MIPS TECHNOLOGIES, INC.
CLASS A COMMON STOCK
($.001 PAR VALUE)
FORM OF UNDERWRITING AGREEMENT
_______ __, 1999
Xxxxxxx, Xxxxx & Co.,
Credit Suisse First Boston Corporation,
BancBoston Xxxxxxxxx Xxxxxxxx, Inc.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Silicon Graphics, Inc., a Delaware corporation (the "Selling
Stockholder") and a stockholder of MIPS Technologies, Inc., a Delaware
corporation (the "Company"), proposes, subject to the terms and conditions
stated herein, to sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of 6,000,000 shares (the "Firm Shares") and, at the
election of the Underwriters, up to 900,000 additional shares (the "Optional
Shares") of Class A Common Stock ("Stock") of the Company (the Firm Shares and
the Optional Shares that the Underwriters elect to purchase pursuant to Section
2 hereof are herein collectively called the "Shares").
1. (a) Each of the Company and Selling Stockholder jointly and
severally represents and warrants to, and agrees with, each of the Underwriters
that:
(i) A registration statement on Form S-1 (File No.
333-73071) (the "Initial Registration Statement") in respect of the Shares has
been filed with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto, delivered
to you for each of the other Underwriters, have been declared effective by the
Commission in such form; other than a registration statement, if any, increasing
the size of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
"Act"), which became effective upon filing, no other document with respect to
the Initial Registration Statement has heretofore been filed with the
Commission; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act is hereinafter called a "Preliminary Prospectus"; the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(A)(a) hereof
and deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration
Statement at the time it was declared effective, each as amended at the time
such part of the Initial Registration Statement became effective or such part of
the Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration Statement"; and
such final prospectus, in the form first filed pursuant to Rule 424(b) under the
Act, is hereinafter called the "Prospectus");
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects to
the requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; PROVIDED, HOWEVER, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein or by the
Selling Stockholder expressly for use in the preparation of the answers therein
to Items 7 and 11(m) of Form S-1;
(iii) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the Registration
Statement or the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date as to
the Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; PROVIDED, HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by an Underwriter through
Xxxxxxx, Sachs & Co. expressly for use therein or by the Selling Stockholder
expressly for use in the preparation of the answers therein to Items 7 and 11(m)
of Form S-1;
(iv) Neither the Company nor any of its
subsidiaries has sustained since the date of the latest audited financial
statements included in the Prospectus any material loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is given
in the Registration Statement and the Prospectus, there has not been any
change in the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations
of the Company and its subsidiaries considered as a whole, otherwise than as
set forth or contemplated in the Prospectus;
(v) The Company and its subsidiaries have good and
marketable title to all personal property owned by them, in each case free and
clear of all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such property and do
not materially 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 materially interfere with the use made and proposed to be
made of such property and buildings by the Company and its subsidiaries, neither
the Company nor any of its subsidiaries own any real property;
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(vi) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction; and each subsidiary of the Company has
been duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation;
(vii) The Company has an authorized capitalization
as set forth in the Prospectus, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description of such stock
contained in the Prospectus; and all of the issued shares of capital stock of
each subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and (except for directors'
qualifying shares) are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(viii) The compliance by the Company with all of the
provisions of this Agreement and the consummation of the transactions herein
contemplated will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under (in each case material
to the Company and to subsidiaries, considered as a whole), any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, nor will such action result
in any violation of the provisions of the Certificate of Incorporation or
By-laws of the Company, nor will such action result in any violation (in each
case material to the Company and its subsidiaries, considered as a whole) of any
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or any of
their properties; and no consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or body is
required for sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under the
Act of the Shares and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the Underwriters;
(ix) Neither the Company nor any of its
subsidiaries is (a) in violation of its Certificate of Incorporation or
By-laws; or (b) in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may
be bound except, in the case of clause (b), for such violations as would not
have a material adverse effect on the financial condition or results of
operations of the Company and its subsidiaries, considered as a whole;
(x) The statements set forth in the Prospectus under
the caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, under the captions "Summary -
The Recapitalization and our Relationship with Silicon Graphics", "The
Recapitalization", "Arrangements between MIPS Technologies and Silicon
Graphics", "Certain United States Federal Tax Considerations for Non-United
States Holders" and under the caption "Underwriting", insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate, complete and fair in all material respects;
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(xi) Other than as set forth or contemplated in the
Prospectus, there are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of the Company
and its subsidiaries, considered as a whole; and, to the Company's knowledge, no
such proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(xii) The Company is not and, after giving effect to
the offering and sale of the Shares, will not be an "investment company", as
such term is defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(xiii) To the Company's knowledge, Ernst & Young LLP,
who have certified certain financial statements of the Company and its
subsidiaries, are independent public accountants as required by the Act and
the rules and regulations of the Commission thereunder;
(xiv) Except as set forth in the Prospectus, the
Company has reviewed its operations and that of its subsidiaries and any
third parties with which the Company or any of its subsidiaries has a
material relationship 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 a result of such review, except as set forth or
contemplated in the Prospectus, the Company has no reason to believe, and
does not believe, that the Year 2000 Problem will have a material adverse
effect on the general affairs, management, the current or future consolidated
financial position, business prospects, stockholders' equity or results of
operations of the Company and its subsidiaries, considered as a whole or
result in any material loss or interference with the Company's business or
operations. The "Year 2000 Problem" as used herein means any significant
risk that computer hardware or software used in the receipt, transmission,
processing, manipulation, 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.
(xv) The Company owns, or possesses adequate rights
to use, all material trademarks, service marks, trade names, trademark
registrations, service xxxx registrations, domain names, copyrights,
licenses, know-how, trade secrets and proprietary information necessary for
the conduct of its business and, except as set forth in the Prospectus, has
no reason to believe that the conduct of its business will conflict with, and
has not received any notice of any claim of conflict with, any such rights,
in each case with such exceptions as would not have a material adverse effect
on the business, financial condition, results of operations or prospects of
the Company; and, to the Company's knowledge, neither the Company nor any of
its subsidiaries have infringed or are infringing any trademarks, services
marks, trade names, trademark registrations, service xxxx registrations,
domain names or copyrights, which infringement could reasonably be expected
to result in any material adverse change, or in any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations
of the Company and its subsidiaries, considered as a whole;
(xvi) The Company owns, or possesses adequate rights
to use, all patents necessary for the conduct of its business with such
exceptions as do not have a material adverse effect on the financial
condition or results of operations of the Company and its subsidiaries,
considered as a whole; to the Company's knowledge, no valid United States
patent is or would be infringed by the activities of the Company, except as
would not have a material adverse effect on the business, financial
condition, results of operations or prospects of the Company; there are no
actions, suits or judicial proceedings pending relating to patents or
proprietary information to which the
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Company is a party or of which any property of the Company is subject, and,
to the knowledge of the Company, no actions, suits or judicial proceedings
are threatened by governmental authorities or, except as set forth or
contemplated in the Prospectus, others, in each case except as would not
result in any material adverse change, or in any development involving a
prospective material adverse change, in or affecting the general affairs,
management, the current or future consolidated financial position, business
prospects, stockholders' equity or results of operations of the Company and
its subsidiaries; except as set forth or contemplated in the Prospectus or as
would not result in any material adverse change, or in any development
involving a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, the Company is not aware of
any claim by others that the Company is infringing or otherwise violating the
patents or other intellectual property of others and is not aware of any
rights of third parties to any of the Company's patent applications, licensed
patents or licenses which could affect materially the use thereof by the
Company;
(xvii) The Company carries, or is covered by,
insurance as is customary for companies similarly situated and engaged in
similar businesses in similar industries;
(xviii) There are no contracts or other
documents which are required to be described in the Prospectus or to be filed
as exhibits to the Initial Registration Statement by the Act or the Exchange
Act which are not so described or filed;
(ix) No labor disturbance by the employees of the
Company exists or, to the knowledge of the Company, is imminent which might
be expected to have a material adverse effect on the business, financial
condition, results of operations or prospects of the Company;
(xx) The Company has no subsidiaries other than
MIPS Technologies International A.G.;
(xxi) The Company has furnished the Underwriters
a true and complete copy of each of the Preliminary Proxy Statement and
Definitive Proxy Statement (together, including the form of Proxy and
annexes, the "Proxy Materials") filed with the Commission in connection with
the Company's Special Meeting of stockholders held March 31, 1999 (the
"Special Meeting") to approve the recapitalization (the "Recapitalization")
of the Company described therein, including the approval and adoption of
certain changes to the Company's Certificate of Incorporation and By-laws
pursuant to which each issued and outstanding share of the Company's then
existing common stock was redesignated as one share of newly created and
issued Class A Common Stock. The Proxy Materials, as of their respective
filing dates and, in the case of the Definitive Proxy Statement, as of the
date of the Special Meeting, complied in all material respects with the
requirements of the Exchange Act and did not contain any untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading. All material
authorizations, consents, orders and approvals of, or declarations with, any
governmental entity necessary for the consummation of the Recapitalization
and transactions contemplated in the Proxy Materials have been obtained. The
Recapitalization has been duly and validly authorized by all necessary
corporate action on the part of the Company and has been approved by the
Board of Directors and stockholders of the Company; and the Recapitalization
has been consummated in the manner described in the Definitive Proxy
Statement; and
(xxii) Each of the Corporate Agreement dated as of
July 6, 1998, Management Services Agreement dated as of July 6, 1998, Tax
Sharing Agreement dated as of July 6, 1998, Separation Agreement dated July
6, 1998, Trademark Agreement dated July 6, 1998, Technology Transfer
Agreement dated July 6, 1998 and Exchange Agreement dated ______, 1999
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between the Company and the Selling Stockholder (collectively, the
"Intercompany Agreements") have been duly and validly authorized by all
necessary corporate action on the part of the Company and the Selling
Stockholder, including the approval by their respective boards of directors.
The Intercompany Agreements have been duly executed and delivered by each of
the Company and the Selling Stockholder and constitute valid and binding
obligations of the Company and the Selling Stockholder, enforceable against
the parties in accordance with their respective terms.
(b) The Selling Stockholder represents and warrants to,
and agrees with, each of the Underwriters that:
(i) All consents, approvals, authorizations and
orders necessary for the execution and delivery by the Selling Stockholder of
this Agreement hereinafter referred to, and for the sale and delivery of the
Shares to be sold by the Selling Stockholder hereunder, have been obtained;
and the Selling Stockholder has full right, power and authority to enter into
this Agreement, and to sell, assign, transfer and deliver the Shares to be
sold by the Selling Stockholder hereunder;
(ii) The sale of the Shares to be sold by the
Selling Stockholder hereunder and the compliance by the Selling Stockholder
with all of the provisions of this Agreement, and the consummation of the
transactions herein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any statute, indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Selling Stockholder is a party or
by which the Selling Stockholder is bound or to which any of the property or
assets of the Selling Stockholder is subject, nor will such action result in
any violation of the provisions of the Certificate of Incorporation or
By-laws of the Selling Stockholder or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Selling Stockholder or the property of the Selling Stockholder,
except, in each case, for such conflicts, breaches, violations or defaults as
would not, singly or in the aggregate, have a material adverse effect on the
ability of the Selling Stockholder to timely perform its obligations under
this Agreement.
(iii) The Selling Stockholder has, and immediately
prior to each Time of Delivery (as defined in Section 4 hereof) the Selling
Stockholder will have, good and valid title to the Shares to be sold by the
Selling Stockholder hereunder, free and clear of all liens, encumbrances,
equities or claims; and, upon delivery of such Shares and payment therefor
pursuant hereto, good and valid title to such Shares, free and clear of all
liens, encumbrances, equities or claims, will pass to the several
Underwriters;
(iv) During the period beginning from the date
hereof and continuing to and including the date 90 days after the date of
the Prospectus, the Selling Stockholder will not offer, sell, contract to
sell or otherwise dispose of, except as provided hereunder, any securities of
the Company that are substantially similar to the Shares, including but not
limited to any securities that are convertible into or exchangeable for, or
that represent the right to receive, Stock or any such substantially similar
securities without the prior written consent of Xxxxxxx Xxxxx & Co., PROVIDED
HOWEVER, that the foregoing consent shall not be required for a transaction
by the Selling Stockholder that is intended to qualify as a Tax-Free
Distribution and that, as a result of a Change in Tax Law, would not be a
Tax-Free Distribution unless undertaken by the Selling Stockholder prior to
the expiration of the foregoing 180-day period, PROVIDED FURTHER, that the
Selling Stockholder provides prompt notice to the Underwriters of its
intention to effect such Tax-Free Distribution prior to undertaking such
transaction. "Tax-Free Distribution" means the divestiture by the Selling
Stockholder of its interest in the Company to the stockholders of the Selling
Stockholder in a transaction generally intended to qualify under Section 355
of the Internal Revenue Code of 1986, as amended. "Change in Tax Law" means
the amendment of the Internal Revenue Code by the
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enactment of new legislation which, in effect, generally imposes a
requirement to the effect that in a tax-free spin-off or split-off of a
subsidiary, the distributing company must hold not less than 80% of the value
of all or a portion of the subsidiary's stock;
(v) The Selling Stockholder has not taken and will
not take, directly or indirectly, any action which is designed to or which
has constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares;
(vi) To the extent that any statements or omissions
made in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto are made in reliance upon
and in conformity with written information furnished to the Company by the
Selling Stockholder expressly for use therein, such Preliminary Prospectus
and the Registration Statement did, and the Prospectus and any further
amendments or supplements to the Registration Statement and the Prospectus,
when they become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of the Act and
the rules and regulations of the Commission thereunder and will not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading; and
(vii) In order to document the Underwriters'
compliance with the reporting and withholding provisions of the Tax Equity
and Fiscal Responsibility Act of 1982 with respect to the transactions herein
contemplated, the Selling Stockholder will deliver to you prior to or at the
First Time of Delivery (as hereinafter defined) a properly completed and
executed United States Treasury Department Form W-9 (or other applicable form
or statement specified by Treasury Department regulations in lieu thereof).
2. Subject to the terms and conditions herein set forth, (a)
the Selling Stockholder agrees to sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from the
Selling Stockholder, at a purchase price per share of $_____, the number of
Firm Shares set forth opposite the Selling Stockholder's name in Schedule II
hereto; and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, the
Selling Stockholder agrees to sell to each of the Underwriters, and each of
the Underwriters agrees, severally and not jointly, to purchase from the
Selling Stockholder, at the purchase price per share set forth in clause (a)
of this Section 2, that portion of the number of Optional Shares as to which
such election shall have been exercised (to be adjusted by you so as to
eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in SCHEDULE I hereto and the
denominator of which is the maximum number of Optional Shares which all of
the Underwriters are entitled to purchase hereunder.
The Selling Stockholder hereby grants to the Underwriters the right
to purchase at their election up to 900,000 Optional Shares, at the purchase
price per share set forth in the paragraph above, for the sole purpose of
covering overallotments in the sale of the Firm Shares. Any such election to
purchase Optional Shares may be exercised only by written notice from you to
the Selling Stockholder, given within a period of 30 calendar days after the
date of this Agreement and setting forth the aggregate number of Optional
Shares to be purchased and the date on which such Optional Shares are to be
delivered, as determined by you but in no event earlier than the First Time
of Delivery (as defined in Section 4 hereof) or, unless you and the Selling
Stockholder otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
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3. Upon the authorization by you of the release of the Firm
Shares, the several Underwriters propose to offer the Firm Shares for sale
upon the terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter
hereunder, in definitive form, and in such authorized denominations and
registered in such names as Xxxxxxx, Sachs & Co. may request upon at least
forty-eight hours' prior notice to the Selling Stockholder shall be delivered
by or on behalf of the Selling Stockholder to Xxxxxxx, Xxxxx & Co., through
the facilities of the Depository Trust Company ("DTC"), for the account of
such Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Selling Stockholder to Xxxxxxx, Sachs & Co. at least
forty-eight hours in advance. The Selling Stockholder will cause the
certificates representing the Shares to be made available for checking and
packaging at least twenty-four hours prior to the Time of Delivery (as
defined below) with respect thereto at the office of DTC or its designated
custodian (the "Designated Office"). The time and date of such delivery and
payment shall be, with respect to the Firm Shares, 9:30 a.m., New York time,
on ............., 1999 or such other time and date as Xxxxxxx, Xxxxx & Co.
and the Selling Stockholder may agree upon in writing, and, with respect to
the Optional Shares, 9:30 a.m., New York time, on the date specified by
Xxxxxxx, Sachs & Co. in the written notice given by Xxxxxxx, Xxxxx & Co. of
the Underwriters' election to purchase such Optional Shares, or such other
time and date as Xxxxxxx, Sachs & Co. and the Selling Stockholder may agree
upon in writing. Such time and date for delivery of the Firm Shares is
herein called the "First Time of Delivery", such time and date for delivery
of the Optional Shares, if not the First Time of Delivery, is herein called
the "Second Time of Delivery", and each such time and date for delivery is
herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of
Delivery by or on behalf of the parties hereto pursuant to Section 7 hereof,
including the cross receipt for the Shares and any additional documents
requested by the Underwriters pursuant to Section 7(l) hereof, will be
delivered at the offices of Venture Law Group, A Professional Corporation,
0000 Xxxx Xxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000 (the "Closing Location"),
and the Shares will be delivered at the Designated Office, all at such Time
of Delivery. A meeting will be held at the Closing Location at 10:00 a.m.,
New York City time, on the New York Business Day next preceding such Time of
Delivery, at which meeting the final drafts of the documents to be delivered
pursuant to the preceding sentence will be available for review by the
parties hereto. For the purposes of this Section 4, "New York Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not
a day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you
and to file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day following
the execution and delivery of this Agreement, or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to
advise you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective
or any supplement to the Prospectus or any amended Prospectus has been filed
and to furnish you with copies thereof; to advise you, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any Preliminary
Prospectus or Prospectus, of the suspension of the qualification of the
Shares for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance
of any stop
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order or of any order preventing or suspending the use of any Preliminary
Prospectus or prospectus or suspending any such qualification, promptly to
use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you
may reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with
such laws so as to permit the continuance of sales and dealings therein in
such jurisdictions for as long as may be necessary to complete the
distribution of the Shares, provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a
general consent to service of process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the New
York Business Day next succeeding the date of this Agreement and from time to
time, to furnish the Underwriters with copies of the Prospectus in New York
City in such quantities as you may reasonably request, and, if the delivery
of a prospectus is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the
offering or sale of the Shares and if at such time any events shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus in order to comply
with the Act, to notify you and upon your request to file such documents and
to prepare and furnish without charge to each Underwriter and to any dealer
in securities as many copies as you may from time to time reasonably request
of an amended Prospectus or a supplement to the Prospectus which will correct
such statement or omission or effect such compliance, and in case any
Underwriter is required to deliver a prospectus in connection with sales of
any of the Shares at any time nine months or more after the time of issue of
the Prospectus, upon your request but at the expense of such Underwriter, to
prepare and deliver to such Underwriter as many copies as you may request of
an amended or supplemented Prospectus complying with Section 10(a)(3) of the
Act;
(d) To make generally available to the Company's
securityholders as soon as practicable, but in any event not later than
eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the Company
and its subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) The Company and the Selling Stockholder will not,
during the period beginning from the date hereof and continuing to and
including the date 90 days after the date of the Prospectus, offer, sell,
contract to sell or otherwise dispose of, except as provided hereunder, any
securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to director or employee
stock option plans and director or employee stock purchase plans existing on,
or upon the conversion or exchange of convertible or exchangeable securities,
outstanding as of, the date of this Agreement) without the prior written
consent of Xxxxxxx, Xxxxx & Co.
(f) To furnish to the Company's stockholders as soon as
practicable after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders' equity and cash flows
of the Company and its consolidated subsidiaries certified by independent
public accountants) and, as soon as practicable after the end of each of the
first three quarters of each fiscal year (beginning with the fiscal quarter
ending after the effective date of the Registration Statement), to make
available to its stockholders consolidated summary financial
-9-
information of the Company and its subsidiaries for such quarter in
accordance with applicable Commission regulations;
(g) During a period of three years from the effective
date of the Registration Statement, to furnish to you copies of all reports
or other communications (financial or other) furnished to stockholders, and
to deliver to you (i) as soon as they are available, copies of any reports
and financial statements furnished to or filed with the Commission or any
national securities exchange on which any class of securities of the Company
is listed; and (ii) such additional public information concerning the
business and financial condition of the Company as you may from time to time
reasonably request (such financial statements to be on a consolidated basis
to the extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its stockholders generally or to the
Commission);
(h) To use its best efforts to list for quotation the
Shares on the National Association of Securities Dealers Automated Quotations
National Market System ("NASDAQ"); and
(i) If the Company elects to rely upon Rule 462(b), the
Company shall file a Rule 462(b) Registration Statement with the Commission
in compliance with Rule 462(b) by 10:00 P.M. Washington, D.C. time, on the
date of this Agreement, and the Company shall at the time of filing either
pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act.
6. Each of the Company and the Selling Stockholder covenants
and agrees with one another and with the several Underwriters that the
Selling Stockholder will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or
producing any Agreement among Underwriters, this Agreement, the Blue Sky
Memorandum, closing documents (including any compilations thereof) and any
other documents in connection with the offering, purchase, sale and delivery
of the Shares; (iii) all expenses in connection with the qualification of the
Shares for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the reasonable fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky survey (iv) all fees and expenses in connection
with listing the Shares on the NASDAQ; (v) the filing fees incident to, and
the reasonable fees and disbursements of counsel for the Underwriters in
connection with, securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (vi) the
cost of preparing stock certificates; (vii) the cost and charges of any
transfer agent or registrar and (viii) all costs and expenses incident to the
performance of the Selling Stockholder's and the Company's obligations
hereunder which are not otherwise specifically provided for in this Section,
including (A) any fees and expenses of counsel for the Selling Stockholder,
and (B) all expenses and taxes incident to the sale and delivery of the
Shares to be sold by the Selling Stockholder to the Underwriters hereunder.
In connection with clause (viii)(B) of the preceding sentence, Xxxxxxx, Sachs
& Co. agrees to pay New York State stock transfer tax, and the Selling
Stockholder agrees to reimburse Xxxxxxx, Xxxxx & Co. for associated carrying
costs if such tax payment is not rebated on the day of payment and for any
portion of such tax payment not rebated. It is understood, however, that the
Company shall bear, and the Selling Stockholder shall not be required to pay
or to reimburse the Company for, the cost of any other matters not directly
relating to the sale and purchase of the Shares pursuant to this Agreement,
and that, except as provided in this Section, and Sections 8 and 11 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel, stock transfer taxes on resale
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of any of the Shares by them, and any advertising expenses connected with any
offers they may make.
7. The obligations of the Underwriters hereunder, as to the
Shares to be delivered at each Time of Delivery, shall be subject, in their
discretion, to the condition that all representations and warranties and
other statements of the Company and of the Selling Stockholder herein are, at
and as of such Time of Delivery, true and correct, the condition that each of
the Company and the Selling Stockholder shall have performed all of its
obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; if the Company has elected to rely upon
Rule 462(b), the Rule 462(b) Registration Statement shall have become
effective by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the Commission; and
all requests for additional information on the part of the Commission shall
have been complied with to your reasonable satisfaction;
(b) Venture Law Group, A Professional Corporation,
counsel for the Underwriters, shall have furnished to you such written
opinion or opinions (a draft of such opinion is attached as Annex II(a)
hereto), dated such Time of Delivery, with respect to the matters covered in
paragraphs (i), (ii), (iii), (vi), and (viii) of subsection (c)(A) below as
well as such other related matters as you may reasonably request, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) (A) Shearman & Sterling, special counsel for the
Company, shall have furnished to you their written opinion (a draft of such
opinion is attached as Annex II(b) hereto), dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
State of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(ii) The Company has an authorized capitalization
as set forth in the Prospectus, and all of the issued shares of capital stock
of the Company (including the Shares being delivered at such Time of
Delivery) have been duly and validly authorized and issued and are fully paid
and non-assessable; and the Shares conform to the description of the Stock
contained in the Prospectus;
(iii) This Agreement has been duly authorized,
executed and delivered by the Company;
(iv) The compliance by the Company with all of the
provisions of this Agreement and the consummation of the transactions herein
contemplated will not conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under (in each case
material to the Company and its subsidiaries, considered as a whole), any
indenture, mortgage, deed of trust, loan agreement or other material
agreement known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or its
subsidiaries is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the Company, nor
will such action result in any violation (in each case material to the
Company and its subsidiaries, considered as a whole) of any statute or any
order, rule or regulation known to such
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counsel of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties;
(v) No consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by this
Agreement, except the registration under the Act of the Shares, and such
consents, approvals, authorizations, registrations or qualifications as may
be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters;
(vi) The statements set forth in the Prospectus
under the caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, under the captions "Summary
-The Recapitalization and our Relationship with Silicon Graphics", "The
Recapitalization", "Arrangements between MIPS Technologies and Silicon
Graphics", "Certain United States Federal Tax Considerations for Non-United
States Holders" and under the caption "Underwriting", insofar as they purport
to describe the provisions of the laws and documents referred to therein
fairly presents the information called for with respect to such laws and
documents in all material respects;
(vii) The Company is not an "investment company", as
such term is defined in the Investment Company Act;
(viii) The Registration Statement and the Prospectus
and any further amendments and supplements thereto made by the Company prior
to such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion) comply
as to form in all material respects with the requirements of the Act and the
rules and regulations thereunder; although they do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus, except for those
referred to in the opinion in subsection (vi) of this Section 7(c)(A), they
have no reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related schedules
and other financial data therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that, as of its date, the Prospectus or
any further amendment or supplement thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related schedules
and other financial data therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted to state
a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that, as of such
Time of Delivery, either the Registration Statement or the Prospectus or any
further amendment or supplement thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related schedules
and other financial data therein, as to which such counsel need express no
opinion) contains an untrue statement of a material fact or omits to state a
material fact necessary to make th statements therein, in the light of the
circumstances under which they were made, not misleading; and they do not
know of any amendment to the Registration Statement required to be filed or
of any contracts or other documents of a character required to be filed as an
exhibit to the Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not filed or described as
required; and
(ix) Counsel does not know of any agreements or
documents required to be filed as exhibits to the Registration Statement or
described in the Registration Statement or Prospectus which are not so filed
or described as required, and such agreements and documents as
-12-
are summarized in the Registration Statement or the Prospectus are fairly
summarized in all material respects.
(B) The General Counsel of the Company shall have
furnished to you its written opinion, dated such Time of Delivery, in form
and substance satisfactory to you to the effect that:
(i) The Company has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification, or
is subject to no material liability or disability by reason of failure to be
so qualified in any such jurisdiction (such counsel being entitled to rely in
respect of the opinion in this clause upon opinions of local counsel and in
respect of matters of fact upon certificates of officers of the Company,
provided that such counsel shall state that they believe that both you and
they are justified in relying upon such opinions and certificates);
(ii) All of the issued shares of capital stock of
each such subsidiary of the Company are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims (such
counsel being entitled to rely in respect of the opinion in this clause upon
opinions of local counsel and in respect of matters of fact upon certificates
of officers of the Company or its subsidiaries, provided that such counsel
shall state that they believe that both you and they are justified in relying
upon such opinions and certificates);
(iii) 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 materially interfere with the use made and proposed to be made of
such property and buildings by the Company and its subsidiaries (in giving
the opinion in this clause, such counsel may state that no examination of
record titles for the purpose of such opinion has been made, and that they
are relying upon a general review of the titles of the Company and its
subsidiaries, upon opinions of local counsel and abstracts, reports and
policies of title companies rendered or issued at or subsequent to the time
of acquisition of such property by the Company or its subsidiaries, upon
opinions of counsel to the lessors of such property and, in respect of
matters of fact, upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that they believe that
both you and they are justified in relying upon such opinions, abstracts,
reports, policies and certificates);
(iv) To the best of such counsel's knowledge and
other than as set forth or contemplated in the Prospectus, there are no legal
or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the Company or
any of its subsidiaries, would individually or in the aggregate have a
material adverse effect on the current or future consolidated financial
position stockholders' equity or results of operations of the Company and its
subsidiaries, considered as a whole; and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(v) Neither the Company nor any of its
subsidiaries is (a) in violation of its Certificate of Incorporation or
By-laws or (b) in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, or lease or agreement or other
instrument to which it is a party or by which it or any of its properties may
be bound, except, in the case of clause (b), where such default would not
have a material adverse effect on the Company and its subsidiaries,
considered as a whole;
(d) (A) Shearman & Sterling, special counsel for the
Selling Stockholder, shall have furnished to you its written opinion with
respect to the Selling Stockholder (a draft of such opinion
-13-
is attached as Annex II(c) hereto), dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) This Agreement has been duly executed and
delivered by or on behalf of the Selling Stockholder.
(ii) No consent, approval, authorization or order
of any court or governmental agency or body is required for the consummation
of the transactions contemplated by this Agreement in connection with the
Shares to be sold by the Selling Stockholder hereunder, except such as have
been obtained under the Act and such as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution
of such Shares by the Underwriters;
(iii) Immediately prior to such Time of Delivery,
the Selling Stockholder was the sole registered owner of the Shares to be
sold at such time of Delivery by the Selling Stockholder under this Agreement
free and clear of all liens, encumbrances, equities or claims and had full
corporate power and authority to sell, assign, transfer and deliver the
Shares to be sold by the Selling Stockholder hereunder; and
(iv) Upon consummation of the sale of the Shares by
the Selling Stockholder pursuant to this Agreement, all of the rights of the
Selling Stockholder in the Shares, free and clear of all liens, encumbrances,
equities or claims, will have been transferred to each of the several
Underwriters who have purchased such Shares in good faith and without notice
of any such lien, encumbrance, equity or claim or any other adverse claim
within the meaning of the Uniform Commercial Code.
In rendering the opinion in paragraph (iii), such counsel may rely
upon a certificate of the Selling Stockholder in respect of matters of fact
as to ownership of, and liens, encumbrances, equities or claims on, the
Shares sold by the Selling Stockholder, provided that such counsel provides
you with a copy of such certificate and shall state that they believe that
both you and they are justified in relying upon such certificate;
(B) The General Counsel or Assistant General Counsel of
the Selling Stockholder shall have furnished to you its written opinion,
dated such Time of Delivery, in form and substance satisfactory to you to the
effect that:
The sale of the Shares to be sold by the Selling
Stockholder hereunder and the compliance by the Selling Stockholder with all
of the provisions of this Agreement, and the consummation of the transactions
herein contemplated will not conflict with or result in a breach or violation
of any terms or provisions of, or constitute a default under, any statute,
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Selling Stockholder is a party
or by which the Selling Stockholder is bound or to which any of the property
or assets of the Selling Stockholder is subject, nor will such action result
in any violation of the provisions of the Certificate of Incorporation or
By-laws of the Selling Stockholder or any statute, order, rule or regulation
known to such counsel of any court or governmental agency or body having
jurisdiction over the Selling Stockholder or the property of the Selling
Stockholder, except in each case, for such conflicts, breaches, violations or
defaults as would not, singly or in the aggregate, have a material adverse
effect on the ability of the Selling Stockholder to hereby perform its
obligations under this Agreement.
(e) On the date of the Prospectus at a time prior to the
execution of this Agreement, at 9:30 a.m., New York City time, on the
effective date of any post-effective amendment to the Registration Statement
filed subsequent to the date of this Agreement and also at each Time of
Delivery, Ernst & Young, LLP shall have furnished to you a letter or letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto
-14-
(the executed copy of the letter delivered prior to the execution of this
Agreement is attached as Annex I(a) hereto and a draft of the form of letter
to be delivered on the effective date of any post-effective amendment to the
Registration Statement and as of each Time of Delivery is attached as Annex
I(b) hereto);
(f) (i) Neither the Company nor any of its subsidiaries
shall have sustained since the date of the latest audited financial
statements included in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus, and (ii) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the capital
stock or long-term debt of the Company or any of its subsidiaries or any
change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, otherwise than as
set forth or contemplated in the Prospectus, the effect of which, in any such
case described in Clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(g) On or after the date hereof (i) no downgrading shall
have occurred in the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and
(iii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any of the Company's debt securities; there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on NASDAQ; (ii) a
suspension or material limitation in trading in the Company's securities on
NASDAQ; (iii) a general moratorium on commercial banking activities declared
by either Federal or New York or California State authorities; (iv) the
outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the
effect of any such event specified in this Clause (iv) in the judgment of the
Representatives makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus; or
(v) the occurrence of any material adverse change in the financial, political
or economic condition in the United States or elsewhere which in the judgment
of the Representatives would materially and adversely affect the financial
markets, the market for these Shares or the market for any other equity
securities.
(i) The Shares at such Time of Delivery shall have been
duly listed for quotation on NASDAQ subject to notice of issuance;
(j) The Company has obtained and delivered to the
Underwriters executed copies of an agreement from each officer and director
of the Company, substantially to the effect set forth in Exhibit A hereto in
form and substance satisfactory to you;
(k) The Company shall have complied with the provisions
of Section 5(c) hereof with respect to the furnishing of prospectuses on the
New York Business Day next succeeding the date of this Agreement; and
(l) The Company and the Selling Stockholder shall have
furnished or caused to be furnished to you at such Time of Delivery
certificates of officers of the Company and of the Selling Stockholder,
respectively, satisfactory to you as to the accuracy of the representations
and warranties of the Company and the Selling Stockholder, respectively,
herein at and as of such Time of Delivery, as to the performance by the
Company and the Selling Stockholder of all of their respective
-15-
obligations hereunder to be performed at or prior to such Time of Delivery,
and as to such other matters as you may reasonably request, and the Company
shall have furnished or caused to be furnished certificates as to the matters
set forth in subsections (a) and (f) of this Section;
8. (a) Each of the Company and the Selling Stockholder,
jointly and severally, will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; PROVIDED, HOWEVER, that the Company and
the Selling Stockholder shall not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged
omission made in any Preliminary Prospectus, the Registration Statement or
the Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the
Company and the Selling Stockholder against any losses, claims, damages or
liabilities to which the Company or the Selling Stockholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
an untrue statement or alleged untrue statement of a material fact contained
in any Preliminary Prospectus, the Registration Statement or the Prospectus,
or any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein; and will reimburse the Company and the
Selling Stockholder for any legal or other expenses reasonably incurred by
the Company or the Selling Stockholder in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party
in writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party otherwise than under such subsection. In case any
such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of
the indemnified party, effect
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the settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such
action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(d) If the indemnification provided for in this Section 8
is unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholder on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and the Selling Stockholder on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Stockholder on the one hand
and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Selling Stockholder bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault
shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or the Selling Stockholder on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company,
the Selling Stockholder and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subsection (d) were
determined by PRO RATA allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall
be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations
in this subsection (d) to contribute are several in proportion to their
respective underwriting obligations and not joint.
(e) The obligations of the Company and the Selling
Stockholder under this Section 8 shall be in addition to any liability which
the Company and the Selling Stockholder may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
-17-
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company
(including any person who, with his or her consent, is named in the
Registration Statement as about to become a director of the Company) and to
each person, if any, who controls the Company or the Selling Stockholder
within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or
other parties to purchase such Shares on the terms contained herein. If
within thirty-six hours after such default by any Underwriter you do not
arrange for the purchase of such Shares, then the Selling Stockholder shall
be entitled to a further period of thirty-six hours within which to procure
another party or other parties satisfactory to you to purchase such Shares on
such terms. In the event that, within the respective prescribed periods, you
notify the Selling Stockholder that you have so arranged for the purchase of
such Shares, or the Selling Stockholder notifies you that they have so
arranged for the purchase of such Shares, you or the Selling Stockholder
shall have the right to postpone a Time of Delivery for a period of not more
than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your
opinion may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any person substituted under this Section with
like effect as if such person had originally been a party to this Agreement
with respect to such Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Selling Stockholder as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased does not exceed one-eleventh
of the aggregate number of all the Shares to be purchased at such Time of
Delivery, then the Selling Stockholder shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Selling Stockholder as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all of the Shares to be purchased at such Time of
Delivery, or if the Selling Stockholder shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Time of Delivery, the obligations
of the Underwriters to purchase and of the Selling Stockholder to sell the
Optional Shares) shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Selling Stockholder, except for the
expenses to be borne by the Company and the Selling Stockholder and the
Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company, the Selling Stockholder and
the several Underwriters, as set forth in this Agreement or made by or on
behalf of them, respectively, pursuant to this Agreement, shall remain in
full force and effect, regardless of any investigation (or any statement as
to the results thereof) made
-18-
by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or the Selling Stockholder, or any officer or
director or controlling person of the Company, or any controlling person of
the Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, neither the Company nor the Selling Stockholder shall then be under
any liability to any Underwriter except as provided in Sections 6 and 8
hereof; but, if for any other reason any Shares are not delivered by or on
behalf of the Selling Stockholder as provided herein, the Selling Stockholder
will reimburse the Underwriters through you for all out-of-pocket expenses
approved in writing by you, including reasonable fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of the Shares not so delivered, but the
Company and the Selling Stockholder shall then be under no further liability
to any Underwriter in respect of the Shares not so delivered except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each
of the Underwriters, and the parties hereto shall be entitled to act and rely
upon any statement, request, notice or agreement on behalf of any Underwriter
made or given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as
the representatives.
All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriters shall be delivered or sent by mail,
telex or facsimile transmission to you as the representatives in care of
Xxxxxxx, Sachs & Co., 00 Xxx Xxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Registration Department; if to the Selling Stockholder shall be
delivered or sent by mail, telex or facsimile transmission to counsel for the
Selling Stockholder at its address set forth in Schedule II hereto; and if to
the Company shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(d) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which address will be supplied to the Company or the Selling
Stockholder by you on request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to
the benefit of, the Underwriters, the Company and the Selling Stockholder
and, to the extent provided in Sections 8 and 10 hereof, the officers and
directors of the Company and each person who controls the Company, the
Selling Stockholder or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser
of any of the Shares from any Underwriter shall be deemed a successor or
assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's
office in Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed
to be an original, but all such counterparts shall together constitute one
and the same instrument.
If the foregoing is in accordance with your understanding, please
sign and return to us one for the Company and each of the Representatives
plus one for each counsel and the Selling Stockholder, counterparts hereof,
and upon the acceptance hereof by you, on behalf of each of the Underwriters,
this letter and such acceptance hereof shall constitute a binding agreement
among each of the
-19-
Underwriters, the Company and the Selling Stockholder. It is understood that
your acceptance of this letter on behalf of each of the Underwriters is
pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company and the
Selling Stockholder for examination, upon request, but without warranty on
your part as to the authority of the signers thereof.
Very truly yours,
MIPS TECHNOLOGIES, INC.
By:
-------------------------
Name:
` Title:
SILICON GRAPHICS, INC.
By:
-------------------------
Name:
Title:
Accepted as of the date hereof in New York, New York:
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation,
BancBoston Xxxxxxxxx Xxxxxxxx, Inc.
By:
---------------------------------------------
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
-20-
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
------------- ---------------- -------------------
Xxxxxxx, Xxxxx & Co. .............................
Credit Suisse First Boston Corporation............
BancBoston Xxxxxxxxx Xxxxxxxx, Inc................
-------------- --------------
Total............................................. 6,000,000 900,000
-------------- --------------
-------------- --------------
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SCHEDULE II
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF SOLD IF
FIRM SHARES MAXIMUM OPTION
TO BE SOLD EXERCISED
---------------- ------------------
The Company............................... 0 0
The Selling Stockholder:
SILICON GRAPHICS, INC.(a)......... 6,000,000 900,000
--------- -------
Total.................................. 6,000,000 900,000
--------- -------
--------- -------
(a) The Selling Stockholder is represented by Shearman & Sterling, 0000 Xx
Xxxxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, (000) 000-0000.
-22-
ANNEX I
Pursuant to Section 7(e) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the Act and
the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by them
and included in the Prospectus or the Registration Statement comply as to
form in all material respects with the applicable accounting requirements of
the Act and the related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
consolidated interim financial statements, selected financial data, pro forma
financial information, financial forecasts and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the representatives of the
Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of the
unaudited condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the Prospectus
as indicated in their reports thereon copies of which have been separately
furnished to the Representatives and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations,
nothing came to their attention that caused them to believe that the
unaudited condensed consolidated financial statements do not comply as to
form in all material respects with the applicable accounting requirements of
the Act and the related published rules and regulations;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and financial position of
the Company for the five most recent fiscal years included in the Prospectus
agrees with the corresponding amounts (after restatements where applicable)
in the audited consolidated financial statements for such five fiscal years,
copies of which have been furnished to the Representatives;
(v) They have compared the information in the Prospectus
under selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures that caused them
to believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the latest
audited financial statements included in the Prospectus, inquiries of
officials of the Company and its subsidiaries responsible for financial and
accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them to
believe that:
(A) (i) the unaudited consolidated statements of
income, consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the related
published rules and regulations, or (ii) any material modifications should be
made to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus for them to be in conformity with generally
accepted accounting principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial statements from
which such data and items were derived, and any such unaudited data and items
were not determined on a basis substantially consistent with the basis for
the corresponding amounts in the audited consolidated financial statements
included in the Prospectus;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived any unaudited
condensed financial statements referred to in Clause (A) and any unaudited
income statement data and balance sheet items included in the Prospectus and
referred to in Clause (B) were not determined on a basis substantially
consistent with the basis for the audited consolidated financial statements
included in the Prospectus;
(D) any unaudited pro forma consolidated condensed
financial statements included in the Prospectus do not comply as to form in
all material respects with the applicable accounting requirements of the Act
and the published rules and regulations thereunder or the pro forma
adjustments have not been properly applied to the historical amounts in the
compilation of those statements;
(E) as of a specified date not more than five days
prior to the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock upon
exercise of options and stock appreciation rights, upon earn-outs of
performance shares and upon conversions of convertible securities, in each
case which were outstanding on the date of the latest financial statements
included in the Prospectus) or any increase in the consolidated long-term
debt of the Company and its subsidiaries, or any decreases in consolidated
net current assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the latest
balance sheet included in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(F) for the period from the date of the latest
financial statements included in the Prospectus to the specified date
referred to in Clause (E) there were any decreases in consolidated net
revenues or operating profit or the total or per share amounts of
consolidated net income or other items specified by the Representatives, or
any increases in any items specified by the Representatives, in each case as
compared with the comparable period of the preceding year and with any other
period of corresponding length specified by the Representatives, except in
each case
F-2
for decreases or increases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included in the Prospectus and the limited procedures, inspection
of minute books, inquiries and other procedures referred to in paragraphs
(iii) and (vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives, which are derived from the
general accounting records of the Company and its subsidiaries, which appear
in the Prospectus, or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives, and have compared
certain of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found them to
be in agreement.
F-3
