Exhibit 1.1
AQUANTIVE, INC.
[___] Shares
Common Stock
($0.01 par value per Share)
UNDERWRITING AGREEMENT
[pricing date], 2006
UNDERWRITING AGREEMENT
[pricing date], 2006
UBS Securities LLC
Xxxxxxxxx & Company, Inc.
Bear, Xxxxxxx & Co. Inc.
Xxxxxx Xxxxxx Partners LLC
as Managing Underwriters
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
c/x Xxxxxxxxx & Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
aQuantive, Inc., a Washington corporation (the "Company"), proposes
to issue and sell to the underwriters named in Schedule A annexed hereto (the
"Underwriters"), for whom you are acting as representatives, an aggregate of
[__________] shares (the "Firm Shares") of common stock, $0.01 par value per
share (the "Common Stock"), of the Company. In addition, solely for the purpose
of covering over-allotments, the Company proposes to grant to the Underwriters
the option to purchase from the Company up to an additional [________] shares of
Common Stock (the "Additional Shares"). The Firm Shares and the Additional
Shares are hereinafter collectively sometimes referred to as the "Shares." The
Shares are described in the Prospectus which is referred to below.
The Company has prepared and filed, in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations thereunder (collectively, the "Act"), with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(File No. [____]) under the Act (the "registration statement"), including a
prospectus, which registration statement incorporates by reference documents
which the Company has filed, or will file, in accordance with the provisions of
the Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the "Exchange Act"). Such registration statement has
become effective under the Act.
Except where the context otherwise requires, "Registration
Statement," as used herein, means the registration statement, as amended at the
time of such registration statement's effectiveness for purposes of Section 11
of the Act, as such section applies to the respective Underwriters (the
"Effective Time"), including (i) all documents filed as a part thereof or
incorporated or deemed to be incorporated by reference therein, (ii) any
information contained or incorporated by reference in a prospectus filed with
the Commission pursuant to Rule 424(b) under the Act, to the extent such
information is deemed, pursuant to Rule 430B or Rule 430C under the Act, to be
part of the registration statement at the Effective Time, and (iii) any
registration statement filed to register the offer and sale of Shares pursuant
to Rule 462(b) under the Act.
The Company has furnished to you, for use by the Underwriters and by
dealers in connection with the offering of the Shares, copies of one or more
preliminary prospectus supplements, and the documents incorporated by reference
therein, relating to the Shares. Except where the context otherwise requires,
"Pre-Pricing Prospectus," as used herein, means each such preliminary prospectus
supplement, in the form so furnished, including any basic prospectus (whether or
not in preliminary form) furnished to you by the Company and attached to or used
with such preliminary prospectus supplement. Except where the context otherwise
requires, "Basic Prospectus," as used herein, means any such basic prospectus
and any basic prospectus furnished to you by the Company and attached to or used
with the Prospectus Supplement (as defined below).
Except where the context otherwise requires, "Prospectus
Supplement," as used herein, means the final prospectus supplement, relating to
the Shares, filed by the Company with the Commission pursuant to Rule 424(b)
under the Act on or before the second business day after the date hereof (or
such earlier time as may be required under the Act), in the form furnished by
the Company to you for use by the Underwriters and by dealers in connection with
the offering of the Shares.
Except where the context otherwise requires, "Prospectus," as used
herein, means the Prospectus Supplement together with the Basic Prospectus
attached to or used with the Prospectus Supplement.
"Permitted Free Writing Prospectuses," as used herein, means the
documents listed on Schedule B attached hereto and each "road show" (as defined
in Rule 433 under the Act), if any, related to the offering of the Shares
contemplated hereby that is a "written communication" (as defined in Rule 405
under the Act). The Underwriters have not offered or sold and will not offer or
sell, without the Company's consent, any Shares by means of any "free writing
prospectus" (as defined in Rule 405 under the Act) that is required to be filed
by the Underwriters with the Commission pursuant to Rule 433 under the Act,
other than a Permitted Free Writing Prospectus.
"Disclosure Package," as used herein, means any Pre-Pricing
Prospectus or Basic Prospectus, in either case together with any combination of
one or more of the Permitted Free Writing Prospectuses, if any.
Any reference herein to the registration statement, the Registration
Statement, any Basic Prospectus, any Pre-Pricing Prospectus, the Prospectus
Supplement, the Prospectus or any Permitted Free Writing Prospectus shall be
deemed to refer to and include the documents, if any, incorporated by reference,
or deemed to be incorporated by reference, therein (the "Incorporated
Documents"), including, unless the context otherwise requires, the documents, if
any, filed as exhibits to such Incorporated Documents. Any reference herein to
the terms "amend," "amendment" or "supplement" with respect to the Registration
Statement, any Basic Prospectus, any Pre-Pricing Prospectus, the Prospectus
Supplement, the Prospectus or any Permitted Free
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Writing Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act on or after the initial effective date of the
Registration Statement, or the date of such Basic Prospectus, such Pre-Pricing
Prospectus, the Prospectus Supplement, the Prospectus or such Permitted Free
Writing Prospectus, as the case may be, and deemed to be incorporated therein by
reference.
As used in this Agreement, "business day" shall mean a day on which
the New York Stock Exchange (the "NYSE") is open for trading. The terms
"herein," "hereof," "hereto," "hereinafter" and similar terms, as used in this
Agreement, shall in each case refer to this Agreement as a whole and not to any
particular section, paragraph, sentence or other subdivision of this Agreement.
The term "or," as used herein, is not exclusive.
The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the representations and
warranties and subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from the Company the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule A attached hereto, subject to adjustment in accordance with Section 8
hereof, in each case at a purchase price of $[____] per Share. The Company is
advised by you that the Underwriters intend (i) to make a public offering of
their respective portions of the Firm Shares as soon after the effectiveness of
this Agreement as in your judgment is advisable and (ii) initially to offer the
Firm Shares upon the terms set forth in the Prospectus. You may from time to
time increase or decrease the public offering price after the initial public
offering to such extent as you may determine.
In addition, the Company hereby grants to the several Underwriters
the option (the "Over-Allotment Option") to purchase, and upon the basis of the
representations and warranties and subject to the terms and conditions herein
set forth, the Underwriters shall have the right to purchase, severally and not
jointly, from the Company, ratably in accordance with the number of Firm Shares
to be purchased by each of them, all or a portion of the Additional Shares as
may be necessary to cover over-allotments made in connection with the offering
of the Firm Shares, at the same purchase price per share to be paid by the
Underwriters to the Company for the Firm Shares. The Over-Allotment Option may
be exercised by UBS Securities LLC ("UBS") and Xxxxxxxxx & Company, Inc.
(collectively, the "Joint Book-Running Managers") on behalf of the several
Underwriters at any time and from time to time on or before the thirtieth day
following the date of the Prospectus Supplement, by written notice to the
Company. Such notice shall set forth the aggregate number of Additional Shares
as to which the Over-Allotment Option is being exercised and the date and time
when the Additional Shares are to be delivered (any such date and time being
herein referred to as an "additional time of purchase"); provided, however, that
no additional time of purchase shall be earlier than the "time of purchase" (as
defined below) nor earlier than the second business day after the date on which
the Over-Allotment Option shall have been exercised nor later than the tenth
business day after the date on which the Over-Allotment Option shall have been
exercised. The number of Additional Shares to be sold to each Underwriter shall
be the number which bears the same proportion to the aggregate number of
Additional Shares being purchased as the number of Firm Shares set forth
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opposite the name of such Underwriter on Schedule A hereto bears to the total
number of Firm Shares (subject, in each case, to such adjustment as the
Joint-Book Running Managers may determine to eliminate fractional shares),
subject to adjustment in accordance with Section 8 hereof.
2. Payment and Delivery. Payment of the purchase price for the Firm
Shares shall be made to the Company by Federal Funds wire transfer against
delivery of the certificates for the Firm Shares to you through the facilities
of The Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on [closing date], 2006 (unless another time shall be agreed to by
you and the Company or unless postponed in accordance with the provisions of
Section 8 hereof). The time at which such payment and delivery are to be made is
hereinafter sometimes called the "time of purchase." Electronic transfer of the
Firm Shares shall be made to you at the time of purchase in such names and in
such denominations as you shall specify.
Payment of the purchase price for the Additional Shares shall be
made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Electronic transfer of the Additional
Shares shall be made to you at the additional time of purchase in such names and
in such denominations as you shall specify.
Deliveries of the documents described in Section 6 hereof with
respect to the purchase of the Shares shall be made at the offices of Pillsbury
Xxxxxxxx Xxxx Xxxxxxx LLP at 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000,
at 9:00 A.M., New York City time, on the date of the closing of the purchase of
the Firm Shares or the Additional Shares, as the case may be.
3. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) the Registration Statement has heretofore become effective
under the Act or, with respect to any registration statement to be filed
to register the offer and sale of Shares pursuant to Rule 462(b) under the
Act, will be filed with the Commission and become effective under the Act
no later than 10:00 P.M., New York City time, on the date of determination
of the public offering price for the Shares; no stop order of the
Commission preventing or suspending the use of any Basic Prospectus, any
Pre-Pricing Prospectus, the Prospectus Supplement, the Prospectus or any
Permitted Free Writing Prospectus, or the effectiveness of the
Registration Statement, has been issued, and no proceedings for such
purpose have been instituted or, to the Company's knowledge, are
contemplated by the Commission;
(b) the Registration Statement complied when it became effective,
complies as of the date hereof and, as amended or supplemented, at the
time of purchase, each additional time of purchase, if any, and at all
times during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172 under the Act or
any similar rule) in connection with any sale of Shares, will comply, in
all material respects, with the requirements of the Act; the conditions to
the use of Form
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S-3 in connection with the offering and sale of the Shares as contemplated
hereby have been satisfied; the Registration Statement constitutes an
"automatic shelf registration statement" (as defined in Rule 405 under the
Act); the Company has not received, from the Commission, a notice,
pursuant to Rule 401(g)(2), of objection to the use of the automatic shelf
registration statement form; as of the determination date applicable to
the Registration Statement (and any amendment thereof) and the offering
contemplated hereby, the Company is a "well-known seasoned issuer" as
defined in Rule 405 under the Act; the Registration Statement meets, and
the offering and sale of the Shares as contemplated hereby complies with,
the requirements of Rule 415 under the Act (including, without limitation,
Rule 415(a)(5) under the Act); the Registration Statement did not, as of
the Effective Time, 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; each Pre-Pricing Prospectus
complied, at the time it was filed with the Commission, and complies as of
the date hereof, in all material respects with the requirements of the
Act; at no time during the period that begins on the earlier of the date
of such Pre-Pricing Prospectus and the date such Pre-Pricing Prospectus
was filed with the Commission and ends at the time of purchase did or will
any Pre-Pricing Prospectus, as then amended or supplemented, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and at no time
during such period did or will any Pre-Pricing Prospectus, as then amended
or supplemented, together with any combination of one or more of the then
issued Permitted Free Writing Prospectuses, if any, include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; each Basic Prospectus complied
or will comply, as of its date and the date it was or will be filed with
the Commission, complies as of the date hereof (if filed with the
Commission on or prior to the date hereof) and, at the time of purchase,
each additional time of purchase, if any, and at all times during which a
prospectus is required by the Act to be delivered (whether physically or
through compliance with Rule 172 under the Act or any similar rule) in
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connection with any sale of Shares, will comply, in all material respects,
with the requirements of the Act; at no time during the period that begins
on the earlier of the date of such Basic Prospectus and the date such
Basic Prospectus was filed with the Commission and ends at the time of
purchase did or will any Basic Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, and at no time during such period did or will any Basic
Prospectus, as then amended or supplemented, together with any combination
of one or more of the then issued Permitted Free Writing Prospectuses, if
any, include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
each of the Prospectus Supplement and the Prospectus will comply, as of
the date that it is filed with the Commission, the date of the Prospectus
Supplement, the time of purchase, each additional time of purchase, if
any, and at all times during which a prospectus is required by the Act to
be delivered (whether physically or through compliance with Rule 172 under
the Act or any similar rule) in connection with any sale of Shares, in all
material respects, with the requirements of the Act (in the case of the
Prospectus, including, without limitation, Section 10(a) of the Act); at
no time during the period that begins on the earlier of the date of the
Prospectus Supplement and the date the Prospectus Supplement is filed with
the Commission and ends at the later of the time of purchase, the latest
additional time of purchase, if any, and the end of the period during
which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares did or will any
Prospectus Supplement or the Prospectus, as then amended or supplemented,
include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; at no time
during the period that begins on the date of such Permitted Free Writing
Prospectus and ends at the time of purchase did or will any Permitted Free
Writing Prospectus include an untrue statement of a material fact or omit
to state 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 the Company makes no representation or
warranty in this Section 3(b) with respect to any statement contained in
the Registration Statement, any Pre-Pricing Prospectus, the Prospectus or
any Permitted Free Writing Prospectus in reliance upon and in conformity
with information concerning an Underwriter and furnished in writing by or
on behalf of such Underwriter through you to the Company expressly for use
in the Registration Statement, such Pre-Pricing Prospectus, the Prospectus
or such Permitted Free Writing Prospectus; each Incorporated Document, at
the time such document was filed with the Commission or at the time such
document became effective, as applicable, complied, in all material
respects, with the requirements of the Exchange Act and did not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(c) prior to the execution of this Agreement, the Company has not,
directly or indirectly, offered or sold any Shares by means of any
"prospectus" (within the meaning of the Act) or used any "prospectus"
(within the meaning of the Act) in connection with the offer or sale of
the Shares, in each case other than the Pre-Pricing Prospectuses and the
Permitted Free Writing Prospectuses, if any; the Company has not, directly
or indirectly, prepared, used or referred to any Permitted Free Writing
Prospectus except in compliance with Rule 163 or with Rules 164 and 433
under the Act; assuming that such Permitted Free Writing Prospectus is so
sent or given after the Registration Statement was filed with the
Commission (and after such Permitted Free Writing Prospectus was, if
required pursuant to Rule 433(d) under the Act, filed with the
Commission), the sending or giving, by any Underwriter, of any Permitted
Free Writing Prospectus will satisfy the provisions of Rule 164 and Rule
433 (without reliance on subsections (b), (c) and (d) of Rule 164); the
conditions set forth in one or more of subclauses (i) through (iv),
inclusive, of Rule 433(b)(1) under the Act are satisfied, and the
registration statement relating to the offering of the Shares contemplated
hereby, as initially filed with the Commission, includes a prospectus
that, other than by reason of Rule 433 or Rule 431 under the Act,
satisfies the requirements of Section 10 of the Act; neither the Company
nor the Underwriters are disqualified, by reason of subsection (f) or (g)
of Rule 164 under
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the Act, from using, in connection with the offer and sale of the Shares,
"free writing prospectuses" (as defined in Rule 405 under the Act)
pursuant to Rules 164 and 433 under the Act; the Company is not an
"ineligible issuer" (as defined in Rule 405 under the Act) as of the
eligibility determination date for purposes of Rules 164 and 433 under the
Act with respect to the offering of the Shares contemplated by the
Registration Statement; the parties hereto agree and understand that the
content of any and all "road shows" (as defined in Rule 433 under the Act)
related to the offering of the Shares contemplated hereby is solely the
property of the Company;
(d) in accordance with Rule 2710(b)(7)(C)(i) of the National
Association of Securities Dealers, Inc. (the "NASD"), the Shares have been
registered with the Commission on Form S-3 under the Act pursuant to the
standards for such Form S-3 in effect prior to October 21, 1992;
(e) as of the date of this Agreement, the Company has an
authorized and outstanding capitalization as set forth in the sections of
the Registration Statement, the Pre-Pricing Prospectuses and the
Prospectus entitled "Capitalization" and "Description of capital stock"
(and any similar sections or information, if any, contained in any
Permitted Free Writing Prospectus), and, as of the time of purchase and
any additional time of purchase, as the case may be, the Company shall
have an authorized and outstanding capitalization as set forth in the
sections of the Registration Statement, the Pre-Pricing Prospectuses and
the Prospectus entitled "Capitalization" "and "Description of capital
stock" (and any similar sections or information, if any, contained in any
Permitted Free Writing Prospectus) (subject, in each case, to the issuance
of shares of Common Stock upon exercise of stock options disclosed as
outstanding in the Registration Statement (excluding the exhibits
thereto), each Pre-Pricing Prospectus and the Prospectus or under the
Company's 1999 Employee Stock Purchase Plan (the "ESPP") or upon
conversion of the Company's 2.25% Senior Subordinated Convertible Notes
due 2024 (the "Notes") subsequent to the date as to which information is
given in the sections of the Registration Statement, the Pre-Pricing
Prospectuses and the Prospectus entitled "Capitalization" "and
"Description of capital stock") and the grant of options under existing
stock option plans described in the Registration Statement (excluding the
exhibits thereto), each Pre-Pricing Prospectus and the Prospectus); all of
the issued and outstanding shares of capital stock, including the Common
Stock, of the Company have been duly authorized and validly issued and are
fully paid and non-assessable, have been issued in compliance with all
applicable securities laws and were not issued in violation of any
preemptive right, resale right, right of first refusal or similar right;
the Shares are duly listed, and admitted and authorized for trading,
subject to official notice of issuance, on the Nasdaq National Market"
(the "NASDAQ");
(f) the Company has been duly incorporated and is validly existing
as a corporation under the laws of the State of Washington, with full
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement, the
Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any, to execute and deliver this Agreement and to issue,
sell and deliver the Shares as contemplated herein;
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(g) the Company is duly qualified to do business as a foreign
corporation and (where applicable) is in good standing in each
jurisdiction where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing would not, individually or
in the aggregate, either (i) have a material adverse effect on the
business, properties, financial condition, results of operations or
prospects of the Company and the Subsidiaries (as defined below) taken as
a whole, (ii) prevent or materially interfere with consummation of the
transactions contemplated hereby or (iii) result in the delisting of
shares of Common Stock from the NASDAQ (the occurrence of any such effect
or any such prevention or interference or any such result described in the
foregoing clauses (i), (ii) and (iii) being herein referred to as a
"Material Adverse Effect");
(h) the Company has no subsidiaries (as defined under the Act)
other than those listed on Exhibit 21.1 to the Company's Annual Report on
Form 10-K for the year ended December 31, 2005 (collectively, the
"Subsidiaries"); the Company owns all of the issued and outstanding
capital stock of each of the Subsidiaries; other than the capital stock of
the Subsidiaries, the Company does not own, directly or indirectly, any
shares of stock or any other equity interests or long-term debt securities
of any corporation, firm, partnership, joint venture, association or other
entity; complete and correct copies of the charters and the bylaws of the
Company and each Subsidiary and all amendments thereto have been delivered
or made available to you or your representatives, and no changes therein
will be made on or after the date hereof through and including the time of
purchase or, if later, any additional time of purchase; each Subsidiary
has been duly incorporated and is validly existing as a corporation in
good standing (where applicable) under the laws of the jurisdiction of its
incorporation, with full corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement, the Pre-Pricing Prospectuses, the Prospectus and
the Permitted Free Writing Prospectuses, if any; each Subsidiary is duly
qualified to do business as a foreign corporation and is in good standing
in each jurisdiction where the ownership or leasing of its properties or
the conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing would not, individually or
in the aggregate, have a Material Adverse Effect; all of the outstanding
shares of capital stock of each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable, have
been issued in compliance with all applicable securities laws, were not
issued in violation of any preemptive right, resale right, right of first
refusal or similar right and are owned by the Company subject to no
security interest, other encumbrance or adverse claims; no options,
warrants or other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligation into shares of capital
stock or ownership interests in the Subsidiaries are outstanding; other
than SBI Holdings Inc., aQuantive Australia Pty Ltd, aQuantive
International Holdings, Inc., a Quantive Paymaster LLC , Atlas DMT LLC,
Atlas Europe LTD, Atlas OnePoint LLC, AVENUE A LLC, Avenue A/Razorfish
Philadelphia LLC, Avenue A/Razorfish, Inc, DNA COMPUTERS LTD, Drive
Performance Media, LLC, Xxxx.xxx Ltd, and Mediabrokers Limited
(collectively, the "Active Subsidiaries"), no Subsidiary owns or possesses
any property or assets, or has any obligations or liabilities,
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or possesses any rights (by contract, franchise, permit or otherwise) or
engages in any operations; none of the Subsidiaries (other than the Active
Subsidiaries incorporated or organized under the laws of any of the
several U.S. States) is a "significant subsidiary," as that term is
defined in Rule 1-02(w) of Regulation S-X under the Act.
(i) the Shares have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued, fully paid and non-assessable and free of
statutory and contractual preemptive rights, resale rights, rights of
first refusal and similar rights; the Shares, when issued and delivered
against payment therefor as provided herein, will be free of any
restriction upon the voting or transfer thereof pursuant to the Company's
charter or bylaws or any agreement or other instrument to which the
Company is a party;
(j) the capital stock of the Company, including the Shares,
conforms in all material respects to each description thereof, if any,
contained or incorporated by reference in the Registration Statement, the
Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any; and the certificates for the Shares are in due and
proper form;
(k) this Agreement has been duly authorized, executed and
delivered by the Company;
(l) neither the Company nor any of the Subsidiaries is in breach
or violation of or in default under (nor has any event occurred which,
with notice, lapse of time or both, would result in any breach or
violation of, constitute a default under or give the holder of any
indebtedness (or a person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under) (A) its charter or bylaws, or (B) any indenture,
mortgage, deed of trust, bank loan or credit agreement or other evidence
of indebtedness, or any license, lease, contract or other agreement or
instrument to which it is a party or by which it or any of its properties
may be bound or affected, or (C) any federal, state, local or foreign law,
regulation or rule, or (D) any rule or regulation of any self-regulatory
organization or other non-governmental regulatory authority (including,
without limitation, the rules and regulations of the NASDAQ), or (E) any
decree, judgment or order applicable to it or any of its properties;
except, in the cases of subsection (B), (C) and (D) where such occurrence
would not, individually or in the aggregate, have a Material Adverse
Effect.
(m) the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares and the consummation of the transactions
contemplated hereby will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any event
which, with notice, lapse of time or both, would result in any breach or
violation of, constitute a default under or give the holder of any
indebtedness (or a person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under) (or result in the creation or imposition of a lien,
charge or encumbrance on any property or assets of the Company or any
Subsidiary pursuant to) (A) the charter or bylaws of the Company or
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any of the Subsidiaries, or (B) any indenture, mortgage, deed of trust,
bank loan or credit agreement or other evidence of indebtedness, or any
license, lease, contract or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which any of them or
any of their respective properties may be bound or affected, or (C) any
federal, state, local or foreign law, regulation or rule, or (D) any rule
or regulation of any self-regulatory organization or other
non-governmental regulatory authority (including, without limitation, the
rules and regulations of the NASDAQ), or (E) any decree, judgment or order
applicable to the Company or any of the Subsidiaries or any of their
respective properties; except, in the cases of subsection (B), (C) and (D)
where such occurrence would not, individually or in the aggregate, have a
Material Adverse Effect.
(n) no approval, authorization, consent or order of or filing with
any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or of or with any
self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the NASDAQ), or approval of the
shareholders of the Company, is required in connection with the issuance
and sale of the Shares or the consummation by the Company of the
transactions contemplated hereby, other than (i) registration of the
Shares under the Act, which has been effected (or, with respect to any
registration statement to be filed hereunder pursuant to Rule 462(b) under
the Act, will be effected in accordance herewith), (ii) any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the Underwriters or
(iii) under the Conduct Rules of the NASD;
(o) except as described in the Registration Statement (excluding
the exhibits thereto), each Pre-Pricing Prospectus and the Prospectus, (i)
no person has the right, contractual or otherwise, to cause the Company to
issue or sell to it any shares of Common Stock or shares of any other
capital stock or other equity interests of the Company, (ii) no person has
any preemptive rights, resale rights, rights of first refusal or other
rights to purchase any shares of Common Stock or shares of any other
capital stock of or other equity interests in the Company and (iii) no
person has the right to act as an underwriter or as a financial advisor to
the Company in connection with the offer and sale of the Shares; no person
has the right, contractual or otherwise, to cause the Company to register
under the Act any shares of Common Stock or shares of any other capital
stock of or other equity interests in the Company, or to include any such
shares or interests in the Registration Statement or the offering
contemplated thereby;
(p) each of the Company and the Subsidiaries has all necessary
licenses, authorizations, consents and approvals and has made all
necessary filings required under any applicable law, regulation or rule,
and has obtained all necessary licenses, authorizations, consents and
approvals from other persons, in order to conduct their respective
businesses; neither the Company nor any of the Subsidiaries is in
violation of, or in default under, or has received notice of any
proceedings relating to revocation or modification of, any such license,
authorization, consent or approval or any federal, state, local or foreign
law, regulation or rule or any decree, order or judgment applicable to the
Company or any of the Subsidiaries, except where such violation, default,
revocation or modification would not, individually or in the aggregate,
have a Material Adverse Effect;
- 10 -
(q) there are no actions, suits, claims, investigations or
proceedings pending or, to the Company's knowledge, threatened or
contemplated to which the Company or any of the Subsidiaries or any of
their respective directors or officers is or would be a party or of which
any of their respective properties is or would be subject at law or in
equity, before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency, or before or by
any self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the NASDAQ), except any such
action, suit, claim, investigation or proceeding which is described in the
Registration Statement Pre-Pricing Prospectuses and Prospectus or which,
if resolved adversely to the Company or any Subsidiary, would not,
individually or in the aggregate, have a Material Adverse Effect; KPMG
LLP, whose report on the consolidated financial statements of the Company
and the Subsidiaries is included or incorporated by reference in the
Registration Statement, the Pre-Pricing Prospectuses and the Prospectus,
are independent registered public accountants as required by the Act and
by the rules of the Public Company Accounting Oversight Board;
(r) the financial statements included or incorporated by reference
in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, together
with the related notes and schedules, present fairly the consolidated
financial position of the Company and the Subsidiaries as of the dates
indicated and the consolidated results of operations, cash flows and
changes in shareholders' equity of the Company for the periods specified
and have been prepared in compliance with the requirements of the Act and
Exchange Act and in conformity with U.S. generally accepted accounting
principles applied on a consistent basis during the periods involved; all
pro forma financial statements or data included or incorporated by
reference in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, comply
with the requirements of the Act and the Exchange Act, and the assumptions
used in the preparation of such pro forma financial statements and data
are reasonable, the pro forma adjustments used therein are appropriate to
give effect to the transactions or circumstances described therein and the
pro forma adjustments have been properly applied to the historical amounts
in the compilation of those statements and data; the other financial and
statistical data contained or incorporated by reference in the
Registration Statement, the Pre-Pricing Prospectuses, the Prospectus and
the Permitted Free Writing Prospectuses, if any, are accurately and fairly
presented and prepared on a basis consistent with the financial statements
and books and records of the Company; there are no financial statements
(historical or pro forma) that are required to be included or incorporated
by reference in the Registration Statement, any Pre-Pricing Prospectus or
the Prospectus that are not included or incorporated by reference as
required; the Company and the Subsidiaries do not have any material
liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described in the Registration
Statement (excluding the exhibits thereto), each Pre-Pricing Prospectus
and the Prospectus; and all disclosures contained or incorporated by
reference in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, regarding
"non-GAAP financial measures" (as such term is defined by the rules and
regulations of the Commission) comply with Regulation G of the Exchange
Act and Item 10 of Regulation
- 11 -
S-K under the Act, to the extent applicable;
(s) subsequent to the respective dates as of which information is
given in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, in each
case excluding any amendments or supplements to the foregoing made after
the execution of this Agreement, there has not been (i) any material
adverse change, or any development involving a prospective material
adverse change, in the business, properties, management, financial
condition or results of operations of the Company and the Subsidiaries
taken as a whole, (ii) any transaction which is material to the Company
and the Subsidiaries taken as a whole, (iii) any obligation or liability,
direct or contingent (including any off-balance sheet obligations),
incurred by the Company or any Subsidiary, which is material to the
Company and the Subsidiaries taken as a whole, (iv) any change in the
capital stock (except for the issuance of stock pursuant to the exercise
of stock options outstanding as of the dates as of which information is
given in the Registration Statement, the Pre-Pricing Prospectuses and the
Prospectus or pursuant to the ESPP or upon conversion of the Notes) or
outstanding long-term indebtedness of the Company or any Subsidiaries or
(v) any dividend or distribution of any kind declared, paid or made on the
capital stock of the Company or any Subsidiary;
(t) the Company has obtained for the benefit of the Underwriters
the agreement (a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of each of its directors and "officers" (within the meaning of
Rule 16a-1(f) under the Exchange Act);
(u) neither the Company nor any Subsidiary is, and, after giving
effect to the offering and sale of the Shares, neither of them will be, an
"investment company" or an entity "controlled" by an "investment company,"
as such terms are defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act");
(v) the Company and each of the Subsidiaries have good and
marketable title to all property (real and personal) described the
Registration Statement, the Pre-Pricing Prospectuses, the Prospectus and
the Permitted Free Writing Prospectuses, if any, as being owned by any of
them, free and clear of all liens, claims, security interests or other
encumbrances; all the property described in the Registration Statement,
the Pre-Pricing Prospectuses, the Prospectus and the Permitted Free
Writing Prospectuses, if any, as being held under lease by the Company or
a Subsidiary is held thereby under valid, subsisting and enforceable
leases;
(w) the Company and the Subsidiaries own, or have obtained valid
and enforceable licenses for, or other rights to use, the inventions,
patent applications, patents, trademarks (both registered and
unregistered), tradenames, service names, copyrights, trade secrets and
other proprietary information described in the Registration Statement, the
Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any, as being owned or licensed by them or which are
necessary for the conduct of their respective businesses as currently
conducted or as proposed to be
- 12 -
conducted, except where the failure to own, license or have such rights
would not, individually or in the aggregate, have a Material Adverse
Effect (collectively, "Intellectual Property"); (i) there are no third
parties who have or, to the Company's knowledge, will be able to establish
rights to any Intellectual Property owned by the Company or Subsidiary,
except for, and to the extent of, the ownership rights of the owners of
the Intellectual Property which the Registration Statement (excluding the
exhibits thereto), each Pre-Pricing Prospectus and the Prospectus disclose
is licensed to the Company; (ii) to the knowledge of the Company, there is
no material infringement by third parties of any Intellectual Property;
(iii) there is no pending or, to the Company's knowledge, threatened
action, suit, proceeding or claim by others challenging the Company's
rights in or to any Intellectual Property, and the Company is unaware of
any facts which could form a reasonable basis for any such action, suit,
proceeding or claim; (iv) there is no pending or, to the Company's
knowledge, threatened action, suit, proceeding or claim by others
challenging the validity, enforceability or scope of any Intellectual
Property, and the Company is unaware of any facts which could form a
reasonable basis for any such action, suit, proceeding or claim except for
such actions, suits, proceedings or claims which would not, individually
or in the aggregate, have a Material Adverse Effect; (v) there is no
pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company or any Subsidiary infringes
or otherwise violates any patent, trademark, tradename, service name,
copyright, trade secret or other proprietary rights of others, and the
Company is unaware of any facts which could form a reasonable basis for
any such action, suit, proceeding or claim; (vi) the Company and the
Subsidiaries have complied in all material respects with the terms of each
agreement pursuant to which Intellectual Property has been licensed to the
Company or any Subsidiary, and all such agreements are in full force and
effect; and (vii) to the knowledge of the Company, there is no prior art
that may render any patent application within the Intellectual Property
unpatentable that has not been disclosed to the U.S. Patent and Trademark
Office;
(x) neither the Company nor any of the Subsidiaries is engaged in
any unfair labor practice; except for matters which would not,
individually or in the aggregate, have a Material Adverse Effect, (i)
there is (A) no unfair labor practice complaint pending or, to the
Company's knowledge, threatened against the Company or any of the
Subsidiaries before the National Labor Relations Board, and no grievance
or arbitration proceeding arising out of or under collective bargaining
agreements is pending or, to the Company's knowledge, threatened, (B) no
strike, labor dispute, slowdown or stoppage pending or, to the Company's
knowledge, threatened against the Company or any of the Subsidiaries and
(C) no union representation dispute currently existing concerning the
employees of the Company or any of the Subsidiaries, (ii) to the Company's
knowledge, no union organizing activities are currently taking place
concerning the employees of the Company or any of the Subsidiaries and
(iii) there has been no violation of any federal, state, local or foreign
law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour laws or any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") or the rules and
regulations promulgated thereunder concerning the employees of the Company
or any of the Subsidiaries;
- 13 -
(y) the Company and the Subsidiaries and their respective
properties, assets and operations are in compliance with, and the Company
and each of the Subsidiaries hold all permits, authorizations and
approvals required under, Environmental Laws (as defined below), except to
the extent that failure to so comply or to hold such permits,
authorizations or approvals would not, individually or in the aggregate,
have a Material Adverse Effect; there are no past, present or, to the
Company's knowledge, reasonably anticipated future events, conditions,
circumstances, activities, practices, actions, omissions or plans that
could reasonably be expected to give rise to any material costs or
liabilities to the Company or any Subsidiary under, or to interfere with
or prevent compliance by the Company or any Subsidiary with, Environmental
Laws; except as would not, individually or in the aggregate, have a
Material Adverse Effect, neither the Company nor any of the Subsidiaries
(i) is the subject of any investigation, (ii) has received any notice or
claim, (iii) is a party to or affected by any pending or, to the Company's
knowledge, threatened action, suit or proceeding, (iv) is bound by any
judgment, decree or order or (v) has entered into any agreement, in each
case relating to any alleged violation of any Environmental Law or any
actual or alleged release or threatened release or cleanup at any location
of any Hazardous Materials (as defined below) (as used herein,
"Environmental Law" means any federal, state, local or foreign law,
statute, ordinance, rule, regulation, order, decree, judgment, injunction,
permit, license, authorization or other binding requirement, or common
law, relating to health, safety or the protection, cleanup or restoration
of the environment or natural resources, including those relating to the
distribution, processing, generation, treatment, storage, disposal,
transportation, other handling or release or threatened release of
Hazardous Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous or
toxic substances or wastes) that is regulated by or may give rise to
liability under any Environmental Law);
(z) all tax returns required to be filed by the Company or any of
the Subsidiaries have been timely filed, and all taxes and other
assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties
applicable thereto due or claimed to be due from such entities have been
timely paid, other than those being contested in good faith and for which
adequate reserves have been provided;
(aa) the Company and each of the Subsidiaries maintain insurance
covering their respective properties, operations, personnel and businesses
as the Company reasonably deems adequate; such insurance insures against
such losses and risks to an extent which is adequate in accordance with
customary industry practice to protect the Company and the Subsidiaries
and their respective businesses; all such insurance is fully in force on
the date hereof and will be fully in force at the time of purchase and
each additional time of purchase, if any; neither the Company nor any
Subsidiary has reason to believe that it will not be able to renew any
such insurance as and when such insurance expires;
(bb) neither the Company nor any Subsidiary has sent or received
any communication regarding termination of, or intent not to renew, any of
the contracts or
- 14 -
agreements referred to or described in any Pre-Pricing Prospectus, the
Prospectus or any Permitted Free Writing Prospectus, or referred to or
described in, or filed as an exhibit to, the Registration Statement or any
Incorporated Document, and no such termination or non-renewal has been
threatened by the Company or any Subsidiary or, to the Company's
knowledge, any other party to any such contract or agreement except for
matters which would not, individually or in the aggregate, have a Material
Adverse Effect;
(cc) the Company and each of the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(dd) the Company has established and maintains and evaluates
"disclosure controls and procedures" (as such term is defined in Rule
13a-15 and 15d-15 under the Exchange Act) and "internal control over
financial reporting" (as such term is defined in Rule 13a-15 and 15d-15
under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Company,
including its consolidated subsidiaries, is made known to the Company's
Chief Executive Officer and its Chief Financial Officer by others within
those entities, and such disclosure controls and procedures are effective
to perform the functions for which they were established; the Company's
independent auditors and the Audit Committee of the Board of Directors of
the Company have been advised of: (i) all significant deficiencies, if
any, in the design or operation of internal controls which could adversely
affect the Company's ability to record, process, summarize and report
financial data; and (ii) all fraud, if any, whether or not material, that
involves management or other employees who have a role in the Company's
internal controls; all material weaknesses, if any, in internal controls
have been identified to the Company's independent auditors; since the date
of the most recent evaluation of such disclosure controls and procedures
and internal controls, there have been no significant changes in internal
controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses; the principal executive officers (or
their equivalents) and principal financial officers (or their equivalents)
of the Company have made all certifications required by the Xxxxxxxx-Xxxxx
Act of 2002 (the "Xxxxxxxx-Xxxxx Act") and any related rules and
regulations promulgated by the Commission, and the statements contained in
each such certification are complete and correct; the Company, the
Subsidiaries and the Company's directors and officers are each in
compliance in all material respects with all applicable effective
provisions of the Xxxxxxxx-Xxxxx Act and the rules and regulations of the
Commission and the NASDAQ promulgated thereunder;
(ee) each "forward-looking statement" (within the meaning of
Section 27A of
- 15 -
the Act or Section 21E of the Exchange Act) contained or incorporated by
reference in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, has been
made or reaffirmed with a reasonable basis and in good faith;
(ff) all statistical, industry-related or market-related data
included or incorporated by reference in the Registration Statement, the
Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any, are based on or derived from sources that the
Company reasonably believes to be reliable and accurate, and the Company
has obtained the written consent to the use of such data from such sources
to the extent required;
(gg) neither the Company nor any of the Subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary
or received or retained any funds in violation of any law, rule or
regulation (including, without limitation, the Foreign Corrupt Practices
Act of 1977), which payment, receipt or retention of funds is of a
character required to be disclosed in the Registration Statement, any
Pre-Pricing Prospectus or the Prospectus;
(hh) the issuance and sale of the Shares as contemplated hereby
will not cause any holder of any shares of capital stock, securities
convertible into or exchangeable or exercisable for capital stock or
options, warrants or other rights to purchase capital stock or any other
securities of the Company to have any right to acquire any shares of
preferred stock of the Company;
(ii) the Company has not received any notice from the NASDAQ
regarding the delisting of the Common Stock from the NASDAQ;
(jj) except pursuant to this Agreement, neither the Company nor any
of the Subsidiaries has incurred any liability for any finder's or
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby or by the Registration Statement;
(kk) neither the Company nor any of the Subsidiaries nor any of
their respective directors or officers (or, to the actual knowledge of the
Company, any of their affiliates or controlling persons) has taken,
directly or indirectly, any action designed, or which has constituted or
might reasonably be expected to cause or result in the stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Shares; and
(ll) to the Company's knowledge, there are no affiliations or
associations between (i) any member of the NASD and (ii) the Company or
any of the Company's officers, directors or 5% or greater security holders
or any beneficial owner of the Company's unregistered equity securities
that were acquired at any time on or after the 180th day immediately
preceding the date the Registration Statement was initially filed
- 16 -
with the Commission, except as disclosed in the Registration Statement
(excluding the exhibits thereto), the Pre-Pricing Prospectuses and the
Prospectus.
In addition, any certificate signed by any officer of the Company or
any of the Subsidiaries and delivered to the Underwriters or counsel for the
Underwriters in connection with the offering of the Shares shall be deemed to be
a representation and warranty by the Company, as to matters covered thereby, to
each Underwriter.
4. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise
to cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you
may designate and to maintain such qualifications in effect so long as you
may request for the distribution of the Shares; provided, however, that
the Company shall not be required to qualify as a foreign corporation or
to consent to the service of process under the laws of any such
jurisdiction (except service of process with respect to the offering and
sale of the Shares); and to promptly advise you of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Shares for offer or sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as
soon as practicable after this Agreement becomes effective, and thereafter
from time to time to furnish to the Underwriters, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company
shall have made any amendments or supplements thereto after the effective
date of the Registration Statement) as the Underwriters may reasonably
request for the purposes contemplated by the Act; in case any Underwriter
is required to deliver (whether physically or through compliance with Rule
172 under the Act or any similar rule), in connection with the sale of the
Shares, a prospectus after the nine-month period referred to in Section
10(a)(3) of the Act, or after the time a post-effective amendment to the
Registration Statement is required pursuant to Item 512(a) of Regulation
S-K under the Act, the Company will prepare, at its expense, promptly upon
request such amendment or amendments to the Registration Statement and the
Prospectus as may be necessary to permit compliance with the requirements
of Section 10(a)(3) of the Act or Item 512(a) of Regulation S-K under the
Act, as the case may be;
(c) if, at the time this Agreement is executed and delivered, it
is necessary or appropriate for a post-effective amendment to the
Registration Statement, or a Registration Statement under Rule 462(b)
under the Act, to be filed with the Commission and become effective before
the Shares may be sold, the Company will use its best efforts to cause
such post-effective amendment or such Registration Statement to be filed
and become effective, and will pay any applicable fees in accordance with
the Act, as soon as possible; and the Company will advise you promptly
and, if requested by you, will confirm such advice in writing, (i) when
such post-effective amendment or such Registration Statement has become
effective, and (ii) if Rule 430A under the Act is used,
- 17 -
when the Prospectus is filed with the Commission pursuant to Rule 424(b)
under the Act (which the Company agrees to file in a timely manner in
accordance with such Rules);
(d) if, at any time during the period when a prospectus is
required by the Act to be delivered (whether physically or through
compliance with Rule 172 under the Act or any similar rule) in connection
with any sale of Shares, the Registration Statement shall cease to comply
with the requirements of the Act with respect to eligibility for the use
of the form on which the Registration Statement was filed with the
Commission or the Registration Statement shall cease to be an "automatic
shelf registration statement" (as defined in Rule 405 under the Act) or
the Company shall have received, from the Commission, a notice, pursuant
to Rule 401(g)(2), of objection to the use of the form on which the
Registration Statement was filed with the Commission, to (i) promptly
notify you, (ii) promptly file with the Commission a new registration
statement under the Act, relating to the Shares, or a post-effective
amendment to the Registration Statement, which new registration statement
or post-effective amendment shall comply with the requirements of the Act
and shall be in a form satisfactory to you, (iii) use its best efforts to
cause such new registration statement or post-effective amendment to
become effective under the Act as soon as practicable, (iv) promptly
notify you of such effectiveness and (v) take all other action necessary
or appropriate to permit the public offering and sale of the Shares to
continue as contemplated in the Prospectus; all references herein to the
Registration Statement shall be deemed to include each such new
registration statement or post-effective amendment, if any;
(e) if the third anniversary of the initial effective date of the
Registration Statement (within the meaning of Rule 415(a)(5) under the
Act) shall occur at any time during the period when a prospectus is
required by the Act to be delivered (whether physically or through
compliance with Rule 172 under the Act or any similar rule) in connection
with any sale of Shares, to file with the Commission, prior to such third
anniversary, a new registration statement under the Act relating to the
Shares, which new registration statement shall comply with the
requirements of the Act (including, without limitation, Rule 415(a)(6)
under the Act) and shall be in a form satisfactory to you; such new
registration statement shall constitute an "automatic shelf registration
statement" (as defined in Rule 405 under the Act); provided, however, that
if the Company is not then eligible to file an "automatic shelf
registration statement" (as defined in Rule 405 under the Act), then such
new registration statement need not constitute an "automatic shelf
registration statement" (as defined in Rule 405 under the Act), but the
Company shall use its best efforts to cause such new registration
statement to become effective under the Act as soon as practicable, but in
any event within 180 days after such third anniversary and promptly notify
you of such effectiveness; the Company shall take all other action
necessary or appropriate to permit the public offering and sale of the
Shares to continue as contemplated in the Prospectus; all references
herein to the Registration Statement shall be deemed to include each such
new registration statement, if any;
(f) to advise you promptly, confirming such advice in writing, of
any request by the Commission for amendments or supplements to the
Registration Statement, any Pre-Pricing Prospectus, the Prospectus or any
Permitted Free Writing Prospectus or for
- 18 -
additional information with respect thereto, or of notice of institution
of proceedings for, or the entry of a stop order, suspending the
effectiveness of the Registration Statement and, if the Commission should
enter a stop order suspending the effectiveness of the Registration
Statement, to use its best efforts to obtain the lifting or removal of
such order as soon as possible; to advise you promptly of any proposal to
amend or supplement the Registration Statement, any Pre-Pricing Prospectus
or the Prospectus, and to provide you and Underwriters' counsel copies of
any such documents for review and comment a reasonable amount of time
prior to any proposed filing and to file no such amendment or supplement
to which you shall object in writing;
(g) subject to Section 4(f) hereof, to file promptly all reports
and documents and any preliminary or definitive proxy or information
statement required to be filed by the Company with the Commission in order
to comply with the Exchange Act for so long as a prospectus is required by
the Act to be delivered (whether physically or through compliance with
Rule 172 under the Act or any similar rule) in connection with any sale of
Shares; and to provide you, for your review and comment, with a copy of
such reports and statements and other documents to be filed by the Company
pursuant to Section 13, 14 or 15(d) of the Exchange Act during such period
a reasonable amount of time prior to any proposed filing, and to file no
such report, statement or document to which you shall have objected in
writing; and to promptly notify you of such filing;
(h) to pay the fees applicable to the Registration Statement in
connection with the offering of the Shares within the time required by
Rule 456(b)(1)(i) under the Act (without reliance on the proviso to Rule
456(b)(1)(i) under the Act) and in compliance with Rule 456(b) and Rule
457(r) under the Act;
(i) to advise the Underwriters promptly of the happening of any
event within the period during which a prospectus is required by the Act
to be delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection with any sale of Shares,
which event could require the making of any change in the Prospectus then
being used so that the Prospectus would not include an untrue statement of
a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they are made, not misleading, and to advise the Underwriters promptly if,
during such period, it shall become necessary to amend or supplement the
Prospectus to cause the Prospectus to comply with the requirements of the
Act, and, in each case, during such time, subject to Section 4(f) hereof,
to prepare and furnish, at the Company's expense, to the Underwriters
promptly such amendments or supplements to such Prospectus as may be
necessary to reflect any such change or to effect such compliance;
(j) to make generally available to its security holders, and to
deliver to you, an earnings statement of the Company (which will satisfy
the provisions of Section 11(a) of the Act) covering a period of twelve
months beginning after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act) as soon as is reasonably
practicable after the termination of such twelve-month period but in any
case not later than May 10, 2007;
- 19 -
(k) to furnish to you five copies of the Registration Statement,
as initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto and documents incorporated by reference
therein) and sufficient copies of the foregoing (other than exhibits) for
distribution of a copy to each of the other Underwriters;
(l) to furnish to you as early as practicable prior to the time of
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and monthly consolidated financial statements, if any,
of the Company and the Subsidiaries which have been read by the Company's
independent registered public accountants, as stated in their letter to be
furnished pursuant to Section 6(b) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of proceeds" in the Prospectus
Supplement;
(n) except as set forth in a side letter agreement dated the date
hereof relating to certain fees and expenses to be paid by the
Underwriters on behalf of the Company, to pay all costs, expenses, fees
and taxes in connection with (i) the preparation and filing of the
Registration Statement, each Basic Prospectus, each Pre-Pricing
Prospectus, the Prospectus Supplement, the Prospectus, each Permitted Free
Writing Prospectus and any amendments or supplements thereto, and the
printing and furnishing of copies of each thereof to the Underwriters and
to dealers (including costs of mailing and shipment), (ii) the
registration, issue, sale and delivery of the Shares including any stock
or transfer taxes and stamp or similar duties payable upon the sale,
issuance or delivery of the Shares to the Underwriters, (iii) the
producing, word processing and/or printing of this Agreement, any
Agreement Among Underwriters, any dealer agreements, any Powers of
Attorney and any closing documents (including compilations thereof) and
the reproduction and/or printing and furnishing of copies of each thereof
to the Underwriters and (except closing documents) to dealers (including
costs of mailing and shipment), (iv) the qualification of the Shares for
offering and sale under state or foreign laws and the determination of
their eligibility for investment under state or foreign law (including the
legal fees and filing fees and other disbursements of counsel for the
Underwriters) and the printing and furnishing of copies of any blue sky
surveys or legal investment surveys to the Underwriters and to dealers,
(v) any listing of the Shares on any securities exchange or qualification
of the Shares for quotation on the NASDAQ and any registration thereof
under the Exchange Act, (vi) any filing for review of the public offering
of the Shares by the NASD, including the legal fees and filing fees and
other disbursements of counsel to the Underwriters relating to NASD
matters, (vii) the fees and disbursements of any transfer agent or
registrar for the Shares, (viii) the costs and expenses of the Company
relating to presentations or meetings undertaken in connection with the
marketing of the offering and sale of the Shares to prospective investors
and the Underwriters' sales forces, including, without limitation,
expenses associated with the production of road show slides and graphics,
fees and expenses of any consultants engaged in connection with the road
show presentations, travel, lodging and other expenses incurred by the
officers of the Company and any such consultants, and the cost
- 20 -
of any aircraft chartered in connection with the road show, and (ix) the
performance of the Company's other obligations hereunder; provided,
however, that in no event shall the Company be required to pay the legal
fees for counsel to the Underwriters, except as provided herein;
(o) to comply with Rule 433(d) under the Act (without reliance on
Rule 164(b) under the Act) and with Rule 433(g) under the Act;
(p) beginning on the date hereof and ending on, and including, the
date that is 90 days after the date of the Prospectus Supplement (the
"Lock-Up Period"), without the prior written consent of the Joint
Book-Running Managers, not to (i) issue, sell, offer to sell, contract or
agree to sell, hypothecate, pledge, grant any option to purchase or
otherwise dispose of or agree to dispose of, directly or indirectly, or
establish or increase a put equivalent position or liquidate or decrease a
call equivalent position within the meaning of Section 16 of the Exchange
Act and the rules and regulations of the Commission promulgated
thereunder, with respect to, any Common Stock or any other securities of
the Company that are substantially similar to Common Stock, or any
securities convertible into or exchangeable or exercisable for, or any
warrants or other rights to purchase, the foregoing, (ii) file or cause to
become effective a registration statement under the Act relating to the
offer and sale of any Common Stock or any other securities of the Company
that are substantially similar to Common Stock, or any securities
convertible into or exchangeable or exercisable for, or any warrants or
other rights to purchase, the foregoing, (iii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of
the economic consequences of ownership of Common Stock or any other
securities of the Company that are substantially similar to Common Stock,
or any securities convertible into or exchangeable or exercisable for, or
any warrants or other rights to purchase, the foregoing, whether any such
transaction is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise or (iv) publicly announce an intention to
effect any transaction specified in clause (i), (ii) or (iii), except, in
each case, for (A) the registration of the offer and sale of the Shares as
contemplated by this Agreement, (B) issuances of Common Stock upon the
exercise of options disclosed as outstanding in the Registration Statement
(excluding the exhibits thereto), each Pre-Pricing Prospectus and the
Prospectus, (C) the issuance of employee stock options not exercisable
(other than pursuant to provisions for automatic acceleration of
exercisability in connection with a change in control of the Company)
during the Lock-Up Period pursuant to stock option plans described in the
Registration Statement (excluding the exhibits thereto), each Pre-Pricing
Prospectus and the Prospectus, and (D) issuances of Common Stock pursuant
to the ESPP or upon conversion of the Notes; provided, however, that if
(a) during the period that begins on the date that is fifteen (15)
calendar days plus
- 21 -
three (3) business days before the last day of the Lock-Up Period and ends
on the last day of the Lock-Up Period, the Company issues an earnings
release or material news or a material event relating to the Company
occurs; or (b) prior to the expiration of the Lock-Up Period, the Company
announces that it will release earnings results during the sixteen (16)
day period beginning on the last day of the Lock-Up Period, then the
restrictions imposed by this Section 4(p) shall continue to apply until
the expiration of the date that is fifteen (15) calendar days plus three
(3) business days after the date on which the issuance of the earnings
release or the material news or material event occurs; provided, however,
that the immediately preceding proviso shall not apply if (i) the Company
meets the applicable requirements of the safe harbor provided by Rule 139
under the Act in the manner contemplated by Rule 2711(f)(4) of the NASD,
and (ii) within the 3 business days preceding the 15th calendar day before
the last day of the Lock-Up Period, the Company delivers (in accordance
with the notice provisions of this Agreement) to the Joint Book-Running
Managers a certificate, signed by the Chief Financial Officer or Chief
Executive Officer of the Company, certifying on behalf of the Company that
the Company's shares of Common Stock are "actively traded securities,"
within the meaning of Rule 2711(f)(4) of the NASD.
(q) prior to the time of purchase, to issue no press release or
other communication directly or indirectly and hold no press conferences
with respect to the Company or any Subsidiary, the financial condition,
results of operations, business, properties, assets, or liabilities of the
Company or any Subsidiary, or the offering of the Shares, without your
prior consent;
(r) not, at any time at or after the execution of this Agreement,
to, directly or indirectly, offer or sell any Shares by means of any
"prospectus" (within the meaning of the Act), or use any "prospectus"
(within the meaning of the Act) in connection with the offer or sale of
the Shares, in each case other than the Prospectus;
(s) not to, and to cause the Subsidiaries not to, take, directly
or indirectly, any action designed, or which will constitute, or has
constituted, or might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(t) to use its best efforts to cause the Shares to be listed for
quotation on the NASDAQ and to maintain the listing of the Common Stock,
including the Shares, for quotation on the NASDAQ; and
(u) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common
Stock.
5. Reimbursement of Underwriters' Expenses. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the fifth paragraph of Section 8 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 4(n) hereof,
reimburse the Underwriters for all of their out-of-pocket expenses, including
the fees and disbursements of their counsel.
6. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters hereunder are subject to the accuracy of the representations
and warranties on the part of the Company on the date hereof, at the time of
purchase and, if applicable, at the additional time of purchase, the performance
by the Company of its obligations hereunder and to
- 22 -
the following additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase and,
if applicable, at the additional time of purchase, an opinion of Xxxxxxx
Coie LLP, counsel for the Company, addressed to the Underwriters, and
dated the time of purchase or the additional time of purchase, as the case
may be, with executed copies for each of the other Underwriters, and in
form and substance satisfactory to the Joint Book-Running Managers, in the
form set forth in Exhibit B hereto.
(b) You shall have received from KPMG LLP letters dated,
respectively, the date of this Agreement, the date of the Prospectus
Supplement, the time of purchase and, if applicable, the additional time
of purchase, and addressed to the Underwriters (with executed copies for
each of the Underwriters) in the forms satisfactory to UBS, which letters
shall cover, without limitation, the various financial disclosures
contained in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any.
(c) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, the favorable opinion of
Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP, counsel for the Underwriters, dated
the time of purchase or the additional time of purchase, as the case may
be, in form and substance reasonably satisfactory to the Joint
Book-Running Managers.
(d) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus shall have been filed to which you shall have
objected in writing.
(e) The Registration Statement and any registration statement
required to be filed, prior to the sale of the Shares, under the Act
pursuant to Rule 462(b) shall have been filed and shall have become
effective under the Act. The Prospectus Supplement shall have been filed
with the Commission pursuant to Rule 424(b) under the Act at or before
5:30 P.M., New York City time, on the second full business day after the
date of this Agreement (or such earlier time as may be required under the
Act).
(f) Prior to and at the time of purchase, and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto shall 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 not misleading; (iii) none of the Pre-Pricing Prospectuses or the
Prospectus, and no amendment or supplement thereto, shall include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading; (iv) no
Disclosure Package, and no amendment or supplement thereto, shall include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading; and (v) none of
the Permitted
- 23 -
Free Writing Prospectuses, if any, shall include an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
are made, not misleading.
(g) The Company will, at the time of purchase and, if applicable,
at the additional time of purchase, deliver to you a certificate of its
Chief Executive Officer and its Chief Financial Officer, dated the time of
purchase or the additional time of purchase, as the case may be, in the
form attached as Exhibit C hereto.
(h) You shall have received each of the signed Lock-Up Agreements
referred to in Section 3(t) hereof, and each such Lock-Up Agreement shall
be in full force and effect at the time of purchase and the additional
time of purchase, as the case may be.
(i) The Company shall have furnished to you such other documents
and certificates as to the accuracy and completeness of any statement in
the Registration Statement, any Pre-Pricing Prospectus, the Prospectus or
any Permitted Free Writing Prospectus as of the time of purchase and, if
applicable, the additional time of purchase, as you may reasonably
request.
(j) The Shares shall have been approved for quotation on the
NASDAQ, subject only to notice of issuance at or prior to the time of
purchase or the additional time of purchase, as the case may be.
(k) The NASD shall not have raised any objection with respect to
the fairness or reasonableness of the underwriting, or other arrangements
of the transactions, contemplated hereby.
7. Effective Date of Agreement; Termination. This Agreement shall
become effective when the parties hereto have executed and delivered this
Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of Joint Book-Running
Managers, if (1) since the time of execution of this Agreement or the earlier
respective dates as of which information is given in the Registration Statement,
the Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any, there has been any change or any development involving a
prospective change in the business, properties, management, financial condition
or results of operations of the Company and the Subsidiaries taken as a whole,
the effect of which change or development is, in the sole judgment of Joint
Book-Running Managers, so material and adverse as to make it impractical or
inadvisable to proceed with the public offering or the delivery of the Shares on
the terms and in the manner contemplated in the Registration Statement, the
Pre-Pricing Prospectuses, the Prospectus and the Permitted Free Writing
Prospectuses, if any, or (2) since the time of execution of this Agreement,
there shall have occurred: (A) a suspension or material limitation in trading in
securities generally on the NYSE, the American Stock Exchange or the NASDAQ; (B)
a suspension or material limitation in trading in the Company's securities on
the NASDAQ; (C) a general moratorium on commercial banking activities declared
by either federal or New York State authorities or a material disruption in
commercial banking or
- 24 -
securities settlement or clearance services in the United States; (D) an
outbreak or escalation of hostilities or acts of terrorism involving the United
States or a declaration by the United States of a national emergency or war; or
(E) any other calamity or crisis or any change in financial, political or
economic conditions in the United States or elsewhere, if the effect of any such
event specified in clause (D) or (E), in the sole judgment of the Joint
Book-Running Managers, makes it impractical or inadvisable to proceed with the
public offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, or (3) since the
time of execution of this Agreement, there shall have occurred any downgrading,
or any notice or announcement shall have been given or made of: (A) any intended
or potential downgrading or (B) any watch, review or possible change that does
not indicate an affirmation or improvement in the rating accorded any securities
of or guaranteed by the Company or any Subsidiary by any "nationally recognized
statistical rating organization," as that term is defined in Rule 436(g)(2)
under the Act.
If Joint Book-Running Managers elect to terminate this Agreement as
provided in this Section 7, the Company and each other Underwriter shall be
notified promptly in writing.
If the sale to the Underwriters of the Shares, as contemplated by
this Agreement, is not carried out by the Underwriters for any reason permitted
under this Agreement, or if such sale is not carried out because the Company
shall be unable to comply with any of the terms of this Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 4(n), 5 and 9 hereof), and the Underwriters
shall be under no obligation or liability to the Company under this Agreement
(except to the extent provided in Section 9 hereof) or to one another hereunder.
8. Increase in Underwriters' Commitments. Subject to Sections 6 and 7
hereof, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a
failure of a condition set forth in Section 6 hereof or a reason sufficient to
justify the termination of this Agreement under the provisions of Section 7
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters (including the
Underwriters, if any, substituted in the manner set forth below) shall take up
and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such designation is made,
such Shares shall be taken up and paid for by all non-defaulting Underwriters
pro rata in proportion to the aggregate number of Firm Shares set forth opposite
the names of such non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Firm Shares hereunder unless all of the Firm Shares are purchased
by the Underwriters (or by substituted Underwriters selected by you with the
approval of the Company or selected by the Company
- 25 -
with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 8 with like effect as if
such substituted Underwriter had originally been named in Schedule A hereto.
If the aggregate number of Firm Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Firm Shares which all Underwriters agreed to purchase hereunder, and if
neither the non-defaulting Underwriters nor the Company shall make arrangements
within the five business day period stated above for the purchase of all the
Firm Shares which the defaulting Underwriter or Underwriters agreed to purchase
hereunder, this Agreement shall terminate without further act or deed and
without any liability on the part of the Company to any Underwriter and without
any liability on the part of any non-defaulting Underwriter to the Company.
Nothing in this paragraph, and no action taken hereunder, shall relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
9. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such person may incur
under the Act, the Exchange Act, the common law or otherwise, insofar as
such loss, damage, expense, liability or claim arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company) or arises out of or is based upon any omission or alleged
omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as
any such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material
fact contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in, the Registration
Statement or arises out of or is based upon any omission or alleged
omission to state a material fact in the Registration Statement in
connection with such information, which material fact was not contained in
such information and which material fact was required to be stated in such
Registration Statement or was necessary to make such information not
misleading or (ii) any untrue statement or alleged untrue
- 26 -
statement of a material fact included in any Prospectus (the term
Prospectus for the purpose of this Section 9 being deemed to include any
Basic Prospectus, any Pre-Pricing Prospectus, the Prospectus Supplement,
the Prospectus and any amendments or supplements to the foregoing), in any
Permitted Free Writing Prospectus, in any "issuer information" (as defined
in Rule 433 under the Act) of the Company, which "issuer information" is
required to be, or is, filed with the Commission, or in any Prospectus
together with any combination of one or more of the Permitted Free Writing
Prospectuses, if any, or arises out of or is based upon any omission or
alleged omission to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except, with respect to such Prospectus or
Permitted Free Writing Prospectus, insofar as any such loss, damage,
expense, liability or claim arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in, and
in conformity with information concerning such Underwriter furnished in
writing by or on behalf of such Underwriter through you to the Company
expressly for use in, such Prospectus or Permitted Free Writing Prospectus
or arises out of or is based upon any omission or alleged omission to
state a material fact in such Prospectus or Permitted Free Writing
Prospectus in connection with such information, which material fact was
not contained in such information and which material fact was necessary in
order to make the statements in such information, in the light of the
circumstances under which they were made, not misleading.
(b) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Company, its directors and officers, and any person who
controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, the Company or any such person may incur under the
Act, the Exchange Act, the common law or otherwise, insofar as such loss,
damage, expense, liability or claim arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained
in, and in conformity with information concerning such Underwriter
furnished in writing by or on behalf of such Underwriter through you to
the Company expressly for use in, the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof
by the Company), or arises out of or is based upon any omission or alleged
omission to state a material fact in such Registration Statement in
connection with such information, which material fact was not contained in
such information and which material fact was required to be stated in such
Registration Statement or was necessary to make such information not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact contained in, and in conformity with information concerning
such Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in, a Prospectus or a
Permitted Free Writing Prospectus, or arises out of or is based upon any
omission or alleged omission to state a material fact in such Prospectus
or Permitted Free Writing Prospectus in connection with such information,
which material fact was not contained in such information and which
material fact was necessary in order to make the statements in such
information, in the light of the circumstances under which they were
- 27 -
made, not misleading.
(c) If any action, suit or proceeding (each, a "Proceeding") is
brought against a person (an "indemnified party") in respect of which
indemnity may be sought against the Company or an Underwriter (as
applicable, the "indemnifying party") pursuant to subsection (a) or (b),
respectively, of this Section 9, such indemnified party shall promptly
notify such indemnifying party in writing of the institution of such
Proceeding and such indemnifying party shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees and expenses; provided,
however, that the omission to so notify such indemnifying party shall not
relieve such indemnifying party from any liability which such indemnifying
party may have to any indemnified party or otherwise. The indemnified
party or parties shall have the right to employ its or their own counsel
in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless the employment of
such counsel shall have been authorized in writing by the indemnifying
party in connection with the defense of such Proceeding or the
indemnifying party shall not have, within a reasonable period of time in
light of the circumstances, employed counsel to defend such Proceeding or
such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from,
additional to or in conflict with those available to such indemnifying
party (in which case such indemnifying party shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party
or parties), in any of which events such fees and expenses shall be borne
by such indemnifying party and paid as incurred (it being understood,
however, that such indemnifying party shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in
any one Proceeding or series of related Proceedings in the same
jurisdiction representing the indemnified parties who are parties to such
Proceeding). The indemnifying party shall not be liable for any settlement
of any Proceeding effected without its written consent but, if settled
with its written consent, such indemnifying party agrees to indemnify and
hold harmless the indemnified party or parties from and against any loss
or liability by reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second sentence of this Section
9(c), then the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if (i)
such settlement is entered into more than 60 business days after receipt
by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have fully reimbursed the indemnified party
in accordance with such request prior to the date of such settlement and
(iii) such indemnified party shall have given the indemnifying party at
least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
Proceeding and does not include an admission of fault or
- 28 -
culpability or a failure to act by or on behalf of such indemnified party.
(d) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 9 or insufficient to hold an indemnified party harmless in respect
of any losses, damages, expenses, liabilities or claims referred to
therein, then each applicable indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, damages, expenses, liabilities or claims (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriters on the other hand from the offering of
the Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the
Underwriters on the other in connection with the statements or omissions
which resulted in such losses, damages, expenses, liabilities or claims,
as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters on
the other shall be deemed to be in the same respective proportions as the
total proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company, and
the total underwriting discounts and commissions received by the
Underwriters, bear to the aggregate public offering price of the Shares.
The relative fault of the Company on the one hand and of the Underwriters
on the other shall be determined by reference to, among other things,
whether the untrue statement or alleged untrue statement of a material
fact or omission or alleged omission relates to information supplied by
the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The amount paid or payable by a party as a
result of the losses, damages, expenses, liabilities and claims referred
to in this subsection shall be deemed to include any legal or other fees
or expenses reasonably incurred by such party in connection with
investigating, preparing to defend or defending any Proceeding.
(e) The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that
does not take account of the equitable considerations referred to in
subsection (d) above. Notwithstanding the provisions of this Section 9, 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 such
Underwriter and distributed to the public were offered to the public
exceeds the amount of any damage which such Underwriter has otherwise been
required to pay by reason of such untrue statement 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 to contribute
pursuant to this Section 9 are several in proportion to their respective
underwriting commitments and not joint.
(f) The indemnity and contribution agreements contained in this
Section 9
- 29 -
and the covenants, warranties and representations of the Company contained
in this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, its partners,
directors or officers or any person (including each partner, officer or
director of such person) who controls any Underwriter within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, or by or on
behalf of the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and shall survive any termination of this
Agreement or the issuance and delivery of the Shares. The Company and each
Underwriter agree promptly to notify each other of the commencement of any
Proceeding against it and, in the case of the Company, against any of the
Company's officers or directors in connection with the issuance and sale
of the Shares, or in connection with the Registration Statement, any Basic
Prospectus, any Pre-Pricing Prospectus, the Prospectus or any Permitted
Free Writing Prospectus.
10. Information Furnished by the Underwriters. The statements set forth
in the last paragraph on the cover page of the Prospectus Supplement and the
statements set forth in the first paragraph under the caption
"Underwriting-Commissions and Discounts" and in the first through fifth
paragraphs under the caption "Underwriting-Price Stabilization, Short Positions"
in the Prospectus, only insofar as such statements relate to the amount of
selling concession and reallowance or to over-allotment and stabilization
activities that may be undertaken by the Underwriters, constitute the only
information furnished by or on behalf of the Underwriters, as such information
is referred to in Sections 3 and 9 hereof.
11. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram or facsimile
and, if to the Underwriters, shall be sufficient in all respects if delivered or
sent to UBS Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention:
Syndicate Department and to Xxxxxxxxx & Company, Inc., 000 Xxxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel and, if to the
Company, shall be sufficient in all respects if delivered or sent to the Company
at the offices of the Company at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx,
Xxxxxxxxxx, Attention: General Counsel.
12. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
13. Submission to Jurisdiction. Except as set forth below, no Claim may
be commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim arising out of or in any way relating to this
Agreement is brought by any third party against any Underwriter or any
indemnified party. Each Underwriter and the
- 30 -
Company (on its behalf and, to the extent permitted by applicable law, on behalf
of its shareholders and affiliates) waive all right to trial by jury in any
action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) in any way arising out of or relating to this Agreement. The Company
agrees that a final judgment in any such action, proceeding or counterclaim
brought in any such court shall be conclusive and binding upon the Company and
may be enforced in any other courts to the jurisdiction of which the Company is
or may be subject, by suit upon such judgment.
14. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Company and to the
extent provided in Section 9 hereof the controlling persons, partners, directors
and officers referred to in such Section, and their respective successors,
assigns, heirs, personal representatives and executors and administrators. No
other person, partnership, association or corporation (including a purchaser, as
such purchaser, from any of the Underwriters) shall acquire or have any right
under or by virtue of this Agreement.
15. No Fiduciary Relationship. The Company hereby acknowledges that the
Underwriters are acting solely as underwriters in connection with the purchase
and sale of the Company's securities. The Company further acknowledges that the
Underwriters are acting pursuant to a contractual relationship created solely by
this Agreement entered into on an arm's length basis, and in no event do the
parties intend that the Underwriters act or be responsible as a fiduciary to the
Company, its management, stockholders or creditors or any other person in
connection with any activity that the Underwriters may undertake or have
undertaken in furtherance of the purchase and sale of the Company's securities,
either before or after the date hereof. The Underwriters hereby expressly
disclaim any fiduciary or similar obligations to the Company, either in
connection with the transactions contemplated by this Agreement or any matters
leading up to such transactions, and the Company hereby confirms its
understanding and agreement to that effect. The Company and the Underwriters
agree that they are each responsible for making their own independent judgments
with respect to any such transactions and that any opinions or views expressed
by the Underwriters to the Company regarding such transactions, including, but
not limited to, any opinions or views with respect to the price or market for
the Company's securities, do not constitute advice or recommendations to the
Company. The Company hereby waives and releases, to the fullest extent permitted
by law, any claims that the Company may have against the Underwriters with
respect to any breach or alleged breach of any fiduciary or similar duty to the
Company in connection with the transactions contemplated by this Agreement or
any matters leading up to such transactions.
16. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
17. Successors and Assigns. This Agreement shall be binding upon the
Underwriters and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's and any of the
Underwriters' respective businesses and/or assets.
18. Miscellaneous. UBS, an indirect, wholly owned subsidiary of UBS AG,
is not a bank and is separate from any affiliated bank, including any U.S.
branch or agency of UBS AG.
- 31 -
Because UBS is a separately incorporated entity, it is solely responsible for
its own contractual obligations and commitments, including obligations with
respect to sales and purchases of securities. Securities sold, offered or
recommended by UBS are not deposits, are not insured by the Federal Deposit
Insurance Corporation, are not guaranteed by a branch or agency, and are not
otherwise an obligation or responsibility of a branch or agency.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS]
If the foregoing correctly sets forth the understanding between the
Company and the several Underwriters, please so indicate in the space provided
below for that purpose, whereupon this Agreement and your acceptance shall
constitute a binding agreement between the Company and the Underwriters,
severally.
Very truly yours,
aQuantive, Inc.
By:
-----------------------------------
Name:
Title:
Accepted and agreed to as of the date
first above written, on behalf of
themselves and the other several
Underwriters named in Schedule A
UBS SECURITIES LLC
XXXXXXXXX & COMPANY, INC.
BEAR, XXXXXXX & CO. INC.
XXXXXX XXXXXX PARTNERS LLC
By: UBS SECURITIES LLC
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
By: XXXXXXXXX & COMPANY, INC.
By:
-------------------------------
Name:
Title:
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
UBS SECURITIES LLC................................................. [____]
XXXXXXXXX & COMPANY, INC........................................... [____]
BEAR, XXXXXXX & CO. INC. ..........................................
XXXXXX XXXXXX PARTNERS LLC.........................................
-----------
Total........................................................ [____]
===========
Exhibit A
Lock-Up Agreement
-----------------
___________ ___, 2006
UBS Securities LLC
Xxxxxxxxx & Company, Inc.
Bear, Xxxxxxx & Co. Inc.
Xxxxxx Xxxxxx Partners LLC
as Managing Underwriters
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
c/x Xxxxxxxxx & Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This Lock-Up Agreement is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement") to be entered
into by aQuantive, Inc., a Washington corporation (the "Company"), and you and
the other underwriters named in Schedule A to the Underwriting Agreement, with
respect to the public offering (the "Offering") of common stock, par value $0.01
per share, of the Company (the "Common Stock").
In order to induce you to enter into the Underwriting Agreement, the
undersigned agrees that, for a period (the "Lock-Up Period") beginning on the
date hereof and ending on, and including, the date that is 90 days after the
date of the final prospectus supplement relating to the Offering, the
undersigned will not, without the prior written consent of UBS Securities LLC
and Xxxxxxxxx & Company, Inc., (i) sell, offer to sell, contract or agree to
sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of
or agree to dispose of, directly or indirectly, or file (or participate in the
filing of) a registration statement with the Securities and Exchange Commission
(the "Commission") in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning
of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the Commission promulgated thereunder (the "Exchange Act")
with respect to, any Common Stock or any other securities of the Company that
are substantially similar to Common Stock, or any securities convertible into or
exchangeable or exercisable for, or any warrants or other rights to purchase,
the foregoing, (ii) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
Common Stock or any other securities of the Company that are substantially
similar to Common Stock, or any securities convertible into or exchangeable or
exercisable for, or any warrants or other rights to purchase,
the foregoing, whether any such transaction is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise or (iii) publicly
announce an intention to effect any transaction specified in clause (i) or (ii).
The foregoing sentence shall not apply to (a) the registration of the offer and
sale of Common Stock as contemplated by the Underwriting Agreement and the sale
of the Common Stock to the Underwriters (as defined in the Underwriting
Agreement) in the Offering, (b) bona fide gifts, provided the recipient thereof
agrees in writing with the Underwriters to be bound by the terms of this Lock-Up
Agreement or (c) dispositions to any trust for the direct or indirect benefit of
the undersigned and/or the immediate family of the undersigned, provided that
such trust agrees in writing with the Underwriters to be bound by the terms of
this Lock-Up Agreement, (d) transfers of Common Stock or securities convertible
into Common Stock on death by will or intestacy, (e) transfers of Common Stock
or securities convertible into Common Stock pursuant to the bona fide
acquisition of the Company by a third party by way of merger, consolidation,
stock exchange or tender offer (excluding, for the avoidance of doubt, any
merger, consolidation or other transaction in which the holders of the Company's
outstanding Common Stock immediately prior to such transaction collectively own
in excess of fifty percent (50%) of the voting power or equity interests of the
surviving or acquiring entity immediately after such transaction), (f) sales or
transfers of Common Stock solely in connection with the "cashless" exercise of
Company stock options outstanding on the date hereof for the purpose of
exercising such stock options (provided that any remaining Common Stock received
upon such exercise will be subject to the restrictions provided for in this
Lock-Up Agreement) or (g) sales or transfers of Common Stock or securities
convertible into Common Stock pursuant to a sales plan entered into prior to the
date hereof pursuant to Rule 10b5-1 under the Exchange Act, a copy of which has
been provided to the Joint Book-Running Managers (as defined in the Underwriting
Agreement). In addition, the restrictions set forth herein shall not prevent the
undersigned from entering into a sales plan pursuant to Rule 10b5-1 under the
Exchange Act after the date hereof provided that (i) a copy of such plan is
provided to the Joint Book-Running Managers promptly upon entering into the same
and (ii) no sales or transfers may be made under such plan until the Lock-Up
Period ends or this Lock-Up Agreement is terminated in accordance with its
terms. For purposes of this paragraph, "immediate family" shall mean the
undersigned and the spouse, any lineal descendent, father, mother, brother or
sister of the undersigned.
In addition, the undersigned hereby waives any rights the undersigned may
have to require registration of Common Stock in connection with the filing of a
registration statement relating to the Offering. The undersigned further agrees
that, for the Lock-Up Period, the undersigned will not, without the prior
written consent of UBS Securities LLC and Xxxxxxxxx & Company, Inc., make any
demand for, or exercise any right with respect to, the registration of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock, or warrants or other rights to purchase Common Stock or any such
securities.
Notwithstanding the above, if (a) during the period that begins on the date
that is fifteen (15) calendar days plus three (3) business days before the last
day of the Lock-Up Period and ends on the last day of the Lock-Up Period, the
Company issues an earnings release or material news or a material event relating
to the Company occurs; or (b) prior to the expiration of the Lock-Up Period, the
Company announces that it will release earnings results during the sixteen (16)
day period beginning on the last day of the Lock-Up Period, then the
restrictions
2
imposed by this Lock-Up Agreement shall continue to apply until the expiration
of the date that is fifteen (15) calendar days plus three (3) business days
after the date on which the issuance of the earnings release or the material
news or material event occurs; provided, however, that this paragraph shall not
apply if (i) the Company meets the applicable requirements of the safe harbor
provided by Rule 139 under the Securities Act of 1933, as amended, in the manner
contemplated by Rule 2711(f)(4) of the National Association of Securities
Dealers, Inc. (the "NASD"); and (ii) within the 3 business days preceding the
15th calendar day before the last day of the Lock-Up Period, the Company
delivers (in accordance with the notice provisions of the Underwriting
Agreement) to UBS Securities LLC a certificate, signed by the Chief Financial
Officer or Chief Executive Officer of the Company, certifying on behalf of the
Company that the Company's shares of Common Stock are "actively traded
securities," within the meaning of Rule 2711(f)(4) of the NASD.
The undersigned hereby confirms that the undersigned has not, directly or
indirectly, taken, and hereby covenants that the undersigned will not, directly
or indirectly, take, any action designed, or which has constituted or will
constitute or might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of shares of Common Stock.
* * *
3
If (i) the Company notifies you in writing that it does not intend to
proceed with the Offering, (ii) the registration statement filed with the
Commission with respect to the Offering is withdrawn or (iii) for any reason the
Underwriting Agreement shall be terminated prior to the "time of purchase" (as
defined in the Underwriting Agreement), this Lock-Up Agreement shall be
terminated and the undersigned shall be released from its obligations hereunder.
Yours very truly,
------------------------------
Name:
4
