Exhibit 1.1
13,300,000 Shares
VIA ▇▇▇.▇▇▇▇▇, INC.
Common Stock
UNDERWRITING AGREEMENT
----------------------
__________, 2000
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
DLJdirect INC.
As representatives of the
several Underwriters
named in Schedule I hereto
c/▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
DLJ INTERNATIONAL SECURITIES
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INTERNATIONAL LIMITED
SALOMON BROTHERS INTERNATIONAL LIMITED
CAZENOVE & CO.
MEESPIERSON N.V.
As representatives of the
several International
Managers named in Schedule II hereto
▇/▇ ▇▇▇ International Securities
▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇-▇▇▇
Dear Sirs:
VIA ▇▇▇.▇▇▇▇▇, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell to the several Underwriters (as defined below) 13,300,000 shares
of its common stock, $.001 par value per share (the "Firm Shares"). It is
understood that, subject to the conditions hereinafter stated, 6,650,000 Firm
Shares (the "U.S. Firm Shares") will be sold to the several U.S.
Underwriters named in Schedule I hereto (the "U.S. Underwriters") in connection
with the offering and sale of such U.S. Firm Shares in the United States and
Canada to United States and Canadian Persons (as such terms are defined in the
Agreement Between U.S. Underwriters and International Managers of even date
herewith), and 6,650,000 Firm Shares (the "International Shares") will be sold
to the several International Managers named in Schedule II hereto (the
"International Managers") in connection with the offering and sale of such
International Shares outside the United States and Canada to persons other than
United States and Canadian Persons. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities
Corporation, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. and
DLJdirect Inc. shall act as representatives (the "U.S. Representatives") of the
several U.S. Underwriters, and DLJ International Securities, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. International Limited, Salomon Brothers International Limited, Cazenove &
Co. and MeesPierson N.V. shall act as representatives (the "International
Representatives") of the several International Managers. The U.S.
Representatives and the International Representatives are hereinafter
collectively referred to as the "Representatives." The U.S. Underwriters and the
International Managers are hereinafter collectively referred to as the
"Underwriters."
The Company also proposes to issue and sell to the several U.S.
Underwriters not more than an additional 1,995,000 shares of its common stock,
$.001 par value per share (the "Additional Shares") if requested by the U.S.
Underwriters as provided in Section 2 hereof. The Firm Shares and the
Additional Shares are hereinafter referred to collectively as the "Shares;" the
U.S. Firm Shares and the Additional Shares are herein referred to collectively
as the "U.S. Shares." The shares of common stock of the Company to be
outstanding after giving effect to the sales contemplated hereby and in the
Reserved Share Offering (as defined below) are hereinafter referred to as the
"Common Stock."
It is understood and agreed by the parties hereto that pursuant to the
terms of a stockholders agreement, the Company proposes to offer and sell to
certain current holders of the Company's preferred stock (the "Preferred
Stockholders"), in a separate concurrent offering in the United States
registered with the Commission (as defined below) under the Act (as defined
below), 700,000 shares (the "Reserved Shares") of newly issued common stock of
the Company (the "Reserved Share Offering"). The parties hereto agree that the
Underwriters have no obligation to the Company with respect to the Reserved
Shares or the Reserved Share Offering and that other than specifically set forth
herein, the Company has no obligation to the Underwriters with respect to the
Reserved Shares or the Reserved Share Offering.
Section 1. Registration Statement and Prospectus. The Company has
prepared and filed with the Securities and Exchange Commission (the
"Commission"), in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Act"), a registration statement on Form S-1. The
registration
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statement contains two prospectuses: the U.S. prospectus (the "U.S. Prospectus")
to be used in connection with the offering and sale of the Shares in the United
States and Canada and the resale of International Shares into the United States
during the period after the date hereof in which an Underwriter is required to
deliver a prospectus under the Act; and a separate prospectus to be used in
connection with the Reserved Share Offering (the "Reserved Share Prospectus").
In connection with the offer and sale of the Reserved Shares, the Company has
prepared a preliminary Reserved Share Prospectus to used in connection with the
Reserved Share Offering and the final Reserved Share Prospectus. It is
understood that such preliminary Reserved Share Prospectus and the Reserved
Share Prospectus will be identical to the preliminary U.S. Prospectus and the
U.S. Prospectus, respectively, except for certain substitute pages.
In connection with the offering and sale of the International Shares
outside of the United States and Canada, the Company has prepared a preliminary
international prospectus to be used in connection with the offering of the
International Shares outside of the United States and Canada and a final
international prospectus dated the date hereof to be used in connection with the
offering of the International Shares outside of the United States and Canada
(the "International Prospectus"). It is understood that such preliminary
International Prospectus and the International Prospectus will be identical to
the preliminary U.S. Prospectus and the U.S. Prospectus, respectively, except
for certain substitute pages.
The registration statement, as amended at the time it became effective,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A under the Act, is
hereinafter referred to as the "Registration Statement," and the U.S. Prospectus
and the International Prospectus in the respective forms first used to confirm
sales of Shares are hereinafter collectively referred to as the "Prospectus."
If the Company has filed or is required pursuant to the terms hereof to file a
registration statement pursuant to Rule 462(b) under the Act registering
additional shares of Common Stock (a "Rule 462(b) Registration Statement"),
then, unless otherwise specified, any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462(b) Registration Statement.
The Company agrees that the shares issued in the Reserved Share Offering will be
sold to the Preferred Stockholders at the initial public offering price listed
on the cover page of the Prospectus.
Section 2. Agreements to Sell and Purchase and Lock-Up Agreements. On the
basis of the representations and warranties contained in this Agreement, and
subject to its terms and conditions, the Company agrees to issue and sell, and
each Underwriter agrees, severally and not jointly, to purchase from the Company
at a price per Share of $______ (the "Purchase Price") the number of Firm
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Shares set forth opposite the name of such Underwriter in Schedule I and II
hereto.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to issue
and sell to the U.S. Underwriters, and the U.S. Underwriters shall have the
right to purchase, severally and not jointly, from the Company, up to 1,995,000
Additional Shares at the Purchase Price. The Additional Shares may be purchased
solely for the purpose of covering over-allotments made in connection with the
offering of the Firm Shares. The U.S. Underwriters may exercise their right to
purchase Additional Shares in whole or in part from time to time by giving
written notice thereof to the Company within 30 days after the date of this
Agreement. The U.S. Representatives shall give any such notice on behalf of the
U.S. Underwriters and such notice shall specify the aggregate number of
Additional Shares to be purchased pursuant to such exercise and the date for
payment and delivery thereof. The date specified in any such notice shall be a
business day (i) no earlier than the Closing Date (as defined below)), (ii) no
earlier than two business days after such notice has been given and (iii) no
later than ten business days after such notice has been given. If any
Additional Shares are to be purchased, each U.S. Underwriter, severally and not
jointly, agrees to purchase from the Company the number of Additional Shares
(subject to such adjustments to eliminate fractional shares as the U.S.
Representatives may determine) which bears the same proportion to the total
number of Additional Shares to be purchased from the Company as the number of
the U.S. Firm Shares set forth opposite the name of such U.S. Underwriter in
Schedule I bears to the total number of the U.S. Firm Shares.
The Company hereby agrees not to (i) offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or (ii) enter
into any swap or other arrangement that transfers all or a portion of the
economic consequences associated with the ownership of any Common Stock
(regardless of whether any of the transactions described in clause (i) or (ii)
is to be settled by the delivery of Common Stock, or such other securities, in
cash or otherwise), except to the Underwriters pursuant to this Agreement, for a
period of 180 days after the date of the Prospectus without the prior written
consent of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation. Notwithstanding
the foregoing, during such period (i) the Company may grant stock options or
restricted stock pursuant to the Company's existing stock option and award
plans, (ii) the Company may issue shares of Common Stock upon the exercise of an
option or warrant or the conversion of a security outstanding on the date hereof
and (iii) the Company may issue shares of Common Stock or any option, right or
warrant to purchase, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock in
connection with the Company's acquisition
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of assets of, or an ownership interest in, another business or entity or in
connection with other strategic transactions; provided, that (x) if the acquired
entity or entity from which the Company acquires assets was not prior to such
acquisition, a reporting company (a "Non-Reporting Target") under the United
States Securities Exchange Act of 1934, as amended (the "Exchange Act"), the
recipients of any such shares of common stock shall agree in writing to be bound
by the restrictions of this paragraph for the remainder of such 180 day period.
The Company also agrees not to file any registration statement (except for any
registration statement on Form S-8 or Form S-4 or other successor forms;
provided that any registration statement on Form S-4 shall not be used to
register shares of the Company's common stock if the acquired entity or entity
from which the Company acquires assets is a Non-Reporting Target) with respect
to any shares of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock for a period of 180 days after the date of the
Prospectus without the prior written consent of ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation. The Company shall, prior to or concurrently with the
execution of this Agreement, deliver an agreement executed by (i) each of the
directors and executive officers of the Company and (ii) each stockholder listed
on Annex I hereto to the effect that such person will not, during the period
commencing on the date such person signs such agreement and ending 180 days
after the date of the Prospectus, (A) engage in any of the transactions
described in the first sentence of this paragraph or (B) make any demand for, or
exercise any right with respect to, the registration of any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock, other than (i) as a gift or gifts, provided the donee or donees
thereof agree in writing with ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities
Corporation to be bound by such letter agreement, (ii) transfers to a
transferor's affiliates, as such term is defined in Rule 405 promulgated under
the Act; provided the transferee thereof agrees in writing with ▇▇▇▇▇▇▇▇▇,
Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation to be bound by such letter agreement,
or (iii) with the prior written consent of ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇
Securities Corporation.
As part of the offering contemplated by this Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. has agreed to reserve out of the Shares set forth opposite its name
on the Schedule I to this Agreement, up to 665,000 shares, for sale to the
Company's employees, officers, and directors and other parties associated with
the Company (collectively, "Participants"), as set forth in the Prospectus under
the heading "Underwriting" (the "Directed Share Program"), and subject to the
terms of this Agreement, the applicable rules, regulations and interpretations
of the National Association of Securities Dealers, Inc. (the "NASD") and all
other applicable laws, rules and regulations. The Shares to be sold by ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc. pursuant to the Directed Share Program (the "Directed Shares")
will be sold by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. pursuant to this Agreement at the
public offering price. The Company agrees that it will not direct ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc. to offer or sell any Directed Shares to Participants located in or
otherwise subject to the securities laws of any jurisdiction other than the
United States. Any Directed
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Shares not orally confirmed for purchase by any Participants by the end of the
business day on which this Agreement is executed will be offered to the public
by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. as set forth in the Prospectus.
Section 3. Terms of Public Offering. The Company is advised by you that
the Underwriters propose (i) to make a public offering of their respective
portions of the Shares as soon after the execution and delivery of this
Agreement as in your judgment is advisable and (ii) initially to offer the
Shares upon the terms set forth in the Prospectus.
Section 4. Delivery and Payment. The Shares shall be represented by
definitive certificates and shall be issued in such authorized denominations and
registered in such names as ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation
shall request no later than two business days prior to the Closing Date (as
defined below) or the applicable Option Closing Date (as defined below), as the
case may be. The Company shall deliver the Shares, with any transfer taxes
thereon duly paid by the Company, to ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities
Corporation through the facilities of The Depository Trust Company ("DTC"), for
the respective accounts of the several Underwriters, against payment on the
Closing Date or on an Option Closing Date, as the case may be, to the Company of
the Purchase Price therefor by wire transfer of Federal or other funds
immediately available in New York City to the account specified by the Company
at least three business days prior to the Closing Date. The certificates
representing the Shares shall be made available for inspection not later than
9:30 A.M., New York City time, on the business day prior to the Closing Date or
the applicable Option Closing Date, as the case may be, at the office of DTC or
its designated custodian (the "Designated Office"). The time and date of
delivery and payment for the Firm Shares shall be 9:00 A.M., New York City time,
on ________, 2000, or such other time on the same or such other date as
▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation and the Company shall agree
in writing. The time and date of delivery for the Firm Shares are hereinafter
referred to as the "Closing Date." The time and date of delivery and payment
for any Additional Shares to be purchased by the U.S. Underwriters shall be 9:00
A.M., New York City time, on the date specified in the applicable exercise
notice given by you pursuant to Section 2 or such other time on the same or such
other date as ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation and the
Company shall agree in writing. The time and date of delivery of any Additional
Shares are hereinafter referred to as an "Option Closing Date."
The documents to be delivered on the Closing Date or any Option Closing Date
on behalf of the parties hereto pursuant to Section 8 of this Agreement shall be
delivered at the offices of O'Melveny & ▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇-▇▇▇▇ and the Shares shall be delivered at the
Designated Office, all on the Closing Date or such Option Closing Date, as the
case may be.
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Section 5. Agreements of the Company. The Company agrees with you:
(a) To advise you promptly and, if requested by you, to confirm such
advice in writing, (i) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information, (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the suspension
of qualification of the Shares for offering or sale in any jurisdiction, or the
initiation of any proceeding for such purposes, (iii) when any amendment to the
Registration Statement becomes effective, (iv) if the Company is required to
file a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, when the Rule 462(b) Registration Statement has become effective and
(v) of the happening of any event during the period referred to in Section 5(d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires any additions to or changes
in the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop
order suspending the effectiveness of the Registration Statement, the Company
will use its best efforts to obtain the withdrawal or lifting of such order at
the earliest possible time.
(b) To furnish to you , such number of conformed copies of the
Registration Statement as first filed with the Commission and of each amendment
to it, including all exhibits, and of each amendment to it, without exhibits, as
you may reasonably request.
(c) To prepare the Prospectus, the form and substance of which shall be
satisfactory to you, and to file the U.S. Prospectus in such form with the
Commission within the applicable period specified in Rule 424(b) under the Act;
during the period specified in Section 5(d) below, not to file any further
amendment to the Registration Statement and not to make any amendment or
supplement to the Prospectus of which you shall not previously have been advised
or to which you shall reasonably object after being so advised; and, during such
period, to prepare and file with the Commission, promptly upon your reasonable
request, any amendment to the Registration Statement or amendment or supplement
to the Prospectus which may be necessary or advisable in connection with the
distribution of the Shares by you, and to use its best efforts to cause any such
amendment to the Registration Statement to become promptly effective.
(d) (x) To use its reasonable best efforts prior to 10:00 A.M., New York
City time, on the first business day after the date of this Agreement to furnish
in New York City and London, as applicable, to each Underwriter as many copies
of the U.S. Prospectus and the International Prospectus, as applicable, as the
Underwriters may reasonably request, and (y) to, from time to time after the
date of this Agreement, for such period as in the opinion of counsel for the
Underwriters a prospectus is required by law to be delivered in connection with
7
sales by an Underwriter or a dealer, furnish in New York City or London, as
applicable, to each Underwriter and any dealer as many copies of the U.S.
Prospectus and International Prospectus, as applicable (and of any amendment or
supplement to the Prospectus), as such Underwriter or dealer may reasonably
request.
(e) If during the period specified in Section 5(d), any event shall
occur or condition shall exist as a result of which, in the judgment of the
Company or in the opinion of counsel for the Underwriters, it becomes necessary
to amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Prospectus to comply
with applicable law, forthwith to prepare an appropriate amendment or supplement
to the Prospectus, and to file the amended or supplemented U.S. Prospectus with
the Commission, so that the statements in the Prospectus, as so amended or
supplemented, will not in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with applicable
law, and to furnish to each Underwriter and to any dealer as many copies thereof
as such Underwriter or dealer may reasonably request.
(f) Prior to any public offering of the Shares, to cooperate with you
and counsel for the Underwriters in connection with the registration or
qualification of the Shares for offer and sale by the several Underwriters and
by dealers under the state securities or Blue Sky laws of such jurisdictions as
you may request, to continue such registration or qualification in effect so
long as required for distribution of the Shares and to file such consents to
service of process or other documents as may be necessary in order to effect
such registration or qualification; provided, however, that the Company shall
not be required in connection therewith to qualify as a foreign corporation in
any jurisdiction in which it is not now so qualified or to take any action that
would subject it to general consent to service of process or taxation other than
as to matters and transactions relating to the Prospectus, the Registration
Statement, any preliminary prospectus or the offering or sale of the Shares, in
any jurisdiction in which it is not now so subject.
(g) To mail and make generally available to its stockholders as soon as
practicable an earnings statement covering the twelve-month period ending March
31, 2001 that shall satisfy the provisions of Section 11(a) of the Act, and to
advise you in writing when such statement has been so made available.
(h) During the period of three years after the date of this Agreement,
to furnish to you as soon as available copies of all annual reports and other
documents, reports, financial statements and information (i) furnished to the
record holders of Common Stock, (ii) filed with the Commission under or
8
pursuant to the Act or the Exchange Act or (iii) furnished to The Nasdaq Stock
Market, Inc. National Market (the "Nasdaq National Market") or any national
securities exchange on which any class of securities of the Company is listed
and such other publicly available information concerning the Company and its
subsidiaries as you may reasonably request.
(i) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company's counsel
and the Company's accountants in connection with the registration and delivery
of the Shares under the Act and all other fees and expenses in connection with
the preparation, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), any preliminary prospectus, the
Prospectus and all amendments and supplements to any of the foregoing, including
the mailing and delivering of copies thereof to the Underwriters and dealers in
the quantities specified herein, (ii) all costs and expenses related to the
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) all costs of printing or producing this
Agreement and any other agreements or documents in connection with the offering,
purchase, sale or delivery of the Shares, (iv) all expenses in connection with
the registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the several states and all costs of printing or
producing any Preliminary and Supplemental Blue Sky Memoranda in connection
therewith (including the filing fees and reasonable fees and disbursements of
counsel for the Underwriters in connection with such registration or
qualification and memoranda relating thereto), (v) the filing fees and
reasonable disbursements of counsel for the Underwriters in connection with the
review and clearance of the offering of the Shares by the NASD, (vi) all fees
and expenses in connection with the preparation and filing of the registration
statement on Form 8-A relating to the Common Stock and all costs and expenses
incident to the listing of the Shares on the Nasdaq National Market and the
Amsterdam Stock Exchange ("AEX"), including the reasonable fees and expenses of
the AEX listing agent in its capacity as such, (vii) the cost of printing
certificates representing the Shares, (viii) the costs and charges of any
transfer agent, registrar and/or depositary, (ix) the reasonable fees and
disbursements of counsel for the Underwriters incurred in connection with the
Directed Share Program and stamp duties, similar taxes or duties or other taxes,
if any, incurred by the Underwriters in connection with the Directed Share
Program, (x) the reasonable fees and disbursements of special Dutch counsel to
the Underwriters in connection with the listing of the International Shares on
the AEX (in an amount not to exceed $__________), and (xi) all other costs and
expenses incident to the performance of the obligations of the Company hereunder
for which provision is not otherwise made in this Section.
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(j) To use its reasonable best efforts to list for quotation the Shares
on the Nasdaq National Market and AEX and to maintain the listing of the Shares
on the Nasdaq National Market and AEX for a period of three years after the date
of this Agreement.
(k) To use its reasonable best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by the
Company prior to the Closing Date or any Option Closing Date, as the case may
be, and to satisfy all conditions precedent to the delivery of the Shares.
(l) If the Registration Statement at the time of the effectiveness of
this Agreement does not cover all of the Shares, to file a Rule 462(b)
Registration Statement with the Commission registering the Shares not so covered
in compliance with Rule 462(b) by 10:00 P.M., New York City time, on the date of
this Agreement and to pay to the Commission the filing fee for such Rule 462(b)
Registration Statement at the time of the filing thereof or to give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
(m) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required by the
NASD or the NASD rules from sale, transfer, assignment, pledge or hypothecation
for a period of three months following the date of the effectiveness of the
Registration Statement. ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. will notify the Company as to
which Participants will need to be so restricted. The Company will direct the
removal of such transfer restrictions upon the expiration of such period of
time.
Section 6. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective (other than any Rule
462(b) Registration Statement to be filed by the Company after the effectiveness
of this Agreement); any Rule 462(b) Registration Statement filed after the
effectiveness of this Agreement will become effective no later than 10:00 P.M.,
New York City time, on the date of this Agreement; and no stop order suspending
the effectiveness of the Registration Statement is in effect, and, to the
Company's knowledge, no proceedings for such purpose are pending before or
threatened by the Commission.
(b) (i) The Registration Statement (other than any Rule 462(b)
Registration Statement to be filed by the Company after the effectiveness of
this Agreement), when it became effective, did not contain and, as amended, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration Statement (other than
any Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement) and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the Act,
(iii) if the Company is required to file a Rule 462(b) Registration Statement
after the effectiveness of this
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Agreement, such Rule 462(b) Registration Statement and any amendments thereto,
when they become effective (A) will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (B) will comply in
all material respects with the Act and (iv) the Prospectus does not contain and,
as amended or supplemented, if applicable, will not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this paragraph do not apply to statements or omissions in the Registration
Statement, any Rule 462(b) Registration Statement or the Prospectus, as amended
or supplemented, based upon information relating to any Underwriter furnished to
the Company in writing by or on behalf of such Underwriter through you expressly
for use therein.
(c) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Act, complied when so filed in all material
respects with the Act, and did not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in any
preliminary prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein.
(d) Each of the Company and its subsidiaries has been duly organized, is
validly existing in good standing, to the extent the legal concept of "good
standing" applies in the applicable jurisdiction, under the laws of its
jurisdiction of organization and has the power and authority under its
respective organizational documents and the respective laws of its jurisdiction
of formation to carry on its business as described in the Prospectus and to own,
lease and operate its properties, and each is duly qualified and is in good
standing as a foreign entity authorized to do business in each jurisdiction in
which the nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so qualified would
not have a material adverse effect on the business, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole.
(e) Except as otherwise disclosed in the Registration Statement, there
are no outstanding subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale or liens granted or issued by the Company or any
11
of its subsidiaries relating to or entitling any person to purchase or otherwise
to acquire any shares of the capital stock of the Company or any of its
subsidiaries,.
(f) All the outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid, non-assessable and not
issued in violation of any preemptive or similar rights; and the Shares to be
issued and sold by the Company hereunder have been duly authorized and, when
issued and delivered to the Underwriters against payment therefor as provided by
this Agreement, will be validly issued, fully paid and non-assessable, and,
except as disclosed in the Registration Statement, the issuance of such Shares
will not be subject to any preemptive or similar rights; concurrently with the
Closing, all shares of the mandatorily redeemable convertible preferred stock,
both voting and non-voting, will convert, on a one-for-one basis, into shares of
the Company's Common Stock, both voting and non-voting, and upon such
conversion, each share of Common Stock will be fully paid, non-assessable and
not subject to any preemptive or similar rights.
(g) All of the outstanding equity interests or shares of capital stock
of each of the Company's subsidiaries have been duly authorized and validly
issued and are fully paid and non-assessable, and are owned by the Company, to
the extent that such equity interests or shares of capital stock of such
subsidiary are disclosed in the Prospectus as being owned by the Company,
directly or indirectly through one or more subsidiaries, free and clear of any
security interest, claim, lien, encumbrance or adverse interest of any nature.
(h) The authorized capital stock of the Company conforms in all material
respects as to legal matters to the description thereof contained in the
Prospectus.
(i) Neither the Company nor any of its subsidiaries is (x) in violation
of its respective organizational document, charter or by-laws or (y) in default
in the performance of any obligation, agreement, covenant or condition contained
in any indenture, loan agreement, mortgage, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries or their respective property is
bound, except, with respect to clause (y), for any such violation or default
that would not have a material adverse effect on the business, prospects,
financial condition or results of operations of the Company and its subsidiaries
taken as a whole.
(j) The execution, delivery and performance of this Agreement by the
Company, the compliance by the Company with all the provisions hereof and the
consummation of the transactions contemplated hereby and the application of the
net proceeds from the sale of the Shares as contemplated by the Registration
Statement will not (i) require any consent, approval, authorization or other
order of, or qualification with, any court or governmental body or agency
(except as has
12
been obtained and except as may be required under the securities or Blue Sky
laws of the various states), (ii) conflict with or constitute a breach of any of
the terms or provisions of, or a default under (or event which, with giving of
notice or lapse of time or both, would be a default under) or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any subsidiary pursuant to (A) the organization
document, charter or by-laws of the Company or any of its subsidiaries or (B)
any indenture, loan agreement, mortgage, lease or other agreement or instrument
that is material to the Company and its subsidiaries, taken as a whole, to which
the Company or any of its subsidiaries is a party or by which the Company or any
of its subsidiaries or their respective property is bound, (iii) constitute a
Repayment Event (as defined below), (iv) violate or conflict with any applicable
law or any rule, regulation, judgment, order or decree of any court or any
governmental body or agency having jurisdiction over the Company, any of its
subsidiaries or their respective property or (v) result in the suspension,
termination or revocation of any Authorization (as defined below) of the Company
or any of its subsidiaries or any other impairment of the rights of the holder
of any such Authorization, except where such failure to be valid and in full
force and effect or to be in compliance, the occurrence of any such event or the
presence of any such restriction would not, individually or in the aggregate,
have a material adverse effect on the business, prospects, financial condition
or results of operations of the Company and its subsidiaries taken as a whole.
As used in this Agreement, "Repayment Event" means any event or condition that
gives the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the repurchase
or redemption or repayment of all or a portion of such indebtedness by the
Company or any subsidiary.
(k) There are no legal or governmental proceedings pending or threatened
to which the Company or any of its subsidiaries is or, to the knowledge of the
Company, is expected to be a party or to which any of their respective property
is or, to the knowledge of the Company, is expected to be subject, that are
required to be described in the Registration Statement or the Prospectus and are
not so described; nor are there any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that are not
so described or filed.
(l) Neither the Company nor any of its subsidiaries has violated any
foreign, federal, state or local law or regulation relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), any provisions of the
Employee Retirement Income Security Act of 1974, as amended, or any provisions
of the Foreign Corrupt Practices Act, or the rules and regulations promulgated
thereunder, except for such violations which, singly or in the aggregate, would
not have a material adverse effect on the business, financial
13
condition or results of operation of the Company and its subsidiaries, taken as
a whole.
(m) Each of the Company and its subsidiaries has such permits, licenses,
consents, exemptions, franchises, authorizations and other approvals (each, an
"Authorization") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
telecommunications or Internet laws, as are necessary to own, lease, license and
operate its respective properties and to conduct its business, except where the
failure to have any such Authorization or to make any such filing or notice
would not, individually or in the aggregate, have a material adverse effect on
the business, financial condition or results of operations of the Company and
its subsidiaries, taken as a whole. Each such Authorization is valid and in
full force and effect and each of the Company and its subsidiaries is in
compliance with all the terms and conditions thereof and with the rules and
regulations of the authorities and governing bodies having jurisdiction with
respect thereto; and no event has occurred (including, without limitation, the
receipt of any notice from any authority or governing body) which results or,
after notice or lapse of time or both, would result in any other impairment of
the rights of the Company and its subsidiaries, as holders of any such
Authorization; except where such failure to be valid and in full force and
effect or to be in compliance, the occurrence of any such event or the presence
of any such restriction would not, singly or in the aggregate, have a material
adverse effect on the business, financial condition or results of operations of
the Company and its subsidiaries, taken as a whole.
(n) This Agreement has been duly authorized, executed and delivered by
the Company.
(o) PricewaterhouseCoopers LLP and each of the other accountants listed
in the Experts section of the Registration Statement (collectively, the
"Independent Public Accountants") are independent public accountants with
respect to the Company and its subsidiaries as required by the Act.
(p) The consolidated financial statements included in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), together
with related schedules and notes, present fairly the consolidated financial
position, results of operations, stockholders' deficit/equity, cash flows and
changes in financial position of the Company and its consolidated subsidiaries,
on the basis stated therein at the respective dates or for the respective
periods to which they apply; such statements and related schedules and notes
have been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; the supporting schedules, if any, included in the Registration
Statement present fairly in accordance with generally accepted accounting
principles the information required to be stated therein; and the other
financial and statistical information
14
and data set forth in the Registration Statement and the Prospectus (and any
amendment or supplement thereto) present fairly the information shown therein
and the financial information has been prepared on a basis consistent with the
financial statements and the books and records of the Company and its
consolidated subsidiaries included in the Prospectus and Registration Statement.
The pro forma condensed combined financial statements of the Company and the
related notes thereto set forth in the Registration Statement and the Prospectus
(and any supplement or amendment thereto) have been prepared on a basis
consistent with the historical financial statements of the Company and its
subsidiaries, give effect to the assumptions used in the preparation thereof on
a reasonable basis and in good faith and present fairly the historical and
proposed transactions contemplated by the Registration Statement and the
Prospectus. Such pro forma financial statements have been prepared in accordance
with the applicable requirements of Rule 11-02 of Regulation S-X promulgated by
the Commission and have been computed on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the adjustments
used therein are appropriate to give effect to the transactions and
circumstances referred to therein. The other pro forma financial and statistical
information and data set forth in the Registration Statement and the Prospectus
(and any supplement or amendment thereto) are, in all material respects,
accurately presented and, with respect to the pro forma financial information,
prepared on a basis consistent with the pro forma financial statements.
(q) The Company is not and, after giving effect to the offering and sale
of the Shares and the application of the proceeds thereof as described in the
Prospectus, will not become, an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended.
(r) Except as otherwise disclosed in the Registration Statement, there
are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of the
Company or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement.
(s) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there has not occurred any material adverse change or any development involving
a prospective material adverse change in the condition, financial or otherwise,
or the earnings, business, management or operations of the Company and its
subsidiaries, taken as a whole, (ii) there has not been any material adverse
change or any development involving a prospective material adverse change in the
capital stock or in the long-term debt of the Company or any of its
subsidiaries, taken as a whole, (iii) neither the Company nor any of its
subsidiaries has incurred any liability or
15
obligation, direct or contingent, that is material to the Company and its
subsidiaries, taken as a whole, and (iv) there has been no dividend or
distribution of any kind declared, paid or made by the Company or, except for
dividends paid to the Company or other subsidiaries, any of its subsidiaries on
any class of capital stock or repurchase or redemption by the Company or any of
its subsidiaries of any class of capital stock.
(t) Each certificate signed by any officer of the Company and delivered to
the Underwriters or counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby.
(u) The Company has reviewed its operations and that of its subsidiaries
and any third parties with which the Company or any of its subsidiaries has a
material relationship to evaluate the extent to which the business or operations
of the Company or any of its subsidiaries will be affected by the Year 2000
Problem (as defined below). As a result of such review, other than as disclosed
in the Registration Statement, the Company has no reason to believe, and does
not believe, that the Year 2000 Problem will have a material adverse effect on
the financial condition, or the earnings, business, management or operations of
the Company and its subsidiaries, taken as a whole, or result in any material
loss or interference with the Company's business or operations. The "Year 2000
Problem" as used herein means any significant risk that computer hardware or
software used in the receipt, transmission, processing, manipulation, storage,
retrieval, retransmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind will not, in the case of dates or
time periods occurring after December 31, 1999, function at least as effectively
as in the case of dates or time periods occurring prior to January 1, 2000. The
disclosures in the Registration Statement and Prospectus related to Year 2000
compliance comply in all material respects with the requirements of SEC Release
33-7558.
(v) Neither the Company nor any of its subsidiaries has at any time since
its inception with respect to the Company and since its respective acquisition
by the Company with respect to any subsidiary (i) made any unlawful contribution
to any candidate for foreign office or failed to disclose fully any contribution
in violation of law, or (ii) made any payment to any federal or state
governmental officer or official, or other person charged with similar public or
quasi-public duties, other than payments required or permitted by the laws of
the United States or any jurisdiction thereof.
(w) The Company has not taken and will not take, directly or indirectly,
any action designed to or that might reasonably be expected to cause or result
in stabilization or manipulation of the price of the Common Stock to facilitate
the sale or resale of the Shares.
16
(x) The Company and its subsidiaries have good title to all personal
property owned by them which is material to the business of the Company and its
subsidiaries, taken as a whole, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Prospectus or such
as do not materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company and its
subsidiaries, taken as a whole; and any real property and buildings held under
lease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material to,
and do not interfere with the use made and proposed to be made of such property
and buildings by, the Company and its subsidiaries, taken as a whole, in each
case except as described in the Prospectus; none of the Company or its
subsidiaries own any real property.
(y) The Company and its subsidiaries own or possess sufficient rights to
use all patents, patent applications, patent rights, trademarks, trademark
registrations, service marks, service ▇▇▇▇ registrations, tradenames, mask work
rights, copyrights, manufacturing processes, licenses, inventions, trade
secrets, know-how and other intellectual property rights ("Intellectual
Property") described in the Prospectus as being owned by them or necessary for
the conduct of their businesses, except where the failure to own or possess or
otherwise be able to acquire or use for reasonable consideration such
Intellectual Property would not, individually or in the aggregate, have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole; and
the Company is not aware of any infringement of or conflict with such rights or
any claims to the contrary or any challenge by any other person to the rights of
the Company with respect to the foregoing that, if determined adversely to the
Company, could reasonably be expected to have a material adverse effect on the
business, prospects, financial condition or results of operations of the Company
and its subsidiaries taken as a whole. The Company's business as conducted does
not and, to the Company's best knowledge, will not infringe or conflict with in
any material respect with Intellectual Property or franchise right of any
person. No claim has been made against the Company alleging the infringement by
the Company of any Intellectual Property or franchise right of any person that,
if determined adversely to the Company, could reasonably be expected to have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its subsidiaries taken as a whole.
There is no pending or threatened action, proceeding or claim by the Company
that any third party is infringing the Company's Intellectual Property.
(z) The Company and each of its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; and neither the Company nor any of its subsidiaries (i) has received
17
notice from any insurer or agent of such insurer that substantial capital
improvements or other material expenditures will have to be made in order to
continue such insurance or (ii) has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers at a cost that would not
have a material adverse effect on the business, prospects, financial condition
or results of operations of the Company and its subsidiaries, taken as a whole.
(aa) No relationship, direct or indirect, exists between or among the
Company or any of its subsidiaries on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company or any of its subsidiaries
on the other hand, which is required by the Act to be described in the
Registration Statement or the Prospectus which is not so described.
(bb) There is no (i) significant unfair labor practice complaint,
grievance or arbitration proceeding pending or, to the Company's knowledge,
threatened against the Company or any of its subsidiaries before the National
Labor Relations Board or any foreign, state or local labor relations board or
similar authority, (ii) strike, material labor dispute, slowdown or stoppage
pending or, to the Company's knowledge, threatened against the Company or any of
its subsidiaries or (iii) union representation question existing with respect to
the employees of the Company and its subsidiaries, except for such actions
specified in clause (i), (ii) or (iii) above, which, singly or in the aggregate,
would not have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole. To the Company's knowledge, no collective bargaining organizing
activities are taking place with respect to the Company or any of its
subsidiaries.
(cc) The Company and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(dd) All material tax returns required to be filed by the Company and each
of its subsidiaries in any jurisdiction have been filed, other than those
filings being contested in good faith, and all material taxes, including
withholding taxes, penalties and interest, assessments, fees and other charges
due pursuant to such returns or pursuant to any assessment received by the
Company or any of its
18
subsidiaries have been paid, other than those being contested in good faith and
for which adequate reserves have been provided.
(ee) There are no contracts or documents that are required to be described
in the Registration Statement or to be filed as exhibits thereto which have not
been so described or filed as required.
(ff) No vote or consent of any stockholder of the Company, and no consent,
approval or waiver of any party to or any person entitled to any right or
benefit under the charter or by-laws of the Company, any stockholders'
agreements or arrangements, or any other instrument or agreement to which the
Company is a party or by which it is bound or under which it is entitled to any
right or benefit, except such consents, approvals or waivers which have been
obtained, is required in connection with the offering, issuance, sale or
purchase by you of any of the Shares under this Agreement or the consummation of
any of the other transactions contemplated hereby or the application of the net
proceeds from the sale of the Shares as contemplated by the Registration
Statement; no Underwriter or subsequent purchaser or transferee of any of the
Shares is required to become or shall be deemed to be a party to, or shall be
subject to the terms or provisions of, any shareholders' agreement or
arrangement and none of the Shares sold to the Underwriters will be subject to
the terms or provisions of any of such agreements or arrangements.
(gg) Other than restrictions on the payment of dividends that would render
the Company's subsidiaries insolvent, except as disclosed on Annex II hereto,
there are no limitations or restrictions on the Company's ability to receive
dividends or distributions of any kind from its subsidiaries, whether based on
laws, contracts, or currency controls, and the payment of such dividends or
distributions is not subject to any tax or withholding.
Section 7. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Underwriter, its directors, its officers and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action, that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
any amendment thereto), the Prospectus, the Reserved Share Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged untrue statement or
omission based
19
upon information relating to any Underwriter furnished in writing to the Company
by such Underwriter through you expressly for use therein; provided, however,
that the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter who failed to
deliver a Prospectus, as then amended or supplemented, (so long as the
Prospectus and any amendments or supplements thereto was provided by the Company
to the several Underwriters in the requisite quantity and on a timely basis to
permit proper delivery on or prior to the Closing Date) to the person asserting
any losses, claims, damages, liabilities or judgments caused by any untrue
statement or alleged untrue statement of a material fact contained in such
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, if such material misstatement or omission or
alleged material misstatement or omission was cured in the Prospectus, as so
amended or supplemented, and such Prospectus was required by law to be delivered
at or prior to the written confirmation of sale to such person. In addition to
the foregoing, in connection with the offer and sale of the Directed Shares, the
Company agrees, promptly upon a request in writing, to indemnify and hold
harmless the Underwriters from and against any and all losses, liabilities,
claims, damages and expenses incurred by them as a result of (i) the failure of
purchasers of the Directed Shares (including eligible directors, officers,
employees, customers, subscribers and persons having business relationships with
the Company) to pay for and accept delivery of the Directed Shares which, by the
end of the first business day following the date of this Agreement, were subject
to a properly confirmed application to purchase or (ii) any violation or alleged
violation of the Act or any other federal or state law or any liability based on
common law, in each case, arising out of or relating to the manner in which the
Directed Shares are sold and pertaining to any actions or inactions by the
Company (or by the Company jointly with any other person, excluding any
Underwriter) including, without limitation, any e-mails or other communications
by the Company (or by the Company jointly with any other person, excluding any
Underwriter) with customer or subscribers of the Company relating to the
Directed Shares or possible opportunities to purchase Directed Shares.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Company to such Underwriter but only with
reference to information relating to such Underwriter furnished in writing to
the Company by (i) in the case of the U.S. Underwriter, such U.S. Underwriter
through the U.S. Representatives expressly for use in the Registration Statement
(or any amendment thereto), the U.S. Prospectus (or any amendment or supplement
thereto) or any preliminary prospectus and (ii) in the case of the International
Managers, such International Manager through the International
20
Representatives expressly for use in the Registration Statement (or any
amendment thereto), the International Prospectus (or any amendment or supplement
thereto) or any preliminary prospectus.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
from whom such indemnity may be sought (the "indemnifying party") in writing and
the indemnifying party shall assume the defense of such action, including the
employment of counsel reasonably satisfactory to the indemnified party and the
payment of all fees and expenses of such counsel, as incurred (except that in
the case of any action in respect of which indemnity may be sought pursuant to
both Sections 7(a) and 7(b), the Underwriter shall not be required to assume the
defense of such action pursuant to this Section 7(c), but may employ separate
counsel and participate in the defense thereof, but the fees and expenses of
such counsel, except as provided below, shall be at the expense of such
Underwriter). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties and all such fees and
expenses shall be reimbursed as they are incurred. Such firm shall be designated
in writing by ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation, in the case
of parties indemnified pursuant to Section 7(a), and by the Company, in the case
of parties indemnified pursuant to Section 7(b). The indemnifying party shall
indemnify and hold harmless the indemnified party from and against any and all
losses, claims, damages, liabilities and judgments by reason of any settlement
of any action (i) effected with its written consent or (ii) effected without its
written consent if the settlement is entered into more than twenty business days
after the indemnifying party shall have received a request from the indemnified
party for reimbursement for the fees and expenses of counsel (in any case where
such fees and expenses are at the expense of the indemnifying party) and, prior
to the date of such settlement, the indemnifying party shall have failed
21
to comply with such reimbursement request. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this Section 7 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause 7(d)(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 7(d)(i) above but also the
relative fault of the Company on the one hand and the Underwriters on the other
hand in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total net proceeds from the offering (after deducting
underwriting discounts and commissions, but before deducting expenses) received
by the Company, and the total underwriting discounts and commissions received by
the Underwriters, bear to the total price to the public of the Shares, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault of the Company on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall
22
be deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such indemnified party in connection with
investigating or defending any matter, including any action, that could have
given rise to such losses, claims, damages, liabilities or judgments.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7(d) are several in proportion to the respective number of Shares
purchased by each of the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
Section 8. [Reserved]
Section 9. Conditions of Underwriters' Obligations'. The several
obligations of the Underwriters to purchase the Firm Shares under this Agreement
are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct on the Closing Date with the same force
and effect as if made on and as of the Closing Date.
(b) If the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, such Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., New York City
time, on the date of this Agreement; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before the Commission, and ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation
shall not have become aware of any such action being contemplated by the
Commission.
(c) You shall have received on the Closing Date a certificate dated the
Closing Date, signed by ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, in their
capacities as the Chief Executive Officer and Vice President, Chief Financial
Officer and Treasurer of the Company, respectively, confirming the matters set
forth in Sections 6(t), 9(a) and 9(b) and that the Company has complied with all
of the agreements and satisfied all of the conditions herein contained and
required to be complied with or satisfied by the Company on or prior to the
Closing Date.
23
(d) Since the respective dates as of which information is given in the
Prospectus, other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any change or any development involving a
prospective change in the condition, financial or otherwise, or the earnings,
business, management or operations of the Company and its subsidiaries, taken as
a whole, (ii) there shall not have been any change or any development involving
a prospective change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, the effect of which, in any such case described in clause 9(d)(i),
9(d)(ii) or 9(d)(iii), in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(e) You shall have received on the Closing Date an opinion (satisfactory
to you and counsel for the Underwriters), dated the Closing Date, of ▇▇▇▇▇ &
▇▇▇▇▇▇▇ L.L.P., to the effect that:
(i) the Company has been incorporated and is validly existing as
a corporation in good standing as of the date of the certificate referenced
in such opinion under the laws of the State of Delaware. The Company has
the corporate power and corporate authority under its charter and the
Delaware General Corporation Law to carry on its business as described in
the Prospectus and to own, lease and operate its properties;
(ii) the Company is authorized to transact business as a foreign
corporation as of the respective dates of the certificates and in each
United States jurisdiction listed in Annex III hereto;
(iii) the authorized, issued and outstanding shares of capital
stock of the Company, as of September 30, 1999, was as set forth under the
caption "Capitalization" in the Prospectus and, except as set forth in the
Prospectus, there have been no changes to the capitalization of the
Company. All the outstanding shares of capital stock of the Company shown
as issued and outstanding under said caption are duly authorized, are
validly issued, fully paid and non-assessable. No holder of outstanding
shares of common stock of the Company has any statutory preemptive right
under the Delaware General Corporation Law, the Company's articles or
bylaws or, to such counsel's knowledge, any contractual rights to subscribe
for any of the Shares;
(iv) when issued in accordance with the provisions of the
Agreement, the Shares will be validly issued, fully paid and
24
non-assessable; when issued in accordance with the provisions of the
Reserved Share Prospectus (including the payment of the consideration
contemplated by the Reserved Share Prospectus), the Reserved Shares will be
validly issued, fully paid and non-assessable;
(v) this Agreement has been duly authorized, executed and
delivered on behalf of the Company;
(vi) the information in the Prospectus under the caption
"Description of Capital Stock," to the extent that such information
constitutes matters of law or legal conclusions, has been reviewed by such
counsel, and is correct in all material respects. The Common Stock
conforms in all material respects to the description thereof contained in
the Prospectus under the caption "Description of Capital Stock" (other than
under the sub-caption "--Listing--Trading through the Amsterdam Security
Account System");
(vii) the Registration Statement has become effective under the
Act, and, to such counsel's knowledge, no stop order suspending its
effectiveness has been issued and no proceedings for that purpose have been
instituted or are threatened by the Commission;
(viii) the information under the captions "Management's Discussion
and Analysis of Financial Condition and Results of Operations-- Conversion
to the Euro," "Business--Restrictions on the Import and Export of Encrypted
Material or Encryption Software", "Management--Limitation of Liability and
Indemnification Matters", "--Key Employee Equity Plan," "--1998 Stock
Option and Restricted Plan," "--Employment Agreements," "--Compensation of
Directors," "Transactions with Relation Parties," "Shares Eligible for
Future Sale" and "Material Federal Income Tax Consequences to Non-United
States Stockholders" in the Prospectus, insofar as such statements
constitute a summary of the legal matters, documents or proceedings
referred to therein, fairly present the information called for with respect
to such legal matters, documents and proceedings;
(ix) the execution, delivery and performance as of the date of
such opinion by the Company of the Agreement do not (A) breach or
constitute a default under any agreement or contract filed as an exhibit to
the Registration Statement or any other stockholders agreement,
registration rights agreement or similar agreement to which the Company is
a party that is identified to such counsel by the Company, (B) violate the
Delaware General Corporation Law, or the charter or the bylaws of the
Company, (C) violate any Delaware or Virginia law, rule, regulation that
such counsel, in the exercise of customary professional diligence,
25
recognized as applicable to the Company or transactions of the type
contemplated by this Agreement, or to such counsel's knowledge, any order,
judgment or decree of any Delaware or Virginia governmental agency or (D)
result in a Repayment Event;
(x) no approval or consent of, or registration or filing with, any
federal, Delaware or Virginia governmental agency is required to be
obtained or made by the Company in connection with the execution, delivery
and performance as of the date of such opinion by the Company of the
Agreement, except such as may be required under [the federal securities
laws (certain matters with respect to which are addressed elsewhere in such
opinion) and] the securities or Blue Sky laws of the various states (as to
which such counsel expresses no opinion),
(xi) the Company is not an "investment company," as such term is
defined in the Investment Company Act of 1940, as amended;
(xii) to such counsel's knowledge, except as set forth in the
Prospectus, no holders of common stock or other securities of the Company
have registration rights with respect to securities of the Company and,
except as set forth in the Prospectus, all holders of securities of the
Company having rights to registration of shares of common stock or other
securities as a result of the filing of the Registration Statement by the
Company have, solely with respect to the offering contemplated thereby,
waived such rights; and
(xiii) the Registration Statement (except for the financial
statements and supporting schedules and other financial data contained
therein as to which no opinion need be expressed) complies as to form in
all material respects with the requirements for registration statements on
Form S-1 under the Act and the applicable rules and regulations thereunder.
The opinion of counsel described in Section 9(e) above shall be rendered to
you at the request of the Company and shall so state therein.
(f) The Underwriters shall have received on the Closing Date opinions
(satisfactory to the Underwriters and counsel for the Underwriters), dated the
Closing Date, of the respective local counsel to the Company's subsidiaries
(including ▇▇▇▇▇ & ▇▇▇▇▇▇▇ for any U.S. subsidiaries), to the effect that:
(i) such subsidiary has been duly formed, is validly existing as an
entity in good standing under the laws of its jurisdiction of
formation and has the power and authority to carry on its business as
currently conducted and to own, lease and operate its properties;
26
(ii) such subsidiary is authorized to transact business as a
foreign entity in the jurisdictions listed on a schedule attached to
such opinion as of the respective dates of the certificates specified
in such schedule;
(iii) all the outstanding equity interests or shares of capital
stock of such subsidiary have been duly authorized and validly issued
and are fully paid, non-assessable and not subject to any preemptive
or similar rights, and are owned by the Company, to the extent set
forth in the Prospectus, directly or indirectly through one or more
subsidiaries, free and clear of any security interest, claim, lien,
encumbrance or adverse interest of any nature;
(iv) the capitalization of such subsidiary conforms to the
description thereof on a schedule attached to such opinion;
(v) the information under the caption "Business--Regulatory Matters"
and "--Restrictions on the Import and Export of Encrypted Material or
Encryption Software" in the Prospectus, to the extent that such
information is relevant to such subsidiary and constitutes a summary
of legal matters, has been reviewed by such counsel and is accurate in
all material respects;
(vi) after due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which such
subsidiary is or could be a party or to which any of its property is
or could be subject that are material to such subsidiary;
(vii) such subsidiary has all the necessary permits, licenses,
consents, exemptions, franchises, authorizations and other approvals
of (the "Authorizations"), and has made all filings with and notices
to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including, without
limitation, under any applicable telecommunications and Internet laws,
as are necessary to own, lease, license and operate its properties and
to conduct its business, except where the failure to have any such
Authorization or to make any such filing or notice would not,
individually or in the aggregate, have a material adverse effect on
the business, prospects, financial condition or results of operations
of such subsidiary; to such counsel's knowledge, each such
Authorization is valid and in full force and effect and such
subsidiary is in compliance with all the terms and conditions thereof
and with the rules and regulations of the authorities and governing
bodies
27
having jurisdiction with respect thereto; and no event has occurred
(including, without limitation, the receipt of any notice from any
authority or governing body) which results in or, after notice or
lapse of time or both, would result in, the revocation, suspension or
termination of any such Authorization or any other impairment of the
rights of such subsidiary as the holder of such Authorization, except
where such failure to be valid and in full force and effect or to be
in compliance, the occurrence of any such event or the presence of any
such restriction would not, individually or in the aggregate, have a
material adverse effect on the business, prospects, financial
condition or results of operations of such subsidiary;
(viii) such subsidiary owns or possesses sufficient rights to use
all intellectual property necessary for the conduct of its business,
as now conducted or contemplated to be conducted, and such counsel is
not aware of any infringement of or conflict with such rights or any
claims to the contrary or any challenge by any other person to the
rights of such subsidiary with respect to the foregoing;
(ix) the offering and sale of the shares of common stock by the
Company as contemplated by the Prospectus will not (A) conflict with
or constitute a breach of any of the terms or provisions of, or a
default under (or event which, with giving of notice or lapse of time
or both, would be a default under) or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of such subsidiary pursuant to (x) any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is
material to such subsidiary, to which such subsidiary is a party or by
which such subsidiary or its property is bound (as any such indenture,
loan agreement, mortgage, lease or other agreement or instrument has
been identified to such counsel by an officer of such subsidiary in an
officer's certificate, any such agreement herein a "Material
Obligation") or (y) any shareholders' agreement or acquisition
agreement to which such subsidiary and the Company are a party, or (B)
constitute an event or condition that gives the holder of any Material
Obligation (or any person acting on such holder's behalf) the right to
require, from the subsidiary, the Company or any entity controlled by
the Company, the repurchase or redemption or repayment or
cancellation of all or a portion of such Material Obligation; and.
(x) Other than restrictions on the payment of dividends that would
render such subsidiary insolvent, except as set forth on a schedule
attached to such opinion, there are no limitations or restrictions on
28
such subsidiary's ability to pay dividends or distributions of any
kind to its shareholders, partners or owners, whether based on laws,
contracts, or currency controls, and the payment of such dividends or
distributions is not subject to any tax or withholding.
The opinions of counsel described in Section 9(f) above shall be rendered
to you at the request of the Company and the respective subsidiary and shall so
state therein.
(g) The Underwriters shall have received on the Closing Date an opinion
(satisfactory to the Underwriters and counsel for the Underwriters), dated the
Closing Date, of ▇▇▇▇▇ Dutilh, special Dutch counsel to the Company to the
effect that the information under the caption "Material Netherlands Tax
Consequences" and "Description of Capital Stock--Listing" in the Prospectus, to
the extent that such information is relevant to such subsidiary and constitutes
a summary of legal matters, has been reviewed by such counsel and is accurate in
all material respects.
The opinions of counsel described in Section 9(g) above shall be rendered
to you at the request of the Company and shall so state therein.
(h) You shall have received on the Closing Date an opinion, dated the
Closing Date, of O'Melveny & ▇▇▇▇▇ LLP, counsel for the Underwriters, as to the
matters referred to in Sections 9(e)(iv), 9(e)(v), 9(e)(vii), 9(e)(viii) (but
only with respect to the statements under the caption "Description of Capital
Stock" and "Underwriting") and 9(e)(xiii).
(i) In addition, in their opinions described in Sections 9(e) and 9(h),
respectively, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P. and O'Melveny & ▇▇▇▇▇ LLP shall state that
no facts have come to the attention of such counsel which cause them to believe
that the Registration Statement, at the time it 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 and on the date of such opinion,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, provided,
however, that in making the foregoing statements (which shall not constitute an
opinion), such counsel need not express a view as to the financial statements
and supporting schedules and other financial and statistical information
included in or omitted from the Registration Statement or the Prospectus, and
provided further, that O'Melveny & ▇▇▇▇▇ LLP need not express a view as to the
Reserved Share Prospectus contained in the Registration Statement. ▇▇▇▇▇ &
▇▇▇▇▇▇▇ L.L.P. shall further state that no facts have come to their attention
which cause them to believe that there are any legal or governmental proceedings
pending or
29
threatened against the Company that are required to be disclosed in the
Registration Statement or the Prospectus, other than those disclosed therein, or
that there are any contracts or documents of a character required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described or referred to
therein or so filed.
(j) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from PricewaterhouseCoopers LLP,
independent public accountant to the Company, containing the information and
statements of the type ordinarily included in accountants' "comfort letters" to
Underwriters with respect to the financial statements and certain financial
information of the Company contained in the Registration Statement and the
Prospectus. You shall also have received, on each of the date hereof and the
Closing Date, a letter dated the date hereof or the Closing Date, as the case
may be, in form and substance satisfactory to you, with respect to each
subsidiary of the Company for which audited financial statements are included in
the Registration Statement and Prospectus, from the applicable Independent
Public Accountant containing statements that (a) they are independent public
accountants with respect to such subsidiary as required by the Act, (b) that the
financial statements of such subsidiary audited by them and included in the
Registration Statement and Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act and the related published
rules and regulations and other and (c) containing the information and
statements of the type ordinarily included in accountants' "comfort letters" to
Underwriters with respect to certain financial information specifically related
to such subsidiary contained in the Registration Statement and the Prospectus.
(k) The Company shall have delivered to you the agreements specified in
Section 2 hereof which agreements shall be in full force and effect on the
Closing Date.
(l) The Shares shall have been duly listed for quotation on the Nasdaq
National Market and the AEX.
(m) The Company shall not have failed on or prior to the Closing Date to
perform or comply with any of the agreements herein contained and required to be
performed or complied with by the Company on or prior to the Closing Date.
The several obligations of the U.S. Underwriters to purchase any Additional
Shares hereunder are subject to the delivery to you on the applicable Option
Closing Date of such documents as you may reasonably request with respect to the
good standing of the Company, the due authorization and issuance of such
Additional Shares and other matters related to the issuance of such Additional
Shares.
30
Section 10. Effectiveness of Agreement and Termination. This Agreement
shall become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by you by written notice to the Company if any of the following has
occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus, (ii) the
suspension or material limitation of trading in securities or other instruments
on the New York Stock Exchange, the American Stock Exchange, the Chicago Board
of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of
Trade, the Nasdaq National Market, the AEX or limitation on prices for
securities or other instruments on any such exchange or the Nasdaq National
Market or the AEX, (iii) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in your opinion materially and
adversely affects, or will materially and adversely affect, the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, (iv) the declaration of a banking moratorium by
either federal or New York State authorities or (v) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
If on the Closing Date or on an Option Closing Date, as the case may be,
any one or more of the Underwriters shall fail or refuse to purchase the Firm
Shares or Additional Shares, as the case may be, which it has or they have
agreed to purchase hereunder on such date and the aggregate number of Firm
Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the total number of Firm Shares or Additional Shares, as the
case may be, to be purchased on such date by all Underwriters, each non-
defaulting Underwriter shall be obligated severally, in the proportion which the
number of Firm Shares set forth opposite its name in Schedule I and Schedule II
bears to the total number of Firm Shares which all the non-defaulting
Underwriters have agreed to purchase, or in such other proportion as you may
specify, to purchase the Firm Shares or Additional Shares, as the case may be,
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase on such date; provided that in no event shall the number of Shares
which any Underwriter has agreed to purchase pursuant to Section 2 hereof be
increased pursuant to this Section 10 by an amount in excess of one-ninth of
such number of Shares, without the written consent of such Underwriter. If on
the Closing Date any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than
31
one-tenth of the aggregate number of Firm Shares to be purchased by all
Underwriters and arrangements satisfactory to you and the Company for purchase
of such Firm Shares are not made within 48 hours after such default, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter and the Company. In any such case which does not result in
termination of this Agreement, either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and the
Prospectus or any other documents or arrangements may be effected. If, on an
Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased on such date, the non-defaulting
Underwriters shall have the option to (i) terminate their obligation hereunder
to purchase such Additional Shares or (ii) purchase not less than the number of
Additional Shares that such non-defaulting Underwriters would have been
obligated to purchase on such date in the absence of such default. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of any such Underwriter under this
Agreement.
Section 11. Offering Restrictions Applicable to the International
Managers. Each of the International Managers represents and agrees for itself
that it has not offered or sold and will not offer or sell any International
Shares as part of its initial distribution within the United States or to, or
for the account of a U.S. person (it being understood that the International
Shares being offered outside of the United States and Canada have been
registered under the Act for resale from time to time in the United States).
Terms used in this Section 11 have the respective meanings assigned thereto by
Regulation S under the Act.
Section 12. Miscellaneous. Notices given pursuant to any provision of
this Agreement shall be addressed as follows: (i) if to the Company, to VIA
▇▇▇.▇▇▇▇▇, INC., ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇, Attn:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and (ii) if to any Underwriter or to you, to you c/▇
▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate Department, or in any case to such other
address as the person to be notified may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company and the several Underwriters set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Shares,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of any Underwriter, the officers or directors of any
Underwriter, any person controlling any Underwriter, the Company, the officers
or directors of the
32
Company or any person controlling the Company, (ii) acceptance of the Shares and
payment for them hereunder and (iii) termination of this Agreement.
If for any reason the Shares are not delivered by or on behalf of the
Company as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 10), the Company agrees to reimburse the several
Underwriters for all out-of-pocket expenses (including the fees and
disbursements of counsel) incurred by them. Notwithstanding any termination of
this Agreement, the Company shall be liable for all expenses which it has agreed
to pay pursuant to Section 5(i) hereof. The Company also agrees to reimburse
the several Underwriters, their directors and officers, any persons controlling
any of the Underwriters for any and all fees and expenses (including, without
limitation, the reasonable fees and disbursements of counsel) incurred by them
in connection with enforcing their rights hereunder (including, without
limitation, pursuant to Section 7 hereof).
Except as otherwise provided, this Agreement has been and is made solely
for the benefit of and shall be binding upon the Company, the Underwriters, the
Underwriters' directors and officers, any controlling persons referred to
herein, the Company's directors and the Company's officers who sign the
Registration Statement and their respective successors and assigns, all as and
to the extent provided in this Agreement, and no other person shall acquire or
have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include a purchaser of any of the Shares from any of the
several Underwriters merely because of such purchase.
This Agreement shall be governed and construed in accordance with the laws
of the State of New York.
This Agreement may be signed in various counterparts which together shall
constitute one and the same instrument.
33
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
VIA ▇▇▇.▇▇▇▇▇, INC.
By: _________________________
Title: _________________________
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
DLJdirect INC.
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By: ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
By: ___________________________
Title: ___________________________
DLJ INTERNATIONAL SECURITIES
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INTERNATIONAL LIMITED
SALOMON BROTHERS INTERNATIONAL LIMITED
CAZENOVE & CO.
MEESPIERSON N.V.
Acting severally on behalf of themselves and the several
International Managers named in Schedule II hereto
By: DLJ INTERNATIONAL SECURITIES
By: ___________________________
Title:__________________________
SCHEDULE I
----------
U.S. Underwriters Number of Firm Shares
to be Purchased
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
DLJdirect Inc.
Total ____________________
SCHEDULE II
-----------
International Managers Number of Firm Shares
to be Purchased
DLJ International Securities
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
Salomon Brothers International Limited
Cazenove & Co.
MeesPierson N.V.
Total ____________________
Annex I
The Centennial Funds
Norwest Equity Capital
Telecom Partners II
Harbour Vest International
Providence Equity Partners
Verio
Boston Millenia Partners
[More to come]
Annex II
Limitations and Restrictions on Subsidiary Dividends
Annex III
Jurisdictions in which the Company is Qualified to do Business