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AETHER SYSTEMS, INC.
(a Delaware corporation)
3,500,000 Shares of Common Stock
PURCHASE AGREEMENT
Dated: September ____, 2000
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TABLE OF CONTENTS
Page
SECTION 1. Representations and Warranties..................................................................2
(a) Representations and Warranties by the Company............................................................2
(i) Compliance with Registration Requirements.......................................................3
(ii) Independent Accountants.........................................................................3
(iii) Financial Statements............................................................................3
(iv) No Material Adverse Change in Business..........................................................4
(v) Good Standing of the Company....................................................................5
(vi) Good Standing and Ownership of Subsidiaries.....................................................5
(vii) Capitalization..................................................................................5
(viii) Authorization of Agreement......................................................................6
(ix) Authorization and Description of Securities.....................................................6
(x) Absence of Defaults and Conflicts...............................................................6
(xi) Absence of Labor Dispute........................................................................7
(xii) Absence of Proceedings..........................................................................7
(xiii) Accuracy of Exhibits............................................................................7
(xiv) Possession of Intellectual Property.............................................................7
(xv) Absence of Further Requirements.................................................................8
(xvi) Possession of Licenses and Permits..............................................................8
(xvii) Title to Property...............................................................................8
(xviii) Compliance with Cuba Act........................................................................8
(xix) Investment Company Act..........................................................................8
(xx) Environmental Laws..............................................................................9
(xxi) Registration Rights.............................................................................9
(xxii) Dividends and Distributions.....................................................................9
(xxiii) Taxes...........................................................................................9
(xxiv) Insurance.......................................................................................9
(xxv) ERISA..........................................................................................10
(xxvi) Year 2000 Compliance...........................................................................10
(a1) Representations and Warranties by the Company with respect to OmniSky...................................10
(i) Good Standing and Ownership of OmniSky.........................................................11
(ii) No Material Adverse Change in Business.........................................................11
(iii) Certain Representations and Warranties as to the OmniSky Series B Preferred Stock Purchase
Agreement...............................................................................................11
(b) Representations and Warranties by the Selling Shareholders..............................................11
(i) Accurate Disclosure............................................................................11
(ii) Authorization of Agreements....................................................................11
(iii) Good and Marketable Title......................................................................12
(iv) Due Execution of Power of Attorney and Custody Agreement.......................................12
(v) Absence of Manipulation........................................................................12
(vi) Absence of Further Requirements................................................................13
(vii) Restriction on Sale of Securities..............................................................13
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(viii) Certificates Suitable for Transfer.............................................................13
(ix) No Association with NASD.......................................................................13
(c) Officer's and Selling Shareholders' Certificates........................................................13
SECTION 2. Sale and Delivery to Underwriters; Closing.....................................................14
(a) Initial Securities......................................................................................14
(b) Option Securities.......................................................................................14
(c) Payment.................................................................................................14
(d) Denominations; Registration.............................................................................15
SECTION 3. Covenants of the Company.......................................................................15
(a) Compliance with Securities Regulations and Commission Requests..........................................15
(b) Filing of Amendments....................................................................................16
(c) Delivery of Registration Statements.....................................................................16
(d) Delivery of Prospectus..................................................................................16
(e) Continued Compliance with Securities Laws...............................................................16
(f) Blue Sky Qualifications.................................................................................17
(g) Rule 158................................................................................................17
(h) Listing.................................................................................................17
(i) Restriction on Sale of Securities.......................................................................17
(j) Reporting Requirements..................................................................................18
(k) Compliance with Rule 463................................................................................18
SECTION 4. Payment of Expenses............................................................................18
(a) Expenses................................................................................................18
(b) Expenses of the Selling Shareholders....................................................................18
(c) Termination of Agreement................................................................................18
(d) Allocation of Expenses..................................................................................19
SECTION 5. Conditions of Underwriters' Obligations........................................................19
(a) Effectiveness of Registration Statement.................................................................19
(b) Opinion of Counsel for Company..........................................................................19
(c) Opinion of Counsel for the Selling Shareholders.........................................................19
(d) Opinion of Counsel for Underwriters.....................................................................19
(e) Officers' Certificate...................................................................................20
(f) Certificate of Selling Shareholders.....................................................................20
(g) Accountants' Comfort Letters............................................................................20
(h) Bring-down Comfort Letters..............................................................................20
(i) No Objection............................................................................................21
(j) Lock-up Agreements......................................................................................21
(k) Conditions to Purchase of Option Securities.............................................................21
(i) Officers' Certificate..........................................................................21
(ii) Opinion of Counsel for Company.................................................................21
(iii) Opinion of Counsel for Underwriters............................................................21
(iv) Bring-down Comfort Letters.....................................................................21
(l) Additional Documents....................................................................................21
(m) Termination of Agreement................................................................................22
SECTION 6. Indemnification................................................................................22
(a) Indemnification of Underwriters.........................................................................22
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(b) Indemnification of Company, Directors, Officers and Selling Shareholders................................23
(c) Actions against Parties; Notification...................................................................23
(d) Settlement without Consent if Failure to Reimburse......................................................24
(e) Other Agreements with Respect to Indemnification........................................................24
SECTION 7. Contribution...................................................................................24
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.................................25
SECTION 9. Termination of Agreement.......................................................................26
(a) Termination; General....................................................................................26
(b) Liabilities.............................................................................................26
SECTION 10. Default by One or More of the Underwriters.....................................................26
SECTION 12. Notices........................................................................................27
SECTION 13. Parties........................................................................................28
SECTION 14. GOVERNING LAW AND TIME.........................................................................28
SECTION 15. Effect of Headings.............................................................................28
SCHEDULES
Schedule A - List of Selling Shareholders.................................................Sch A-1
Schedule B - List of Underwriters.........................................................Sch B-1
Schedule C - __/__/01 Lock-up List........................................................Sch C-1
Schedule D - NASD Affiliations............................................................Sch D-1
Schedule E - Pricing Information..........................................................Sch E-1
EXHIBITS
Exhibit A - Form of Opinion of Company's Counsel..............................................A-1
Exhibit B - Form of Opinion of Selling Shareholders' Counsel..................................B-1
Exhibit C - Form of __/__/01 Lock-up Letter...................................................C-1
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AETHER SYSTEMS, INC.
(a Delaware corporation)
3,500,000 Shares of Common Stock
(Par Value $.01 Per Share)
PURCHASE AGREEMENT
September ___, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Deutsche Bank Securities Inc.
FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.
Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc.
as Representatives of the several Underwriters
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Aether Systems, Inc., a Delaware corporation (the "Company"), and the
additional persons or entities listed in Schedule A hereto (the "Selling
Shareholders") confirm their respective agreements with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and each
of the other Underwriters named in Schedule B hereto (collectively, the
"Underwriters", which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, Deutsche
Bank Securities Inc., FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc., ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ Securities Corporation, U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. and Friedman,
Billings, ▇▇▇▇▇▇ & Co., Inc. are acting as representatives (in such capacity,
the "Representatives"), with respect to the sale by the Selling Shareholders,
acting severally and not jointly, and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of shares of Common Stock,
par value $.01 per share, of the Company ("Common Stock") set forth in Schedule
A and Schedule B hereto, and with respect to the grant by the Selling
Shareholders to the Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase all or any part of 525,000
additional shares of Common Stock to cover over-allotments, if any. The
aforesaid 3,500,000 shares of Common Stock (the "Initial Securities") to be
purchased by the Underwriters
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and all or any part of the 525,000 shares of Common Stock subject to the option
described in Section 2(b) hereof (the "Option Securities") are hereinafter
called, collectively, the "Securities".
The Company and the Selling Shareholders understand that the
Underwriters propose to make a public offering of the Securities as soon as the
Representatives deem advisable after this Agreement has been executed and
delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-44566) covering the
registration of the Securities under the Securities Act of 1933, as amended
(the "1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will
either (i) prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations or (ii) if the Company has elected to rely
upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term
sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). The information included in any such prospectus or in any such Term
Sheet, as the case may be, that was omitted from such registration statement at
the time it became effective but that is deemed to be part of such registration
statement at the time it became effective (i) pursuant to paragraph (b) of Rule
430A is referred to as "Rule 430A Information" or (ii) pursuant to paragraph
(d) of Rule 434 is referred to as "Rule 434 Information." Each prospectus used
before such registration statement became effective, and any prospectus that
omitted, as applicable, the Rule 430A Information or the Rule 434 Information,
that was used after such effectiveness and prior to the execution and delivery
of this Agreement, is herein called a "preliminary prospectus." Such
registration statement, including the exhibits thereto and schedules thereto at
the time it became effective and including the Rule 430A Information and the
Rule 434 Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule 462(b) of the
1933 Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final prospectus in the
form first furnished to the Underwriters for use in connection with the
offering of the Securities is herein called the "Prospectus". If Rule 434 is
relied on, the term "Prospectus" shall refer to the preliminary Prospectus
dated September 7, 2000, together with the applicable Term Sheet and all
references in this Agreement to the date of such Prospectus shall mean the date
of the applicable Term Sheet. For purposes of this Agreement, all references to
the Registration Statement, any preliminary prospectus, the Prospectus or any
Term Sheet or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("▇▇▇▇▇").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
and ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, E. ▇▇▇▇▇ ▇▇▇▇▇▇▇ III, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇ (collectively, the "Key Shareholders")
represent and warrant to each Underwriter as of
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the date hereof, as of the Closing Time referred to in Section 2(c) hereof and
as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and
agree with each Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of
the Registration Statement and any Rule 462(b) Registration Statement
has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or,
to the knowledge of the Company, are contemplated by the Commission,
and any request on the part of the Commission for additional
information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments
thereto became effective and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments
and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements thereto
(including any prospectus wrapper), at the time the Prospectus or any
amendments or supplements was issued and at the Closing Time (and, if
any Option Securities are purchased, at the Date of Delivery),
included or will include an untrue statement of a material fact or
omitted or will omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading. If Rule 434 is used, the Company
will comply with the requirements of Rule 434 and the Prospectus shall
not be "materially different", as such term is used in Rule 434, from
the prospectus included in the Registration Statement at the time it
became effective. The representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the
Registration Statement or the Prospectus.
Each preliminary prospectus and the 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 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with this offering
were identical to the electronically transmitted copies thereof filed
with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted
by Regulation S-T.
(ii) Independent Accountants. The accountants who
certified the financial statements and supporting schedules included
in the Registration Statement are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements.
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(A) The financial statements of the Company
included in the Registration Statement and the Prospectus, together
with the related schedules and notes, present fairly the financial
position of the Company and its consolidated Subsidiaries (as defined
below) at the dates indicated and the results of operations,
stockholders' equity and cash flows of the Company and the
consolidated Subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved. The supporting schedules included in
the Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected financial data
and the summary financial information included in the Prospectus
present fairly the information shown therein and have been compiled on
a basis consistent with that of the audited financial statements
included in the Registration Statement.
(B) The financial statements of Mobeo, Inc.
("Mobeo"), Riverbed Technologies, Inc. ("Riverbed") and LocusOne
Communications, Inc. ("LocusOne") included in the Registration
Statement and the Prospectus, together with the related schedules and
notes, present fairly the respective financial condition of Mobeo,
Riverbed and LocusOne at the dates indicated and the respective
results of operations, changes in stockholders' equity and cash flows
of Mobeo, Riverbed and LocusOne for the periods specified; said
financial statements have been prepared in conformity with GAAP
applied on a consistent basis throughout the periods involved.
(C) The pro forma financial statements and the
related notes thereto included in the Registration Statement and the
Prospectus present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly
compiled 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.
(D) The Company and each of the Subsidiaries
maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (w) transactions are executed in
accordance with management's general or specific authorization; (x)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with GAAP, as applicable, and to
maintain asset accountability; (y) access to assets is permitted only
in accordance with management's general or specific authorization; and
(z) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A)
there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Company and the Subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Effect"), (B) there have been no
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transactions entered into by the Company or any of the Subsidiaries,
other than those in the ordinary course of business, which are
material with respect to the Company and the Subsidiaries considered
as one enterprise, and (C) there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
equity interests or capital stock, as applicable.
(v) Good Standing of the Company. The Company has been
duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware and has corporate
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter into
and perform its obligations under this Agreement; and the Company is
duly qualified as a foreign corporation to transact business and is in
good standing in each other jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property
or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(vi) Good Standing and Ownership of Subsidiaries. Each
subsidiary of the Company (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as a
corporation or limited liability company in good standing under the
laws of the jurisdiction of its incorporation or formation, has
corporate or limited liability company power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign
corporation or limited liability company to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to
be in good standing would not result in a Material Adverse Effect;
except as otherwise disclosed in the Registration Statement, all of
the issued and outstanding capital stock or other equity interests of
each such Subsidiary has been duly authorized and validly issued, is
fully paid and non-assessable and is owned by the Company, directly or
through Subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock or other equity interests of any
Subsidiary was issued in violation of the preemptive or similar rights
of any securityholder of such Subsidiary. The only Subsidiaries are
the Subsidiaries listed on Exhibit 21 to the Registration Statement.
(vii) Capitalization.
(a) The authorized, issued and outstanding
capital stock of the Company is set forth in the Prospectus under the
caption "Capitalization" (except for subsequent issuances, if any,
pursuant to reservations, agreements or employee benefit plans
referred to in the Prospectus or pursuant to the exercise of
convertible securities or options referred to in the Prospectus). The
shares of issued and outstanding capital stock of the Company,
including the Securities to be purchased by the Underwriters from the
Selling Shareholders, have been duly authorized and validly issued and
are fully paid and non-assessable; none of the outstanding shares of
capital stock of the Company, including the Securities to be purchased
by the Underwriters from the Selling Shareholders, was
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issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
(b) The shares of Common Stock and options
exercisable for Common Stock issued pursuant to the Agreement and Plan
of Merger, dated February 9, 2000, by and among the Company, RT
Acquisition, Inc. and Riverbed, were issued pursuant to valid
exemptions from the registration requirements of the 1933 Act and the
1933 Act Regulations, and were otherwise issued in compliance with all
applicable securities laws.
(c) The shares of Common Stock and options
exercisable for Common Stock issued pursuant to the Agreement and Plan
of Merger, dated as of August 25, 2000, by and among the Company,
Cerulean Acquisition, Inc. and Cerulean Technology, Inc. ("Cerulean"),
were issued pursuant to valid exemptions from the registration
requirements of the 1933 Act and the 1933 Act Regulations, and were
otherwise issued in compliance with all applicable securities laws.
(viii) Authorization of Agreement. This Agreement has been
duly authorized, executed and delivered by the Company.
(ix) Authorization and Description of Securities. The
Securities to be purchased by the Underwriters from the Selling
Shareholders are validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in
the Prospectus and such description conforms to the rights set forth
in the instruments defining the same; and no holder of the Securities
will be subject to personal liability by reason of being such a
holder.
(x) Absence of Defaults and Conflicts. Neither the
Company nor any of the Subsidiaries is in violation of its charter or
by-laws or similar documents or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to
which the Company or any of the Subsidiaries is a party or by which it
or any of them may be bound, or to which any of the property or assets
of the Company or any Subsidiary is subject (collectively, "Agreements
and Instruments") except for such defaults that would not result in a
Material Adverse Effect; and the execution, delivery and performance
of this Agreement and the consummation of the transactions
contemplated in this Agreement and in the Registration Statement and
compliance by the Company with its obligations under this Agreement
have been duly authorized by all necessary corporate action and do not
and will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or default
or Repayment Event (as defined below) 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, the Agreements
and Instruments (except for such conflicts, breaches or defaults or
liens, charges or encumbrances that would not result in a Material
Adverse Effect), nor will such action result in any violation of the
provisions of the charter or by-laws or similar documents of the
Company or any Subsidiary or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
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jurisdiction over the Company or any Subsidiary or any of their
assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition which 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, redemption
or repayment of all or a portion of such indebtedness by the Company
or any Subsidiary.
(xi) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any Subsidiary exists or, to the knowledge
of the Company, is imminent, and the Company is not aware of any
existing or imminent labor disturbance by the employees of any of its
or any Subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Effect.
(xii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Company, threatened, against or affecting the
Company or any Subsidiary, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which
might reasonably be expected to result in a Material Adverse Effect,
or which might reasonably be expected to materially and adversely
affect the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the
Company of its obligations hereunder; the aggregate of all pending
legal or governmental proceedings to which the Company or any
Subsidiary is a party or of which any of their respective property or
assets is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material
Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits thereto which
have not been so described and filed as required.
(xiv) Possession of Intellectual Property. Except to the
extent described in the Registration Statement, the Company and the
Subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now operated by them, and neither
the Company nor any of the Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property or of any
facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company or any of
the Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
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(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations hereunder, in connection with the offering or sale of
the Securities under this Agreement or the consummation of the
transactions contemplated by this Agreement, except such as have been
already obtained or as may be required under the 1933 Act or the 1933
Act Regulations and foreign or state securities or blue sky laws.
(xvi) Possession of Licenses and Permits. The Company and
the Subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses")
issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies necessary to conduct the business now operated by
them; the Company and the Subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where
the failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid
and in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Company nor any of the Subsidiaries has received any
notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.
(xvii) Title to Property. The Company and the Subsidiaries
have good and marketable title to all real property owned by the
Company and the Subsidiaries and good title to all other properties
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Prospectus or (b) do not,
singly or in the aggregate, 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 or any of the Subsidiaries; and
all of the leases and subleases material to the business of the
Company and the Subsidiaries, considered as one enterprise, and under
which the Company or any of the Subsidiaries holds properties
described in the Prospectus, are in full force and effect, and neither
the Company nor any Subsidiary has any notice of any material claim of
any sort that has been asserted by anyone adverse to the rights of the
Company or any Subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the Company
or such Subsidiary to the continued possession of the leased or
subleased premises under any such lease or sublease.
(xviii) Compliance with Cuba Act. The Company has complied
with, and is and will be in compliance with, the provisions of that
certain Florida act relating to disclosure of doing business with
Cuba, codified as Section 517.075 of the Florida statutes, and the
rules and regulations thereunder (collectively, the "Cuba Act") or is
exempt therefrom.
(xix) Investment Company Act. The Company is not an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
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(xx) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the
Company nor any of the Subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or
protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws
and regulations relating to the release or threatened release of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products (collectively,
"Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, "Environmental Laws"), (B) the
Company and the Subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are
each in compliance with their requirements, (C) there are no pending
or threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any Environmental
Law against the Company or any of the Subsidiaries and (D) there are
no events or circumstances that might reasonably be expected to form
the basis of an order for clean-up or remediation, or an action, suit
or proceeding by any private party or governmental body or agency,
against or affecting the Company or any of the Subsidiaries relating
to Hazardous Materials or any Environmental Laws.
(xxi) Registration Rights. Except as described in the
Registration Statement under the heading "Transactions Between Aether
and its Officers, Directors or Significant Stockholders" or
"Description of Capital Stock," there are no persons with registration
rights or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise registered by the
Company under the 1933 Act.
(xxii) Dividends and Distributions. No Subsidiary is
currently prohibited, directly or indirectly, from paying any
dividends to the Company, making any other distribution on such
Subsidiary's capital stock, repaying to the Company any loans or
advances to such Subsidiary from the Company, or transferring any of
such Subsidiary's property or assets to the Company or any other
Subsidiary.
(xxiii) Taxes. The Company and each of the Subsidiaries have
filed all foreign, federal, state and local tax returns that are
required to be filed or has requested extensions thereof (except in
any case in which the failure so to file would not result in a
Material Adverse Effect) and have paid all taxes required to be paid
by them and any other assessment, fine or penalty levied against them,
to the extent that any of the foregoing is due and payable, except for
any such assessment, fine or penalty that is currently being contested
in good faith.
(xxiv) Insurance. The Company and each of the 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;
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neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for; and neither the Company nor
any such Subsidiary 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 as may be
necessary to continue its business at a cost that would not have a
Material Adverse Effect.
(xxv) ERISA. The Company and each of the Subsidiaries are
each in compliance in all material respects with all presently
applicable provisions of ERISA; no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company or any Subsidiary would have any
liability; neither the Company nor any Subsidiary has incurred and nor
expects to incur liability under (A) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (B) Sections
412 or 4971 of the United States Internal Revenue Code (the "Code");
and each "pension plan" for which the Company or any Subsidiary would
have any liability that is intended to be qualified under Section
401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which
would cause the loss of such qualification.
(xxvi) Year 2000 Compliance. The Company has reviewed its
operations and those of the Subsidiaries to evaluate the extent to
which the business or operations of the Company or any of the
Subsidiaries have been affected by any Year 2000 Problem (as defined
below); (i) as a result of such review, the Company does not believe
that (A) there have been any issues related to the Company's or any
Subsidiary's failure to address any Year 2000 Problem that are of a
character required to be described or referred to in the Prospectus
which have not been accurately described in the Prospectus, and (B)
except to the extent disclosed in the Prospectus, the Year 2000
Problem has had a Material Adverse Effect; and (ii) the Company has
inquired whether the suppliers, vendors, customers or other material
third parties used or served by the Company and the Subsidiaries have
addressed any Year 2000 Problem in a timely manner, except to the
extent that a failure to address any Year 2000 Problem by any
supplier, vendor, customer or material third party would not have a
Material Adverse Effect. "Year 2000 Problem" means any actual
occurrence where, or significant risk that, the Company's computer
hardware or software applications and those of the Subsidiaries (or of
any suppliers, vendors or other material third parties) have not
functioned or will not function, in each case for dates or time
periods occurring after December 31, 1999, at least as effectively as
in the case of dates or time periods occurring prior to January 1,
2000.
(a1) Representations and Warranties by the Company with respect to
OmniSky. The Company and the Key Shareholders represent and warrant to each
Underwriter as of the date hereof (except as to the representation and warranty
set forth in the first sentence of Section (a1)(iii), which representation and
warranty is made as of January 18, 2000), and the Company and the Key
Shareholders represent and warrant as of the Closing Time referred to in
Section 2(c) hereof and as of each Date of Delivery (if any) referred to in
Section 2(b) hereof (except as to the representation and warranty set forth in
the first sentence of Section (a1)(iii), which representation and warranty is
made as of January 18, 2000), as follows:
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(i) Good Standing and Ownership of OmniSky. Airweb
Corporation d/b/a OmniSky ("OmniSky") has been duly organized and is
validly existing as a corporation in good standing under the laws of
Delaware. Except as otherwise disclosed in the Registration Statement,
Aether OpenSky Investments LLC, a Delaware limited liability company
and wholly-owned subsidiary of the Company ("OpenSky Investments"),
owns 10,000,000 shares of Series A Preferred Stock of OmniSky and
[1,439,809 shares of Series B Preferred Stock] of OmniSky, free and
clear of any security interest, mortgage, pledge, lien, encumbrance,
claim or equity other than rights of first refusal and co-sale set
forth in the related purchase agreements. To the knowledge of the
Company, such 10,000,000 shares of Series A Preferred Stock and
[1,439,809 shares of Series B Preferred Stock] constitute __% of the
equity interests of OmniSky on a fully diluted basis.
(ii) No Material Adverse Change in Business. To the
knowledge of the Company, since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, there has been no material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of OmniSky, whether or not
arising in the ordinary course of business.
(iii) Certain Representations and Warranties as to the
OmniSky Series B Preferred Stock Purchase Agreement. Except as set
forth in the schedule of exceptions attached thereto, all of the
representations and warranties (the "January OmniSky Representations")
set forth in the Series B Preferred Stock Purchase Agreement, dated as
of January 18, 2000, between OmniSky and OmniSky Investments, were true
and correct with respect to OmniSky as of January 18, 2000. To the
knowledge of the Company, all of the January OmniSky Representations
are true and correct with respect to OmniSky.
(b) Representations and Warranties by the Selling Shareholders.
Each Selling Shareholder severally represents and warrants to each Underwriter
as of the date hereof, as of the Closing Time referred to in Section 2(c)
hereof and as of each Date of Delivery (if any) referred to in Section 2(b)
hereof, and agrees with each Underwriter, as follows:
(i) Accurate Disclosure. To the best knowledge of such
Selling Shareholder, the representations and warranties of the Company
contained in Section 1(a) and 1(a1) hereof are true and correct; such
Selling Shareholder has reviewed and is familiar with the Registration
Statement and the Prospectus and neither the Prospectus nor any
amendments or supplements thereto include any untrue statement of a
material fact or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; such Selling Shareholder is not
prompted to sell the Securities to be sold by such Selling Shareholder
hereunder by any information concerning the Company or any subsidiary
of the Company which is not set forth in the Prospectus.
(ii) Authorization of Agreements. Each Selling
Shareholder has the full right, power and authority to enter into this
Agreement and a Power of Attorney and Custody Agreement (the "Power of
Attorney and Custody Agreement"), and to sell, transfer and
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deliver the Securities to be sold by such Selling Shareholder
hereunder. The execution and delivery of this Agreement and the Power
of Attorney and Custody Agreement and the sale and delivery of the
Securities to be sold by such Selling Shareholder and the consummation
of the transactions contemplated herein and therein and compliance by
such Selling Shareholder with its obligations hereunder and thereunder
have been duly authorized by such Selling Shareholder and do not and
will not, whether with or without the giving of notice or passage of
time or both, conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any tax, lien,
charge or encumbrance upon the Securities to be sold by such Selling
Shareholder or any property or assets of such Selling Shareholder
pursuant to any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, license, lease or other agreement or
instrument to which such Selling Shareholder is a party or by which
such Selling Shareholder may be bound, or to which any of the property
or assets of such Selling Shareholder is subject, nor will such action
result in any violation of the provisions of the charter or by-laws or
other organizational instrument of such Selling Shareholder, if
applicable, or any applicable treaty, law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction
over such Selling Shareholder or any of its properties.
(iii) Good and Marketable Title. Such Selling Shareholder
has (except as set forth on Schedule A), and will at the Closing Time
and on the Date of Delivery (if any) have, good and marketable title
to the Securities to be sold by such Selling Shareholder hereunder,
free and clear of any security interest, mortgage, pledge, lien,
charge, claim, equity or encumbrance of any kind, other than pursuant
to this Agreement; and upon delivery of such Securities and payment of
the purchase price therefor as herein contemplated, assuming each such
Underwriter has no notice of any adverse claim, each of the
Underwriters will receive good and marketable title to the Securities
purchased by it from such Selling Shareholder, free and clear of any
security interest, mortgage, pledge, lien, charge, claim, equity or
encumbrance of any kind.
(iv) Due Execution of Power of Attorney and Custody
Agreement. Such Selling Shareholder has duly executed and delivered,
in the form heretofore furnished to ▇▇▇▇▇▇▇ ▇▇▇▇▇, the Power of
Attorney and Custody Agreement with ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇.
▇▇▇▇▇ as attorneys-in-fact (the "Attorneys-in-Fact") and as custodian
(the "Custodian"); the Custodian is authorized to deliver the
Securities to be sold by such Selling Shareholder hereunder and to
accept payment therefor; and each of the Attorneys-in-Fact is
authorized to execute and deliver this Agreement and the certificate
referred to in Section 5(f) hereof or that may be required pursuant to
Section 5(m)(ii) hereof on behalf of such Selling Shareholder, to
sell, assign and transfer to the Underwriters the Securities to be
sold by such Selling Shareholder hereunder, to determine the purchase
price to be paid by the Underwriters to such Selling Shareholder, as
provided in Section 2(a) hereof, to authorize the delivery of the
Securities to be sold by such Selling Shareholder hereunder, to accept
payment therefor, and otherwise to act on behalf of such Selling
Shareholder in connection with this Agreement.
(v) Absence of Manipulation. Such Selling Shareholder
has not taken, and will not take, directly or indirectly, any action
which is designed to or which has
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constituted or which might reasonably be expected to cause or result
in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(vi) Absence of Further Requirements. No filing with, or
consent, approval, authorization, order, registration, qualification
or decree of, any court or governmental authority or agency, domestic
or foreign, is necessary or required for the performance by such
Selling Shareholder of its obligations hereunder or in the Power of
Attorney and Custody Agreement, or in connection with the sale and
delivery of the Securities hereunder or the consummation of the
transactions contemplated by this Agreement, except such as may have
previously been made or obtained or as may be required under the 1933
Act or the 1933 Act Regulations or state securities laws.
(vii) Restriction on Sale of Securities. With respect to
each Selling Shareholder listed on Schedule C hereto, during the
period beginning on the date hereof and ending at 11:59 p.m. (Eastern
Standard Time) on _____________, such Selling Shareholder will not,
without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (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 share of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not
apply to the Securities to be sold hereunder.
(viii) Certificates Suitable for Transfer. Certificates for
all of the Securities to be sold by such Selling Shareholder pursuant
to this Agreement, in suitable form for transfer by delivery or
accompanied by duly executed instruments of transfer or assignment in
blank with signatures guaranteed, have been placed, or will be placed
prior to the Closing Time, in custody with the Custodian with
irrevocable conditional instructions to deliver such Securities to the
Underwriters pursuant to this Agreement.
(ix) No Association with NASD. Except as set forth on
Schedule D hereto, neither such Selling Stockholder nor any affiliates
of such Selling Shareholder directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common
control with, or has any other association with (within the meaning of
Article I, Section 1(m) of the By-laws of the National Association of
Securities Dealers, Inc.), any member firm of the National Association
of Securities Dealers, Inc.
(c) Officer's and Selling Shareholders' Certificates. Any
certificate signed by any officer of the Company or any of the Subsidiaries
delivered to the Representatives or to counsel for the Underwriters shall be
deemed a representation and warranty by the Company to each Underwriter as to
the matters covered thereby; and any certificate signed by or on behalf of the
Selling Shareholders as such and delivered to the Global Coordinator, the
Representatives or to
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counsel for the Underwriters pursuant to the terms of this Agreement shall be
deemed a representation and warranty by such Selling Shareholder to the
Underwriters as to matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, each Selling Shareholder, severally and not jointly, agrees to sell to
each Underwriter, severally and not jointly, and each Underwriter, severally
and not jointly, agrees to purchase from each Selling Shareholder, at the price
per share set forth in Schedule E, that proportion of the number of Initial
Securities set forth in Schedule A opposite the name of such Selling
Shareholder, which the number of Initial Securities set forth in Schedule B
opposite the name of such Underwriter, plus any additional number of Initial
Securities which such Underwriter may become obligated to purchase pursuant to
the provisions of Section 10 hereof, bears to the total number of Initial
Securities, subject, in each case, to such adjustments among the Underwriters
as the Representatives in their sole discretion shall make to eliminate any
sales or purchases of fractional securities.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, each Selling Shareholder, severally and not
jointly, hereby grants an option to the Underwriters, severally and not
jointly, to purchase up to that number of shares of Common Stock opposite the
name of such Selling Shareholder on Schedule A, which shares shall total
525,000 in number, at the price per share set forth in Schedule E, less an
amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial Securities upon notice by ▇▇▇▇▇▇▇ ▇▇▇▇▇ to the
Company setting forth the number of Option Securities as to which the several
Underwriters are then exercising the option and the time and date of payment
and delivery for such Option Securities. Any such time and date of delivery for
the Option Securities (a "Date of Delivery") shall be determined by ▇▇▇▇▇▇▇
▇▇▇▇▇, but shall not be later than seven full business days after the exercise
of said option, nor in any event prior to the Closing Time, as hereinafter
defined. If the option is exercised as to all or any portion of the Option
Securities, each of the Underwriters, acting severally and not jointly, will
purchase that proportion of the total number of Option Securities then being
purchased which the number of Initial Securities set forth in Schedule B
opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as ▇▇▇▇▇▇▇ ▇▇▇▇▇ in its
discretion shall make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of ▇▇▇▇▇
& ▇▇▇▇▇▇▇ L.L.P., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such other
place as shall be agreed upon by the Representatives and the Company, at 9:00
A.M. (Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date hereof (unless
postponed in accordance with the provisions of Section 10), or such other time
not later than ten business
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days after such date as shall be agreed upon by the Representatives and the
Company (such time and date of payment and delivery being herein called
"Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Representatives and the Company, on each Date of Delivery as specified in the
notice from ▇▇▇▇▇▇▇ ▇▇▇▇▇ to the Company.
Payment shall be made to the Selling Shareholders by wire transfer of
immediately available funds to bank accounts designated by the Company and the
Custodian pursuant to each Selling Shareholder's Power of Attorney and Custody
Agreement, as the case may be, against delivery to the Representatives for the
respective accounts of the Underwriters of certificates for the Securities to
be purchased by them. It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Initial Securities and the Option
Securities, if any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Initial Securities
or the Option Securities, if any, to be purchased by any Underwriter whose
funds have not been received by the Closing Time or the relevant Date of
Delivery, as the case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
Securities and the Option Securities, if any, shall be in such denominations
and registered in such names as the Representatives may request in writing at
least one full business day before the Closing Time or the relevant Date of
Delivery, as the case may be. The certificates for the Initial Securities and
the Option Securities, if any, will be made available for examination and
packaging by the Representatives in The City of New York not later than 10:00
A.M. (Eastern time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company.
The Company covenants with each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify the
Representatives immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become effective,
or any supplement to the Prospectus or any amended Prospectus shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or
any amendment or supplement to the Prospectus or for additional information,
and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, or of
the initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly
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whether the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the
Representatives notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term Sheet
or any amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the
Prospectus, will furnish the Representatives with copies of any such documents
a reasonable amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document to which the Representatives
or counsel for the Underwriters shall object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each
of the Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectus. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the Securities
Exchange Act of 1934 (the "1934 Act"), such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably request. The
Prospectus and any amendments or supplements thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will
comply with the 1933 Act and the 1933 Act Regulations so as to permit the
completion of the distribution of the Securities as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required
by the 1933 Act to be delivered in connection with sales of the Securities, any
event shall occur or condition shall exist as a result of which it is
necessary, in the opinion of counsel for the Underwriters or for the Company,
to amend the Registration Statement or amend or supplement any Prospectus in
order that the Prospectus will not include any untrue statements of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the time
it is delivered to a purchaser, or if it shall be necessary, in the opinion of
such counsel, at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company will promptly prepare
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and file with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or to make
the Registration Statement or the Prospectus comply with such requirements, and
the Company will furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the Underwriters, to qualify the Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Global Coordinator may designate and
to maintain such qualifications in effect for a period of not less than one
year from the later of the effective date of the Registration Statement and any
Rule 462(b) Registration Statement; provided, however, that the Company shall
not be obligated to file any general consent to service of process or to
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation
in respect of doing business in any jurisdiction in which it is not otherwise
so subject. In each jurisdiction in which the Securities have been so
qualified, the Company will file such statements and reports as may be required
by the laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the effective date of the Registration
Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Listing. The Company will use its best efforts to maintain
the listing of the Securities on the Nasdaq National Market and will file with
the Nasdaq National Market all documents and notices required by the Nasdaq
National Market of companies that have securities that are traded in the
over-the-counter market and quotations for which are reported by the Nasdaq
National Market.
(i) Restriction on Sale of Securities. During a period of 150
days from the date of the Prospectus, the Company will not, without the prior
written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (i) directly or indirectly, 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 any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (A) the Securities to be sold hereunder, (B) any
shares of Common Stock issued by the Company upon the exercise of an option or
warrant or the conversion of a security outstanding on the date hereof and
referred to in the Prospectus, (C) any shares of Common Stock issued or options
to purchase Common Stock granted pursuant to existing employee benefit plans of
the Company referred to in the Prospectus, (D) any shares of Common Stock
issued pursuant to any non-employee director stock plan or dividend
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reinvestment plan, or (E) any shares of Common Stock issued in connection with
a stock split involving the Common Stock approved by the board of directors and
stockholders of the Company pursuant to applicable law.
(j) Reporting Requirements. The Company, during the period when
the Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to
the 1934 Act within the time periods required by the 1934 Act and the rules and
regulations of the Commission thereunder.
(k) Compliance with Rule 463. The Company will comply with Rule
463 of the 1933 Act Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company and the Selling Shareholders will pay
or cause to be paid all expenses incident to the performance of their
obligations under this Agreement, including (i) the preparation, printing and
filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the
preparation, printing and delivery to the Underwriters of this Agreement, any
Agreement among Underwriters and such other documents as may be required in
connection with the offering, purchase, sale or delivery of the Securities,
(iii) the preparation and delivery of the certificates for the Securities to
the Underwriters, including any stock or other transfer taxes and any stamp or
other duties payable upon the sale or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectus and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the
Blue Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities and (ix) the filing fees
incident to, and the reasonable fees and disbursements of counsel to the
Underwriters in connection with, the review by the NASD of the terms of the
sale of the Securities.
(b) Expenses of the Selling Shareholders. Each Selling
Shareholder will pay all of the expenses incident to the performance of such
Selling Shareholder's obligations under, and the consummation of the
transactions contemplated by, this Agreement, including (i) any stamp duties,
capital duties and stock transfer taxes, if any, payable upon the sale of the
Securities to the Underwriters, and their transfer between the Underwriters
pursuant to an agreement between such Underwriters, and (ii) the fees and
disbursements of such Selling Shareholder's respective counsel and accountants.
(c) Termination of Agreement. If this Agreement is terminated by
the Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company and the Selling Shareholders shall reimburse the
Underwriters for all of their
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out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
(d) Allocation of Expenses. The provisions of this Section shall
not affect any agreement that the Company and the Selling Shareholders may make
for the sharing of such costs and expenses.
SECTION 5. Conditions of Underwriters' Obligations. The obligations
of the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Selling Shareholders
contained in Section 1 hereof or in certificates of any officer of the Company
or any Subsidiary or on behalf of any Selling Shareholder delivered pursuant to
the provisions hereof, to the performance by the Company of its covenants and
other obligations hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule
434, a Term Sheet shall have been filed with the Commission in accordance with
Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, counsel for the Company, in form and
substance reasonably satisfactory to counsel for the Underwriters, together
with signed or reproduced copies of such letter for each of the other
Underwriters to the effect set forth in Exhibit A hereto and to such further
effect as counsel to the Underwriters may reasonably request.
(c) Opinion of Counsel for the Selling Shareholders. At Closing
Time, the Representatives shall have received the favorable opinion, dated as
of Closing Time, of counsel for the Selling Shareholders acceptable to the
Representatives in their sole discretion, in form and substance reasonably
satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters to the
effect set forth in Exhibit B hereto and to such further effect as counsel to
the Underwriters may reasonably request.
(d) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters
with respect to the matters set forth in clauses (i), (ii), (v), (vi) (solely
as to preemptive or other similar rights arising by operation of law or under
the charter or by-laws of the Company), (viii) through (x), inclusive, (xii),
(xiv) (solely as to the information in the
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Prospectus under "Description of Capital Stock--Common Stock") and the
penultimate paragraph of Exhibit A hereto. In giving such opinion such counsel
may rely, as to all matters governed by the laws of jurisdictions other than
the law of the State of New York and the federal law of the United States and
the General Corporation Law of the State of Delaware, upon the opinions of
counsel satisfactory to the Representatives. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company and the
Subsidiaries and certificates of public officials.
(e) Officers' Certificate. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and the Subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and the
Representatives shall have received a certificate of the President or a Vice
President of the Company, of the chief financial or chief accounting officer of
the Company and of each Key Shareholder, dated as of Closing Time, to the
effect that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) and Section 1(a1) (except to the
extent such representations and warranties are made as of January 18, 2000)
hereof are true and correct with the same force and effect as though expressly
made at and as of Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or are contemplated by the
Commission.
(f) Certificate of Selling Shareholders. At Closing Time, the
Representatives shall have received a certificate of one of the
Attorneys-in-Fact on behalf of each Selling Shareholder, dated as of Closing
Time, to the effect that (i) the representations and warranties of each Selling
Shareholder contained in Section 1(b) hereof are true and correct in all
respects with the same force and effect as though expressly made at and as of
Closing Time and (ii) each Selling Shareholder has complied with all agreements
and satisfied in all material respects all conditions on its part to be
performed or satisfied under this Agreement at or prior to Closing Time.
(g) Accountants' Comfort Letters. At the time of the execution of
this Agreement, the Representatives shall have received from KPMG LLP and Ernst
& Young LLP letters dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letters for
each of the other Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information
(including, in the case of KPMG LLP, pro forma financial information) contained
in the Registration Statement and the Prospectus.
(h) Bring-down Comfort Letters. At Closing Time, the
Representatives shall have received from KPMG LLP and Ernst & Young LLP
letters, dated as of Closing Time, to the effect that they reaffirm the
statements made in the letters furnished pursuant to subsection (g) of this
Section, except that the specified date referred to shall be a date not more
than three business days prior to Closing Time.
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(i) No Objection. The NASD shall have confirmed that it has not
raised any objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(j) Lock-up Agreements. At the date of this Agreement, the
Representatives shall have received an agreement substantially in the form of
Exhibit C hereto signed by each of the Selling Shareholders listed on Schedule
C hereto.
(k) Conditions to Purchase of Option Securities. In the event
that the Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the Option Securities, the representations and
warranties of the Company and the Selling Shareholders contained herein and the
statements in any certificates furnished by the Company, any Subsidiary of the
Company or the Selling Shareholders hereunder shall be true and correct as of
each Date of Delivery and, at the relevant Date of Delivery, the
Representatives shall have received:
(i) Officers' Certificate. A certificate, dated such
Date of Delivery, of the President or a Vice President of the Company,
of the chief financial or chief accounting officer of the Company and
of each Key Shareholder confirming that the certificate delivered at
the Closing Time pursuant to Section 5(e) hereof remains true and
correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable
opinion of ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, counsel for the Company, in
form and substance reasonably satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for Underwriters. The favorable
opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(d) hereof.
(iv) Bring-down Comfort Letters. Letters from each of
KPMG LLP and Ernst & Young LLP, in form and substance satisfactory to
the Representatives and dated such Date of Delivery, substantially in
the same form and substance as the letters furnished to the
Representatives pursuant to Section 5(g) hereof, except that the
"specified date" in the letter furnished pursuant to this paragraph
shall be a date not more than five days prior to such Date of
Delivery.
(l) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company and the Selling
Shareholders in connection with the issuance and sale of the Securities as
herein contemplated shall be reasonably satisfactory in form and substance to
the Representatives and counsel for the Underwriters.
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(m) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement, or, in the case of any condition to the purchase of Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representatives by notice to the Company
at any time at or prior to Closing Time or such Date of Delivery, as the case
may be, and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1, 6, 7
and 8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company and each Key
Shareholder jointly and severally agree, and each of the Selling Shareholders
other than the Key Shareholders severally and not jointly agree, to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), including the
Rule 430A Information and the Rule 434 Information, if applicable, or
the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission; provided that (subject to Section 6(d) below) any such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the
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Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
Notwithstanding the foregoing, (x) each Selling Shareholder other than the Key
Shareholders shall only have liability pursuant to this Section 6(a) in respect
of information furnished by or on behalf of such Selling Shareholder expressly
for use in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) and (y) the liability of each Selling Shareholder pursuant
to this Section 6(a) shall be limited to an amount equal to the product of (I)
the number of shares of Common Stock to be sold by such Selling Shareholder and
(II) the public offering price of the shares of Common Stock set forth in the
Prospectus less the underwriting discount applicable to such shares.
(b) Indemnification of Company, Directors, Officers and Selling
Shareholders. Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and each Selling
Shareholder and each person, if any, who controls any Selling Shareholder
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or any amendment
or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it
is not materially prejudiced as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. In the case of parties indemnified pursuant to
Section 6(a) above, counsel to the indemnified parties shall be selected by
▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in the case of parties indemnified pursuant to Section 6(b)
above, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental
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agency or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification or contribution could be sought under this Section 6 or
Section 7 hereof (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii)
does not include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(e) Other Agreements with Respect to Indemnification. The
provisions of this Section shall not affect any agreement among the Company and
the Selling Shareholders with respect to indemnification.
SECTION 7. Contribution.
If the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other hand from the
offering of the Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company and the Selling
Shareholders on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Securities pursuant to this Agreement shall
be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Securities pursuant to this Agreement (before
deducting expenses) received by the Selling Shareholders and the total
underwriting discount received by the Underwriters, in each case as set forth
on the cover of the Prospectus, or, if Rule 434 is used, the corresponding
location on the Term Sheet, bear to the aggregate initial public offering price
of the Securities as set forth on such cover.
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The relative fault of the Company and the Selling Shareholders on the
one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the Selling
Shareholders or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company, the Selling Shareholders and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this
Section 7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
7 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
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 Securities 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 any 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 ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or
any Selling Shareholder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as the
Company or such Selling Shareholder, as the case may be. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of Initial Securities set forth opposite their
respective names in Schedule B hereto and not joint.
The provisions of this Section shall not affect any agreement among
the Company and the Selling Shareholders with respect to contribution.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of the
Subsidiaries or the Selling Shareholders submitted pursuant hereto, shall
remain operative and in full force and effect, regardless of any investigation
made by or on behalf of any Underwriter or controlling person, or by or on
behalf
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of the Company or any Selling Shareholder, and shall survive delivery of the
Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this
Agreement, by notice to the Company and the Selling Shareholders, at any time
at or prior to Closing Time (i) if there has been, since the time of execution
of this Agreement or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and the Subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political,
financial or economic conditions, in each case the effect of which is such as
to make it, in the judgment of the Representatives, impracticable to market the
Securities or to enforce contracts for the sale of the Securities, or (iii) if
trading in any securities of the Company has been suspended or materially
limited by the Commission or the Nasdaq National Market, or if trading
generally on the American Stock Exchange or the New York Stock Exchange or in
the Nasdaq National Market has been suspended or materially limited, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices
have been required, by any of said exchanges or by such system or by order of
the Commission, the National Association of Securities Dealers, Inc. or any
other governmental authority, or (iv) if a banking moratorium has been declared
by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that
Sections 1, 6, 7 and 8 shall survive such termination and remain in full force
and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the Representatives shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but
not less than all, of the Defaulted Securities in such amounts as may be agreed
upon and upon the terms herein set forth; if, however, the Representatives
shall not have completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of
the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs
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after the Closing Time, the obligation of the Underwriters to purchase and of
the Company to sell the Option Securities to be purchased and sold on such Date
of Delivery shall terminate without liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement or, in the case of a Date of Delivery which is
after the Closing Time, which does not result in a termination of the
obligation of the Underwriters to purchase and the Selling Shareholders to sell
the relevant Option Securities, as the case may be, either (i) the
Representatives or (ii) the Company and any Selling Shareholder shall have the
right to postpone Closing Time or the relevant Date of Delivery, as the case
may be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents
or arrangements. As used herein, the term "Underwriter" includes any person
substituted for a Underwriter under this Section 10.
SECTION 11. Default by one or more of the Selling Shareholders. If a
Selling Shareholder shall fail at Closing Time or at a Date of Delivery to sell
and deliver the number of Securities which such Selling Shareholder or Selling
Shareholders are obligated to sell hereunder (the number of Securities with
respect to which such Selling Shareholder and any other Selling Shareholders
are in default are referred to herein as the "Shareholder Defaulted
Securities"), the remaining Selling Shareholders shall have the right to
increase, pro rata or otherwise, the number of Securities to be sold by them
hereunder to the total number to be sold by all Selling Shareholders as set
forth in Schedule A hereto (such Securities sold by the remaining Selling
Shareholders being referred to herein as the "Cure Securities"). If the
remaining Selling Shareholders do not exercise the foregoing rights to increase
the number of Securities to be sold by them hereunder, or do exercise the
foregoing rights to increase the number of Securities to be sold by them
hereunder but the difference between the number of Shareholder Defaulted
Securities and Cure Securities is greater than [________] shares of Common
Stock, then the Underwriters may, at the option of the Representatives, by
notice from the Representatives to the Company and the non-defaulting Selling
Shareholders, either (i) terminate this Agreement without any liability on the
fault of any non-defaulting party except that the provisions of Sections 1, 4,
6, 7 and 8 shall remain in full force and effect or (ii) elect to purchase the
Securities which the non-defaulting Selling Shareholders have agreed to sell
hereunder. No action taken pursuant to this Section 11 shall relieve any
Selling Shareholder so defaulting from liability, if any, in respect of such
default.
In the event of a default by any Selling Shareholder as
referred to in this Section 11, each of the Representatives, the Company and
the non-defaulting Selling Shareholders shall have the right to postpone
Closing Time or the relevant Date of Delivery for a period not exceeding seven
days in order to effect any required change in the Registration Statement or
Prospectus or in any other documents or arrangements.
SECTION 12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives
27
32
at North Tower, World Financial Center, New York, New York 10281-1201,
attention of ▇▇▇▇▇▇ ▇▇▇▇; notices to the Company shall be directed to it at
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇ ▇.
▇▇▇▇; and notices to the Selling Shareholders shall be directed to at ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
SECTION 13. Parties. This Agreement shall inure to the benefit of and
be binding upon the Underwriters, the Company and the Selling Shareholders and
their respective successors. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person, firm or corporation,
other than the Underwriters, the Company and the Selling Shareholders and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Selling Shareholders and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm
or corporation. No purchaser of Securities from any Underwriter shall be deemed
to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
28
33
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Selling Shareholders a
counterpart hereof, whereupon this instrument, along with all counterparts,
will become a binding agreement between the Underwriters, the Company and the
Selling Shareholders in accordance with its terms.
Very truly yours,
AETHER SYSTEMS, INC.
By
---------------------------------
Title:
SELLING SHAREHOLDERS
By
---------------------------------
As Attorney-in-Fact acting on
behalf of the Selling Shareholders
named in Schedule A hereto
34
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
DEUTSCHE BANK SECURITIES INC.
FLEETBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
U.S. BANCORP ▇▇▇▇▇ ▇▇▇▇▇▇▇ INC.
FRIEDMAN, BILLINGS, ▇▇▇▇▇▇ & CO., INC.
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By
---------------------------------
Authorized Signatory
For themselves and as Representatives of
the other Underwriters named in
Schedule B hereto.
35
SCHEDULE A
THE SELLING SHAREHOLDERS
Number of Maximum Number of
Initial Securities Option Securities
------------------ -----------------
▇▇▇▇▇ ▇. ▇▇▇▇..................................
▇▇▇▇▇▇ ▇. ▇▇▇▇▇................................
▇▇▇▇ ▇. ▇▇▇▇▇▇▇................................
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇...............................
▇▇▇▇▇ ▇. ▇▇▇▇▇.................................
E. ▇▇▇▇▇ ▇▇▇▇▇▇▇ III...........................
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
3Com Corporation
NexGen Technologies, L.L.C.....................
Pyramid Ventures, Inc..........................
Telcom-ATI Investors, L.L.C....................
Columbia Riverbed Partners, LLC................
Columbia Capital Equity Partners II
(QP), L.P......................................
FBR Technology Venture
Partners L.P...................................
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.............................
▇▇▇▇ ▇. and E. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Jr...............
The ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Irrevocable Trust.........................
The ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Irrevocable Trust.........................
The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Irrevocable Trust.........................
Totals
Sch A - 1
36
SCHEDULE B
Name of Underwriter Number of
------------------- Initial
Securities
----------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated......................................................
Deutsche Bank Securities Inc...........................................................
FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation....................................
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.........................................................
Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc..................................................
Total 3,500,000
Sch B - 1
37
SCHEDULE C
2/__/01 LOCK-UP LIST
Sch C - 1
38
SCHEDULE D
NASD AFFILIATIONS
Sch D - 1
39
SCHEDULE E
AETHER SYSTEMS, INC.
3,500,000 Shares of Common Stock
(Par Value $.01 Per Share)
1. The public offering price per share for the Securities,
determined as provided in said Section 2, shall be $_____.
2. The purchase price per share for the Securities to be paid by
the several Underwriters shall be $______, being an amount equal to the public
offering price set forth above less $_____ per share; provided that the purchase
price per share for any Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities.
Sch E - 1
40
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the
laws of the State of Delaware.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its
business as described in the Prospectus and to enter
into and perform its obligations under the Purchase
Agreement.
(iii) The Company is duly qualified as a foreign
corporation to transact business and is in good
standing in each jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of
business, except where the failure so to qualify or
to be in good standing would not result in a Material
Adverse Effect.
(iv) The authorized, issued and outstanding capital stock
of the Company will, at the Closing Time and giving
effect to the issuance of the Initial Securities
under the Purchase Agreement, be as set forth in the
Prospectus under the captions "The Offering" and
"Capitalization" (except for subsequent issuances, if
any, pursuant to the Purchase Agreement or pursuant
to reservations, agreements or employee benefit plans
referred to in the Prospectus or pursuant to the
exercise of convertible securities or options
referred to in the Prospectus); the shares of issued
and outstanding capital stock of the Company have
been duly authorized and validly issued and are fully
paid and non-assessable; and none of the outstanding
shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights
of any securityholder of the Company.
(v) Each Subsidiary has been duly organized and is
validly existing as a corporation or limited
liability company in good standing under the laws of
the jurisdiction of its incorporation or formation,
has corporate or limited liability company power and
authority to own, lease and operate its properties
and to conduct its business as described in the
Prospectus and is duly qualified as a foreign
corporation or limited liability company to transact
business and is in good standing in each jurisdiction
in which such qualification is required, whether by
reason of the ownership or leasing of property or the
conduct of business, except where the failure so to
qualify or to be in good standing would not result in
a Material Adverse Effect; except as otherwise
disclosed in the Registration Statement, all of the
issued and outstanding capital stock or other equity
interests of each Subsidiary has been duly authorized
and validly issued, is fully paid and non-assessable
and, to the best of our knowledge, is owned by the
Company,
1
41
directly or through Subsidiaries, free and clear of
any security interest, mortgage, pledge, lien,
encumbrance, claim or equity; none of the outstanding
shares of capital stock or other equity interests of
any Subsidiary was issued in violation of the
preemptive or similar rights of any securityholder of
such Subsidiary.
(vi) The Purchase Agreement was duly authorized, executed
and delivered by the Company.
(vii) The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective
under the 1933 Act; any required filing of the
Prospectus pursuant to Rule 424(b) has been made in
the manner and within the time period required by
Rule 424(b); and, to the best of our knowledge, no
stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933
Act and no proceedings for that purpose have been
instituted or are pending or threatened by the
Commission.
(viii) The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and
the Rule 434 Information, as applicable, the
Prospectus and each amendment or supplement to the
Registration Statement and the Prospectus as of their
respective effective or issue dates (other than the
financial statements and supporting schedules
included therein or omitted therefrom, as to which we
express no opinion) complied as to form in all
material respects with the requirements of the 1933
Act and the 1933 Act Regulations.
(ix) If Rule 434 has been relied upon, the Prospectus was
not "materially different," as such term is used in
Rule 434, from the prospectus included in the
Registration Statement at the time it became
effective.
(x) The form of certificate used to evidence the Common
Stock complies in all material respects with all
applicable statutory requirements, with any
applicable requirements of the charter and by-laws of
the Company and the requirements of the Nasdaq
National Market.
(xi) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any Subsidiary
is a party, or to which the property of the Company
or any Subsidiary is subject, before or brought by
any court or governmental agency or body, domestic or
foreign, which is required to be disclosed in the
Prospectus other than those described or referred to
therein and the descriptions thereof or references
thereto are correct in all material respects, or
which might reasonably be expected to materially and
adversely affect the properties or assets thereof or
the consummation of the transactions contemplated in
the Purchase Agreement or the performance by the
Company of its obligations thereunder.
(xii) The information in the Prospectus under "Description
of Capital Stock" and "Business--Intellectual
Property Rights", "Business--Government Regulation"
2
42
and "Business--Legal Proceedings" and in the
Registration Statement under Item 14, to the extent
that it constitutes matters of law, summaries of
legal matters, the Company's charter and bylaws or
legal proceedings, or legal conclusions, has been
reviewed by us and is correct in all material
respects.
(xiii) To the best of our knowledge, there are no statutes
or regulations that are required to be described in
the Prospectus that are not described as required.
(xiv) All descriptions in the Prospectus of contracts and
other documents to which the Company or the
Subsidiaries are a party are accurate in all material
respects; to the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments
required to be described or referred to in the
Registration Statement or to be filed as exhibits
thereto other than those described or referred to
therein or filed or incorporated by reference as
exhibits thereto, and the descriptions thereof or
references thereto are correct in all material
respects.
(xv) To the best of our knowledge, neither the Company nor
any Subsidiary is in violation of its charter or
by-laws or similar documents and no default by the
Company or any Subsidiary exists in the due
performance or observance of any material obligation,
agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument that is
described or referred to in the Registration
Statement or the Prospectus or filed or incorporated
by reference as an exhibit to the Registration
Statement.
(xvi) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree
of, any court or governmental authority or agency,
domestic or foreign (other than under the 1933 Act
and the 1933 Act Regulations, which have been
obtained, or as may be required under the securities
or blue sky laws of the various states, as to which
we express no opinion) is necessary or required in
connection with the due authorization, execution and
delivery of the Purchase Agreement or for the
offering, issuance, sale or delivery of the
Securities.
(xvii) The execution, delivery and performance of the
Purchase Agreement and the consummation of the
transactions contemplated in the Purchase Agreement
and in the Registration Statement and compliance by
the Company with its obligations under the Purchase
Agreement do not and will not, (A) whether with or
without the giving of notice or lapse of time or
both, conflict with or constitute a breach of, or
default or Repayment Event (as defined in Section
1(a)(x) of the Purchase Agreement) 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 any contract,
indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or
instrument known to us, to which the Company or any
Subsidiary is a party or by which it or any of them
may be bound, or to which any of the property or
assets of the Company or any Subsidiary
3
43
is subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would
not have a Material Adverse Effect), (B) result in
any violation of the provisions of the charter or
by-laws or similar documents of the Company or any
Subsidiary, or (C) violate any applicable law,
statute, rule, regulation, judgment, order, writ or
decree, known to us, of any government, government
instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or
any of their respective properties, assets or
operations.
(xviii) To the best of our knowledge, except as disclosed in
the Prospectus, there are no persons with
registration rights or other similar rights to have
any securities registered pursuant to the
Registration Statement or otherwise registered by
the Company under the 1933 Act.
(xix) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as
such terms are defined in the ▇▇▇▇ ▇▇▇.
(xx) The shares of Common Stock and options exercisable
for Common Stock issued pursuant to the Agreement
and Plan of Merger, dated February 8, 2000, by and
among the Company, RT Acquisition, Inc. and
Riverbed, were issued pursuant to valid exemptions
from the registration requirements of the 1933 Act
and the 1933 Act Regulations, and were otherwise
issued in compliance with all applicable securities
laws.
(xxi) The shares of Common Stock and options exercisable
for Common Stock issued pursuant to the Agreement
and Plan of Merger, dated August 25, 2000, by and
among the Company, Cerulean Acquisition, Inc. and
Cerulean, were issued pursuant to valid exemptions
from the registration requirements of the 1933 Act
and the 1933 Act Regulations, and were otherwise
issued in compliance with all applicable securities
laws.
Nothing has come to our attention that would lead us to believe that
the Registration Statement or any amendment thereto, including the Rule 430A
Information and Rule 434 Information (if applicable), (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we make no statement), at the time such Registration
Statement or any such amendment became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time the Prospectus
was issued, at the time any such amended or supplemented prospectus was issued
or at the Closing Time, included or includes 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 the light of the circumstances under which they were
made, not misleading.
4
44
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
5
45
Exhibit B
FORM OF OPINION OF SELLING SHAREHOLDERS' COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(c)
(i) No filing with, or consent, approval, authorization, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, (other than the issuance of the order
of the Commission declaring the Registration Statement effective and such
authorizations, approvals or consents as may be necessary under state securities
laws, as to which we need express no opinion) is necessary or required to be
obtained by the Selling Shareholders for the performance by each Selling
Shareholder of its obligations under the Purchase Agreement or in the Power of
Attorney and Custody Agreement, or in connection with the offer, sale or
delivery of the Securities to be purchased by the Underwriters.
(ii) Each Power of Attorney and Custody Agreement has been duly
executed and delivered by the respective Selling Shareholder named therein and
constitutes the legal, valid and binding agreement of such Selling Shareholder.
(iii) The Purchase Agreement has been duly authorized, executed and
delivered by or on behalf of [each/the] Selling Shareholder.
(iv) Each Attorney-in-Fact has been duly authorized by the
respective Selling Shareholder named therein to deliver the Securities on behalf
of the Selling Shareholders in accordance with the terms of the Purchase
Agreement.
(v) The execution, delivery and performance of the Purchase
Agreement and the Power of Attorney and Custody Agreement and the sale and
delivery of the Securities and the consummation of the transactions contemplated
in the Purchase Agreement and in the Registration Statement and compliance by
the Selling Shareholders with their obligations under the Purchase Agreement
have been duly authorized by all necessary action on the part of the Selling
Shareholders and do not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or constitute a breach of, or
default under or result in the creation or imposition of any tax, lien, charge
or encumbrance upon the Securities or any property or assets of the Selling
Shareholders pursuant to, any contract, indenture, mortgage, deed of trust, loan
or credit agreement, note, license, lease or other instrument or agreement to
which any Selling Shareholder is a party or by which such Selling Shareholder
may be bound, or to which any of the property or assets of the Selling
Shareholders may be subject nor will such action result in any violation of the
provisions of the charter or by-laws of the Selling Shareholders, if applicable,
or any law, administrative regulation, judgment or order of any governmental
agency or body or any administrative or court decree having jurisdiction over
such Selling Shareholder or any of its properties.
1
46
(vi) To the best of our knowledge, at the Closing Time each Selling
Shareholder will deliver valid and marketable title to the Securities to be sold
by such Selling Shareholder pursuant to the Purchase Agreement, free and clear
of any pledge, lien, security interest, charge, claim, equity or encumbrance of
any kind, and has full right, power and authority to sell, transfer and deliver
such Securities pursuant to the Purchase Agreement. By delivery of a certificate
or certificates therefor such Selling Shareholder will transfer to the
Underwriters who have purchased such Securities pursuant to the Purchase
Agreement (without notice of any defect in the title of such Selling Shareholder
and who are otherwise bona fide purchasers for purposes of the Uniform
Commercial Code) valid and marketable title to such Securities, free and clear
of any pledge, lien, security interest, charge, claim, equity or encumbrance of
any kind.
Nothing has come to our attention that would lead us to believe that
the Registration Statement or any amendment thereto, including the Rule 430A
Information and Rule 434 Information (if applicable), (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time such Registration
Statement or any such amendment became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included therein or omitted
therefrom, as to which we need make no statement), at the time the Prospectus
was issued, at the time any such amended or supplemented prospectuses were
issued or at the Closing Time, included or includes 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 the light of the circumstances under which they
were made, not misleading.
2
47
Exhibit C
FORM OF LOCK-UP FROM DIRECTORS, OFFICERS OR OTHER STOCKHOLDERS
PURSUANT TO SECTION 5(j)
September __, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
Deutsche Bank Securities Inc.
FleetBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.
Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc.
as Representatives of the several
Underwriters to be named in the
within-mentioned Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Proposed Public Offering by Aether Systems, Inc.
Dear Sirs:
The undersigned, a stockholder [and an officer and/or director] of
Aether Systems, Inc., a Delaware corporation (the "Company"), understands that
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
("▇▇▇▇▇▇▇ ▇▇▇▇▇") and Deutsche Bank Securities Inc., FleetBoston ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Inc., ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation, U.S. Bancorp
▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. and Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc. propose to enter
into a Purchase Agreement (the "Purchase Agreement") with the Company providing
for the public offering of shares (the "Securities") of the Company's common
stock, par value $.01 per share (the "Common Stock"). In recognition of the
benefit that such an offering will confer upon the undersigned as a stockholder
[and an officer and/or director] of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the Purchase Agreement
that, during the period beginning on the date of the Purchase Agreement and
ending at 11:59 p.m., Eastern Standard Time, on _________ __, 2001, the
undersigned will not, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇,
directly or indirectly, (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 for the sale of, or otherwise dispose of or
transfer any shares of the Company's Common Stock or any securities convertible
into or exchangeable or exercisable for Common Stock,
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whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise.
Very truly yours,
Signature:
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Print Name:
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