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EXHIBIT 1.1
UNDERWRITING AGREEMENT
April __, 1999
WARBURG DILLON READ LLC
CIBC Oppenheimer Corporation,
XX Xxxxx Securities Corporation
SoundView Technology Group
as Managing Underwriters
c/o Warburg Dillon Read LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Harmonic Inc., a Delaware corporation (the "Company"), proposes
to issue and sell, and the persons named in Schedule B annexed hereto (the
"Selling Stockholders") propose to sell, to the underwriters named in Schedule A
annexed hereto (the "Underwriters") an aggregate of 2,800,000 shares (the "Firm
Shares") of Common Stock, $0.001 par value (the "Common Stock"), of the Company,
of which 2,000,000 shares are to be issued and sold by the Company and an
aggregate of 800,000 shares are to be sold by the Selling Stockholders in the
respective amounts set forth under the caption "Firm Shares" in Schedule B
annexed hereto. 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 420,000 shares of Common Stock. 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 filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively called the "Act"), with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-74599),
including a prospectus, relating to the Shares, which 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 called the "Exchange Act"). The Company has
furnished to you, for use by the Underwriters and by dealers, copies of one or
more preliminary prospectuses and the documents incorporated by reference
therein (each thereof, including the documents incorporated therein by
reference, being herein called a "Preliminary Prospectus") relating to the
Shares. Except where the context otherwise requires, the registration statement,
as amended when it becomes effective, including all documents filed as a part
thereof or incorporated by reference therein, and including any information
contained in a prospectus subsequently filed with the Commission pursuant to
Rule 424(b) under the Act and deemed to be part of the registration statement at
the time of effectiveness pursuant to Rule 430(A) under the Act and also
including any registration statement filed pursuant to Rule 462(b) under the
Act, is herein called the Registration Statement, and the
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prospectus, including all documents incorporated therein by reference, in the
form 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) or, if no such filing is required, the
form of final prospectus included in the Registration Statement at the time it
became effective, is herein called the Prospectus.
The Company, the Selling Stockholders and the Underwriters agree
as follows:
1. Sale and Purchase. Upon the basis of the warranties and
representations and subject to the terms and conditions herein set forth, the
Company and each of the Selling Stockholders, severally and not jointly, agree
to sell to the respective Underwriters and each of the Underwriters, severally
and not jointly, agrees to purchase from the Company and each Selling
Stockholder the respective number of Firm Shares (subject to such adjustment as
you may determine to avoid fractional shares) which bears the same proportion to
the number of Firm Shares to be sold by the Company or by such Selling
Stockholders, as the case may be, as the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule A annexed hereto bears to the
total number of Firm Shares to be sold by the Company and the Selling
Stockholders, in each case at a purchase price of $[____] per Share. The Company
and each Selling Stockholder 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 effective date of the Registration Statement 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 to purchase, and upon the basis of the warranties and
representations 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 (subject to such adjustment as you shall determine to
avoid fractional shares), 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. This option may be exercised by you on
behalf of the several Underwriters at any time (but not more than once) on or
before the thirtieth day following the date hereof, by written notice to the
Company. Such notice shall set forth the aggregate number of Additional Shares
as to which the option is being exercised, and the date and time when the
Additional Shares are to be delivered (such date and time being herein referred
to as the additional time of purchase); provided, however, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second business day(1) after the date on which the
option shall have been exercised nor later than
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(1) As used herein "business day" shall mean a day on which the New York Stock
Exchange is open for trading.
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the tenth business day after the date on which the 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
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 you may
determine to eliminate fractional shares).
Pursuant to powers of attorney, which shall be satisfactory to
counsel for the Underwriters, granted by each Selling Stockholder, Xxxxxxx X.
Xxx and Xxxxx X. Xxxxxxx will act as representatives of the Selling
Stockholders. The foregoing representatives (the "Representatives of the Selling
Stockholders") are authorized, on behalf of each Selling Stockholder, to execute
any documents necessary or desirable in connection with the sale of the Shares
to be sold hereunder by each Selling Stockholder, to make delivery of the
certificates of such Shares, to receive the proceeds of the sale of such Shares,
to give receipts for such proceeds, to pay therefrom the expenses to be borne by
each Selling Stockholder in connection with the sale and public offering of the
Shares, to distribute the balance of such proceeds to each Selling Stockholder
in proportion to the number of Shares sold by each Selling Stockholder, to
receive notices on behalf of each Selling Stockholder and to take such other
action as may be necessary or desirable in connection with the transactions
contemplated by this Agreement.
2. Payment and Delivery. Payment of the purchase price for the
Firm Shares shall be made to the Company and each of the Selling Stockholders 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 April __, 1999 (unless another time
shall be agreed to by you, the Company and the Representatives of the Selling
Stockholders or unless postponed in accordance with the provisions of Section 10
hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the time of purchase. Certificates for the Firm
Shares shall be delivered to you in such names and in such denominations as you
shall specify no later than the second business day preceding the time of
purchase. For the purpose of expediting the checking of the certificates for the
Firm Shares by you, the Company and the Selling Stockholders agree to make such
certificates available to you for such purpose at least one full business day
preceding the time of purchase.
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. Certificates for the Additional
Shares shall be delivered to you in such names and in such denominations as you
shall specify no later than the second business day preceding the additional
time of purchase. For the purpose of expediting the checking of the certificates
for the Additional Shares by you, the Company agrees to make such certificates
available to you for such purpose at least one full business day preceding the
additional time of purchase.
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3. Representations and Warranties of the Company. The Company
represents and warrants to each of the Underwriters that:
(a) the Company has not received, and has no notice of,
any order of the Commission preventing or suspending the use of any Preliminary
Prospectus, or instituting proceedings for that purpose, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects to
the requirements of the Act and when the Registration Statement became
effective, the Registration Statement and the Prospectus complied in all
material respects with the provisions of the Act, and, as of the time of
purchase, the Registration Statement will 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, and, as of the time of
purchase, the Prospectus will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading; any statutes, regulations, contracts, legal or
governmental proceedings 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 have been so described or filed; provided, however, that
the Company makes no warranty or representation with respect to any statement
contained in the Registration Statement or the Prospectus in reliance upon and
in conformity with information concerning the Underwriters and furnished in
writing by or on behalf of any Underwriter through you to the Company expressly
for use in the Registration Statement or the Prospectus. The documents
incorporated by reference in the Prospectus, at the time they were filed with
the Commission, complied in all material respects with the requirements of the
Act and the Exchange Act, and at the time of purchase do not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading and the Company has not
distributed any offering material in connection with the offering or sale of the
Shares other than the Registration Statement, the Preliminary Prospectus, the
Prospectus or any other materials, if any, permitted by the Act or the
Underwriters;
(b) the information set forth under the caption
"Capitalization" in the Prospectus is true and correct as of the date therein
indicated. All of the issued and outstanding shares of capital stock including
Common Stock of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable , have been issued in compliance with all
federal and state securities laws and were not issued in violation of any
preemptive right, resale right, right of first refusal or similar right;
(c) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with full power and authority to own, lease and operate its properties
and conduct its business as described in the Registration Statement;
(d) the Company is duly qualified to do business as a
foreign corporation 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 so qualify would
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not have a material adverse effect on the business, properties, financial
condition or results of operation of the Company and its Subsidiaries (as
hereinafter defined) taken as a whole (a "Material Adverse Effect"). The Company
has no "significant subsidiaries" (as defined in the Rules and Regulations)
other than the subsidiaries listed on Schedule C hereto (collectively, the
"Subsidiaries"); the Company directly or indirectly owns 100% of the outstanding
capital stock of all of its Subsidiaries; complete and correct copies of the
certificates of incorporation and of the bylaws of the Company and the
Subsidiaries and all amendments thereto have been delivered or made available to
you, and except as set forth in the exhibits to the Registration Statement no
changes therein will be made subsequent to the date hereof and prior to the
Closing Date or, if later, the Option Closing Date; each Subsidiary has been
duly incorporated and is validly existing as a corporation 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; each Subsidiary is duly qualified to do business
as a foreign corporation in each jurisdiction where the ownership or leasing of
the properties or the conduct of its business requires such qualification,
except where the failure to so qualify would not 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 and
(except as otherwise described in this Section 3(d)) are owned by the Company
subject to no security interest, other encumbrance or adverse claims, except the
security interests with respect to indebtedness of the Company as disclosed in
the Prospectus; 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.
(e) the Company and each of its Subsidiaries are in
compliance in all material respects with the laws, orders, rules, regulations
and directives issued or administered by each jurisdiction in which they conduct
their respective businesses, except where noncompliance could singly or in the
aggregate result in a Material Adverse Effect;
(f) neither the Company nor any of its Subsidiaries is in
breach of, or in default under (nor has any event occurred which with notice,
lapse of time, or both would result in any breach of, or constitute a default
under), its respective charter or by-laws or in the performance or observance of
any obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any lease, contract or other agreement or instrument to which
the Company or any of its Subsidiaries is a party or by which any of them or any
of their properties is bound, and 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, or result in any breach
of or constitute a default under (nor constitute any event which with notice,
lapse of time, or both would result in any breach of, or constitute a default
under), any provisions of the charter or by-laws, of the Company or any of its
Subsidiaries or under any provision of any license, indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which any of them or their respective
properties may be bound or affected, or under any federal, state, local or
foreign law, regulation or rule or any decree, judgment or order applicable to
the Company or any of its Subsidiaries;
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(g) this Agreement has been duly authorized, executed and
delivered by the Company and is a legal, valid and binding agreement of the
Company enforceable in accordance with its terms;
(h) 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 and fully paid and non-assessable;
(i) no approval, authorization, consent or order of or
filing with any national, state or local governmental or regulatory commission,
board, body, authority or agency is required in connection with the issuance and
sale of the Shares or the consummation by the Company of the transaction as
contemplated hereby other than registration of the Shares under the Act and 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 under
the rules and regulations of the National Association of Securities Dealers,
Inc. (NASD);
(j) except as disclosed in the Prospectus, no person has
the right, contractual or otherwise, to cause the Company to issue to it, or
register pursuant to the Act, any shares of capital stock of the Company upon
the issue and sale of the Shares to the Underwriters hereunder, nor does any
person have preemptive rights, co-sale rights, rights of first refusal or other
rights to purchase any of the Shares other than those that have been expressly
waived prior to the dates hereof;
(k) PriceWaterhouseCoopers LLP, whose report on the
consolidated financial statements of the Company and its Subsidiaries is filed
with the Commission as part of the Registration Statement and Prospectus, are
independent public accountants as required by the Act;
(l) each of the Company and its Subsidiaries has all
necessary licenses, authorizations, consents and approvals and has made all
necessary filings required under any federal, state, local or foreign law,
regulation or rule, and has obtained all necessary authorizations, consents and
approvals from other persons, in order to conduct its respective business;
neither the Company nor any of its Subsidiaries is in violation of, or in
default under, 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 its Subsidiaries the effect of
which could have a Material Adverse Effect;
(m) there are no actions, suits, claims, investigations or
proceedings pending or, to the knowledge of the Company, threatened to which the
Company or any of its Subsidiaries or any of their respective officers is a
party or of which any of their respective properties is subject at law or in
equity, or before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency which could result in a
judgment, decree or order having a Material Adverse Effect or prevent the
consummation of the transaction contemplated hereby;
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(n) the audited financial statements included in the
Registration Statement and the Prospectus present fairly the consolidated
financial position of the Company and its Subsidiaries as of the dates indicated
and the consolidated results of operations and cash flows of the Company and its
Subsidiaries for the periods specified; such financial statements have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis during the periods involved;
(o) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
not been (i) any material adverse change, or any development which, in the
Company's reasonable judgment, is likely to cause a material adverse change, in
the business, properties or assets described or referred to in the Registration
Statement, or the results of operations, condition (financial or otherwise),
business or operations of the Company and its Subsidiaries taken as a whole,
(ii) any transaction which is material to the Company or its Subsidiaries,
except transactions in the ordinary course of business or described in the
Registration Statement as it may be amended or supplemented, (iii) any
obligation, direct or contingent, which is material to the Company and its
Subsidiaries taken as a whole, incurred by the Company or its Subsidiaries,
except obligations incurred in the ordinary course of business or described in
the Registration Statement as it may be amended or supplemented, (iv) any change
in the capital stock or outstanding indebtedness of the Company or its
Subsidiaries or (v) any dividend or distribution of any kind declared, paid or
made on the capital stock of the Company. Neither the Company nor its
Subsidiaries has any material contingent obligation which is not disclosed in
the Registration Statement.
(p) the Company has obtained the agreement of each of the
Selling Stockholders and of each of its directors and executive officers and
certain of its other stockholders not to sell, offer to sell, contract to sell,
hypothecate grant any option to sell or otherwise dispose of, directly or
indirectly, any shares of Common Stock or securities convertible into or
exchangeable for Common Stock or warrants or other rights to purchase Common
Stock for a period of 90 days after the date of the Prospectus;
(q) the Company is not and, after giving effect to the
offering and sale of the Shares, will not 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");
4. Representations and Warranties of the Selling Stockholders.
Each Selling Stockholder, severally and not jointly, represents and warrants to
each Underwriter that:
(a) such Selling Stockholder, at the time of delivery of
such Shares, will be, the lawful owner of the number of Shares to be sold by
such Selling Stockholder pursuant to this Agreement and, at the time of delivery
thereof, will have valid and marketable title to such Shares, and upon delivery
of and payment for such Shares (whether at the time of purchase or the
additional time of purchase, as the case may be), the Underwriters will acquire
valid and marketable title to such Shares free and clear of any claim, lien,
encumbrance, security interest, community property right, restriction on
transfer or other defect in title;
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(b) such Selling Stockholder, at the time of delivery of
such Shares, will have, full legal right, power and capacity, and any approval
required by law (other than those imposed by the Act and the securities or blue
sky laws of certain jurisdictions), to sell, assign, transfer and deliver such
Shares in the manner provided in this Agreement;
(c) this Agreement and the Custody Agreement between
ChaseMellon Shareholder Services, as custodian, and the Selling Stockholders
(the Custody Agreement) have been duly executed and delivered by such Selling
Stockholder and each is a legal, valid and binding agreement of such Selling
Stockholder enforceable in accordance with their terms;
(d) when the Registration Statement becomes effective and
at all times subsequent thereto through the latest of the time of purchase or
the termination of the offering of the Shares, the Registration Statement and
Prospectus, and any supplements or amendments thereto as relate to such Selling
Stockholder will 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;
(e) such Selling Stockholder has duly and irrevocably
authorized the Representatives of the Selling Stockholders, on behalf of such
Selling Stockholder, to execute and deliver this Agreement and any other
document necessary or desirable in connection with the transactions contemplated
thereby and to deliver the Shares to be sold by such Selling Stockholder and
receive payment therefor pursuant hereto; and
(f) the sale of such Selling Stockholder's Shares pursuant
to this Agreement is not prompted by any information concerning the Company
which is not set forth in the Prospectus.
5. 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 jurisdictions as you may designate and to
maintain such qualifications in effect so long as required for the distribution
of the Shares; provided 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 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 the Registration Statement 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 request
for the purposes contemplated by the Act;
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(c) to advise you promptly and (if requested by you) to
confirm such advice in writing, (i) when the Registration Statement has become
effective and when any post-effective amendment thereto becomes effective and
(ii) if Rule 430A under the Act is used, 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 under such Rules);
(d) to advise you promptly, confirming such advice in
writing if requested, of any request by the Commission for amendments or
supplements to the Registration Statement or Prospectus or for 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 make every
reasonable effort 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 or Prospectus including by filing any documents that
would be incorporated therein by reference and to file no such amendment or
supplement to which you shall object in writing;
(e) to file promptly all reports and any definitive proxy
or information statement required to be filed by the Company with the Commission
in order to comply with the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the shares, and to promptly notify you
of such filing;
(f) if necessary or appropriate, to file a registration
statement pursuant to Rule 462(b) under the Act;
(g) to furnish or make available to you and, upon request,
to each of the other Underwriters for a period of five years from the date of
this Agreement (i) copies of any reports or other communications which the
Company shall send to its stockholders or shall from time to time publish or
publicly disseminate, (ii) copies of all annual, quarterly and current reports
filed with the Commission on Forms 10-K, 10-Q and 8-K, or such other similar
form as may be designated by the Commission, (iii) copies of documents or
reports filed with any national securities exchange on which any class of
securities of the Company is listed, and (iv) such other information as you may
reasonably request regarding the Company or its Subsidiaries, in each case as
soon as such communications, documents or information becomes available;
(h) to advise the Underwriters promptly of the happening
of any event known to the Company within the time during which a Prospectus
relating to the Shares is required to be delivered under the Act which, in the
judgment of the Company, would require the making of any change in the
Prospectus then being used , or in the information incorporated therein by
reference, so that the Prospectus would not include an untrue statement of
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they are made, not
misleading, and, during such time, to prepare and furnish, at the Company's
expense, to the Underwriters promptly such amendments or
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supplements to such Prospectus as may be necessary to reflect any such change
and to furnish you a copy of such proposed amendment or supplement before filing
any such amendment or supplement with the Commission;
(i) to furnish to you four (4) signed copies of the
Registration Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto) and sufficient conformed
copies of the foregoing (other than exhibits) for distribution of a copy to each
of the other Underwriters;
(j) if available, to furnish to you as early as
practicable prior to the time of purchase and the 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 consolidated financial statements, if
any, of the Company and its Subsidiaries which have been read by the Company's
independent certified public accountants, as stated in their letter to be
furnished pursuant to Section 8(e) hereof; and
(k) 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.
6. Certain Covenants of the Company and the Selling Stockholders.
The Company and each of the Selling Stockholders agree with each Underwriter as
follows:
(a) the Company will pay all expenses, fees and taxes
(other than any transfer taxes and fees and disbursements of counsel for the
Underwriters except as set forth under Section 7 hereof or (iii) or (iv) below)
in connection with (i) the preparation and filing of the Registration Statement,
each Preliminary Prospectus, the 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
issuance, sale and delivery of the Shares by the Company and the Selling
Stockholders, (iii) the word processing and/or printing of this Agreement, any
Agreement Among Underwriters, any dealer agreements, any Statements of
Information, the Custody Agreement and the Powers of Attorney and the
reproduction and/or printing and furnishing of copies of each thereof to the
Underwriters and to dealers (including costs of mailing and shipment), (iv) the
qualification of the Shares for offering and sale under state laws and the
determination of their eligibility for investment under state law as aforesaid
(including the legal fees and filing fees and other disbursements of counsel to
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 NASDAQ and any registration thereof under the Exchange Act,
(vi) the filing for review of the public offering of the Shares by the National
Association of Securities Dealers, Inc. (the NASD), and (vii) the performance of
the Company's and the Selling Stockholders' other obligations hereunder; and
(b) the Company (other than pursuant to its existing stock
plans or in connection with any acquisition transaction) and the Selling
Stockholders will not issue, sell, grant any option to sell or otherwise dispose
of, directly or indirectly, any shares of Common Stock or securities convertible
into or exchangeable for Common Stock or warrants or other
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rights to purchase Common Stock or, in the case of the Company, permit the
registration under the Act of any shares of Common Stock, except for the
registration of the Shares and the sales to the Underwriters pursuant to this
Agreement and except for issuances of Common Stock upon the exercise of
outstanding options, warrants and debentures, for a period of ninety (90) days
after the date of the Prospectus, without the prior written consent of WDR.
7. Reimbursement of Underwriters' Expenses. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the first two paragraphs of Section 10 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 6(a)
hereof, reimburse the Underwriters for all of their out-of-pocket expenses,
including the fees and disbursements of their counsel, but the Company will not
in any event be liable to any of the Underwriters for damages on account of loss
of anticipated profits.
8. 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 and the Selling
Stockholders at the time of purchase (and the several obligations of the
Underwriters at the additional time of purchase are subject to the accuracy of
the representations and warranties on the part of the Company and the Selling
Stockholders at the time of purchase (unless previously waived) and at the
additional time of purchase, as the case may be), the performance by the Company
and the Selling Stockholders of their obligations hereunder and to the following
additional conditions precedent:
(a) The Company shall furnish to you at the time of
purchase and at the additional time of purchase, as the case may be, an opinion
of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation, addressed to the
Underwriters, and dated the time of purchase or the additional time of purchase,
as the case may be, with reproduced copies for each of the other Underwriters
and in form satisfactory to Xxxxxxx, Phleger & Xxxxxxxx LLP, counsel for the
Underwriters, stating that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares as herein
contemplated;
(ii) the Company is duly qualified or licensed by each
jurisdiction in which it conducts its business and in which the failure,
individually or in the aggregate, to be so licensed or qualified could
have a Material Adverse Effect, and the Company is duly qualified, and
is in good standing, in each jurisdiction in which it owns or leases
real property or maintains an office and in which such qualification is
necessary;
(iii) this Agreement has been duly authorized, executed
and delivered by the Company;
11.
12
(iv) the Shares to be sold by the Company pursuant to this
Agreement have been duly authorized and, when issued and delivered to
and paid for by the Underwriters, will be duly and validly and issued
and will be fully paid and non-assessable;
(v) as of the date set forth in the Registration Statement
and the Prospectus, the Company has an authorized capitalization as set
forth in the Registration Statement and the Prospectus; the outstanding
shares of capital stock of the Company have been duly and validly
authorized and issued, and are fully paid, nonassessable and free of
statutory and to such counsel's knowledge contractual preemptive rights;
the Shares when issued will be free of statutory and to such counsel's
knowledge contractual preemptive rights, resale rights, rights of first
refusal and similar rights, except as disclosed in the Registration
Statement and Prospectus;
(vi) other than the Subsidiaries, to such counsel's
knowledge the Company does not own or control, directly or indirectly,
any corporation, association or other entity that is a "significant
subsidiary" (as defined in the Rules and Regulations);
(vii) the statements set forth in the Prospectus under the
caption "Description of Capital Stock," insofar as they purport to
constitute a summary of the terms of the capital stock of the Company,
fairly and accurately summarize such terms in all material respects;
(viii) at the time it became effective, the Registration
Statement and the Prospectus (except as to the financial statements and
schedules and other financial and statistical data contained or
incorporated by reference therein, as to which such counsel need express
no opinion) comply as to form in all material respects with the
requirements of the Act;
(ix) the Registration Statement has become effective under
the Act and, to the best of such counsel's knowledge, no stop order
proceedings with respect thereto are pending or threatened under the Act
and any required filing of the Prospectus and any supplement thereto
pursuant to Rule 424 under the Act has been made in the manner and
within the time period required by such Rule 424;
(x) no approval, authorization, consent or order of or
filing with any national, state or local governmental or regulatory
commission, board, body, authority or agency is required in connection
with the issuance and sale of the Shares and consummation by the Company
of the transaction as contemplated hereby other than registration of the
Shares under the Act (except such counsel need express no opinion as to
any necessary qualification under the state securities or blue sky laws
of the various jurisdictions in which the Shares are being offered by
the Underwriters);
(xi) the execution and delivery of this Agreement by the
Company and the performance by the Company of its obligations pursuant
to this Agreement do not and will not violate any provisions of the
charter or by-laws of the Company , or result in any breach of, or
constitute a default under (nor constitute any event which with notice,
lapse
12.
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of time, or both, would result in any breach of or constitute a default
under) any provision of any license, indenture, mortgage, deed of trust,
bank loan, credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company is
a party or it or its properties may be bound or affected and which are
filed as an exhibit to the Registration Statement or incorporated
therein by reference, or violate any federal, state, local or foreign
law, regulation or rule or any decree, judgment or order applicable to
the Company and known to such counsel;
(xii) to the best of such counsel's knowledge, the Company
is not in violation of its charter or by-laws;
(xiii) to the best of such counsel's knowledge, there are
no actions, suits, claims, investigations or proceedings pending,
threatened or contemplated to which the Company or any of its
Subsidiaries is subject or of which any of their respective properties,
is subject at law or in equity or before or by any federal, state, local
or foreign governmental or regulatory commission, board, body, authority
or agency which are required to be described in the Prospectus but are
not so described;
(xiv) the documents incorporated by reference in the
Registration Statement and Prospectus, when they were filed (or, if an
amendment with respect to any such document was filed when such
amendment was filed) with the Commission, complied as to form in all
material respects with the Exchange Act (except as to the financial
statements and schedules and other financial and statistical data
contained or incorporated by reference therein as to which such counsel
need express no opinion); and
(xv) the Company will not, upon consummation of the
transactions contemplated by this Agreement, be an "investment company,"
or a "promoter" or "principal underwriter" for, a "registered investment
company," as such terms are defined in the Investment Company Act of
1940, as amended.
In addition, such counsel shall state that such counsel
have participated in conferences with officers and other representatives of the
Company, representatives of the independent public accountants of the Company
and representatives of the Underwriters at which the contents of the
Registration Statement and Prospectus were discussed and, although such counsel
is not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or Prospectus (except as and to the extent stated in subparagraphs (v)
and (vii) above), on the basis of the foregoing nothing has come to the
attention of such counsel that causes them to believe that the Registration
Statement or any amendment thereto at the time such Registration Statement or
amendment became effective contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus or any
supplement thereto at the date of such Prospectus or such supplement, and at all
times up to and including the time of purchase or additional time of purchase,
as the case may be, contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under
13.
14
which they were made, not misleading (it being understood that such counsel need
express no opinion with respect to the financial statements and schedules and
other financial and statistical data included in the Registration Statement or
Prospectus).
(b) The Selling Stockholders shall furnish to you at the
time of purchase and at the additional time of purchase, as the case may be,
opinions of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx Professional Corporation as counsel
to the Selling Shareholders other than Scientific-Atlanta, N.M. New Media
Entertainment, Ltd., Xxxxx Xxxxxxx as an authorized employee of
Scientific-Atlanta, and [______________] as counsel to N.M. New Media
Entertainment, Ltd., addressed to the Underwriters, and dated the time of
purchase or the additional time of purchase, as the case may be, with reproduced
copies for each of the other Underwriters, and in form and substance
satisfactory to Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters,
stating that:
(i) this Agreement and the Custody Agreement have been
duly executed and delivered by or on behalf of each of the Selling
Stockholders;
(ii) each Selling Stockholder has full legal right and
power, and has obtained any authorization or approval required by law
(other than those imposed by the Act and the securities or blue sky laws
of certain jurisdictions), to sell, assign, transfer and deliver the
Shares to be sold by such Selling Stockholder in the manner provided in
this Agreement;
(iii) assuming the Underwriters purchase the Shares to be
sold by each Selling Stockholder for value, in good faith and without
notice of any adverse claim within the meaning of Article VIII of the
Uniform Commercial Code, upon delivery and payment for shares to be sold
by each Selling Stockholder pursuant to this Agreement, the Underwriters
will receive good and valid title to such Shares, free and clear of all
security interests, liens, equities, claims and other encumbrances; and
(iv) the Custody Agreement and the Power of Attorney have
been duly executed and delivered by or on behalf of each Selling
Stockholder.
In rendering such opinion, Xxxxxx Xxxxxxx Xxxxxxxx &
Xxxxxx Professional Corporation, Xxxxx Xxxxxxx and [____________________] may
rely as to matters governed by the laws of states other than California,
Delaware, or Federal laws on local counsel in such jurisdictions, provided that
in each case, Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx Professional Corporation, Xxxxx
Xxxxxxx and [____________________] shall state that it believes that it and the
Underwriters are justified in relying on such other counsel.
(c) The Company shall furnish to you at the time of
purchase opinions of [__________], and [__________], Israeli counsel to the
Company's Subsidiaries in Israel, relating to each of the Israeli Subsidiaries
(each an "Israeli Subsidiary") addressed to the Underwriters and dated the time
of purchase, with reproduced copies for each of the other Underwriters, and in
form satisfactory to Xxxxxxx, Xxxxxxx & Xxxxxxxx, LLP, counsel to the
Underwriters stating that:
14.
15
(i) the Israeli Subsidiary has been duly incorporated and
is validly existing as a corporation under the laws of Israel, and has
all requisite corporate authority to own, lease and license its
properties and conduct the business in which it is engaged;
(ii) to the best of such counsel's knowledge, the Israeli
Subsidiary is not qualified as a foreign corporation in any
jurisdiction, and, to the best of such counsel's knowledge, is not
required to so qualify except where the failure to so qualify would not
have a material adverse effect on the Company and the Israeli Subsidiary
taken as a whole;
(iii) all of the issued and outstanding capital stock of
the Israeli Subsidiary has been duly and validly issued and is fully
paid and nonassessable and was not issued in violation of preemptive
rights and is owned, directly or indirectly, by the Company, to the best
of such counsel's knowledge, free and clear of any lien encumbrance,
claim, security interest, restriction on transfer, stockholders'
agreement, voting trust or other defect of title whatsoever;
(iv) to the best of such counsel's knowledge, there is no
litigation or governmental or other action, suit, proceedings or
investigations before any court or before or by any public, regulatory
or governmental agency or body pending or, to the best of such counsel's
knowledge, threatened in Israel against, or involving the properties or
business of, the Israeli Subsidiary in Israel which, if determined
adversely to the Israeli Subsidiary would have a Material Adverse Effect
on the consolidated financial position, shareholders equity or results
of operations of the Company and its subsidiaries; and
(v) to the best of such counsel's knowledge, the
execution, delivery and performance by Company of the Underwriting
Agreement and the performance by Company of its obligations set forth
therein do not and will not (A) result in a breach or violation of any
of the provisions of, or constitute a default (or an event which with
notice or lapse of time, or both, would constitute a default) or require
consent under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Israeli
Subsidiary of which we know pursuant to, any material agreement,
instrument, franchise, license or permit known to such counsel to which
the Israeli Subsidiary is a party or by which it or its properties or
assets are bound (insofar as such agreements or instruments are governed
by Israeli law) the effect of which breach or violation would have a
Material Adverse Effect, or (B) violate or conflict with any provision
of the Memorandum of Association or Articles of Association of the
Israeli Subsidiary, or, to the best of such counsel's knowledge, any
judgment, decree, order, statute, rule or regulation known to such
counsel of any Israeli court or any Israeli public, governmental or
regulatory agency or body having jurisdiction over the Israeli
Subsidiary or any of its properties or assets in Israel of which such
counsel knows. To the best of such counsel's knowledge, no consent,
approval, authorization, order, registration, filing, qualification,
license or permit of or with any Israeli court or any Israeli public,
governmental agency or body having jurisdiction over the Israeli
Subsidiary or any of its properties or assets in Israel of which we know
is required for the execution, delivery and performance by the
15.
16
Company of the Underwriting Agreement or the consummation of the
transactions contemplated thereby, except that no opinion is rendered
herein with respect to the Israeli Securities Law, 1978 and rules and
regulations promulgated thereunder, as well as with respect to the
compliance by the Company therewith.
In rendering such opinion, [___________] and [___________]
may rely as to matters governed by the laws of jurisdiction other than Israel on
local counsel in such jurisdictions, provided that in each case, [_____________]
and [____________] shall state that it believes that it and the Underwriters are
justified in relying on such other counsel.
(d) The Company shall furnish to you at the time of
purchase an opinion of Xxxxxx Xxxxxxx Xxxxxxx, U.K. counsel to the Company with
respect to Harmonic (U.K.) Ltd. (the "UK Subsidiary"), addressed to the
Underwriters and dated the time of purchase, with reproduced copies for each of
the other Underwriters, and in form satisfactory to Xxxxxxx, Xxxxxxx & Xxxxxxxx
LLP, counsel to the Underwriters stating that:
To the best of such counsel's knowledge, based upon and
subject to the foregoing and subject to the reservations referred to below, we
are of the opinion that
(i) The U.K. Subsidiary is duly incorporated and validly
existing as a private limited company registered in England under
company number 3335009. The Company is authorized pursuant to its
Memorandum of Association to carry on its current business and to own,
lease and license its current premises. The U.K. Subsidiary is in "good
standing" as shown by the Certificate of Good Standing received from the
Registrar of Companies.
(ii) The authorized share capital of the U.K. Subsidiary
is Pound Sterling1,000,000 divided into 1,000,000 shares of Pound
Sterling1 each of which 1,000 shares have been validly issued and are
fully paid up. Harmonic Lightwaves Inc. is the registered holder of
1,000 ordinary shares of Pound Sterling1 each in the capital of the U.K.
Subsidiary which, to the best of such counsel's knowledge and belief,
are free and clear of all liens, restrictions on transfer, encumbrances
and security interests. Harmonic Lightwaves Inc. is the former name of
Harmonic Inc.
In rendering such opinion, Xxxxxx Xxxxxxx Xxxxxxx may rely as to
matters governed by the laws of jurisdiction other than the laws of England and
Wales on local counsel in such jurisdictions, provided that in each case, Xxxxxx
Xxxxxxx Xxxxxxx shall state that it believes that it and the Underwriters are
justified in relying on such other counsel.
(e) You shall have received from PriceWaterhouseCoopers
LLP, letters dated, respectively, the date of this Agreement and the time of
purchase and additional time of purchase, as the case may be, and addressed to
the Underwriters (with reproduced copies for each of the Underwriters) in the
forms heretofore approved by WDR.
(f) You shall have received at the time of purchase and at
the additional time of purchase, as the case may be, the favorable opinion of
Xxxxxxx, Phleger & Xxxxxxxx LLP,
16.
17
counsel for the Underwriters, dated the time of purchase or the additional time
of purchase, as the case may be, as to the matters referred to in subparagraphs
(iii), (iv), (vii) (with respect to the Shares only), (viii) and (ix) of
paragraph (a) of this Section 8.
In addition, such counsel shall state that such counsel
have participated in conferences with officers and other representatives of the
Company, counsel for the Company, representatives of the independent public
accountants of the Company and representatives of the Underwriters at which the
contents of the Registration Statement and Prospectus and related matters were
discussed and, although such counsel is not passing upon and does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and Prospectus (except as to matters
referred to with respect to the Shares under subparagraph (vii) of paragraph (a)
of this Section 8), on the basis of the foregoing (relying as to materiality to
a large extent upon the opinions of officers and other representatives of the
Company), no facts have come to the attention of such counsel which lead them to
believe that the Registration Statement or any amendment thereto at the time
such Registration Statement or amendment became effective contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that the Prospectus as of its date or any supplement thereto as of its date
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading (it
being understood that such counsel need express no comment with respect to the
financial statements and schedules and other financial and statistical data
included in the Registration Statement or Prospectus).
(g) No amendment or supplement to the Registration
Statement or Prospectus, including documents deemed to be incorporated by
reference therein, shall be filed prior to the time the Registration Statement
becomes effective to which you object in writing.
(h) The Registration Statement shall become effective, or
if Rule 430A under the Act is used, the Prospectus shall have been filed with
the Commission pursuant to Rule 424(b) under the Act, at or before 5:00 P.M.,
New York City time, on the date of this Agreement, unless a later time (but not
later than 5:00 P.M., New York City time, on the second full business day after
the date of this Agreement) shall be agreed to by the Company, the
Representatives of the Selling Stockholders and you in writing or by telephone,
confirmed in writing; provided, however, that the Company, the Representatives
of the Selling Stockholders and you and any group of Underwriters, including
you, who have agreed hereunder to purchase in the aggregate at least 50% of the
Firm Shares may from time to time agree on a later date.
(i) Prior to the time of purchase or the additional time
of purchase, as the case may be, (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, or modifications thereof, if
any, 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; and (iii) the Prospectus and all amendments or
supplements thereto, or modifications thereof, if any, shall not contain an
17.
18
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading.
(j) Between the time of execution of this Agreement and
the time of purchase or the additional time of purchase, as the case may be, (i)
no material and unfavorable change, financial or otherwise (other than as
referred to in the Registration Statement and Prospectus), in the business,
condition or prospects of the Company and its Subsidiaries taken as a whole
shall occur or become known and (ii) no transaction which is material and
unfavorable to the Company shall have been entered into by the Company or any of
its Subsidiaries.
(k) The Company will, at the time of purchase or
additional time of purchase, as the case may be, deliver to you a certificate of
two of its executive officers to the effect that the representations and
warranties of the Company as set forth in this Agreement are true and correct as
of [each] such date, that the Company shall perform such of its obligations
under this Agreement as are to be performed at or before the time of purchase
and at or before the additional time of purchase, as the case may be and the
conditions set forth in paragraphs (i) and (j) of this Section 8 have been met.
(l) You shall have received signed letters, dated the date
of this Agreement, from each of the Selling Stockholders and each of the
directors and officers of the Company and certain of its other stockholders to
the effect that such persons shall not sell, offer or agree to sell, contract to
sell, grant any option to sell or otherwise dispose of, directly or indirectly,
any shares of Common Stock of the Company or securities convertible into or
exchangeable or exercisable for Common Stock or warrants or other rights to
purchase Common Stock for a period of 90 days after the date of the Prospectus
without WDR's prior written consent.
(m) The Company and the Selling Stockholders shall have
furnished to you such other documents and certificates as to the accuracy and
completeness of any statement in the Registration Statement and the Prospectus
as of the time of purchase and the additional time of purchase, as the case may
be, as you may reasonably request.
(n) The Shares shall have been approved for listing for
quotation on 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.
(o) The Selling Stockholders will at the time of purchase
deliver to you a certificate of the Representatives of the Selling Stockholders
to the effect that the representations and the warranties of the Selling
Stockholders as set forth in this Agreement are true and correct as of each such
date.
(p) Between the time of execution of this Agreement and
the time of purchase, there shall not have occurred any downgrading, nor shall
any notice or announcement have been given or made of (i) any intended or
potential downgrading or (ii) any review or possible change that does not
indicate an improvement, in the rating accorded any securities of or
18.
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guaranteed by the Company by any "nationally recognized statistical rating
organization", as that term is defined in Rule 436(g)(2) under the Act.
9. Effective Date of Agreement; Termination. This Agreement shall
become effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, 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 you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares, if, since the time of execution of
this Agreement or the respective dates as of which information is given in the
Registration Statement and Prospectus, (y) there has been any material adverse
and unfavorable change, financial or otherwise (other than as referred to in the
Registration Statement and Prospectus), in the operations, business, condition
or prospects of the Company and its Subsidiaries taken as a whole, which would,
in your judgment or in the judgment of such group of Underwriters, make it
impracticable to market the Shares, or (z) there shall have occurred any
downgrading, or any notice shall have been given of (i) any intended or
potential downgrading or (ii) any review or possible change that does not
indicate an improvement, in the rating accorded any securities of or guaranteed
by the Company by any "nationally recognized statistical rating organization",
as that term is defined in Rule 436(g)(2) under the Act or, if, at any time
prior to the time of purchase or, with respect to the purchase of any Additional
Shares, the additional time of purchase, as the case may be, trading in
securities on the New York Stock Exchange, the American Stock Exchange or the
NASDAQ National Market shall have been suspended or limitations or minimum
prices shall have been established on the New York Stock Exchange, the American
Stock Exchange or the NASDAQ National Market or if a banking moratorium shall
have been declared either by the United States or New York State authorities, or
if the United States shall have declared war in accordance with its
constitutional processes or there shall have occurred any material outbreak or
escalation of hostilities or other national or international calamity or crisis
of such magnitude in its effect on the financial markets of the United States
as, in your judgment or in the judgment of such group of Underwriters, to make
it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this
Agreement as provided in this Section 9, the Company, the Representatives of the
Selling Stockholders and each other Underwriter shall be notified promptly by
letter or telegram.
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 or
the Selling Stockholders, as the case may be, shall be unable to comply with any
of the terms of this Agreement, the Company or the Selling Stockholders, as the
case may be, shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 6(a), 7 and 11 hereof), and the
Underwriters shall be under no obligation or liability to the Company and the
Selling Stockholders under this Agreement (except to the extent provided in
Section 11 hereof) or to one another hereunder.
19.
20
10.Increase in Underwriters' Commitments. Subject to Sections 8
and 9, 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 reasons
sufficient to justify the termination of this Agreement under the provisions of
Section 9 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 shall
take up and pay for (in addition to the 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 Underwriter or
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 opposite the
names of such non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company and the Selling Stockholders agree with the
non-defaulting Underwriters that they 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 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 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 10 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of 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 Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall be terminated without further act or deed and without any
liability on the part of the Company to any non-defaulting 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.
11.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
20.
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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 in a
Prospectus (the term Prospectus for the purpose of this Section 11 being deemed
to include any Preliminary Prospectus, the Prospectus and the Prospectus as
amended or supplemented by the Company), or (ii) any omission or alleged
omission to state a material fact required to be stated in either such
Registration Statement or Prospectus or necessary to make the statements made
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 furnished in writing by or on behalf of any Underwriter to the
Company expressly for use with reference to such Underwriter in such
Registration Statement or such Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information required to be stated in either such Registration Statement or
Prospectus or necessary to make such information not misleading; provided,
further, that the Indemnity Agreement contained in this Section 11(a) with
respect to any Preliminary Prospectus shall not inure to benefit of any
Underwriter from whom the person asserting any such losses, claims, damages,
liabilities or expenses purchase the Shares which is the subject thereof (or to
the benefit of any person, controlling such Underwriter) if at or prior to the
written confirmation of the sale of such shares, a copy of the Prospectus (or
the Prospectus as amended or supplemented) was not sent or delivered to such
person and the untrue statement or omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus (or the Prospectus as
amended or supplemented).
(b) The Selling Stockholders severally agree 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 , 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 in a Prospectus, or (ii) any
omission or alleged omission to state a material fact required to be stated in
either such Registration Statement or Prospectus or necessary to make the
statements made therein not misleading, except that in each case to the extent
but only to the extent that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by such Selling Stockholder expressly for use therein, and will
reimburse each Underwriter for any legal or other
21.
22
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, that (A) the Selling Stockholders will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by an Underwriter through the Representatives specifically for use
therein, and provided, further, that the liability under this Section 11 of each
such Selling Stockholder shall be limited to an amount equal to the aggregate
proceeds, net of underwriting discounts and commissions, to such Selling
Stockholder from the sale of Shares sold by such Selling Stockholder hereunder,
and (B) with respect to any untrue statement or alleged untrue statement in or
omission or alleged omission from any Preliminary Prospectus the indemnity
agreement contained in this subsection 11(b) shall not inure to the benefit of
any Underwriter from whom the person asserting any such losses, claims, damages
or liabilities purchased the Shares concerned, to the extent that a Prospectus
relating to such Shares was required to be delivered by such Underwriter under
the Act in connection with such purchase and any such loss, claim, damage or
liability of such Underwriter results from the fact that there was not sent or
given to such person, at or prior to the written confirmation of the sale of
such Shares to such person, a copy of the Prospectus if the Company had
previously furnished copies thereof to such Underwriter. Notwithstanding
anything herein to the contrary, the Underwriters agree that they shall not seek
indemnification under this Section 11(b) from the Selling Stockholders unless
the Underwriters shall first have sought indemnity from the Company under
Section 11(a) and the Company has not agreed to satisfy such request for
indemnification in full within 120 days; provided further, that the Underwriters
shall not be required to effect such initial demand upon the Company and wait
such 120-day period if it would prejudice their right to indemnification from
the Selling Stockholders hereunder.
(c) If any action, suit or proceeding (together, a
"Proceeding") is brought against an Underwriter or any such person in respect of
which indemnity may be sought against the Company or any Selling Stockholder
pursuant to the foregoing paragraphs 11(a) and 11(b), such Underwriter or such
person shall promptly notify the Company and the Representatives of the Selling
Stockholders in writing of the institution of such Proceeding and the Company or
such Selling Stockholder, as the case may be, 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 the Company or the Representative of the Selling
Stockholders shall not relieve the Company or any Selling Stockholder from any
liability which the Company may have to any Underwriter or any such person or
otherwise, unless the party to whom notice was not given was unaware of the
proceeding to which such notice would have related and was materially prejudiced
by the failure to give such notice. Such Underwriter or such controlling person
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
Underwriter or of such person unless the employment of such counsel shall have
been authorized in writing by the Company or such Selling Stockholder in
connection with the defense of such Proceeding or the Company or such Selling
Stockholder shall not have, within a reasonable period of time in light of the
circumstances employed counsel to have charge of the defense of such Proceeding
or such indemnified party or parties shall have reasonably
22.
23
concluded that there may be defenses available to it or them which are different
from, additional to or in conflict with those available to the Company or such
Selling Stockholder (in which case the Company or such Selling Stockholder 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 the Company or such Selling Stockholder, as the case may be,
and paid as incurred (it being understood, however, that the Company or such
Selling Stockholder 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 Company or such
Selling Stockholder shall not be liable for any settlement of any such
Proceeding effected without its written consent but if settled with the written
consent of the Company or such Selling Stockholder, the Company or such Selling
Stockholder agrees to indemnify and hold harmless any Underwriter and any such
person from and against any loss or liability by reason 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 and does not include an
admission of fault, culpability or a failure to act, by or on behalf of such
indemnified party.
(d) Each Underwriter severally agrees to indemnify, defend
and hold harmless the Company, its directors and officers, each Selling
Stockholder and any person who controls the Company or any Selling Stockholder
within the meaning of Section 15 of the Act, or Section 20 of the Exchange Act
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, the Company, any
Selling Stockholder or any such person may incur under the Act, the Exchange
Act, or Common Law or otherwise, insofar as 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 furnished in writing by or on behalf of such Underwriter through you
to the Company expressly for use with reference to such Underwriter in the
Registration Statement (or in the Registration Statement as amended by or on
behalf of any post-effective amendment thereof by the Company) or in a
Prospectus, or arises out of or is based upon any omission or alleged omission
to state a material fact in connection with such information required to be
stated in such Registration Statement or Prospectus or necessary to make such
information not misleading.
(e) If any Proceeding is brought against the Company, any
Selling Stockholder or any such person in respect of which indemnity may be
sought against any Underwriter pursuant to the foregoing paragraph 11(d), the
Company, such Selling Stockholder or such person shall promptly notify such
Underwriter in writing of the institution of such Proceeding and such
Underwriter 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 Underwriter shall not relieve such Underwriter, from any liability
which such Underwriter may have to the Company,
23.
24
any Selling Stockholder or any such person or otherwise. The Company, such
Selling Stockholder or such person shall have the right to employ its own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of the Company, such Selling Stockholder or such person unless the
employment of such counsel shall have been authorized in writing by such
Underwriter in connection with the defense of such Proceeding or within a
reasonable period of time in light of the circumstances, such Underwriter shall
not have employed counsel to have charge of the defense of 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 or additional to or
in conflict with those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such Underwriter), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter 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). No
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company, any Selling Stockholder and any such person 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 paragraph, 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 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.
(f) If the indemnification provided for in this Section 11
is unavailable to an indemnified party under subsections (a), (b) and (e) of
this Section 11 in respect of any losses, damage, expenses, liabilities or
claims referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders 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 and the Selling
24.
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Stockholders 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 and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed
to be in the same respective proportion as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the Selling Stockholders and the total underwriting
discounts and commissions received by the Underwriters, bear to the aggregate
public offering price is the shares. The relative fault of the Company and the
Selling Stockholders 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, by the Selling Stockholders 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 claim or
Proceeding.
(g) The Company, the Selling Stockholders and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 11 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 11, (i) 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 and (ii) no Selling Stockholder shall be
required to contribute any amount in excess of the net proceeds received by such
Selling Stockholder from the Underwriters (net of underwriting discounts and
commissions) from the sale of the Shares sold by such Selling Stockholder
hereunder. 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 11 are several in proportion
to their respective underwriting commitments and not joint.
(h) The indemnity and contribution agreements contained in
this Section 11 and the covenants, warranties and representations of the Company
and the Selling Stockholders contained in this Agreement shall remain in full
force and effect regardless of any partners, investigation made by or on behalf
of any Underwriter, its directors and 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, its directors or officers, any Selling Stockholder or
any person who controls 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, each Selling
Stockholder and each Underwriter agree promptly to notify
25.
26
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 or Prospectus.
12. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
Warburg Dillon Read LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000-0000, Attention:
Syndicate Department, 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
Xxx, Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Chief Financial Officer and, if to
any of the Selling Stockholders, shall be sufficient in all respects if
delivered or sent to the Representatives of the Selling Stockholders at 000
Xxxxxx Xxx, Xxxxxxxxx, XX 00000, Attention: Xxxxx X. Xxxxxxx.
13. 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.
14. 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 Warburg Dillon Read LLC
or any indemnified party. Each of Warburg Dillon Read LLC and the Company (on
its behalf and, to the extent permitted by applicable law, on behalf of its
stockholders and affiliates) waives 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 in the jurisdiction of which the Company is or may be
subject, by suit upon such judgment.
15. Parties at Interest. The Agreement herein set forth has been
and is made solely for the benefit of the Underwriters, the Company, the Selling
Stockholders and to the extent provided in Section 11 hereof the controlling
persons, directors and officers referred to in Such Section, and their
respective successors, assigns, heirs, pursuant 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.
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.
26.
27
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.
27.
28
If the foregoing correctly sets forth the understanding among the
Company, the Selling Stockholders and the Underwriters, please so indicate in
the space provided below for the purpose, whereupon this letter and your
acceptance shall constitute a binding agreement among the Company, the Selling
Stockholders and the Underwriters, severally.
Very truly yours,
HARMONIC LIGHTWAVES, INC.
By:
-------------------------------------
Xxxxxxx Xxx
Chief Executive Officer
THE SELLING STOCKHOLDERS NAMED IN
SCHEDULE B ATTACHED HERETO
By:
-------------------------------------
Attorney-in-Fact
Accepted and agreed to as of the date first above written, on behalf of
themselves and the other several Underwriters named in Schedule A
WARBURG DILLON READ LLC
CIBC XXXXXXXXXXX CORPORATION
XX XXXXX SECURITIES CORPORATION
SOUNDVIEW TECHNOLOGY GROUP
By: WARBURG DILLON READ LLC
By:
--------------------------------
Title:
By:
--------------------------------
Title:
28.
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SCHEDULE A
Number of
Underwriter Shares
----------- ---------
WARBURG DILLON READ LLC
CIBC XXXXXXXXXXX CORPORATION
XX XXXXX SECURITIES CORPORATION
SOUNDVIEW TECHNOLOGY GROUP
---------
Total ........................................................
=========
30
SCHEDULE B
Number of
Selling Stockholders Firm Shares
-------------------- -----------
Scientific-Atlanta, Inc. 720,000
N.M. New Media Entertainment, Ltd. 45,000
Xxxxxxx X. Xxx 30,000
Xxxxx X. Xxxxxxx 5,000
-------
Total .................................... 800,000
=======
31
SCHEDULE C
SIGNIFICANT SUBSIDIARIES
