
Act) of the Stock. Copies of such registration statement and of each amendment
thereto, if any, including the related preliminary prospectus (meeting the
requirements of Rule 430A of the rules and regulations of the Commission)
heretofore filed by the Company with the Commission have been delivered to you.
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1 Plus an option to purchase from the Company and the Selling
Securityholders up to 570,000 additional shares to cover
over-allotments.
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The term Registration Statement as used in this agreement shall mean
such registration statement, including all exhibits and financial statements,
all information omitted therefrom in reliance upon Rule 430A and contained in
the Prospectus referred to below, in the form in which it became effective, and
any registration statement filed pursuant to Rule 462(b) of the rules and
regulations of the Commission with respect to the Stock (herein called a Rule
462(b) registration statement), and, in the event of any amendment thereto after
the effective date of such registration statement (herein called the Effective
Date), shall also mean (from and after the effectiveness of such amendment) such
registration statement as so amended (including any Rule 462(b) registration
statement). The term Prospectus as used in this Agreement shall mean the
prospectus relating to the Stock first filed with the Commission pursuant to
Rule 424(b) and Rule 430A (or if no such filing is required, as included in the
Registration Statement) and, in the event of any supplement or amendment to such
prospectus after the Effective Date, shall also mean (from and after the filing
with the Commission of such supplement or the effectiveness of such amendment)
such prospectus as so supplemented or amended. The term Preliminary Prospectus
as used in this Agreement shall mean each preliminary prospectus included in
such registration statement prior to the time it becomes effective.
The Registration Statement has been declared effective under the
Securities Act, and no post-effective amendment to the Registration Statement
has been filed as of the date of this Agreement. The Company has caused to be
delivered to you copies of each Preliminary Prospectus and has consented to the
use of such copies for the purposes permitted by the Securities Act.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
SECURITYHOLDERS.
(a) The Company hereby represents and warrants as follows:
(i) Each of the Company and its subsidiaries has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has full corporate
power and authority to own or lease its properties and conduct its business as
described in the Registration Statement and the Prospectus and as being
conducted, and is duly qualified as a foreign corporation and in good standing
in all jurisdictions in which the character of the property owned or leased or
the nature of the business transacted by it makes qualification necessary
(except where the failure to be so qualified would not, singly or in the
aggregate, have a material adverse effect on the business, properties, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole).
(ii) The Registration Statement has become effective
(other than any Rule 462(b) registration statement to be filed by the Company
after the date hereof); any Rule 462(b) registration statement filed after the
effectiveness of this Agreement will become effective no later than 7:00 p.m.,
San Francisco time, on the date of this Agreement; and no stop order suspending
the effectiveness of the Registration Statement is in effect, and no proceedings
for such purpose are pending before or threatened by the Commission.
(iii) The Registration Statement and the Prospectus comply,
and on the Closing Date (as hereinafter defined) and any later date on which
Option Stock is to be purchased, the Prospectus will comply, in all material
respects, with the provisions of the Securities Act; on the Effective Date, the
Registration Statement did not contain any untrue statement of a material fact
and did not omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading; and, on the
Effective Date the Prospectus did not and, on the Closing Date and any later
date on which Option Stock is to be purchased, will not contain any untrue
statement
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of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that none of the representations and
warranties in this subparagraph (iii) shall apply to statements in, or omissions
from, the Registration Statement or the Prospectus made in reliance upon and in
conformity with information herein or otherwise furnished in writing to the
Company by or on behalf of the Underwriters for use in the Registration
Statement or the Prospectus.
(iv) Since the respective dates as of which information is
given in the Prospectus, other than as set forth in the Registration Statement
and the Prospectus, (A) there has not occurred any material adverse change or
any development involving a prospective material adverse change in the business,
properties, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, (B) there has not been any material adverse change
or any development involving a prospective material adverse change in the
capital stock or in the long-term debt of the Company or any of its
subsidiaries, (C) neither the Company nor any of its subsidiaries has incurred
any material liability or obligation, direct or contingent and (D) except in the
ordinary course of business, neither the Company nor any of its subsidiaries has
entered into any transaction not referred to in the Prospectus.
(v) The authorized capital stock of the Company conforms
to the description thereof contained in the Registration Statement and the
Prospectus. All of the outstanding shares of capital stock of the Company
(including, without limitation, the Stock to be sold by the Selling
Securityholders) have been duly authorized and validly issued, are fully paid
and non-assessable, conform to the description of the capital stock of the
Company contained in the Registration Statement and the Prospectus and are not
subject to any preemptive or similar rights. There are no preemptive or similar
rights to subscribe for or to purchase any securities of the Company.
(vi) Prior to the Closing Date, the Stock to be issued and
sold by the Company, and the Stock to be sold by the Selling Securityholders,
will be authorized for quotation on the Nasdaq National Market. The form of
certificate evidencing the Stock complies in all material respects with the
applicable requirements of law, the Company's charter and bylaws and the Nasdaq
National Market.
(vii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission. Each Preliminary
Prospectus filed as part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant to Rule 424 under the
Securities Act, complied when so filed in all material respects with the
Securities Act, and did not contain an untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that none of the representations and warranties
set forth in this subparagraph (vii) shall apply to statements in, or omissions
from, any Preliminary Prospectus made in reliance upon and in conformity with
information herein or otherwise furnished in writing to the Company by or on
behalf of the Underwriters for use in such Preliminary Prospectus.
(viii) There are no outstanding subscriptions, rights,
warrants, options, calls, convertible securities, commitments of sale or liens
granted or issued by the Company or any of its subsidiaries relating to or
entitling any person to purchase or otherwise to acquire any shares of the
capital stock of the Company or any of its subsidiaries, except as disclosed in
the Registration Statement and the Prospectus.
(ix) The Stock has been duly authorized for issuance and
sale pursuant to this Agreement and, when issued and delivered to the
Underwriters against payment therefor as provided in
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this Agreement, will be validly issued, fully paid and non-assessable and will
conform to the description thereof contained in the Registration Statement and
the Prospectus, and the issuance of the Stock will not be subject to any
preemptive or similar rights. No further approval or authority of the
stockholders or the Board of Directors of the Company is required for the
transfer and sale of the Stock to be sold by the Selling Securityholders or for
the issuance and sale of the Stock by the Company as contemplated herein.
(x) The Company has no subsidiaries and owns no equity
interests in any other person, except that the Company owns, directly or
indirectly, all of the issued and outstanding capital stock of Witness Systems
UK Limited, a company organized under the laws of the Companies Act (United
Kingdom) ("Witness UK"). All of the outstanding shares of capital stock of the
Company's subsidiary have been duly authorized and validly issued, are fully
paid and non-assessable, and are owned by the Company free and clear of all
liens, encumbrances, equities, security interests, defects, adverse interests
and claims whatsoever. The Company has no direct or indirect significant
subsidiaries (as defined in Rule 1-02 of the Commission's Regulation S-X). [The
Company's subsidiary is not currently prohibited, directly or indirectly, from
(A) paying any dividends to the Company, (B) making any other distribution on
such subsidiary's capital stock, (C) repaying any loans or advances made to such
subsidiary by the Company, or (D) transferring any of such subsidiary's property
or assets to the Company, in each case except as disclosed in the Registration
Statement and the Prospectus.]
(xi) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by-laws or in default in the performance
of any obligation, agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a whole, to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries or their respective property is bound.
(xii) None of the execution, delivery or performance of
this Agreement by the Company, the compliance by the Company with any provision
hereof or the consummation of the transactions contemplated hereby or by the
Registration Statement and the Prospectus will (A) require any consent,
approval, authorization or other order of, or qualification with, any court or
governmental body or agency (except such as have been obtained and such as may
be required under the securities or Blue Sky laws of the various states), (B)
conflict with or constitute a breach of any of the terms or provisions of, or a
default under, the charter or bylaws of the Company or any of its subsidiaries
or any indenture, loan agreement, mortgage, lease or other agreement or
instrument that is material to the Company and its subsidiaries, taken as a
whole, to which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries or their respective property is bound,
(C) violate or conflict with any applicable law or any rule, regulation,
judgment, order or decree of any court or any governmental body or agency having
jurisdiction over the Company, any of its subsidiaries or their respective
property or (D) result in the suspension, termination or revocation of any
Authorization (as defined below) of the Company or any of its subsidiaries or
any other impairment of the rights of the holder of any such Authorization.
(xiii) No Authorization or other action by, or notice to or
filing with, any court, governmental authority, regulatory body or other person
is required for the execution, delivery or perfomance of this Agreement, the
compliance by the Company with the provisions hereof or the consummation of the
transactions contemplated hereby or by the Registration Statement and the
Prospectus, except such as have been obtained and such as may be required under
state securities or Blue Sky laws in connection with the offer, sale and
distribution of the Stock by the Underwriters.
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(xiv) There are no legal or governmental proceedings
pending or threatened to which the Company or any of its subsidiaries is or
could be a party or to which any of their respective property is or could be
subject that are required to be described in the Registration Statement or the
Prospectus and are not so described; nor are there any statutes, rules,
regulations, laws, orders, decrees, judgments, contracts, instruments or other
documents or agreements that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration
Statement that are not so described or filed as required. Without limiting the
generality of the foregoing sentence, the Company has no reason to believe that
any legal or governmental proceedings will be instituted against it any or its
subsidiaries and, to the best knowledge of the Company, there exists no basis
for any legal or governmental proceedings to be instituted against it or any or
its subsidiaries.
(xv) Neither the Company nor any of its subsidiaries has
violated any foreign, federal, state or local statute, rule, regulation, law,
order, decree or judgment (including, without limitation, any such statute,
rule, regulation, law, order, decree or judgment relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants (hereinafter called Environmental Laws), any
provisions of the Employee Retirement Income Security Act of 1974, as amended
(hereinafter called ERISA), or any provisions of the Foreign Corrupt Practices
Act or the rules and regulations promulgated thereunder), except for such
violations which, singly or in the aggregate, would not have a material adverse
effect on the business, properties, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
(xvi) Each of the Company and its subsidiaries has such
permits, licenses, consents, exemptions, franchises, authorizations and other
approvals (each, hereinafter called an Authorization) of, and has made all
filings with and notices to, all governmental or regulatory authorities and
self-regulatory organizations and all courts and other tribunals, including,
without limitation, under any applicable Environmental Laws, as are necessary to
own, lease, license and operate its respective properties and to conduct its
business, except where the failure to have any such Authorization or to make any
such filing or notice would not, singly or in the aggregate, have a material
adverse effect on the business, properties, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole. Each such
Authorization is valid and in full force and effect and each of the Company and
its subsidiaries is in compliance with all the terms and conditions thereof and
with the rules and regulations of the authorities and governing bodies having
jurisdiction with respect thereto; and no event has occurred (including, without
limitation, the receipt of any notice from any authority or governing body)
which allows or, after notice or lapse of time or both, would allow, revocation,
suspension or termination of any such Authorization or results or, after notice
or lapse of time or both, would result in any other impairment of the rights of
the holder of any such Authorization; and such Authorizations contain no
restrictions that are burdensome to the Company or any of its subsidiaries;
except where such failure to be valid and in full force and effect or to be in
compliance, the occurrence of any such event or the presence of any such
restriction would not, singly or in the aggregate, have a material adverse
effect on the business, properties, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
(xvii) There are no costs or liabilities (contingent or
otherwise) 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 Authorization, any
related constraints on operating activities and any potential liabilities to
third parties) or ERISA which would, singly or in the aggregate, have a material
adverse effect on the business, properties, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole.
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(xviii) This Agreement has been duly authorized, executed and
delivered by the Company.
(xix) KPMG LLP are independent public accountants with
respect to the Company and its subsidiaries as required by the Securities Act.
(xx) The consolidated financial statements included in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto), together with related schedules and notes, present fairly the
consolidated financial position, results of operations and changes in financial
position of the Company and its subsidiaries on the basis stated therein at the
respective dates or for the respective periods to which they apply; such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; all adjustments necessary for a
fair presentation of results for such periods have been made; the selected
financial information included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto) present fairly the information shown
therein and have been compiled on a basis consistent with the financial
statements presented therein; the supporting schedules, if any, included in the
Registration Statement present fairly in accordance with generally accepted
accounting principles the information required to be stated therein; and the
other financial and statistical information and data set forth in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) are, in all material respects, accurately presented and prepared on a
basis consistent with such financial statements and the books and records of the
Company. No other financial statements, supporting schedules or other financial
information (whether pro forma financial statements or otherwise) are required
to be included in the Registration Statement or the Prospectus. As of the date
of the Prospectus, the Company is not engaged in substantive discussions with
any third party with respect to, or obligated to complete, any acquisitions for
which disclosure of pro forma financial information in the Prospectus is
required by the Securities Act.
(xxi) The Company is not and, after giving effect to the
offering and sale of the Stock and the application of the proceeds thereof as
described in the Prospectus, will not be, an "investment company" as such term
is defined in the Investment Company Act of 1940, as amended.
(xxii) Except as disclosed in the Registration Statement and
the Prospectus, there are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Securities Act with respect to any
securities of the Company or to include any securities of the Company in any
registration statement of the Company. Neither the filing of the Registration
Statement nor the offering or sale of the Stock as contemplated by this
Agreement gives rise to any rights for or relating to the registration of any
securities of the Company, except for such rights which have been waived or
satisfied by the inclusion of shares of Common Stock in the offering of Stock
contemplated hereby.
(xxiii) The Company and its subsidiaries have good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them which is material to the business
of the Company and its subsidiaries, in each case free and clear of all liens,
encumbrances, equities, security interests, defects, adverse interests and
claims whatsoever, except such as are described in the Prospectus or such as do
not materially affect the value of such property and do not interfere with the
use made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its subsidiaries, in each case except as described in the
Prospectus.
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(xxiv) The Company and its subsidiaries own or possess, or
can acquire on reasonable terms, all patents, patent rights, licenses,
inventions, domain names, computer programs, computer code, communications
protocols, copyrights, other software, know-how (including, without limitation,
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks and
trade names (hereinafter called Intellectual Property) currently employed by
them in connection with the business now operated by them except (A) where the
failure to own or possess or otherwise be able to acquire such Intellectual
Property would not, singly or in the aggregate, have a material adverse effect
on the business, properties, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole, or (B) as disclosed in the
Registration Statement and the Prospectus. There are no legal or governmental
proceedings pending or threatened relating to any Intellectual Property that are
required to be described in the Registration Statement or the Prospectus and are
not so described; there are no contracts or other documents relating to any
Intellectual Property required to be filed as an exhibit to the Registration
Statement or required to be described in the Registration Statement or the
Prospectus that are not so filed or described as required. The expiration of any
Intellectual Property owned or employed by the Company will not, singly or in
the aggregate, have a material adverse effect on the business, properties,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(xxv) Neither the Company nor any of its subsidiaries is
infringing or otherwise violating any Intellectual Property of others or has
received any notice of infringement of or conflict with asserted rights of
others with respect to any Intellectual Property, except for any such
infringement, violation or conflict which (A) would not, singly or in the
aggregate, have a material adverse effect on the business, properties, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole, or (B) is disclosed in the Registration Statement and the Prospectus.
There are no legal or governmental proceedings pending or threatened relating to
any Intellectual Property which, singly or in the aggregate, would have a
material adverse effect on the business, properties, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole.
(xxvi) The Company and each of its subsidiaries are insured
by insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which they
are engaged; and neither the Company nor any of its subsidiaries (A) has
received notice from any insurer or agent of such insurer that substantial
capital improvements or other material expenditures will have to be made in
order to continue such insurance or (B) 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 at a cost that would
not, singly or in the aggregate, have a material adverse effect on the business,
properties, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(xxvii) No relationship, direct or indirect, exists between
or among the Company or any of its subsidiaries on the one hand, and the
directors, officers, stockholders, customers or suppliers of the Company or any
of its subsidiaries on the other hand, which is required by the Securities Act
to be described in the Registration Statement or the Prospectus which is not so
described.
(xxviii) There is no (A) significant unfair labor practice
complaint, grievance or arbitration proceeding pending or threatened against the
Company or any of its subsidiaries before the National Labor Relations Board or
any state or local labor relations board, (B) strike, labor dispute, slowdown or
stoppage pending or threatened against the Company or any of its subsidiaries or
(C) union representation question existing with respect to the employees of the
Company and its
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subsidiaries, except for such actions specified in clause (A), (B) or (C) above,
which, singly or in the aggregate, would not have a material adverse effect on
the business, properties, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole. To the best of the Company's
knowledge, no collective bargaining organizing activities are taking place with
respect to the Company or any of its subsidiaries.
(xxix) The Company and each of its subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurance that (A) transactions are executed in accordance with management's
general or specific authorizations; (B) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (C) access
to assets is permitted only in accordance with management's general or specific
authorization; and (D) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(xxx) All material tax returns required to be filed by the
Company and each of its subsidiaries in any jurisdiction have been filed, other
than those filings being contested in good faith, and all material taxes,
including, without limitation, withholding taxes, penalties and interest,
assessments, fees and other charges due pursuant to such returns or pursuant to
any assessment received by the Company or any of its subsidiaries have been
paid, other than those being contested in good faith and for which adequate
reserves have been provided.
(xxxi) The Company and its subsidiaries have complied and
are in compliance with all foreign, federal, state and local statutes,
executive orders, proclamations, regulations, rules, directives, decrees,
ordinances and similar provisions having the force or effect of law and all
judicial and administrative orders, rulings, determinations and common law
concerning the importation of merchandise, the export or reexport of products,
services and technology, and the terms and conduct of international transactions
applicable to the Company and its subsidiaries in connection with the conduct of
the business of the Company and its subsidiaries (including, without limitation,
as the same relates to record keeping requirements) (herein called International
Trade Laws and Regulations), except for such non-compliance which, singly or in
the aggregate, would not have a material adverse effect on the business,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole; neither the Company nor any of its subsidiaries
has made or provided any false statement or omission to any agency of any
federal, state or local government, purchasers of products, or foreign
government or foreign agency, in connection with the exportation of merchandise
(including, without limitation, with respect to export licenses, exceptions and
other export authorizations and any filings required for or related to
exportation of any item), the importation of merchandise or other approvals
required by a foreign government or agency or any other requirement relating to
any International Trade Laws and Regulations.
(xxxii) The Company has not offered, or caused the
Underwriters to offer, any Stock to any person pursuant to the Directed Share
Program (as defined below) with the intent to unlawfully influence (A) a
customer or supplier of the Company or any of its subsidiaries to alter the
customer's or supplier's level or type of business with the Company or any of
its subsidiaries or (B) a trade journalist or publication to write or publish
favorable information about the Company, any of its subsidiaries or their
products. As used herein, Directed Share Program means the offer and sale of
Stock described in the ____ paragraph under the caption "Underwriting" in the
Prospectus.
(xxxiii) The Company has reviewed its operations and the
operations of its subsidiaries to evaluate the extent to which the business or
operations of the Company or any of its subsidiaries will be affected by the
Year 2000 Problem (as defined below).
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As a result of such review, the Company has no reason to believe, and does not
believe, that the Year 2000 Problem has had or will have a material adverse
effect on the business, properties, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, or result in any material
loss or interference with the business or operations of the Company or such
subsidiary. As used herein, the Year 2000 Problem means any risk that the
computer hardware or software used in the receipt, transmission, storage,
retrieval, retransmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind will not, in the case of dates or
time periods occurring after December 31, 1999, function at least as effectively
as in the case of dates or time periods occurring prior to January 1, 2000.
(xxxiv) All sales of the Company's securities prior to the
date hereof were at all relevant times duly registered under the Securities Act
and applicable foreign securities laws and state securities or Blue Sky laws or
were exempt from the registration requirements of the Securities Act and
applicable foreign and state securities laws, or if such securities were not
registered or exempt in compliance with the Securities Act and applicable
foreign and state securities laws, any private rights of action for rescission
or damages arising from the failure to register any such securities are time
barred by applicable statutes of limitations or equitable principles, including
laches.
(xxxv) Each certificate signed by any officer of the Company
and delivered to the Underwriters or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to the Underwriters as
to the matters covered thereby.
(b) Each of the Selling Securityholders hereby represents and
warrants as follows:
(i) Such Selling Securityholder is a natural person or
has been duly incorporated or formed and is validly existing as a corporation,
limited liability company or partnership in good standing under the laws of its
jurisdiction of incorporation or formation.
(ii) Such Selling Securityholder has, and on the Closing
Date and on any later date on which Option Stock is purchased will have, good
and marketable title to all the shares of Stock to be sold by such Selling
Securityholder hereunder, free and clear of all liens, encumbrances, equities,
security interests, defects, adverse interests and claims whatsoever, with full
right and authority to deliver the same hereunder, subject, in the case of each
Selling Securityholder, to the rights of , as Custodian (herein
called the Custodian), and that upon the delivery of and payment for such shares
of the Stock hereunder, the several Underwriters will receive good and
marketable title thereto, free and clear of all liens, encumbrances, equities,
security interests, defects, adverse interests and claims whatsoever.
(iii) Such Selling Securityholder has, and on the Closing
Date and any later date on which Option Stock is purchased will have, full legal
right, power and authority, and all authorization and approval required by law,
to enter into this Agreement and the Custody Agreement and Power of Attorney
referred to in Section 2(b)(iv), and to sell, assign, transfer and deliver the
Stock to be sold by such Selling Securityholder in the manner provided herein
and therein.
(iv) Certificates in negotiable form for the shares of the
Stock to be sold by such Selling Securityholder have been placed in custody
under a Custody Agreement for delivery under this Agreement with the Custodian;
such Selling Securityholder specifically agrees that the shares of the Stock
represented by the certificates so held in custody for such Selling
Securityholder are subject to the interests of the several Underwriters and the
Company, that the arrangements made by such Selling
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Securityholder for such custody, including the Power of Attorney provided for in
such Custody Agreement, are to that extent irrevocable, and that the obligations
of such Selling Securityholder shall not be terminated by any act of such
Selling Securityholder or by operation of law, whether by the death or
incapacity of such Selling Securityholder (or, in the case of a Selling
Securityholder that is not an individual, the dissolution or liquidation of such
Selling Securityholder) or the occurrence of any other event; if any such death,
incapacity, dissolution, liquidation or other such event should occur before the
delivery of such shares of the Stock hereunder, certificates for such shares of
the Stock shall be delivered by the Custodian in accordance with the terms and
conditions of this Agreement as if such death, incapacity, dissolution,
liquidation or other event had not occurred, regardless of whether the Custodian
shall have received notice of such death, incapacity, dissolution, liquidation
or other event.
(v) This Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Securityholder.
(vi) The Custody Agreement entered into by, and the Power
of Attorney given by, such Selling Securityholder have been duly authorized,
executed and delivered by such Selling Securityholder, and such Custody
Agreement and Power of Attorney are valid and binding on such Selling
Securityholder, enforceable in accordance with their terms.
(vii) None of the execution, delivery or performance of
this Agreement, such Custody Agreement or such Power of Attorney, the compliance
such Selling Securityholder with the provisions hereof or thereof or the
consummation of the transactions contemplated hereby or thereby will (A) require
any consent, approval, authorization or other order of, or qualification with,
any court or governmental body or agency (except such as have been obtained and
such as may be required under the securities or Blue Sky laws of the various
states), (B) conflict with or constitute a breach of any of the terms or
provisions of, or a default under, the charter or bylaws of such Selling
Securityholder or any indenture, loan agreement, mortgage, lease or other
agreement or instrument that is material to such Selling Securityholder or (C)
violate or conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or agency having
jurisdiction over such Selling Securityholder or its property.
(viii) Such Selling Securityholder has reviewed the
Registration Statement and Prospectus and, although such Selling Securityholder
has not independently verified the accuracy or completeness of all the
information contained therein, nothing has come to the attention of such Selling
Securityholder that would lead such Selling Securityholder to believe that on
the Effective Date, the Registration Statement contained any untrue statement of
a material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein not misleading;
and, on the Effective Date the Prospectus contained and, on the Closing Date and
any later date on which Option Stock is to be purchased, contains any untrue
statement of a material fact or omitted or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(ix) Each certificate signed by or on behalf of such
Selling Securityholder and delivered to the Underwriters or counsel for the
Underwriters shall be deemed to be a representation and warranty by such Selling
Securityholder to the Underwriters as to the matters covered thereby.
3. PURCHASE OF THE STOCK BY THE UNDERWRITERS.
(a) On the basis of the representations and warranties and subject
to the terms and conditions herein set forth, the Company agrees to issue and
sell 3,800,000 shares of the Underwritten Stock to the several Underwriters, and
each of the Underwriters agrees to purchase from the Company
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the respective aggregate number of shares of Underwritten Stock set forth
opposite its name in Schedule I. The price at which such shares of Underwritten
Stock shall be sold by the Company and purchased by the several Underwriters
shall be $_____ per share. In making this Agreement, each Underwriter is
contracting severally and not jointly; except as provided in paragraphs (b) and
(c) of this Section 3, the agreement of each Underwriter is to purchase only the
respective number of shares of the Underwritten Stock specified in Schedule I.
(b) If for any reason one or more of the Underwriters shall fail
or refuse (otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 8 or 9 hereof) to purchase and
pay for the number of shares of the Stock agreed to be purchased by such
Underwriter or Underwriters, the Company or, in the case of such a failure or
refusal to purchase Option Stock, the Company and the Selling Securityholders
shall immediately give notice thereof to you, and the non-defaulting
Underwriters shall have the right within 24 hours after the receipt by you of
such notice to purchase, or procure one or more other Underwriters to purchase,
in such proportions as may be agreed upon between you and such purchasing
Underwriter or Underwriters and upon the terms herein set forth, all or any part
of the shares of the Stock which such defaulting Underwriter or Underwriters
agreed to purchase. If the non-defaulting Underwriters fail so to make such
arrangements with respect to all such shares and portion, the number of shares
of the Stock which each non-defaulting Underwriter is otherwise obligated to
purchase under this Agreement shall be automatically increased on a pro rata
basis to absorb the remaining shares and portion which the defaulting
Underwriter or Underwriters agreed to purchase; provided, however, that the
non-defaulting Underwriters shall not be obligated to purchase the shares and
portion which the defaulting Underwriter or Underwriters agreed to purchase if
the aggregate number of such shares of the Stock exceeds 10% of the total number
of shares of the Stock which all Underwriters agreed to purchase hereunder. If
the total number of shares of the Stock which the defaulting Underwriter or
Underwriters agreed to purchase shall not be purchased or absorbed in accordance
with the two preceding sentences, the Company and, in the case of such a failure
or refusal to purchase Option Stock, the Selling Securityholders, shall have the
right, within 24 hours next succeeding the 24-hour period above referred to, to
make arrangements with other underwriters or purchasers satisfactory to you for
purchase of such shares and portion on the terms herein set forth. In any such
case, either you or the Company and, in the case of such a failure or refusal to
purchase Option Stock, the Selling Securityholders, shall have the right to
postpone the Closing Date determined as provided in Section 5 hereof for not
more than seven business days after the date originally fixed as the Closing
Date pursuant to said Section 5 in order that any necessary changes in the
Registration Statement, the Prospectus or any other documents or arrangements
may be made. If neither the non-defaulting Underwriters nor the Company and, in
the case of such a failure or refusal to purchase Option Stock, the Selling
Securityholders, shall make arrangements within the 24-hour periods stated above
for the purchase of all the shares of the Stock which the defaulting Underwriter
or Underwriters agreed to purchase hereunder, this Agreement shall be terminated
without further act or deed and without any liability on the part of the Company
and, in the case of such a failure or refusal to purchase Option Stock, the
Selling Securityholders, to any non-defaulting Underwriter and without any
liability on the part of any non-defaulting Underwriter to the Company and, in
the case of such a failure or refusal to purchase Option Stock, the Selling
Securityholders. Nothing in this paragraph (b), and no action taken hereunder,
shall relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
(c) On the basis of the representations, warranties and covenants
herein contained, and subject to the terms and conditions herein set forth, the
Company and the Selling Securityholders grant an option to the several
Underwriters to purchase, severally and not jointly, up to 570,000 shares in the
aggregate of the Option Stock from the Company and the Selling Securityholders
at the same price per share as the Underwriters shall pay for the Underwritten
Stock. Said option may be exercised only to
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cover over-allotments in the sale of the Underwritten Stock by the Underwriters
and may be exercised in whole or in part at any time (but not more than once) on
or before the thirtieth day after the date of this Agreement upon written or
telegraphic notice by you to the Company setting forth the aggregate number of
shares of the Option Stock as to which the several Underwriters are exercising
the option. The number of shares of Option Stock to be sold by each Seller (as
defined below) shall be equal to the number set forth opposite the name of such
Seller on Schedule III hereto or, if the Underwriters exercise such option for
less than the full number of shares of Option Stock available under such option,
the number of shares of Option Stock to be sold by each Seller shall be equal to
(a) the aggregate number of shares for which the option shall have been
exercised, multipled by (b) a fraction, the numerator of which is the number of
shares set forth opposite the name of such Seller on Schedule III hereto, and
the denominator of which is the total number of shares of Option Stock set forth
in the first sentence of this Section 3(c). As used in the preceding sentence,
Seller shall mean each of the Company and each Selling Securityholder. The
number of shares of the Option Stock to be purchased by each Underwriter shall
be the same percentage of the total number of shares of the Option Stock to be
purchased by the several Underwriters as such Underwriter is purchasing of the
Underwritten Stock, as adjusted by you in such manner as you deem advisable to
avoid fractional shares. Delivery of certificates for the shares of Option
Stock, and payment therefor, shall be made as provided in Section 5 hereof.
4. OFFERING BY UNDERWRITERS.
(a) The terms of the initial public offering by the Underwriters
of the Stock to be purchased by them shall be as set forth in the Prospectus.
The Underwriters may from time to time change the public offering price after
the closing of the initial public offering and increase or decrease the
concessions and discounts to dealers as they may determine.
(b) The information set forth under "Underwriting" in the
Registration Statement, any Preliminary Prospectus and the Prospectus relating
to the Stock filed by the Company (insofar as such information relates to the
Underwriters) constitutes the only information furnished by the Underwriters to
the Company for inclusion in the Registration Statement, any Preliminary
Prospectus, and the Prospectus, and you on behalf of the respective Underwriters
represent and warrant to the Company that the statements made therein are
correct.
5. DELIVERY OF AND PAYMENT FOR THE STOCK.
(a) The Stock shall be delivered by or on behalf of the Sellers,
with any transfer taxes thereon duly paid by the respective Sellers, to
Xxxxxxxxx & Xxxxx LLC through the facilities of The Depository Trust Company
(herein called the DTC), for the respective accounts of the several
Underwriters, against payment to the Sellers of the purchase price therefor as
provided herein. The certificates representing the Stock shall be made available
for inspection not later than 7:00 a.m., San Francisco time, on the business day
prior to the Closing Date or such other date on which the Option Stock is
purchased hereunder, as applicable, at the office of the DTC or its designated
custodian (such office is herein called the Designated Office). The date for the
delivery of and payment for Underwritten Stock and the Option Stock (if the
option granted under Section 3(c) hereof shall have been exercised not later
than 7:00 a.m., San Francisco time, on the date two business days preceding the
Closing Date) shall be the [fourth] business day after the date of this
Agreement, or at such time on such other day, not later than seven full business
days after such [fourth] business day, as shall be agreed upon in writing by the
Company, the Selling Securityholders and you. The date and hour of such delivery
and payment (which may be postponed as provided in Section 3(b) hereof) are
herein called the Closing Date.
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(b) If the option granted by Section 3(c) hereof shall be
exercised after 7:00 a.m., San Francisco time, on the date two business days
preceding the Closing Date, the date for the delivery of and payment for the
Option Stock shall be the third business day after the exercise of such option.
(c) Payment for the Stock purchased from the Company shall be made
to the Company or its order, and payment for the Stock purchased from the
Selling Securityholders shall be made to the Custodian, for the account of the
Selling Securityholders, in each case by wire transfer of Federal or other funds
immediately available in New York City. Such payment shall be made upon
delivery of certificates for the Stock through the facilities of the DTC for the
respective accounts of the several Underwriters as set forth herein. The Stock
shall be represented by definitive certificates, if requested by the
Underwriters, and shall be registered in such name or names and shall be in such
denominations as you may request at least one business day before the Closing
Date, in the case of Underwritten Stock, and at least one business day prior to
the purchase thereof, in the case of the Option Stock.
It is understood that you, individually and not on behalf of the
Underwriters, may (but shall not be obligated to) make payment to the Company
and the Selling Securityholders for shares to be purchased by any Underwriter
whose check or other funds shall not have been received by you on the Closing
Date or any later date on which Option Stock is purchased for the account of
such Underwriter. Any such payment by you shall not relieve such Underwriter
from any of its obligations hereunder.
The documents to be delivered on behalf of the parties hereto pursuant
to this Agreement on the Closing Date or any later date on which Option Stock is
purchased hereunder shall be delivered at the offices of Xxxxxx & Bird LLP, 0000
Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000-0000 and the Stock shall be
delivered at the Designated Office, all on the Closing Date or such later date
on which Option Stock is purchased, as the case may be.
6. FURTHER AGREEMENTS OF THE COMPANY AND THE SELLING
SECURITYHOLDERS. Each of the Company and the Selling Securityholders
respectively covenants and agrees as follows:
(a) The Company will (i) prepare and timely file with the
Commission under Rule 424(b) a Prospectus containing information previously
omitted at the time of effectiveness of the Registration Statement in reliance
on Rule 430A and (ii) not file any amendment to the Registration Statement or
supplement to the Prospectus of which you shall not previously have been advised
and furnished with a copy or to which you shall have reasonably objected in
writing or which is not in compliance with the Securities Act.
(b) The Company will promptly notify each Underwriter in the event
of (i) the request by the Commission for amendment of the Registration Statement
or for supplement to the Prospectus or for any additional information, (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, (iii) the institution or notice of intended institution
of any action or proceeding for that purpose, (iv) the receipt by the Company of
any notification with respect to the suspension of the qualification of the
Stock for sale in any jurisdiction, or (v) the receipt by it of notice of the
initiation or threatening of any proceeding for such purpose. The Company and
the Selling Securityholders will make every reasonable effort to prevent the
issuance of such a stop order and, if such an order shall at any time be issued,
to obtain the withdrawal thereof at the earliest possible moment.
(c) The Company will (i) on or before the Closing Date, deliver to
you a signed copy of the Registration Statement as originally filed and of each
amendment thereto filed prior to the time the Registration Statement becomes
effective and, promptly upon the filing thereof, a signed copy of each
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post-effective amendment, if any, to the Registration Statement (together with,
in each case, all exhibits thereto unless previously furnished to you) and will
also deliver to you, for distribution to the Underwriters, a sufficient number
of additional conformed copies of each of the foregoing (but without exhibits)
so that one copy of each may be distributed to each Underwriter, (ii) as
promptly as possible deliver to you and send to the several Underwriters, at
such office or offices as you may designate, as many copies of the Prospectus as
you may reasonably request, and (iii) thereafter from time to time during the
period in which a prospectus is required by law to be delivered by an
Underwriter or dealer, likewise send to the Underwriters as many additional
copies of the Prospectus and as many copies of any supplement to the Prospectus
and of any amended prospectus, filed by the Company with the Commission, as you
may reasonably request for the purposes contemplated by the Securities Act.
(d) If at any time during the period in which a prospectus is
required by law to be delivered by an Underwriter or dealer any event relating
to or affecting the Company, or of which the Company shall be advised in writing
by you, shall occur as a result of which it is necessary, in the opinion of
counsel for the Company or of counsel for the Underwriters, to supplement or
amend the Prospectus in order to make the Prospectus not misleading in the light
of the circumstances existing at the time it is delivered to a purchaser of the
Stock, the Company will forthwith prepare and file with the Commission a
supplement to the Prospectus or an amended prospectus so that the Prospectus as
so supplemented or amended will not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time such
Prospectus is delivered to such purchaser, not misleading. If, after the initial
public offering of the Stock by the Underwriters and during such period, the
Underwriters shall propose to vary the terms of offering thereof by reason of
changes in general market conditions or otherwise, you will advise the Company
in writing of the proposed variation, and, if in the opinion either of counsel
for the Company or of counsel for the Underwriters such proposed variation
requires that the Prospectus be supplemented or amended, the Company will
forthwith prepare and file with the Commission a supplement to the Prospectus or
an amended prospectus setting forth such variation. The Company authorizes the
Underwriters and all dealers to whom any of the Stock may be sold by the several
Underwriters to use the Prospectus, as from time to time amended or
supplemented, in connection with the sale of the Stock in accordance with the
applicable provisions of the Securities Act.
(e) Prior to the filing thereof with the Commission, the Company
will submit to you, for your information, a copy of any post-effective amendment
to the Registration Statement and any supplement to the Prospectus or any
amended prospectus proposed to be filed.
(f) The Company will cooperate, when and as requested by you, in
the qualification of the Stock for offer and sale under the securities or Blue
Sky laws of such jurisdictions as you may designate and, during the period in
which a prospectus is required by law to be delivered by an Underwriter or
dealer, in keeping such qualifications in good standing under said securities or
Blue Sky laws; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified. The Company
will, from time to time, prepare and file such statements, reports, and other
documents as are or may be required to continue such qualifications in effect
for so long a period as you may reasonably request for distribution of the
Stock.
(g) During a period of five years commencing with the date hereof,
the Company will furnish to you, and to each Underwriter who may so request in
writing, copies of all periodic and special reports furnished to stockholders of
the Company and of all information, documents and reports filed with the
Commission (including, without limitation, any information required by Rule 463
of the Commission under the Securities Act).
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(h) Not later than the 45th day following the end of the fiscal
quarter first occurring after the first anniversary of the Effective Date, the
Company will make generally available to its security holders an earnings
statement in accordance with Section 11(a) of the Securities Act and Rule 158
thereunder.
(i) The Company agrees to pay all costs and expenses incident to
the performance of its obligations under this Agreement, including, without
limitation, all costs and expenses incident to (i) the preparation, printing and
filing with the Commission and the National Association of Securities Dealers,
Inc. (herein called the NASD) of the Registration Statement, any Preliminary
Prospectus and the Prospectus, (ii) the furnishing to the Underwriters of copies
of any Preliminary Prospectus and of the several documents required by paragraph
(c) of this Section 6 to be so furnished, (iii) the printing of this Agreement
and related documents delivered to the Underwriters, (iv) the preparation,
printing and filing of all supplements and amendments to the Prospectus referred
to in paragraph (d) of this Section 6, (v) the furnishing to you and the
Underwriters of the reports and information referred to in paragraph (g) of this
Section 6 and (vi) the printing and issuance of stock certificates, including,
without limitation, the transfer agent's fees. The Selling Securityholders agree
to pay all costs and expenses incident to the performance of their respective
obligations under this Agreement, including, without limitation, any transfer
taxes incident to the transfer to the Underwriters of the shares of Stock being
sold by the Selling Securityholders.
(j) The Company agrees to reimburse you, for the account of the
several Underwriters, for Blue Sky fees and related disbursements (including,
without limitation, counsel fees and disbursements and cost of printing
memoranda for the Underwriters) paid by or for the account of the Underwriters
or their counsel in qualifying the Stock under state securities or Blue Sky laws
and in the review of the offering by the NASD.
(k) The provisions of paragraphs (i) and (j) of this Section are
intended to relieve the Underwriters from the payment of the expenses and costs
which the Company and the Selling Securityholders hereby agree to pay and shall
not affect any agreement which the Company and the Selling Securityholders may
make, or may have made, for the sharing of any such expenses and costs.
(l) The Company and each of the Selling Securityholders hereby
agree that, without the prior written consent of Xxxxxxxxx & Xxxxx LLC on behalf
of the Underwriters, the Company or such Selling Securityholder, as the case may
be, will not, for a period of 180 days following the commencement of the public
offering of the Stock by the Underwriters, directly or indirectly, (i) sell,
offer, contract to sell, make any short sale, pledge, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exchangeable or exercisable
for or any rights to purchase or acquire Common Stock or (ii) enter into any
swap or other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise. The foregoing sentence
shall not apply to (A) the Stock to be sold to the Underwriters pursuant to this
Agreement, (B) shares of Common Stock issued by the Company upon the exercise of
options granted under the stock option plans of the Company (herein called the
Option Plans), all as described under the caption "Capitalization" in the
Preliminary Prospectus, and (C) options to purchase Common Stock granted under
the Option Plans.
(m) If at any time during the 25-day period after the Registration
Statement becomes effective any rumor, publication or event relating to or
affecting the Company shall occur as a result of
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which in your opinion the market price for the Stock has been or is likely to be
materially affected (regardless of whether such rumor, publication or event
necessitates a supplement to or amendment of the Prospectus), the Company will,
after written notice from you advising the Company to the effect set forth
above, forthwith prepare, consult with you concerning the substance of, and
disseminate a press release or other public statement, reasonably satisfactory
to you, responding to or commenting on such rumor, publication or event.
(n) The Company is familiar with the Investment Company Act of
1940, as amended, and has in the past conducted its affairs, and will in the
future conduct its affairs, in such a manner to ensure that the Company was not
and will not be an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, and the rules and regulations thereunder.
(o) The Company will comply with the Securities Act, the
Securities Exchange Act of 1934 (herein called the Exchange Act) and the rules
and regulations of the Commission, so as to permit the completion of the
distribution of the Stock as contemplated in this Agreement and the Prospectus.
(p) The Company shall apply the net proceeds of its sale of the
Stock as set forth in the Prospectus under the caption "Use of Proceeds."
(q) None of the Company, any of its subsidiaries or any Selling
Securityholder will take, directly or indirectly, any action designed to cause
or result in, or that has constituted or might reasonably be expected to
constitute, the stabilization or manipulation of the price of the Common Stock.
(r) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of incorporation of the Company, a registrar (which may
be the same entity as the transfer agent) for the Common Stock.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) Subject to the provisions of paragraph (f) of this Section 7,
the Company and the Selling Securityholders jointly and severally agree to
indemnify and hold harmless each Underwriter and each person (including, without
limitation, each partner or officer thereof) who controls any Underwriter within
the meaning of Section 15 of the Securities Act from and against any and all
losses, claims, damages or liabilities, joint or several, to which such
indemnified parties or any of them may become subject under the Securities Act,
the Exchange Act, the common law or otherwise, and the Company and the Selling
Securityholders jointly and severally agree to reimburse each such Underwriter
and controlling person for any legal or other expenses (including, without
limitation, except as otherwise hereinafter provided, reasonable fees and
disbursements of counsel) incurred by the respective indemnified parties in
connection with defending against any such losses, claims, damages or
liabilities or in connection with any investigation or inquiry of, or other
proceeding which may be brought against, the respective indemnified parties, in
each case arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(including, without limitation, the Prospectus as part thereof and any Rule
462(b) registration statement) or any post-effective amendment thereto
(including, without limitation, any Rule 462(b) registration statement), or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
(ii) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or the Prospectus (as amended or as
supplemented if the Company shall have filed with the Commission any amendment
thereof or
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supplement thereto) or the omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however,
that (1) the indemnity agreements of the Company and the Selling Securityholders
contained in this paragraph (a) shall not apply to any such losses, claims,
damages, liabilities or expenses if such statement or omission was made in
reliance upon and in conformity with information furnished as herein stated, (2)
the indemnity agreement contained in this paragraph (a) with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter from
whom the person asserting any such losses, claims, damages, liabilities or
expenses purchased the Stock which is the subject thereof (or to the benefit of
any person controlling such Underwriter) if at or prior to the written
confirmation of the sale of such Stock a copy of the Prospectus (or the
Prospectus as amended or supplemented) was not sent or delivered to such person
and the untrue statement or omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus (or the Prospectus as
amended or supplemented) unless the failure is the result of noncompliance by
the Company with paragraph (c) of Section 6 hereof and (3) each Selling
Securityholder shall only be liable under this paragraph with respect to (A)
information pertaining to such Selling Securityholder furnished by or on behalf
of such Selling Securityholder expressly for use in any Preliminary Prospectus
or the Registration Statement or the Prospectus or any such amendment thereof or
supplement thereto and (B) facts that would constitute a breach of any
representation or warranty of such Selling Securityholder set forth in Section
2(b) hereof. The indemnity agreements of the Company and the Selling
Securityholders contained in this paragraph (a) and the representations and
warranties of the Company contained in Section 2 hereof shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of any indemnified party and shall survive the delivery of and payment
for the Stock.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, each of its officers who signs the Registration Statement
on his own behalf or pursuant to a power of attorney, each of its directors,
each other Underwriter and each person (including, without limitation, each
partner or officer thereof) who controls the Company or any such other
Underwriter within the meaning of Section 15 of the Securities Act, and the
Selling Securityholders from and against any and all losses, claims, damages or
liabilities joint or several, to which such indemnified parties or any of them
may become subject under the Securities Act, the Exchange Act, or the common law
or otherwise and to reimburse each of them for any legal or other expenses
(including, without limitation, except as otherwise hereinafter provided,
reasonable fees and disbursements of counsel) incurred by the respective
indemnified parties in connection with defending against any such losses,
claims, damages or liabilities or in connection with any investigation or
inquiry of, or other proceeding which may be brought against, the respective
indemnified parties, in each case arising out of or based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (including, without limitation, the Prospectus as part
thereof and any Rule 462(b) registration statement) or any post-effective
amendment thereto (including, without limitation, any Rule 462(b) registration
statement) or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (as amended or as supplemented if the
Company shall have filed with the Commission any amendment thereof or supplement
thereto) or the omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, if such statement or
omission was made in reliance upon and in conformity with information furnished
as herein stated. The indemnity agreement of each Underwriter contained in this
paragraph (b) shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of any indemnified party and shall
survive the delivery of and payment for the Stock.
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(c) Each party indemnified under the provision of paragraphs (a)
and (b) of this Section 7 agrees that, upon the service of a summons or other
initial legal process upon it in any action or suit instituted against it or
upon its receipt of written notification of the commencement of any
investigation or inquiry of, or proceeding against, it in respect of which
indemnity may be sought on account of any indemnity agreement contained in such
paragraphs, it will promptly give written notice (herein called the Notice) of
such service or notification to the party or parties from whom indemnification
may be sought hereunder. No indemnification provided for in such paragraphs
shall be available to any party who shall fail so to give the Notice if the
party to whom such Notice was not given was unaware of the action, suit,
investigation, inquiry or proceeding to which the Notice would have related and
was prejudiced by the failure to give the Notice, but the omission so to notify
such indemnifying party or parties of any such service or notification shall not
relieve such indemnifying party or parties from any liability which it or they
may have to the indemnified party for contribution or otherwise than on account
of such indemnity agreement. Any indemnifying party shall be entitled at its own
expense to participate in the defense of any action, suit or proceeding against,
or investigation or inquiry of, an indemnified party. Any indemnifying party
shall be entitled, if it so elects within a reasonable time after receipt of the
Notice by giving written notice (herein called the Notice of Defense) to the
indemnified party, to assume (alone or in conjunction with any other
indemnifying party or parties) the entire defense of such action, suit,
investigation, inquiry or proceeding, in which event such defense shall be
conducted, at the expense of the indemnifying party or parties, by counsel
chosen by such indemnifying party or parties and reasonably satisfactory to the
indemnified party or parties; provided, however, that (i) if the indemnified
party or parties reasonably determine that there may be a conflict between the
positions of the indemnifying party or parties and of the indemnified party or
parties in conducting the defense of such action, suit, investigation, inquiry
or proceeding or that there may be legal defenses available to such indemnified
party or parties different from or in addition to those available to the
indemnifying party or parties, then counsel for the indemnified party or parties
shall be entitled to conduct the defense to the extent reasonably determined by
such counsel to be necessary to protect the interests of the indemnified party
or parties and (ii) in any event, the indemnified party or parties shall be
entitled to have counsel chosen by such indemnified party or parties participate
in, but not conduct, the defense. If, within a reasonable time after receipt of
the Notice, an indemnifying party gives a Notice of Defense and the counsel
chosen by the indemnifying party or parties is reasonably satisfactory to the
indemnified party or parties, the indemnifying party or parties will not be
liable under paragraphs (a) through (c) of this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party or parties in connection
with the defense of the action, suit, investigation, inquiry or proceeding,
except that (A) the indemnifying party or parties shall bear the legal and other
expenses incurred in connection with the conduct of the defense as referred to
in clause (i) of the proviso to the preceding sentence and (B) the indemnifying
party or parties shall bear such other expenses as it or they have authorized to
be incurred by the indemnified party or parties. If, within a reasonable time
after receipt of the Notice, no Notice of Defense has been given, the
indemnifying party or parties shall be responsible for any legal or other
expenses incurred by the indemnified party or parties in connection with the
defense of the action, suit, investigation, inquiry or proceeding.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
paragraph (a) or (b) of this Section 7, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in paragraph (a) or (b) of this Section 7 (i) in such
proportion as is appropriate to reflect the relative benefits received by each
indemnifying party from the offering of the Stock or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of each indemnifying party in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities,
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or actions in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Securityholders on the one hand and the Underwriters on the other shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of the Stock received by the Company and the Selling
Securityholders and the total underwriting discount received by the
Underwriters, as set forth in the table on the cover page of the Prospectus,
bear to the aggregate public offering price of the Stock. Relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by each indemnifying party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission.
The parties agree that it would not be just and equitable if
contributions pursuant to this paragraph (d) were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to in the first sentence of this paragraph
(d). The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities, or actions in respect thereof, referred to in the first
sentence of this paragraph (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigation, preparing to defend or defending against any action or claim
which is the subject of this paragraph (d). Notwithstanding the provisions of
this paragraph (d), no Underwriter shall be required to contribute any amount in
excess of the underwriting discount applicable to the Stock purchased by such
Underwriter. 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 Underwriters' obligations in this paragraph (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
Each party entitled to contribution agrees that upon the service of a
summons or other initial legal process upon it in any action instituted against
it in respect of which contribution may be sought, it will promptly give written
notice of such service to the party or parties from whom contribution may be
sought, but the omission so to notify such party or parties of any such service
shall not relieve the party from whom contribution may be sought from any
obligation it may have hereunder or otherwise (except as specifically provided
in paragraph (c) of this Section 7).
(e) Neither the Company nor the Selling Securityholders will,
without the prior written consent of each Underwriter, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim, action,
suit or proceeding in respect of which indemnification may be sought hereunder
(whether or not such Underwriter or any person who controls such Underwriter
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act is a party to such claim, action, suit or proceeding) unless such
settlement, compromise or consent includes an unconditional release of such
Underwriter and each such controlling person from all liability arising out of
such claim, action, suit or proceeding.
(f) The liability of each Selling Securityholder under the
indemnity and reimbursement agreements contained in the provisions of this
Section 7 and Section 11 hereof shall be limited to an amount equal to the
initial public offering price of the stock sold by such Selling Securityholder
to the Underwriters. The Company and the Selling Securityholders may agree, as
among themselves and without limiting the rights of the Underwriters under this
Agreement, as to the respective amounts of such liability for which they each
shall be responsible.
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(g) The remedies provided for in this Section 7 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
8. TERMINATION. This Agreement may be terminated by you at any
time prior to the Closing Date by giving written notice to the Company and the
Selling Securityholders if after the date of this Agreement trading in the
Common Stock shall have been suspended, or if there shall have occurred (i) the
engagement in hostilities or an escalation of major hostilities by the United
States or the declaration of war or a national emergency by the United States on
or after the date hereof, (ii) any outbreak of hostilities or other national or
international calamity or crisis or change in economic or political conditions
if the effect of such outbreak, calamity, crisis or change in economic or
political conditions in the financial markets of the United States would, in the
Underwriters' reasonable judgment, make the offering or delivery of the Stock
impracticable, (iii) suspension of trading in securities generally or a material
adverse decline in value of securities generally on the New York Stock Exchange,
the American Stock Exchange, or The Nasdaq Stock Market, or limitations on
prices (other than limitations on hours or numbers of days of trading) for
securities on either such exchange or system, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of, or commencement of any proceeding or investigation by, any court,
legislative body, agency or other governmental authority which in the
Underwriters' reasonable opinion materially and adversely affects or will
materially or adversely affect the business or operations of the Company, (v)
declaration of a banking moratorium by either federal or New York State
authorities or (vi) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in the
Underwriters' reasonable opinion has a material adverse effect on the securities
markets in the United States. If this Agreement shall be terminated pursuant to
this Section 8, there shall be no liability of the Company or the Selling
Securityholders to the Underwriters and no liability of the Underwriters to the
Company or the Selling Securityholders; provided, however, that in the event of
any such termination the Company and the Selling Securityholders agree to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company and the Selling
Securityholders under this Agreement, including, without limitation, all costs
and expenses referred to in paragraphs (i) and (j) of Section 6 hereof.
9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the several Underwriters to purchase and pay for the Stock shall be subject to
the performance by the Company and the Selling Securityholders of all their
respective obligations to be performed hereunder at or prior to the Closing Date
or any later date on which Option Stock is to be purchased, as the case may be,
and to the following further conditions:
(a) The Registration Statement shall have become effective; and no
stop order suspending the effectiveness thereof shall have been issued and no
proceedings therefor shall be pending or threatened by the Commission.
(b) The legality and sufficiency of the sale of the Stock
hereunder and the validity and form of the certificates representing the Stock,
all corporate proceedings and other legal matters incident to the foregoing, and
the form of the Registration Statement and of the Prospectus (except as to the
financial statements contained therein), shall have been approved at or prior to
the Closing Date by Xxxxxx & Bird LLP, counsel for the Underwriters.
(c) You shall have received from (A) Xxxxxx, Xxxxxxx & Xxxxxx,
LLP, counsel for the Company, (B) ______________, counsel for the Selling
Securityholders, and (C) __________________, patent counsel for the Company,
opinions, addressed to the Underwriters and dated the Closing Date, covering the
matters set forth in Annex A, Annex B and Annex C hereto,
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respectively, and if Option Stock is purchased at any date after the Closing
Date, additional opinions from each such counsel, addressed to the Underwriters
and dated such later date, confirming that the statements expressed as of the
Closing Date in such opinions remain valid as of such later date.
(d) You shall be satisfied that (i) as of the Effective Date, the
statements made in the Registration Statement and the Prospectus were true and
correct and neither the Registration Statement nor the Prospectus omitted to
state any material fact required to be stated therein or necessary in order to
make the statements therein, respectively, not misleading, (ii) since the
Effective Date, no event has occurred which should have been set forth in a
supplement or amendment to the Prospectus which has not been set forth in such a
supplement or amendment, (iii) since the respective dates as of which
information is given in the Prospectus, other than as set forth in the
Prospectus (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement), (A) there has not occurred any material adverse change
or any development involving a prospective material adverse change in or
affecting the business, properties, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, (B) there has not been any
material adverse change or any development involving a prospective material
adverse change in the capital stock or in the long-term debt of the Company or
any of its subsidiaries, (C) neither the Company nor any of its subsidiaries has
incurred any material liability or obligation, direct or contingent and (D)
except in the ordinary course of business, neither the Company nor any of its
subsidiaries has entered into any transaction not referred to in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (iv) neither the Company nor any of its subsidiaries has any
material contingent obligations which are not disclosed in the Registration
Statement and the Prospectus, (v) there are not any pending or known threatened
legal proceedings to which the Company or any of its subsidiaries is a party or
of which property of the Company or any of its subsidiaries is the subject which
are material and which are not disclosed in the Registration Statement and the
Prospectus, (vi) there are not any franchises, contracts, leases or other
documents which are required to be filed as exhibits to the Registration
Statement which have not been filed as required, (vii) the representations and
warranties of the Company herein are true and correct in all material respects
as of the Closing Date or any later date on which Option Stock is to be
purchased, as the case may be, and (viii) there has not been any material change
in the market for securities in general or in political, financial or economic
conditions from those reasonably foreseeable as to render it impracticable in
your reasonable judgment to make a public offering of the Stock, or a material
adverse change in market levels for securities in general (or those of companies
in particular) or financial or economic conditions which render it inadvisable
to proceed.
(e) You shall have received on the Closing Date and on any later
date on which Option Stock is purchased a certificate, dated the Closing Date or
such later date, as the case may be, and signed by the President and the Chief
Financial Officer of the Company, stating that the respective signers of said
certificate have carefully examined the Registration Statement in the form in
which it originally became effective and the Prospectus contained therein and
any supplements or amendments thereto, and that the statements included in
clauses (i) through (vii) of paragraph (d) of this Section 9 are true and
correct.
(f) You shall have received from KPMG LLP, a letter or letters,
addressed to the Underwriters and dated the Closing Date and any later date on
which Option Stock is purchased, confirming that they are independent public
accountants with respect to the Company within the meaning of the Securities Act
and based upon the procedures described in their letter delivered to you
concurrently with the execution of this Agreement (herein called the Original
Letter), but carried out to a date not more than three business days prior to
the Closing Date or such later date on which Option Stock is purchased (i)
confirming, to the extent true, that the statements and conclusions set forth in
the
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Original Letter are accurate as of the Closing Date or such later date, as the
case may be, and (ii) setting forth any revisions and additions to the
statements and conclusions set forth in the Original Letter which are necessary
to reflect any changes in the facts described in the Original Letter since the
date of the Original Letter or to reflect the availability of more recent
financial statements, data or information. The letters shall not disclose any
change, or any development involving a prospective change, in or affecting the
business or properties of the Company or any of its subsidiaries which, in your
sole judgment, makes it impractical or inadvisable to proceed with the public
offering of the Stock or the purchase of the Option Stock as contemplated by the
Prospectus.
(g) You shall have received from KPMG LLP a letter stating that
their review of the Company's system of internal accounting controls, to the
extent they deemed necessary in establishing the scope of their examination of
the Company's financial statements as at [LATEST BALANCE SHEET DATE], did not
disclose any weakness in internal controls that they considered to be material
weaknesses.
(h) You shall have been furnished evidence in usual written or
telegraphic form from the appropriate authorities of the several jurisdictions,
or other evidence satisfactory to you, of the qualification referred to in
paragraph (f) of Section 6 hereof.
(i) Prior to the Closing Date, the Stock to be issued and sold by
the Company shall have been duly authorized for quotation on the Nasdaq National
Market.
(j) On or prior to the Closing Date, you shall have received from
all of the Company's directors, officers, and stockholders agreements, in form
reasonably satisfactory to Xxxxxxxxx & Xxxxx LLC, stating that without the prior
written consent of Xxxxxxxxx & Xxxxx LLC on behalf of the Underwriters, such
person or entity will not, for a period of 180 days following the commencement
of the public offering of the Stock by the Underwriters, directly or indirectly,
(i) sell, offer, contract to sell, make any short sale, pledge, sell any option
or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of any
shares of Common Stock or any securities convertible into or exchangeable or
exercisable for or any rights to purchase or acquire Common Stock or (ii) enter
into any swap or other agreement that transfers, in whole or in part, any of the
economic consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise.
In addition, you shall have received on the Closing Date and on any
later date on which Option Stock is purchased, such additional documents
(including, without limitation, opinions of counsel, letters, certificates and
agreements) as you may reasonably request. All the agreements, opinions,
certificates and letters mentioned above or elsewhere in this Agreement shall be
deemed to be in compliance with the provisions hereof only if Xxxxxx & Bird LLP,
counsel for the Underwriters, shall be satisfied that they comply in form and
scope.
In case any of the conditions specified in this Section 9 shall not be
fulfilled, this Agreement may be terminated by you by giving notice to the
Company and to the Selling Securityholders. Any such termination shall be
without liability of the Company or the Selling Securityholders to the
Underwriters and without liability of the Underwriters to the Company or the
Selling Securityholders; provided, however, that (i) in the event of such
termination, the Company and the Selling Securityholders jointly and severally
agree to indemnify and hold harmless the Underwriters from all costs or expenses
incident to the performance of the obligations of the Company and the Selling
Securityholders under this Agreement, including, without limitation, all costs
and expenses referred to in paragraphs (i) and (j) of Section 6 hereof, and (ii)
if this Agreement is terminated by you because of any
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refusal, inability or failure on the part of the Company or the Selling
Securityholders to perform any agreement herein, to fulfill any of the
conditions herein, or to comply with any provision hereof other than by reason
of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally upon demand for all out-of-pocket expenses (including,
without limitation, reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the transactions contemplated
hereby.
10. CONDITIONS OF THE OBLIGATION OF THE COMPANY AND THE SELLING
SECURITYHOLDERS. The obligation of the Company and the Selling Securityholders
to deliver the Stock shall be subject to the conditions that (a) the
Registration Statement shall have become effective and (b) no stop order
suspending the effectiveness thereof shall be in effect and no proceedings
therefor shall be pending or threatened by the Commission.
In case either of the conditions specified in this Section 10 shall not
be fulfilled, this Agreement may be terminated by the Company and the Selling
Securityholders by giving notice to you. Any such termination shall be without
liability of the Company and the Selling Securityholders to the Underwriters and
without liability of the Underwriters to the Company or the Selling
Securityholders; provided, however, that in the event of any such termination
the Company and the Selling Securityholders jointly and severally agree to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company and the Selling
Securityholders under this Agreement, including, without limitation, all costs
and expenses referred to in paragraphs (i) and (j) of Section 6 hereof.
11. REIMBURSEMENT OF CERTAIN EXPENSES. In addition to its other
obligations under Section 7 of this Agreement (and subject, in the case of a
Selling Securityholder, to the provisions of paragraph (f) of Section 7), the
Company and the Selling Securityholders hereby jointly and severally agree to
reimburse on a quarterly basis the Underwriters for all reasonable legal and
other expenses incurred in connection with investigating or defending any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any alleged statement or omission, described in
paragraph (a) of Section 7 of this Agreement, notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the obligations
under this Section 11 and the possibility that such payments might later be held
to be improper; provided, however, that (i) to the extent any such payment is
ultimately held to be improper, the persons receiving such payments shall
promptly refund them and (ii) such persons shall provide to the Company, upon
request, reasonable assurances of their ability to effect any refund, when and
if due.
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of the Company, the Selling Securityholders and the several
Underwriters and, with respect to the provisions of Section 7 hereof, the
several parties (in addition to the Company, the Selling Securityholders and the
several Underwriters) indemnified under the provisions of said Section 7, and
their respective personal representatives, successors and assigns. Nothing in
this Agreement is intended or shall be construed to give to any other person,
firm or corporation any legal or equitable remedy or claim under or in respect
of this Agreement or any provision herein contained. The term "successors and
assigns" as herein used shall not include any purchaser, as such purchaser, of
any of the Stock from any of the several Underwriters.
13. NOTICES. Except as otherwise provided herein, all
communications hereunder shall be in writing or by telegraph and, if to the
Underwriters, shall be mailed, telegraphed or delivered to Xxxxxxxxx & Xxxxx
LLC, Xxx Xxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, with copies to Xxxxxxxxx
& Xxxxx LLC, 0000 Xxxxxxxxx Xxxx, X.X., Xxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxx, Attention:
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Xx. Xxxxxx X. Xxxxx, and Xxxxxx & Bird LLP, 0000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxx 00000-0000, Attention: Xxxxx X. Xxxxx, Esq.; if to the Company, shall be
mailed, telegraphed or delivered to it at its office, 0000 Xxxxxxxxx Xxxxxxx,
Xxxxx 000, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Chief Executive Officer, with a
copy to Xxxxxx, Xxxxxxx & Xxxxxx, LLP, 1600 Atlanta Financial Center, 0000
Xxxxxxxxx Xxxx, X.X., Xxxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxx,
Esq.; and if to the Selling Securityholders, shall be mailed, telegraphed or
delivered to the Selling Securityholders in care of the Company at the address
of the Company set forth above, with a copy to Xxxxxx, Xxxxxxx & Xxxxxx, LLP as
set forth above. All notices given by telegraph shall be promptly confirmed by
letter.
14. MISCELLANEOUS. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the representations,
warranties and covenants in this Agreement shall remain in full force and effect
regardless of (a) any termination of this Agreement, (b) any investigation made
by or on behalf of any Underwriter or controlling person thereof, or by or on
behalf of the Company or the Selling Securityholders or their respective
directors or officers, and (c) delivery and payment for the Stock under this
Agreement; provided, however, that if this Agreement is terminated prior to the
Closing Date, the provisions of paragraphs (l) and (m) of Section 6 hereof shall
be of no further force or effect.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of California.
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Please sign and return to the Company and to the Selling
Securityholders in care of the Company the enclosed duplicates of this letter,
whereupon this letter will become a binding agreement among the Company, the
Selling Securityholders and the several Underwriters in accordance with its
terms.
Very truly yours,
WITNESS SYSTEMS, INC.
By:
---------------------------------------
Name:
Title:
Selling Securityholders
[List Names]
By:
---------------------------------------
Name:
Title: Attorney-in-Fact
The foregoing Agreement is hereby confirmed
and accepted as of the date first above written.
XXXXXXXXX & XXXXX LLC
U.S. BANCORP XXXXX XXXXXXX INC.
SOUNDVIEW TECHNOLOGY GROUP, INC.
By: Xxxxxxxxx & Xxxxx LLC
By:
----------------------------------------------
Name:
Title: Managing Director
Acting on behalf of the several Underwriters,
including themselves, named in Schedule I hereto.
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SCHEDULE I
UNDERWRITERS
NUMBER OF SHARES
UNDERWRITERS TO BE PURCHASED
------------ ---------------
Xxxxxxxxx & Xxxxx LLC.....................................
U.S. Bancorp Xxxxx Xxxxxxx Inc............................
SoundView Technology Group, Inc...........................
Total................................... 3,800,000
=========
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SCHEDULE II
SELLING SECURITYHOLDERS
NAME AND ADDRESS OF NUMBER OF SHARES
SELLING SECURITYHOLDERS TO BE SOLD
----------------------- -----------------
Total........................................
=====
28
SCHEDULE III
OPTIONAL STOCK
NUMBER OF SHARES
NAME OF SELLER TO BE SOLD
-------------- ----------------
Witness Systems, Inc...........................................
[Add Selling Securityholders]
Total..................................................... 570,000
=======
