EXHIBIT 1.1
2,600,000 SHARES
POLYCOM, INC.
COMMON STOCK, $.0005 PAR VALUE
FORM OF
UNDERWRITING AGREEMENT
, 2000
-----------------------
, 2000
------------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxx Partners LLC
Xxxx Xxxxxxxx Xxxxxxx
Warburg Dillon Read LLC
First Security Xxx Xxxxxx
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Polycom, Inc., a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters named in Schedule I
hereto (the "UNDERWRITERS"), and 3M Financial Management Company (the
"SELLING STOCKHOLDER") proposes to sell to the several Underwriters, an
aggregate of 2,600,000 shares of the Company's Common Stock, $.0005 par value
(the "FIRM SHARES"), of which 1,600,000 shares are to be issued and sold by
the Company and 1,000,000 shares are to be sold by the Selling Stockholder.
The Company and the Selling Stockholder also propose to
issue and sell to the several Underwriters not more than an additional
390,000 shares of its Common Stock, $.0005 par value (the "ADDITIONAL
SHARES") if and to the extent that you, as Managers of the offering, shall
have determined to exercise, on behalf of the Underwriters, the right to
purchase such shares of common stock granted to the Underwriters in Section 4
hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "SHARES." The shares of Common Stock, $.0005
par value, of the Company to be outstanding after giving effect to the sales
contemplated hereby are hereinafter referred to as the "COMMON STOCK." The
Company and the Selling Stockholder are hereinafter sometimes collectively
referred to as the "SELLERS."
The Company has filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement, including a
prospectus, relating to the Shares. The registration statement as amended at
the time it becomes effective, including the information incorporated by
reference therein and information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A
under the Securities Act of 1933, as amended (the "SECURITIES ACT"), is
hereinafter referred to as the "REGISTRATION STATEMENT"; the prospectus in
the form first used to confirm sales of Shares, including the information
incorporated by reference therein, is hereinafter referred to as the
"PROSPECTUS." If the Company has filed an abbreviated registration statement
to register additional shares of Common Stock pursuant to Rule 462(b) under
the Securities Act (the "RULE 462 REGISTRATION STATEMENT"), then
any reference herein to the term "REGISTRATION STATEMENT" shall be deemed to
include such Rule 462 Registration Statement.
1. 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 become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission. The Company has complied with the
conditions for the use of Form S-3.
(b) (i) Each document filed or to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"),
including each of the documents incorporated by reference in the
Prospectus (the "INCORPORATED DOCUMENTS") complied or will comply when
so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii)
each part of the Registration Statement, when it became effective, did
not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Registration Statement and
the Prospectus comply and, as amended or supplemented, if applicable,
will comply in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder and (iv)
the Prospectus does not contain and, as amended or supplemented, if
applicable, will not through the Option Closing Date (defined below)
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except
that the representations and warranties set forth in this paragraph do
not apply to statements or omissions in the Registration Statement or
the Prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you
expressly for use therein.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership
or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would
not have a material adverse effect on the Company and its subsidiaries,
taken as a whole; all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and are owned directly by the
Company, free and clear of all liens, encumbrances, equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained or incorporated by
reference in the Prospectus.
(g) The shares of Common Stock (including the Shares to be
sold by the Selling Stockholder) outstanding prior to the issuance of
the Shares have been duly authorized and are validly issued, fully paid
and non-assessable. Except as set forth in the Prospectus or in any
Incorporated Document, the Company does not have outstanding any
options to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, any securities or obligations convertible
into, or any contracts or commitments to issue or sell, shares of its
capital stock or any such options, rights, convertible securities or
obligations. All outstanding shares of capital stock of the Company,
and options and other rights to acquire capital stock of the Company,
have been issued in compliance with the registration and prospectus
delivery requirements and qualification provisions of all applicable
securities laws, and were not issued in violation of any preemptive
rights, rights of first refusal or other similar rights.
(h) The Shares to be issued and sold by the Company have been
duly authorized and, when issued and delivered in accordance with the
terms of this Agreement, will be validly issued, fully paid and
non-assessable, and the issuance of such Shares will not be subject to
any preemptive rights, rights of first refusal or other similar rights.
(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or bylaws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a
whole, from that set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement).
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party
or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the
Registration Statement, the Prospectus or the Incorporated Documents
and are not so described or any statutes, regulations, contracts or
other documents that are required to be described in the Registration
Statement, the Prospectus or the Incorporated Documents or to be filed
as exhibits to the Registration Statement that are not described or
filed as required.
(l) Each preliminary prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder.
(m) The Company is not and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as such term is defined in the Investment Company Act of 1940,
as amended.
(n) The Company and its subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(o) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which could, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(p) There is no owner of any securities of the Company who has
any rights, not effectively satisfied or waived, to require
registration of any shares of capital stock of the Company in
connection with the filing of the Registration Statement or the sale of
any shares of capital stock of the Company or the Selling Stockholder
thereunder.
(q) The Company has complied with all provisions of
Section 517.075, Florida Statutes relating to doing business with the
Government of Cuba or with any person or affiliate located in Cuba.
(r) The Company and its subsidiaries own or possess, or
can acquire on reasonable terms, all material patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and
trade names currently employed by them in connection with the business
now operated by them, and neither the Company nor any of its
subsidiaries has received any notice of infringement of or conflict
with asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse affect on
the Company and its subsidiaries, taken as a whole.
(s) PricewaterhouseCoopers LLP are independent public
accountants with respect to the Company and its subsidiaries as
required by the Securities Act.
(t) The consolidated financial statements of the Company
included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto), together with related schedules and
notes, present fairly the consolidated financial position, results of
operations and changes in financial position of the Company and its
subsidiaries on the basis stated therein at the respective dates or for
the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; the supporting
schedules, if any, included in the Registration Statement present
fairly in accordance with generally accepted accounting principles the
information required to be stated therein; and the other financial and
statistical information and data set forth in the Registration
Statement and Prospectus (and any amendment or supplement thereto) are,
in all material respects, accurately presented and prepared on a basis
consistent with such financial statements and the books and records of
the Company.
2. REPRESENTATIONS AND WARRANTIES OF THE SELLING
STOCKHOLDER. The Selling Stockholder represents, warrants and covenants to and
agrees with each of the Underwriters that:
(a) This Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Stockholder.
(b) The execution and delivery by the Selling Stockholder of,
and the performance by the Selling Stockholder of its obligations
under, this Agreement, the Irrevocable Election to Sell signed by the
Selling Stockholder (the "IRREVOCABLE ELECTION"), the Transmittal
Letter and Custodian Agreement signed by the Selling Stockholder and
___________ as Custodian, relating to the deposit of the Shares to be
sold by the Selling Stockholder (the "CUSTODY AGREEMENT") and the
Irrevocable Power of Attorney signed by the Selling Stockholder
appointing certain individuals as the Selling Stockholder's
attorneys-in-fact to the extent set forth therein, relating to the
transactions contemplated hereby and by the Registration Statement (the
"POWER OF ATTORNEY") will not contravene any provision of applicable
law and will not result in a breach of any of the terms and provisions
or constitute a default under the certificate of incorporation or
bylaws of the Selling Stockholder, or any agreement or other instrument
to which the Selling Stockholder is a party (or by which any property
or assets of the Selling Stockholder is bound or to which any property
or assets of the Selling Stockholder is subject) or any judgment, order
or decree of any governmental body, agency or court having jurisdiction
over the Selling Stockholder, and no consent, approval, authorization
or order of, or qualification with, any governmental body or agency is
required for the performance by the Selling Stockholder of its
obligations under this Agreement, the Irrevocable Election, the Custody
Agreement or Power of Attorney of the Selling Stockholder, except the
as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares.
(c) The Selling Stockholder has, and on the Closing Date or
the Option Closing Date, as the case may be, will have, good and
marketable title to the Shares to be sold by the Selling Stockholder
and the full legal right and corporate power, and all authorization and
approval required by law, to enter into this Agreement, the Irrevocable
Election, the Custody Agreement and the Power of Attorney and to sell,
transfer and deliver the Shares to be sold by the Selling Stockholder.
(d) The Shares to be sold by the Selling Stockholder pursuant
to this Agreement have been duly authorized and are validly issued,
fully paid and non-assessable.
(e) Each of the Irrevocable Election, the Custody Agreement
and the Power of Attorney has been duly authorized, executed and
delivered by the Selling Stockholder and is a valid and binding
agreement of the Selling Stockholder.
(f) Upon the delivery of and payment for the Shares to be sold
by the Selling Stockholder pursuant to this Agreement, the Underwriters
will obtain good and marketable title thereto free and clear of any
security interests, claims, liens, equities and other encumbrances.
(g) All information furnished in writing by or on behalf of
the Selling Stockholder for use in the Registration Statement is, and
on the Closing Date will be, true, correct, and complete, and does not,
and on the Closing Date will not, contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
information not misleading, and all information furnished in writing by
or on behalf of the Selling Stockholder for use in the Prospectus is,
and on the Closing Date will be, true, correct, and complete, and does
not, and on the Closing Date will not, contain any untrue statement of
a material fact or omit to state any material fact necessary to make
the information not misleading in the light of the circumstances under
which they were made.
(h) the section of the Registration Statement entitled
"Selling Stockholder," when it became effective, did not contain and,
as amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading with respect to the Selling Stockholder.
(i) There are no shares of Common Stock that are beneficially
owned (within the meaning of Rule 13d-3 of the Exchange Act by the
Selling Stockholder or by an affiliate (within the meaning of Rule
12b-2 of the Exchange Act) of the Selling Stockholder that are not
subject to an agreement restricting the transfer of such shares during
the period between the date of this Agreement and 90 days after the
date of the Prospectus.
(j) The sale of the Shares by the Selling Stockholder pursuant
to this Agreement is not prompted by any material information
concerning the Company or any of its subsidiaries which is not set
forth in the Registration Statement or the Incorporated Documents.
3. AGREEMENTS TO SELL AND PURCHASE. Each Seller,
severally and not jointly, hereby agrees to sell to the several Underwriters,
and each Underwriter, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agrees,
severally and not jointly, to purchase from such Seller the respective number
of Firm Shares set forth in Schedule I hereto opposite its name at $_______ a
share (the "PURCHASE PRICE").
On the basis of the representations and warranties
contained in this Agreement, and subject to its terms and conditions, the
Company and the Selling Stockholder agree to issue and sell to the
Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to 390,000
Additional Shares at the Purchase Price. If you, on behalf of the
Underwriters, elect to exercise such option, you shall so notify the Company
in writing not later than 30 days after the date of this Agreement, which
notice shall specify the number of Additional Shares to be purchased by the
Underwriters and the date on which such shares are to be purchased. Such date
may be the same as the Closing Date (as defined below) but not earlier than
the Closing Date nor later than ten business days after the date of such
notice. Additional Shares may be purchased as provided in Section 5 hereof
solely for the purpose of covering over-allotments made in connection with
the offering of the Firm Shares. If any Additional Shares are to be
purchased, each Underwriter agrees, severally and not jointly, to purchase
the number of Additional Shares (subject to such adjustments to eliminate
fractional shares as you may determine) that bears the same proportion to the
total number of Additional Shares to be purchased as the number of Firm
Shares set forth in Schedule II hereto opposite the name of such Underwriter
bears to the total number of Firm Shares.
Each Seller hereby agrees that, without the prior written
consent of Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Underwriters,
it will not, during the period ending 90 days after the date of the
Prospectus, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, lend, or otherwise transfer or dispose
of, directly or indirectly, any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or (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,
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to (A) the Shares to be
sold hereunder, (B) transactions relating to shares of Common Stock or other
securities acquired in open market transactions after the completion of the
public offering of the shares, (C) the issuance by the Company of shares of
Common Stock upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof as described in the Registration
Statement or of which the Underwriters have been advised in writing, (D) the
grant of options to purchase Common Stock pursuant to the 1996 Stock
Incentive Plan and (E) the issuance by the Company of shares of Common Stock
pursuant to the 1996 Employee Stock Purchase Plan. In addition, the Selling
Stockholder agrees that, without the prior written consent of Xxxxxx Xxxxxxx
& Co. Incorporated on behalf of the Underwriters, it will not, during the
period ending 90 days after the date of the Prospectus, initiate any demand
for the registration of any shares of Common Stock or any security
convertible into or exchangeable for Common Stock.
4. TERMS OF PUBLIC OFFERING. The Sellers are advised
by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement
and this Agreement have become effective as in your judgment is advisable.
The Sellers are further advised by you that the Shares are to be offered to
the public initially at $_____ a share (the "PUBLIC OFFERING PRICE") and to
certain dealers selected by you at a price that represents a concession not
in excess of $____ a share under the Public Offering Price, and that any
Underwriter may allow, and such dealers may reallow, a concession, not in
excess of $___ a share, to any Underwriter or to certain other dealers
5. PAYMENT AND DELIVERY. Payment for the Firm Shares
to be sold by each Seller shall be made to such Seller in Federal or other
funds immediately available in New York City against delivery of such Firm
Shares for the respective accounts of the several Underwriters at 10:00 a.m.,
New York City time, on _________, 2000, or at such other time on the same or
such other date, not later than _________, 2000, as shall be designated in
writing by you. The time and date of such payment are hereinafter referred to
as the "CLOSING DATE."
Payment for any Additional Shares shall be made to such
Seller in Federal or other funds immediately available in New York City
against delivery of such Additional Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New York City time, on the date specified
in the notice described in Section 3 or at such other time on the same or on
such other date, in any event not later than _________, 2000, as shall be
designated in writing by you. The time and date of such payment are
hereinafter referred to as the "OPTION CLOSING DATE."
Certificates for the Firm Shares and Additional Shares
shall be in definitive form and registered in such names and in such
denominations as you shall request in writing not later than one full
business day prior to the Closing Date or the Option Closing Date, as the
case may
be. The certificates evidencing the Firm Shares and Additional Shares shall
be delivered to you on the Closing Date or the Option Closing Date, as the
case may be, for the respective accounts of the several Underwriters, with
any transfer taxes payable in connection with the transfer of the Shares to
the Underwriters duly paid, against payment of the Purchase Price therefor.
6. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Sellers to sell the Shares to the Underwriters and the
several obligations of the Underwriters to purchase and pay for the Shares on
the Closing Date are subject to the condition that the Registration Statement
shall have become effective not later than 5:30 p.m. (New York City time) on
the date hereof.
The several obligations of the Underwriters are subject to
the following further conditions:
(a) Subsequent to the execution and delivery of this
Agreement and prior to the Closing Date:
(i) there shall not have occurred any
downgrading, nor shall any notice have been given of any
intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any
change, or any development involving a prospective change, in
the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries,
taken as a whole, from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent
to the date of this Agreement) that, in your judgment, is
material and adverse and that makes it, in your judgment,
impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing
Date a certificate, dated the Closing Date and signed by the chief
executive officer and chief financial officer of the Company, to the
effect set forth in Section 6(a)(i) above and to the effect that the
representations and warranties of the Company contained in this
Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all of
the conditions on its part to be performed or satisfied hereunder on or
before the Closing Date.
The officers signing and delivering such certificate may rely
upon the best of his or her respective knowledge as to proceedings
threatened.
(c) The Underwriters shall have received on the Closing
Date a certificate, dated the Closing Date and signed by the Selling
Stockholder (or by its attorney-in-fact on their behalf), to the effect
that the representations and warranties of the Selling Stockholder
contained in this Agreement are true and correct as of the Closing Date
and that the Selling Stockholder has complied with all of the
agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date.
If the attorney-in-fact signs such certificate on behalf of
the Selling Stockholder, such attorney-in-fact may rely upon the
representations of the Selling Stockholder contained herein and in the
Custody Agreement and the Power of Attorney of the Selling Stockholder;
PROVIDED that copies of such Custody Agreements and Powers of Attorney
are delivered to you and shall be in form and substance satisfactory to
your counsel.
(d) The Underwriters shall have received on the Closing
Date an opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx PC, outside counsel
for the Company, dated the Closing Date, to the effect that:
(i) the Company has been duly incorporated,
is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be
in good standing would not have a material adverse effect on
the Company and its subsidiaries, taken as a whole;
(ii) each significant subsidiary (as defined
under Section 1-02 of Regulation S-X) of the Company has been
duly incorporated, is validly existing as a corporation in
good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own
its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires
such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries,
taken as a whole;
(iii) the authorized capital stock of the
Company conforms as to legal matters to the description
thereof contained or incorporated by reference in the
Prospectus;
(iv) the shares of Common Stock (including
the Shares to be sold by the Selling Stockholder) outstanding
prior to the issuance of the Shares have been duly authorized
and are validly issued, fully paid and non-assessable;
(v) all of the issued shares of capital
stock of each subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and
non-assessable and are owned directly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(vi) (A) the Shares have been duly
authorized and, when issued and delivered in accordance with
the terms of this Agreement, will be validly issued, fully
paid and non-assessable, and (B) the issuance of such Shares
will not be subject to any preemptive rights, rights of first
refusal or similar rights;
(vii) this Agreement has been duly
authorized, executed and delivered by the Company;
(viii) the execution and delivery by the
Company of, and the performance by the Company of its
obligations under, this Agreement will not contravene any
provision of any applicable law or the certificate of
incorporation or bylaws of the Company or, to the best of such
counsel's knowledge, (A) any agreement or other instrument
binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a
whole, or (B) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over
the Company or any subsidiary, and no consent, approval,
authorization or order of, or qualification with, any
governmental body or agency is required for the performance by
the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of
the various states or foreign jurisdictions in connection with
the offer and sale of the Shares;
(ix) the statements (A) in the Prospectus
under the captions "Risk Factors - Anti-Takeover Effects of
Provisions in Our Certificate of Incorporation" and
"Underwriters." (B) in the Registration Statement in Items 14
and 15, (C) in the Company's Annual Report on Form 10-K for
its fiscal year ended December 31, 1999 in "Item 3 - Legal
Proceedings" and (D) in the Company's Forms 8-A in the
Incorporated Documents relating to the description of the
Company's authorized and outstanding capital stock, in each
case insofar as such statements constitute summaries of the
legal matters, documents or proceedings referred to therein,
fairly present the information called for with respect to such
legal matters, documents and proceedings and fairly summarize
the matters referred to therein;
(x) after due inquiry, such counsel does not
know of any legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is
a party or to which any of the properties of the Company or
any
of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and
are not so described or of any statutes, regulations,
contracts or other documents that are required to be described
in the Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement that are not
described or filed as required;
(xi) the Company is not and, after giving
effect to the offering and sale of the Shares and the
application of the proceeds thereof as described in the
Prospectus, will not be an "investment company" as such term
is defined in the Investment Company Act of 1940, as amended;
(xii) to the knowledge of such counsel,
there is no legal or beneficial owner of any securities of the
Company who has any rights, not effectively satisfied or
waived, to require registration of any shares of capital stock
of the Company in connection with the filing of the
Registration Statement or the sale of any shares of capital
stock of the Company thereunder;
(xiii) to the knowledge of such counsel: (A)
the Registration Statement has become effective under the
Securities Act, no stop order proceedings with respect thereto
have been instituted or are pending or threatened under the
Securities Act, and nothing has come to such counsel's
attention to lead it to believe that such proceedings are
contemplated, and (B) any required filing of the Prospectus
and any supplement thereto pursuant to Rule 424(b) under the
Securities Act has been made in the manner and within the time
period required by such Rule 424(b);
(xiv) such counsel shall also state that (A)
such counsel believes that the Registration Statement,
Prospectus (except for financial statements and schedules and
other financial and statistical data included or incorporated
by reference therein as to which such counsel need not express
any opinion) comply as to form in all material respects with
the Securities Act and the applicable rules and regulations of
the Commission thereunder, (B) such counsel has no reason to
believe that (except for financial statements and schedules
and other financial and statistical data included or
incorporated by reference therein as to which such counsel
need not express any belief) the Registration Statement and
the prospectus included therein at the time the Registration
Statement became effective contained any untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading and (C) such counsel has no reason to believe
that (except for financial statements and schedules and other
financial and statistical data included or incorporated by
reference therein as to which such counsel need not express
any belief) the Prospectus contains any untrue statement of a
material fact or omits to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(e) The Underwriters shall have received on the Closing Date
an opinion of [_________________,] counsel for the Selling Stockholder,
dated the Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Stockholder;
(ii) the execution and delivery by or on behalf of the
Selling Stockholder of, and the performance by the Selling
Stockholder of its obligations under, this Agreement, the
Irrevocable Election, the Custody Agreement and the Power of
Attorney of the Selling Stockholder will not contravene any
provision of applicable law, or result in a breach of any of
the terms and provisions of, or constitute a default under the
certificate of incorporation or bylaws of the Selling
Stockholder, or, to the best of such counsel's knowledge, any
agreement or other instrument binding upon the Selling
Stockholder or, to the best of the counsel's knowledge, any
judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Selling Stockholder, and no
consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the
performance by the Selling Stockholder of its obligations
under this Agreement or the Custody Agreement or Power of
Attorney of the Selling Stockholder, except such as may be
required by the securities or Blue Sky laws of the various
states or foreign jurisdictions in connection with offer and
sale of the Shares;
(iii) the Selling Stockholder has valid title to the Shares
to be sold by the Selling Stockholder and the legal right and
corporate power, and all authorization and approval required
by law, to enter into this Agreement, the Irrevocable
Election, the Custody Agreement and the Power of Attorney of
the Selling Stockholder and to sell, transfer and deliver the
Shares to be sold by such Selling Stockholder;
(iv) each of the Irrevocable Election, the Custody
Agreement and the Power of Attorney of the Selling Stockholder
has been duly authorized, executed and delivered by the
Selling Stockholder and is a valid and binding agreement of
the Selling Stockholder; and
(v) upon the delivery of and against payment for such
Shares to be sold by the Selling Stockholder pursuant to this
Agreement, the Underwriters will obtain good and marketable
title thereto, free and clear of any security interests,
claims, liens, equities and other encumbrances.
(f) The Underwriters shall have received on the Closing Date
an opinion of Fenwick & West LLP, counsel for the Underwriters, dated
the Closing Date, covering the matters referred to in Sections
6(d)(vi), 6(d)(vii), 6(d)(ix) (but only as to the statements in the
Prospectus under "Underwriters") and 6(d)(xiv) above.
With respect to Section 6(d)(xiv) above, Xxxxxx Xxxxxxx
Xxxxxxxx & Xxxxxx PC and Fenwick & West LLP may state that their
opinion and belief are based upon their participation in the
preparation of the Registration Statement and Prospectus and any
amendments or supplements thereto and the documents incorporated by
reference and review and discussion of the contents thereof, but are
without independent check or verification, except as specified.
With respect to Sections 6(d)(vi)(B), 6(d)(viii)(B), 6(d)(x),
6(d)(xi) and 6(d)(xii), Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx PC may state
that their opinion is based upon a Company certificate with respect to
factual matters. With respect to Section 6(d)(viii)(A), Xxxxxx Xxxxxxx
Xxxxxxxx & Xxxxxx PC may state that their opinion is limited to
agreements filed as exhibits to the Registration Statement or, the
Company's Annual Report on Form 10-K for the 1999 Fiscal Year and the
Company's Quarterly Report on Form 10-Q for the first fiscal quarter of
2000.
The opinions of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx PC and
_____________, described in Sections 6(d), 6(e) and 6(f) above,
respectively, shall each be rendered to the Underwriters at the request
of the Company and shall so state therein.
With respect to Section 6(e) above, Xxxxxx Xxxxxxx Xxxxxxxx &
Xxxxxx PC may rely upon an opinion or opinions of counsel for any
Selling Stockholder and, with respect to factual matters and to the
extent such counsel deems appropriate, upon the representations of the
Selling Stockholder contained herein and in the Custody Agreement and
the Power of Attorney of the Selling Stockholder and in other documents
and instruments; PROVIDED that (A) counsel for the Selling Stockholder
is satisfactory to your counsel; (B) a copy of the opinion so relied
upon is delivered to you and is in form and substance satisfactory to
your counsel, (C) copies of such Irrevocable Elections, Custody
Agreements and Powers of Attorney and of any such other documents and
instruments shall be delivered to you and shall be in form and
substance satisfactory to your counsel and Xxxxxx Xxxxxxx Xxxxxxxx &
Xxxxxx PC shall state in their opinion that they are justified in
relying on each such other opinion..
(g) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriters, from PricewaterhouseCoopers LLP, Independent
Accountants, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in, or incorporated by reference into, the
Registration Statement and the Prospectus; PROVIDED that the letter
delivered on the Closing Date shall use a "cut-off date" not earlier
than the date hereof.
(h) The Lock-Up Agreements, each substantially in the form of
Exhibit A hereto, between you and executive officers and directors of
the Company and the Selling Stockholder relating to sales and certain
other dispositions of shares of Common Stock or
certain other securities, delivered to you on or before the date
hereof, shall be in full force and effect on the Closing Date.
All the agreements, opinions, certificates and letters
mentioned above or elsewhere in this Agreement shall be deemed in compliance
with the provisions hereof only if counsel for the Underwriters shall be
satisfied that they comply in form and scope.
The several obligations of the Underwriters to purchase
Additional Shares hereunder are subject to the delivery to you on the Option
Closing Date of such documents as you may reasonably request with respect to
the good standing of the Company, the due authorization and issuance of the
Additional Shares and other matters related to the issuance of the Additional
Shares and an opinion or opinions of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx PC and
_________ in form and substance satisfactory to Fenwick & West LLP, counsel
for the Underwriters.
7. COVENANTS OF THE COMPANY. In further consideration of
the agreements of the Underwriters herein contained, the Company covenants
with each Underwriter as follows:
(a) To furnish to you, without charge, four signed copies of
the Registration Statement (including exhibits thereto and documents
incorporated by reference) and for delivery to each other Underwriter a
conformed copy of the Registration Statement (without exhibits thereto
but including documents incorporated by reference) and to furnish to
you in New York City, without charge, prior to 10:00 a.m. New York City
time on the business day next succeeding the date of this Agreement and
during the period mentioned in Section 7(c) below, as many copies of
the Prospectus, any documents incorporated by reference and any
supplements and amendments thereto or to the Registration Statement as
you may reasonably request. The terms "supplement" and "amendment" or
"amend" as used in this Agreement shall include all documents
subsequently filed by the Company with the Commission pursuant to the
Exchange Act that are deemed to be incorporated by reference in the
Prospectus.
(b) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file
with the Commission within the applicable period specified in Rule
424(b) under the Securities Act any prospectus required to be filed
pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the
Underwriters the Prospectus is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall
occur or condition exist as a result of which it is necessary to amend
or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Prospectus to
comply with
applicable law, forthwith to prepare, file with the Commission and
furnish, at its own expense, to the Underwriters and to the dealers
(whose names and addresses you will furnish to the Company) to which
Shares may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request and to pay all expenses (including fees and
disbursements of counsel) in connection with such qualification and in
connection with any review of the offering of the Shares by the
National Association of Securities Dealers, Inc.
(e) To make generally available to the Company's security
holders and to you as soon as practicable an earning statement covering
the twelve-month period ending September 30, 2001 that satisfies the
provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder.
(f) The Company will use its best efforts to maintain in
effect the quotation of the Shares on the Nasdaq National Market.
(g) The Company will comply with all provisions of all
undertakings contained in the Registration Statement.
(h) Prior to the Closing Date, the Company will not, directly
or indirectly, issue any press release or other communication and will
not hold any press conference with respect to the Company, or its
financial condition, results of operations, business, properties,
assets, or prospects or this offering, without your prior written
consent.
(i) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Sellers
agree to pay or cause to be paid all costs and expenses incident to the
performance of their obligations under this Agreement, including but
not limited to, all expenses incident to: (i) the fees, disbursements
and expenses of the Company's counsel and the Company's accountants and
counsel for the Selling Stockholders in connection with the
registration and delivery of the Shares under the Securities Act and
all other fees or expenses in connection with the preparation and
filing of the Registration Statement, any preliminary prospectus, the
Prospectus and amendments and supplements to any of the foregoing,
including all printing costs associated therewith, and the mailing and
delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related
to the transfer and delivery of the Shares to the Underwriters,
including any transfer or other taxes payable thereon, (iii) the cost
of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the
Shares under state securities laws and all expenses in connection with
the qualification of the Shares for offer and sale under state
securities laws as provided in Section 8(d) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection
with the Blue Sky or Legal Investment memorandum, (iv) all filing fees
and the reasonable fees and disbursements of counsel to the
Underwriters incurred in connection with the review and qualification
of the offering of the Shares by the National Association of Securities
Dealers, Inc., (v) all costs and expenses incident to listing the
Shares on the Nasdaq National Market, (vi) the cost of printing
certificates representing the Shares, (vii) the costs and charges of
any transfer agent, registrar or depositary, (viii) the costs and
expenses of the Company relating to investor presentations on any "road
show" undertaken in connection with the marketing of the offering of
the Shares, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with
the prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants,
and the cost of any aircraft chartered in connection with the road
show, and (ix) all other costs and expenses incident to the performance
of the obligations of the Sellers hereunder for which provision is not
otherwise made in this Section. It is understood, however, that except
as provided in this Section, Section 9 entitled "Indemnity and
Contribution", and the last paragraph of Section 11 below, the
Underwriters will pay all of their costs and expenses, including fees
and disbursements of their counsel, stock transfer taxes payable on
resale of any of the Shares by them and any advertising expenses
connected with any offers they may make.
8. INDEMNITY AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), from and against any and all losses, claims, damages
and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages
or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to
any Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use therein.
(b) The Selling Stockholder agrees to indemnify and hold
harmless the Underwriters and each person, if any, who controls any
Underwriter within the meaning
of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, or is under common control with or is controlled by any
Underwriter, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
any amendment thereof, any preliminary prospectus or the Prospectus (as
amended or supplemented if the Company shall have furnished any
amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but
only with reference to information relating to the Selling Stockholder
furnished in writing by or on behalf of the Selling Stockholder
expressly for use in the Registration Statement, any preliminary
prospectus, the Prospectus or any amendments or supplements thereto.
The aggregate liability of the Selling Stockholder under the indemnity
agreement contained in this paragraph and the contribution agreement
contained in paragraphs 8(e) and (f) below shall be limited to an
amount equal to the net proceeds received by the Selling Stockholder
from the offering of the Shares sold by the Selling Stockholder under
this Agreement.
(c) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Company, the Selling Stockholder,
the directors of the Company, the officers of the Company who sign the
Registration Statement and each person, if any, who controls the
Company or the Selling Stockholder within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the foregoing indemnity from the Company and the Selling
Stockholder to such Underwriter, but only with reference to information
relating to such Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use in the Registration
Statement, any preliminary prospectus, the Prospectus or any amendments
or supplements thereto.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 8(a), 8(b) or 8(c),
such person (the "INDEMNIFIED PARTY") shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party, upon request of the indemnified
party, shall retain counsel reasonably satisfactory to the indemnified
party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the
fees and disbursements of such counsel related to such proceeding. In
any such proceeding, any indemnified party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying
party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any
proceeding or related proceedings in the same jurisdiction, be liable
for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all
such fees and expenses shall be reimbursed as they are incurred. In the
case of any such separate firm for the Underwriters and such control
persons of any Underwriters, such firm shall be designated in writing
by Xxxxxx Xxxxxxx & Co. Incorporated. In the case of any such separate
firm for the Company, and such directors, officers and control persons
of the Company, such firm shall be designated in writing by the
Company. In the case of any separate firm for the Selling Stockholder
and such control persons of the Selling Stockholder, such firm shall be
designated in writing by the persons named as attorneys-in-fact for the
Selling Shareholder under the Powers of Attorney. The indemnifying
party shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party
agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of
such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is
or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding.
(e) To the extent the indemnification provided for in
Section 8(a), 8(b) or 8(c) is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such paragraph,
in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received
by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand from the offering of the
Shares or (ii) if the allocation provided by clause 8(e)(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 8(e)(i)
above but also the relative fault of the indemnifying party or parties
on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by
the Sellers on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the proceeds from the offering of the
Shares (before deducting expenses) received by each
Seller and the total underwriting discounts and commissions received by
the Underwriters, in each case as set forth in the table on the cover
of the Prospectus, bear to the aggregate Public Offering Price of the
Shares. The relative fault of the Sellers on the one hand and the
Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Sellers or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Underwriters' respective obligations to contribute
pursuant to this Section 8 are several in proportion to the respective
number of Shares they have purchased hereunder, and not joint. The
aggregate liability of the Selling Stockholder under the contribution
agreement contained in this Section and Section 8(f) and under the
indemnification agreement contained in Sections 8(a) and 8(b) above
shall be limited to an amount equal to the net proceeds received by
such Selling Stockholder from the offering of the Shares sold by the
Selling Stockholder.
(f) The Sellers and the Underwriters agree that it would
not be just or equitable if contribution pursuant to this Section 8
were determined by PRO RATA allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations
referred to in Section 8(e). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8, no Underwriter shall
be required to contribute any amount in excess of the amount by which
the total price at which the Shares underwritten by it and distributed
to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section
8 are not exclusive and shall not limit any rights or remedies which
may otherwise be available to any indemnified party at law or in
equity.
(g) The indemnity and contribution provisions contained
in this Section 9 and the representations, warranties and other
statements of the Company and the Selling Stockholder contained in this
Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Selling Stockholder or any person
controlling the Selling Stockholder or by or on behalf of the Company,
its officers or directors or any person controlling the Company and
(iii) acceptance of and payment for any of the Shares.
9. TERMINATION. This Agreement shall be subject to
termination by notice given by you to the Company, if (a) after the execution
and delivery of this Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as the
case may be, any of the New York Stock Exchange, the American Stock Exchange,
the National Association of Securities Dealers, Inc., the Chicago Board of
Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (ii) trading of any securities of the Company shall have been
suspended on any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in your judgment, is
material and adverse and (b) in the case of any of the events specified in
clauses 9(a)(i) through 9(a)(iv), such event, singly or together with any
other such event, makes it, in your judgment, impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus.
10. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This
Agreement shall become effective upon the execution and delivery hereof by
the parties hereto.
If, on the Closing Date or the Option Closing
Date, as the case may be, any one or more of the Underwriters shall fail or
refuse to purchase Shares that it has or they have agreed to purchase
hereunder on such date, and the aggregate number of Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to
purchase is not more than one-tenth of the aggregate number of the Shares to
be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule II bears to the aggregate number
of Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase
the Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; PROVIDED that in no event shall
the number of Shares that any Underwriter has agreed to purchase pursuant to
this Agreement be increased pursuant to this Section 10 by an amount in
excess of one-ninth of such number of Shares without the written consent of
such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Firm Shares and the aggregate number of Firm
Shares with respect to which such default occurs is more than one-tenth of
the aggregate number of Firm Shares to be purchased, and arrangements
satisfactory to you, the Company and the Selling Stockholder for the purchase
of such Firm Shares are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter, the Company or the Selling Stockholder. In any such case, either
you or the Company shall have the right to postpone the Closing Date, but in
no event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. If, on the Option Closing Date,
any Underwriter or Underwriters shall fail or refuse to purchase Additional
Shares and the aggregate number of Additional Shares with respect to which
such default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased, the non-defaulting Underwriters shall have
the option to (i) terminate their obligation hereunder to purchase Additional
Shares or (ii) purchase not less than the number of Additional Shares that
such non-
defaulting Underwriters would have been obligated to purchase in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters,
or any of them, because of any failure or refusal on the part of any Seller
to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason any Seller shall be unable to perform its
obligations under this Agreement, the Company will reimburse the Underwriters
or such Underwriters as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
disbursements of their counsel) reasonably incurred by such Underwriters in
connection with this Agreement or the offering contemplated hereunder.
11. COUNTERPARTS. This Agreement may be signed in two
or more counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
12. APPLICABLE LAW. This Agreement shall be governed
by and construed in accordance with the internal laws of the State of New
York.
13. HEADINGS. The headings of the sections of this
Agreement have been inserted for convenience of reference only and shall not
be deemed a part of this Agreement.
14. HEADINGS. The headings of the sections of this
Agreement have been inserted for convenience of reference only and shall not
be deemed a part of this Agreement.
Very truly yours,
POLYCOM, INC.
By:
----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President of
Finance and Administration
and Chief Financial Officer
SELLING STOCKHOLDER:
3M FINANCIAL MANAGEMENT COMPANY
By:
----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Attorney-in-fact
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxx Partners LLC
Xxxx Xxxxxxxx Xxxxxxx
Warburg Dillon Read LLC
First Security Xxx Xxxxxx
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
----------------------------------
Name:
Title
SCHEDULE I
NUMBER OF FIRM
UNDERWRITER SHARES TO BE PURCHASED
----------- ----------------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxx Partners LLC.
Xxxx Xxxxxxxx Xxxxxxx
Warburg Dillon Read LLC.
First Security Xxx Xxxxxx
-----------
Total 2,600,000
-----------
-----------
EXHIBIT A
[FORM OF LOCK-UP LETTER]
, 2000
---------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxx Partners LLC
Xxxx Xxxxxxxx Xxxxxxx
Warburg Dillon Read LLC
First Security Xxx Xxxxxx
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("XXXXXX XXXXXXX") proposes to enter into an Underwriting Agreement (the
"UNDERWRITING AGREEMENT") with Polycom, Inc., a Delaware corporation (the
"COMPANY") providing for the public offering (the "PUBLIC OFFERING") by the
several Underwriters, including Xxxxxx Xxxxxxx (the "UNDERWRITERS"), of
______________ shares (the "SHARES") of the Common Stock, par value $.0005
per share, of the Company (the "COMMON STOCK").
To induce the Underwriters that may participate in the Public
Offering to continue their efforts in connection with the Public Offering,
the undersigned hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 90 days after the date of the final
prospectus relating to the Public Offering (the "PROSPECTUS"), (1) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant
to purchase, lend, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or (2) 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, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (a) the sale of any Shares to the Underwriters
pursuant to the Underwriting Agreement or (b) transactions relating to shares
of Common Stock or other securities acquired in open market transactions
after the completion of the Public Offering. In addition, the undersigned
agrees that, without the prior written consent of Xxxxxx Xxxxxxx on behalf of
the Underwriters, it will not, during the period commencing on the date
hereof and ending 90 days after the date of the Prospectus, make any demand
for or exercise any right with respect to, the registration of any shares of
Common Stock or any security convertible into or exercisable or exchangeable
for Common Stock. The undersigned also agrees and consents to the entry of
stop transfer instructions with the Company's transfer
agent and registrar against the transfer of the undersigned's shares of
Common Stock except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters
are relying upon this Lock-Up Agreement in proceeding toward consummation of
the Public Offering. The undersigned further understands that this Lock-Up
Agreement is irrevocable and shall be binding upon the undersigned's heirs,
legal representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a
number of factors, including market conditions. Any Public Offering will only
be made pursuant to an Underwriting Agreement, the terms of which are subject
to negotiation between the Company and the Underwriters.
Very truly yours,
----------------------------------
(Name)
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(Address)
