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EXHIBIT 10.46
$400,000,000
SYBASE, INC.
1.75% CONVERTIBLE SUBORDINATED NOTES DUE 2025
PURCHASE AGREEMENT
February 15, 2005
LEHMAN BROTHERS INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
c/o Lehman Brothers Inc.
155 Linfield Drive
Menlo Park, CA 94025
Ladies and Gentlemen:
Sybase,
Inc., a Delaware corporation (the "Company"), proposes, upon
the
terms and considerations set forth herein,
to issue and sell to you, as the
initial purchasers (the "Initial
Purchasers"), $400,000,000 in aggregate
principal amount of its 1.75% Convertible
Subordinated Notes due 2025 (the "Firm
Notes"). The Company also proposes to issue
and sell to you, at your option (the
"Option"), $60,000,000 in aggregate
principal amount of its 1.75% Convertible
Subordinated Notes due 2025 (the "Optional
Notes"). The Firm Notes and the
Optional Notes are hereinafter collectively
referred to as the "Notes". The
Notes will (i) have terms and provisions
that are summarized in the Offering
Memorandum (as defined below) and (ii) are
to be issued pursuant to an Indenture
(the "Indenture") to be entered into
between the Company and U.S. Bank National
Association, as trustee (the "Trustee").
Subject to certain conditions set forth
in the Indenture, the Notes shall be
convertible, at the option of the holders
of the Notes, prior to maturity (unless
previously redeemed or otherwise
purchased by the Company) into cash or a
combination of cash and shares of the
Company's common stock, par value $0.001
per share (the "Common Stock"). This is
to confirm the agreement concerning the
purchase of the Notes from the Company
by the Initial Purchasers.
1.
Preliminary Offering Memorandum and Offering Memorandum. In
accordance
with Section 3 hereof, the Notes will be
offered and sold to the Initial
Purchasers without registration under the
Securities Act of 1933, as amended
(the "Act"), in reliance on an exemption
pursuant to Section 4(2) under the Act.
The Company has prepared a preliminary
offering memorandum, dated February 14,
2005 (the "Preliminary Offering
Memorandum"), and an offering memorandum, dated
February 15, 2005 (the "Offering
Memorandum"), setting forth information
regarding the Company and the Notes. The
terms Preliminary Offering Memorandum
and Offering Memorandum includes all
documents and information incorporated
therein by reference. The Company hereby
confirms that it has authorized the use
of the Preliminary Offering Memorandum and
the Offering Memorandum in connection
with the offering and resale of the Notes
by the Initial Purchasers.
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Any
reference to the Preliminary Offering Memorandum or the
Offering
Memorandum shall be deemed to refer to and
include the Company's most recent
Annual Report on Form 10-K, as amended, and
all subsequent documents filed with
the United States Securities and Exchange
Commission (the "Commission") pursuant
to Section 13(a), 13(c) or 15(d) of the
United States Securities Exchange Act of
1934, as amended (the "Exchange Act"), on
or prior to the date of the
Preliminary Offering Memorandum or the
Offering Memorandum, as the case may be.
Any reference to the Preliminary Offering
Memorandum or the Offering Memorandum,
as the case may be, as amended or
supplemented, as of any specified date, shall
be deemed to include any documents filed
with the Commission pursuant to Section
13(a), 13(c) or 15(d) of the Exchange Act
after the date of the Preliminary
Offering Memorandum or the Offering
Memorandum, as the case may be, and prior to
such specified date. All documents filed
under the Exchange Act and so deemed to
be included in the Preliminary Offering
Memorandum or the Offering Memorandum,
as the case may be, or any amendment or
supplement thereto are hereinafter
called the "Exchange Act Reports." The
Exchange Act Reports, when they were or
are filed (or, if an amendment with respect
to any such document was filed prior
to the date hereof, when such amendment was
filed) with the Commission,
conformed or will conform in all material
respects to the applicable
requirements of the Exchange Act and the
applicable rules and regulations of the
Commission thereunder.
It is
understood and acknowledged that upon original issuance thereof,
and
until such time as the same is no longer
required under the applicable
requirements of the Act, the Notes (and all
securities issued in exchange
therefor, in substitution thereof) shall
bear the following legend (along with
such other legends as the Initial
Purchasers and their counsel reasonably deem
necessary to comply with applicable
law):
"THIS
SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION
OF
THIS
SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933,
AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS
SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS
SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE
REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED
OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION
IS EXEMPT
FROM, OR NOT SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS
SECURITY
IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE
RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER.
THE HOLDER
OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER
OF THE
ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SYBASE, INC. OR
ANY
AFFILIATE
OF SYBASE, INC. WAS THE OWNER
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OF THIS
SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO
SYBASE,
INC. OR
ANY PARENT OR SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE
SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT
REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A
UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR
FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS
GIVEN THAT
THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C)
PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE
SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
SYBASE,
INC.'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER
PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM, AND
IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN
THE
FORM
APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND
DELIVERED
BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE."
You have agreed
with the Company that you will make offers and sales (the
"Exempt Resales") of the Notes purchased by
you hereunder on the terms set forth
in the Offering Memorandum, as amended or
supplemented, solely to persons whom
you reasonably believe to be "qualified
institutional buyers" as defined in Rule
144A under the Act ("QIBs") in transactions
meeting the requirements of Rule
144A under the Act. Those persons specified
in the foregoing sentence are
referred to herein as the ("Eligible
Purchasers"). You will offer the Notes to
Eligible Purchasers initially at a price
equal to 100% of the principal amount
thereof. Such price may be changed at any
time without notice.
Holders
(including subsequent transferees) of the Notes will have the
registration rights set forth in the
registration rights agreement attached
hereto as Exhibit A (the "Registration
Rights Agreement") between the Company,
and the Initial Purchasers to be dated
February 22, 2005 (the "Closing Date"),
for so long as such Notes constitute
"Restricted Securities" (as defined in the
Registration Rights Agreement). Pursuant to
the Registration Rights Agreement,
the Company will agree to file with the
Securities and Exchange Commission (the
"Commission") under the circumstances set
forth therein, a registration
statement under the Act (the "Shelf
Registration Statement") relating to the
resale of the Notes and the common stock
initially issuable upon conversion of
the Notes by holders thereof.
This
Agreement, the Indenture, the Registration Rights Agreement and
the
Notes are referred to herein collectively
as the "Operative Documents."
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2. Representations, Warranties and Agreements of the Company.
The
Company represents, warrants and agrees as
follows:
(a) When the Notes are issued pursuant to the Indenture and
delivered in accordance with this
Agreement, such Notes will not be of the same
class (within the meaning of Rule 144A
under the Act) as securities of the
Company that are listed on a national
securities exchange registered under
Section 6 of the Exchange Act, or that are
quoted in a United States automated
inter-dealer quotation system.
(b) The Company is not, or after giving effect to the offering
and
sale of the Notes and upon application of
the proceeds as described under the
caption "Use of Proceeds" in the Offering
Memorandum will not be, an "investment
company" or a company "controlled" by an
"investment company" within the meaning
of the Investment Company Act of 1940, as
amended.
(c) Assuming that your representations and warranties in
Section
3(b) are true and you comply with the
agreements set forth therein, the purchase
and resale of the Notes by you in the
manner contemplated by this Agreement
(including pursuant to the initial Exempt
Resales by you) is exempt from the
registration requirements of the Act
(except as may be required under the Act
and the rules and regulations promulgated
thereunder in connection with the
registration of the Notes and the Common
Stock pursuant to the Registration
Rights Agreement). No form of general
solicitation or general advertising within
the meaning of Regulation D (including, but
not limited to, advertisements,
articles, notices or other communications
published in any newspaper, magazine
or similar medium or broadcast over
television or radio, or any seminar or
meeting whose attendees have been invited
by any general solicitation or general
advertising) was used by the Company or any
of its representatives (other than
you, as to whom the Company makes no
representation) in connection with the
offer and sale of the Notes.
(d) Each of the Preliminary Offering Memorandum and the
Offering
Memorandum, as of its date, contains all
the information specified in, and
meeting the requirements of Rule 144A(d)(4)
under the Act.
(e) The Preliminary Offering Memorandum and Offering Memorandum
have
been prepared by the Company for use by the
Initial Purchasers in connection
with the Exempt Resales. No order or decree
prohibiting the use of the
Preliminary Offering Memorandum or the
Offering Memorandum, or any order
asserting that the transactions
contemplated by this Agreement are subject to
the registration requirements of the Act
has been issued and no proceeding for
that purpose has commenced or is pending
or, to the knowledge of the Company is
contemplated.
(f) (i) Each document, if any, filed or to be filed pursuant to
the
Exchange Act and incorporated by reference
in either the Preliminary Offering
Memorandum or the Offering Memorandum
complied or will comply when so filed (or,
if an amendment with respect to any such
document was filed, when such amendment
was filed) in all material respects with
the Exchange Act and the applicable
rules and regulations of the Commission
thereunder and (ii) the Preliminary
Offering Memorandum, the Offering
Memorandum as of their respective dates and
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the Offering Memorandum as of the Closing
Date, did not or will not at any time
contain any untrue statement of a material
fact or omit to state a material fact
required to be stated therein or necessary
in order to make the statements made
therein, in light of the circumstances
under which they were made, not
misleading, except that this representation
and warranty does not apply to
statements in or omissions from the
Preliminary Offering Memorandum and Offering
Memorandum made in reliance upon and in
conformity with information relating to
the Initial Purchasers furnished to the
Company in writing by or on behalf of
the Initial Purchasers expressly for use
therein.
(g) The market-related and customer data and estimates in the
Company's annual report for the year ended
December 31, 2003 filed on Form 10-K
are based on or derived from sources that
the Company believes to be reasonable
and accurate.
(h) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as
corporations in good standing under the
laws of their respective jurisdictions of
incorporation, are duly qualified to
do business and are in good standing as
foreign corporations in each
jurisdiction in which their respective
ownership or lease of property or the
conduct of their respective businesses
requires such qualification (except such
failures to qualify or be in good standing
that would not, either individually
or in the aggregate, have a material
adverse effect on the Company and its
subsidiaries taken as a whole), and have
all power and authority necessary to
own or hold their respective properties and
to conduct the businesses in which
they are engaged; and none of the
subsidiaries of the Company (other than
iAnywhere Solutions, Inc. and Sybase Europe
B.V.) is a "significant subsidiary,"
as such term is defined in Rule 405 of the
Rules and Regulations (as defined
herein).
(i) The Company has an authorized capitalization as set forth in
the
Offering Memorandum, and all of the issued
and outstanding shares of capital
stock of the Company have been duly
authorized and validly issued and are fully
paid and non-assessable; and all of the
issued shares of capital stock of each
subsidiary of the Company have been duly
and validly authorized and issued and
are fully paid and non-assessable (except
for directors' qualifying shares and
except as set forth in the Offering
Memorandum) and, to the extent owned
directly or indirectly by the Company, free
and clear of all liens,
encumbrances, equities or claims.
(j) The underlying securities issuable upon conversion of the
Notes
have been duly authorized and reserved and,
when issued upon conversion of the
Notes in accordance with the terms of the
Notes and the Indenture, will be
validly issued, fully paid and
non-assessable, and the issuance of the
underlying securities will not be subject
to any preemptive or similar rights.
(k) The Company has all requisite corporate power and authority
to
enter into the Indenture. The Indenture has
been duly and validly authorized by
the Company, and upon its execution and
delivery and, assuming due
authorization, execution and delivery by
the Trustee, will constitute the valid
and binding agreement of the Company,
enforceable against the Company in
accordance with its terms, except as such
enforceability may be limited by
bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and
other laws relating to or affecting
creditors' rights generally and by general
equitable principles and subject to
limitations on the availability of equitable
relief, including specific performance
(whether
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considered in a proceeding in equity or at
law) and an implied covenant of good
faith and fair dealing; and no
qualification of the Indenture under the Trust
Indenture Act of 1939 (the "1939 Act") is
required in connection with the offer
and sale of the Notes contemplated hereby
or in connection with the initial
Exempt Resales by you.
(l) The Indenture will conform in all material respects to the
description thereof in the Offering
Memorandum.
(m) The Company has all requisite corporate power and authority
to
issue and sell the Notes. The Notes have
been duly authorized by the Company
and, when duly executed by the Company in
accordance with the terms of the
Indenture, assuming due authentication of
the Notes by the Trustee, upon
delivery to the Initial Purchasers against
payment therefor in accordance with
the terms hereof, will be validly issued
and delivered, and will constitute
valid and binding obligations of the
Company entitled to the benefits of the
Indenture, enforceable against the Company
in accordance with their terms,
except as such enforceability may be
limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization,
moratorium, and other laws relating to
or affecting creditors' rights generally
and by general equitable principles and
subject to limitations on the availability
of equitable relief, including
specific performance (whether considered in
a proceeding in equity or at law)
and an implied covenant of good faith and
fair dealing.
(n) The Notes will conform in all material respects to the
description thereof in the Offering
Memorandum.
(o) The Company has all requisite corporate power and authority
to
enter into the Registration Rights
Agreement. The Registration Rights Agreement
has been duly authorized by the Company
and, when executed and delivered by the
Company in accordance with the terms hereof
and thereof, will be validly
executed and delivered and (assuming the
due authorization, execution and
delivery thereof by you) will be the
legally valid and binding obligation of the
Company in accordance with the terms
thereof, enforceable against the Company in
accordance with its terms, except as such
enforceability may be limited by
bankruptcy, insolvency, reorganization,
moratorium and other similar laws
relating to or affecting creditor's rights
generally, by general equitable
principles and subject to limitations on
the availability of equitable relief,
including specific performance (whether
considered in a proceeding in equity or
at law) and an implied covenant of good
faith and fair dealing and, as to rights
of indemnification and contribution, by
federal or state securities laws or the
principles of public policy underlying such
laws.
(p) The Registration Rights Agreement will conform in all
material
respects to the description thereof in the
Offering Memorandum.
(q) The Company has all requisite corporate power and authority
to
enter into this Agreement. This Agreement
has been duly authorized, executed and
delivered by the Company.
(r) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the
Notes, the Indenture, the Registration
Rights Agreement and this
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Agreement and the consummation of the
transactions contemplated hereby and
thereby (i) will not conflict with or
result in a breach or violation of any of
the terms or provisions of, or constitute a
default under, any indenture,
mortgage, deed of trust, loan agreement,
lease or other agreement or instrument
to which the Company or any of its
subsidiaries is a party or by which the
Company or any of its subsidiaries is bound
or to which any of the property or
assets of the Company or any of its
subsidiaries is subject except for such
conflicts, breaches, violations or defaults
which would not be material to the
Company and its subsidiaries, taken as a
whole, (ii) will not result in any
violation of the provisions of the charter
or by-laws of the Company or any of
its subsidiaries or (iii) will not violate
any statute or any order, rule or
regulation of any court or governmental
agency or body having jurisdiction over
the Company or any of its subsidiaries or
any of their properties or assets; and
no consent, approval, authorization or
order of, or filing, registration or
qualification with any such court or
governmental agency or body is required for
the issue and sale of the Notes or the
performance by the Company of its
obligations under this Agreement, the
Registration Rights Agreement or the
Indenture, except for the filing of a
registration statement by the Company with
the Commission pursuant to the Act as
required by the Registration Rights
Agreement and such consents, approvals,
authorizations, orders, filings,
registrations or qualifications as may be
required under state securities or
Blue Sky laws in connection with the
purchase and distribution of the Notes by
the Initial Purchasers or as may be
expressly required by the terms of this
Agreement, the Registration Rights
Agreement or the Indenture following the
Closing Date.
(s) There are no contracts, agreements or understandings between
the
Company and any person granting such person
the right to require the Company to
file a registration statement under the Act
with respect to any securities of
the Company (other than the Registration
Rights Agreement) owned or to be owned
by such person or to require the Company to
include such securities in the
securities registered pursuant to the
Registration Rights Agreement or in any
securities being registered pursuant to any
other registration statement filed
by the Company under the Act.
(t) During the six-month period preceding the date of the
Offering
Memorandum, none of the Company or any
other person acting on behalf of the
Company has offered or sold to any person
any Notes, or any securities of the
same or a similar class as the Notes, other
than Notes offered or sold to the
Initial Purchasers hereunder. The Company
will take reasonable precautions
designed to ensure that any offer or sale,
direct or indirect, in the United
States or to any U.S. person (as defined in
Rule 902 under the Act), of any
Notes or any substantially similar security
issued by the Company, within six
months subsequent to the date on which the
distribution of the Notes has been
completed (as notified to the Company by
the Initial Purchasers), is made under
restrictions and other circumstances
reasonably designed not to affect the
status of the offer and sale of the Notes
in the United States and to U.S.
persons contemplated by this Agreement as
transactions exempt from the
registration provisions of the Act.
(u) Neither the Company nor any of its subsidiaries has
sustained,
since the date of the latest audited
financial statements included in the
Offering Memorandum, any material loss or
interference with its business from
fire, explosion, flood or other calamity,
whether or not covered by insurance,
or from any labor dispute or court or
governmental action, order or decree,
otherwise than as set forth or contemplated
in the Offering Memorandum; and,
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since such date, there has not been any
material change in the stockholders'
equity (other than upon the exercise of
outstanding stock options), long-term
debt (except resulting from the issuance of
the Notes) or other liabilities of
the Company or any of its subsidiaries or
any material adverse change, or any
development involving a prospective
material adverse change, in or affecting the
management, condition, financial or
otherwise, stockholders' equity, results of
operations, business or prospects of the
Company and its subsidiaries, taken as
a whole (a "Material Adverse Effect")
otherwise than as set forth or
contemplated in the Offering
Memorandum.
(v) The financial statements (including the related notes and
supporting schedules) included in the
Offering Memorandum present fairly in all
material respects the financial condition
and results of operations of the
entities purported to be shown thereby, at
the dates and for the periods
indicated filed (or, where an amendment
with respect to any such document
containing such financial statements and
incorporated by reference into the
Offering Memorandum was filed pursuant to
the Exchange Act, at the dates and for
the periods indicated as so amended), and
have been prepared in conformity with
generally accepted accounting principles
applied on a consistent basis
throughout the periods involved except to
the extent that interim financial
statements (i) are subject to normal
year-end adjustments that will not be,
individually or in the aggregate, material
and adverse to the Company, or (ii)
lack footnotes.
(w) Ernst & Young LLP, who have certified certain financial
statements of the Company, whose report
appears in the Offering Memorandum and
who have delivered the initial letter
referred to in Section 7(g) hereof, are
registered accountants as required by the
Act and the rule and regulations
promulgated thereunder (the "Rules and
Regulations").
(x) The Company and each of its subsidiaries has good and
marketable
title in fee simple to all real property
and good and marketable title to all
personal property owned by them, in each
case free and clear of all liens,
encumbrances and defects except such as are
described in the Offering Memorandum
and such as do not materially affect the
value of the property of the Company
and its subsidiaries taken as a whole and
do not materially interfere with the
use made and proposed to be made of such
property by the Company or any of its
subsidiaries; and all real property and
buildings held under lease by the
Company or any of its subsidiaries are held
by them under valid, subsisting and
enforceable leases, with such exceptions as
are not material and do not
materially interfere with the use made and
proposed to be made of such property
and buildings by the Company or any of its
subsidiaries.
(y) Except as disclosed in the Preliminary Offering Memorandum
and
the Offering Memorandum, the Company and
each of its subsidiaries carry, or are
covered by, insurance in such amounts and
covering such risks as is adequate for
the conduct of their respective businesses
and the value of their respective
properties and as is customary for
companies engaged in similar businesses in
similar industries.
(z) The Company and each of its subsidiaries own or possess
adequate
rights to use (or in the case of patents,
to exclude the use by others of) all
material patents, patent applications,
trademarks, service marks, trade names,
trademark registrations, service mark
registrations, copyrights and licenses
necessary for the conduct of their
respective businesses, except where the
failure to own, possess or acquire such
rights would not reasonably be expected
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to be material to the Company and its
subsidiaries, taken as a whole and have no
reason to believe that the conduct of their
respective businesses will conflict,
and have not received any notice of any
claim of conflict, with, any such rights
of others which would reasonably be
expected be material to the Company and its
subsidiaries, taken as a whole.
(aa) There are no legal or governmental proceedings pending to
which
the Company or any of its subsidiaries is a
party or of which any property or
assets of the Company or any of its
subsidiaries is the subject that, if
determined adversely to the Company or any
of its subsidiaries, would reasonably
be expected to have a Material Adverse
Effect, and to the best of the Company's
knowledge, no such proceedings are
threatened in writing by governmental
authorities or others.
(bb) There are no contracts or other documents (other than any
Operative Documents) that would be required
to be filed as exhibits to a Company
registration statement pursuant to Item
601(10) of Regulation S-K that have not
been described in the Offering Memorandum
or filed as an exhibit to a document
incorporated by reference in the Offering
Memorandum.
(cc) No relationship, direct or indirect, that would be required
to
be described in a Company registration
statement pursuant to Item 404 of
Regulation S-K, exists between or among the
Company on the one hand, and the
directors, officers, stockholders,
customers or suppliers of the Company on the
other hand, that has not been described in
the Offering Memorandum.
(dd) No labor disturbance by the employees of the Company or any
of
its subsidiaries exists or, to the
knowledge of the Company or any of its
subsidiaries, is imminent that could
reasonably be expected to have a Material
Adverse Effect.
(ee) The Company is in compliance in all material respects with
all
presently applicable provisions of Section
407(d)(7) of the Employee Retirement
Income Security Act of 1974, as amended,
including the regulations and published
interpretations thereunder ("ERISA"); no
"reportable event" (as defined in
ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for
which the Company would have any material
liability; the Company has not
incurred and does not expect to incur
liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal
from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including
the regulations and published
interpretations thereunder (the "Code"), except in
each case where such liability would not be
material to the Company and its
subsidiaries, taken as a whole; and each
"pension plan" for which the Company
would have any material 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.
(ff) The Company has filed all federal, state and local income
and
franchise tax returns required to be filed
through the date hereof or has
requested extensions thereof except in any
case in which the failure so to file
would not have a Material Adverse Effect
and except as set forth in or
contemplated in the Preliminary Offering
Memorandum and the Offering Memorandum,
and has paid all taxes required to be paid
by it and any other assessment, fine
or
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penalty levied against it, 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 or as would not
have a Material Adverse Effect and
except as set forth in or contemplated in
the Preliminary Offering Memorandum
and the Offering Memorandum.
(gg) Since the date as of which information is given in the
Preliminary Offering Memorandum through the
date hereof, and except as may
otherwise be disclosed in the Offering
Memorandum, the Company has not (i)
issued or granted any securities (except
pursuant to the exercise of outstanding
stock options or ESPP Shares), (ii)
incurred any material liability or
obligation, direct or contingent, other
than liabilities and obligations that
were incurred in the ordinary course of
business, (iii) entered into any
material transaction not in the ordinary
course of business or (iv) declared or
paid any dividend on its capital stock.
(hh) The Company (i) makes and keeps accurate books and records
in
accordance with its financial and
accounting policies in all material respects
and (ii) maintains internal accounting
controls designed to provide reasonable
assurance that (A) transactions are
executed in accordance with management's
authorization, (B) transactions are
recorded as necessary to permit preparation
of its financial statements and to maintain
accountability for its assets, (C)
access to its assets is permitted only in
accordance with management's
authorization and (D) the reported
accountability for its assets is compared
with existing assets at reasonable
intervals.
(ii) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii)
is in default in any material respect,
and no event has occurred that, with notice
or lapse of time or both, would
constitute such a material default, in the
due performance or observance of any
term, covenant, condition or other
obligation contained in any material
indenture, mortgage, deed of trust, loan
agreement or other agreement or
instrument to which it is a party or by
which it is bound or to which any of its
properties or assets is subject or (iii) is
in violation in any material respect
of any law, ordinance, governmental rule,
regulation or court decree to which it
or its property or assets may be subject or
has failed to obtain or maintain any
material license, permit, certificate,
franchise or other governmental
authorization or permit necessary to the
ownership of its property or to the
conduct of its business.
(jj) Neither the Company nor any of its subsidiaries, nor any
director, officer, agent, employee or other
person associated with or acting on
behalf of the Company or any of its
subsidiaries, has used any corporate funds
for any unlawful contribution, gift,
entertainment or other unlawful expense
relating to political activity; made any
direct or indirect unlawful payment to
any foreign or domestic government official
or employee from corporate funds;
violated or is in violation of any
provision of the Foreign Corrupt Practices
Act of 1977; or made any bribe, rebate,
payoff, influence payment, kickback or
other unlawful payment with corporate
funds.
(kk) Except for such matters as would not, individually or in
the
aggregate, either reasonably be expected to
result in a Material Adverse Effect
or require disclosure in the Offering
Memorandum, the Company and any of its
subsidiaries (1) are conducting and have
conducted their businesses, operations
and facilities in compliance with
Environmental Laws (as defined below); (2)
possess, and are in compliance with, any
and all permits, licenses or
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<PAGE>
registrations required under Environmental
Law ("Environmental Permits"); (3)
will not require material expenditures to
maintain such compliance with
Environmental Law or their Environmental
Permits or to remediate, clean up,
abate or remove any Hazardous Substance (as
defined below); and (4) are not
subject to any pending or, to the knowledge
of the Company or any of its
subsidiaries, threatened claim or other
legal proceeding under any Environmental
Laws against the Company or its
subsidiaries, and have not been named as a
"potentially responsible party" under or
pursuant to any Environmental Law. As
used in this paragraph, "Environmental
Laws" means any and all applicable
federal, state, local, and foreign laws,
ordinances, regulations and common law,
or any administrative or judicial order,
consent, decree or judgment thereof,
relating to pollution or the protection of
human health or the environment,
including, without limitation, those
related to (i) emissions, discharges,
releases or threatened releases of, or
exposure to, Hazardous Substances, (ii)
the generation, manufacture, processing,
distribution, use, treatment, storage,
disposal, transport or handling of
Hazardous Substances, or (iii) the
investigation, remediation or cleanup of
any Hazardous Substances. As used in
this paragraph, "Hazardous Substances"
means pollutants, contaminants or
hazardous, dangerous, toxic, biohazardous
or infectious substances, materials or
wastes, or any other chemical substance
regulated under Environmental Laws.
(ll) None of the transactions contemplated by this Agreement
(including, without limitation, the use of
the proceeds from the sale of the
Notes), will violate or result in a
violation of Section 7 of the Exchange Act,
or any regulation promulgated thereunder,
including, without limitation,
Regulations T, U and X of the Board of
Governors of the Federal Reserve System.
(mm) The statements set forth in the Offering Memorandum under
the
caption "Description of Notes," insofar as
they purport to constitute a summary
of the terms of the Notes and under the
captions "Capitalization" and
"Description of Capital Stock" insofar as
they purport to describe the
provisions of the laws and documents
referred to therein, are accurate in all
material respects.
(nn) Prior to the date hereof, neither the Company nor any of
its
affiliates nor any person acting on its or
their behalf (other than you, as to
whom the Company makes no representation)
has taken any action that is designed
to or that has constituted or that might
have been expected to cause or result
in unlawful stabilization or manipulation
of the price of any security of the
Company in connection with the offering of
the Notes.
(oo) The minute books and records of the Company and its
subsidiaries relating to proceedings of
their respective shareholders, boards of
directors, and committees of their
respective boards of directors made available
to Davis Polk & Wardwell, counsel for
the Initial Purchasers, are their original
minute books and records or are true,
correct and complete copies thereof, with
respect to all proceedings of said
shareholders, boards of directors and
committees since January 1, 2001 through
the date hereof. In the event that
definitive minutes have not been prepared
with respect to any proceedings of
such shareholders, boards of directors or
committees, the Company has provided
Davis Polk & Wardwell with originals or
true, correct and complete copies of
draft minutes or written agendas relating
thereto, which drafts and agendas, if
any, reflect all events that occurred in
connection with such proceedings.
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<PAGE>
(pp) All instruments, records, agreements and other documents
requested in Davis Polk & Wardwell's
document request letter have been provided
or summarized to, or made available for
inspection by Davis Polk & Wardwell.
(qq) The Company is subject to the reporting requirements of
Section
13 or 15(d) of the Exchange Act.
(rr) The Company has established and maintains disclosure
controls
and procedures (as such term is defined in
Rule 13a-14 under the Exchange Act),
which (i) are designed to provide
reasonable assurance that material information
relating to the Company, including its
consolidated subsidiaries, is made known
to the Company's principal executive
officer and its principal financial officer
by others within those entities; (ii) have
been evaluated for effectiveness as
of a date within 90 days prior to the date
of the Company's most recent annual
or quarterly report; and (iii) are
effective in all material respects to perform
the functions for which they were
established.
(ss) Based on the most recent evaluation of its disclosure
controls
and procedures, the Company is not aware of
(i) any significant deficiency in
the design or operation of internal
controls which could adversely affect the
Company's ability to record, process,
summarize and report financial data or any
material weaknesses in internal controls;
or (ii) any fraud, whether or not
material, that involves management or other
employees who have a significant
role in the Company's internal
controls.
(3)
Purchase of the Notes by the Initial Purchasers, Agreements to
Sell,
Purchase and Resell.(a) The Company hereby
agrees, on the basis of the
representations, warranties and agreements
of the Initial Purchasers contained
herein and subject to all the terms and
conditions set forth herein, to issue
and sell to the Initial Purchasers and,
upon the basis of the representations,
warranties and agreements of the Company
herein contained and subject to all the
terms and conditions set forth herein, the
Initial Purchasers agree, severally
and not jointly, to purchase from the
Company, at a purchase price of 98% of the
principal amount thereof, the principal
amount of Notes set forth opposite the
name of such Initial Purchaser in Schedule
I hereto. The Company shall not be
obligated to deliver any of the securities
to be delivered hereunder except upon
payment for all of the securities to be
purchased as provided herein.
(b) Each of the Initial Purchasers, severally and not jointly
hereby
represents and warrants to the Company that
it will offer the Notes for sale
upon the terms and conditions set forth in
this Agreement and in the Offering
Memorandum. Each of the Initial Purchasers
hereby represents and warrants to,
and agrees with, the Company that such
Initial Purchaser: (i) is a QIB with such
knowledge and experience in financial and
business matters as are necessary in
order to evaluate the merits and risks of
an investment in the Notes; (ii) is
purchasing the Notes pursuant to a private
sale exempt from registration under
the Act; (iii) in connection with the
initial Exempt Resales by you, will
solicit offers to buy the Notes only from,
and will offer to sell the Notes only
to, the Eligible Purchasers in accordance
with this Agreement and on the terms
contemplated by the Offering Memorandum and
(iv) will not offer or sell the
Notes, nor has it offered or sold the Notes
by, or otherwise engaged in, any
form of general solicitation or general
advertising (within the meaning of
Regulation D, including, but not limited
to, advertisements, articles, notices
or other communications published in any
newspaper, magazine,
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<PAGE>
or similar medium or broadcast over
television or radio, or any seminar or
meeting whose attendees have been invited
by any general solicitation or general
advertising). The Initial Purchasers have
advised the Company that they will
offer the Notes to Eligible Purchasers at a
price initially equal to 100% of the
principal amount thereof, plus accrued
interest, if any, from the date of
issuance of the Notes. Such price may be
changed by the Initial Purchasers at
any time without notice.
The
Initial Purchasers understand that the Company and, for purposes
of
the opinions to be delivered to the Initial
Purchasers pursuant to Sections
7(c), 7(d) and 7(e) hereof, counsel to the
Company and counsel to the Initial
Purchasers, will rely upon the accuracy and
truth of the foregoing
representations, warranties and agreements
and the Initial Purchasers hereby
consent to such reliance.
4.
Delivery of the Notes and Payment Therefor. (a) Delivery of and
payment
for the Firm Notes shall be made at the
office of Wilson Sonsini Goodrich &
Rosati, P.C., 650 Page Mill Road, Palo
Alto, CA 94304, at 10:00 A.M., New York
City Time, on the Closing Date (such date
and time of delivery and payment for
the Firm Notes being called the "First
Delivery Date"). The place of closing for
the Notes and the Closing Date may be
varied by agreement between the Initial
Purchasers and the Company.
The Notes
will be delivered to the Initial Purchasers, or the Trustee as
custodian for The Depository Trust Company
("DTC"), against payment by or on
behalf of the Initial Purchasers of the
purchase price therefor by wire transfer
in immediately available funds to an
account designated by the Company, by
causing DTC to credit the Notes to the
respective accounts of the Initial
Purchasers at DTC. The Notes will be
evidenced by one or more global securities
in definitive form (the "Global Notes") and
will be registered in the name of
Cede & Co. as nominee of DTC. A
facsimile copy of the Notes to be delivered to
the Initial Purchasers shall be made
available to the Initial Purchasers for
inspection not later than 3:00 P.M., New
York City time, on the business day
next preceding the Closing Date.
(b) Subject to the terms and conditions and in reliance upon
the
representations and warranties herein set
forth, the Company hereby grants the
Option to each of the Initial Purchasers to
purchase, severally and not jointly,
at the purchase price equal to 98% of the
principal amount thereof that portion
of the aggregate principal amount of
Optional Notes as to which such Option
shall have been exercised (to be adjusted
by the Initial Purchasers so as to
eliminate fractional Notes) determined by
multiplying such aggregate principal
amount of Optional Notes by a fraction, the
numerator of which is the maximum
principal amount of Firm Notes which such
Initial Purchaser is entitled to
purchase as set forth opposite the name of
such Initial Purchaser in Schedule I
hereto and the denominator of which is the
maximum principal amount of Firm
Notes which all of the Initial Purchasers
are entitled to purchase hereunder.
The maximum aggregate principal amount of
Optional Notes which all of the
Initial Purchasers are entitled to purchase
hereunder is $60,000,000. At any
time on or before the thirtieth day after
the date of this Agreement (but not
more than once), the Option may be
exercised by written notice being given to
the Company by the Initial Purchasers. Such
notice shall set forth the aggregate
principal amount of Optional Notes as to
which the Option is being exercised,
the names in which the Optional Notes are
to be registered, the denominations in
which the Optional Notes are to be
registered, the denominations in which the
Optional Notes are
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<PAGE>
to be issued and the date and time, as
determined by the Initial Purchasers,
when the Optional Notes are to be
issued.
The date
of delivery of and payment for the Optional Notes, being
hereafter referred to as an "Optional
Delivery Date," which may be the First
Delivery Date (the First Delivery Date and
the Optional Delivery Date, if any,
being sometimes referred to as a "Delivery
Date"), shall be determined by the
Initial Purchasers but shall not be earlier
than two full business days or later
than five full business days after written
notice of the election to purchase
the Optional Notes is given. Delivery of
the Optional Notes shall be made to the
Initial Purchasers for the respective
account of the several Initial Purchasers
against payment by the several Initial
Purchasers through Lehman Brothers Inc.
of the purchase price thereof to or upon
the order of the Company by wire
transfer or transfers in immediately
available funds to an account designated by
the Company.
5.
Agreements of the Company. The Company agrees with each of the
Initial
Purchasers as follows:
(a) The Company will furnish to the Initial Purchasers, without
charge, by the second business day after
the date of the Offering Memorandum,
such number of copies of the Offering
Memorandum as may then be amended or
supplemented as they may reasonably
request.
(b) The Company will not make any amendment or supplement to
the
Preliminary Offering Memorandum or to the
Offering Memorandum of which the
Initial Purchasers shall not previously
have been advised or to which they shall
reasonably object after being so
advised.
(c) The Company consents to the use, in accordance with the
securities or Blue Sky laws of the
jurisdictions in which the Notes are offered
by the Initial Purchasers and by dealers,
prior to the date of the Offering
Memorandum, of each Preliminary Offering
Memorandum so furnished by the Company.
The Company consents to the use of the
Offering Memorandum in accordance with
the securities or Blue Sky laws of the
jurisdictions in which the Notes are
offered by the Initial Purchasers and by
all dealers to whom Notes may be sold,
in connection with the offering and sale of
the Notes.
(d) If, at any time prior to completion of the distribution of
the
Notes by the Initial Purchasers to Eligible
Purchasers, any event occurs or
information becomes known that, in the
judgment of the Company or in the opinion
of counsel for the Initial Purchasers,
should be set forth in the Offering
Memorandum so that the Offering Memorandum
does not include any untrue statement
of material fact or omit to state a
material fact necessary in order to make the
statements therein, in the light of the
circumstances under which they were
made, not misleading, or if it is necessary
to supplement or amend the Offering
Memorandum in order to comply with any law,
the Company will forthwi
