Exhibit 1.1
OPENWAVE SYSTEMS INC.
(a Delaware corporation)
15,600,000 Shares of Common Stock
PURCHASE AGREEMENT
Dated: December 7,
2005
OPENWAVE SYSTEMS INC.
(a Delaware corporation)
15,600,000 Shares of Common Stock
(Par Value $0.001 Per Share)
PURCHASE AGREEMENT
December 7, 2005
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Lehman Brothers Inc.
J.P. Morgan Securities Inc.
Thomas Weisel Partners LLC
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080
Ladies and Gentlemen:
Openwave Systems Inc., a Delaware
corporation (the “Company”), confirms its agreement
with Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated (“Merrill Lynch”)
and each of the other Underwriters named in Schedule A hereto
(collectively, the “Underwriters”, which term shall
also include any underwriter substituted as hereinafter provided in
Section 10 hereof), for whom Merrill Lynch is acting as
representative (in such capacity, the
“Representative)”), with respect to the issue and sale
by the Company and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of shares of
Common Stock, par value $0.001 per share, of the Company
(“Common Stock”) set forth in said Schedule A, and with
respect to the grant by the Company to the Underwriters, acting
severally and not jointly, of the option described in
Section 2(b) hereof to purchase all or any part of 2,340,000
additional shares of Common Stock to cover overallotments, if any.
The aforesaid 15,600,000 shares of Common Stock (the “Initial
Securities”) to be purchased by the Underwriters and all or
any part of the 2,340,000 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 understands that the
Underwriters propose to make a public offering of the Securities as
soon as the Representative deems advisable after this Agreement has
been executed and delivered.
The Company has filed with the
Securities and Exchange Commission (the “Commission”)
an automatic shelf registration statement on Form S-3 (No.
333-130042), including the related preliminary prospectus or
prospectuses, which registration statement became effective upon
filing under Rule 462(e) of the rules and regulations of the
Commission (the “1933 Act Regulations”) under the
Securities Act of 1933, as amended (the “1933 Act”).
Such registration statement covers the registration of the
Securities under the 1933 Act. Promptly after execution and
delivery of this Agreement, the Company will prepare and file a
prospectus in accordance with the provisions of Rule 430B
(“Rule 430B”) of the 1933 Act Regulations and paragraph
(b) of Rule 424 (“Rule 424(b)”) of the 1933 Act
Regulations. Any information included in such prospectus that was
omitted from such registration statement at the time it became
effective but that is deemed to be part of and included in such
registration statement pursuant to Rule 430B is referred to as
“Rule 430B Information.” Each prospectus used in
connection with the offering of the Securities that omitted Rule
430B Information is herein called a “preliminary
prospectus.”
Such registration statement, at any given time,
including the amendments thereto at such time, the exhibits and any
schedules thereto at such time, the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the
1933 Act at such time and the documents otherwise deemed to be a
part thereof or included therein by 1933 Act Regulations, is herein
called the “Registration Statement.” The Registration
Statement at the time it originally became effective is herein
called the “Original Registration Statement.” The final
prospectus in the form first furnished to the Underwriters for use
in connection with the offering of the Securities, including the
documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the 1933 Act at the time of the
execution of this Agreement and any preliminary prospectuses that
form a part thereof, is herein called the “Prospectus.”
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus 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
(“EDGAR”).
All references in this Agreement to
financial statements and schedules and other information which is
“contained,” “included” or
“stated” in the Registration Statement, any preliminary
prospectus or the Prospectus (or other references of like import)
shall be deemed to mean and include all such financial statements
and schedules and other information which is incorporated by
reference in or otherwise deemed by 1933 Act Regulations to be a
part of or included in the Registration Statement, any preliminary
prospectus or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the
Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to mean and include the filing of any
document under the Securities Exchange Act of 1934 (the “1934
Act”) which is incorporated by reference in or otherwise
deemed by 1933 Act Regulations to be a part of or included in the
Registration Statement, such preliminary prospectus or the
Prospectus, as the case may be.
SECTION 1. Representations and
Warranties.
(a) Representations and
Warranties by the Company . The Company represents and warrants
to each Underwriter as of the date hereof, as of the Applicable
Time referred to in Section 1(a)(i) 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) Status as a Well-Known
Seasoned Issuer . (A) At the time of filing the Original
Registration Statement, (B) at the time of the most recent
amendment thereto for the purposes of complying with
Section 10(a)(3) of the 1933 Act (whether such amendment was
by post-effective amendment, incorporated report filed pursuant to
Section 13 or 15(d) of the 1934 Act or form of prospectus),
(C) at the time the Company or any person acting on its behalf
(within the meaning, for this clause only, of Rule 163(c) of the
1933 Act Regulations) made any offer relating to the Securities in
reliance on the exemption of Rule 163 of the 1933 Act Regulations
and (D) at the date hereof, the Company was and is a
“well-known seasoned issuer” as defined in Rule 405 of
the 1933 Act Regulations (“Rule 405”), including not
having been and not being an “ineligible issuer” as
defined in Rule 405. The Registration Statement is an
“automatic shelf registration statement,” as defined in
Rule 405, and the Securities, since their registration on the
Registration Statement, have been and remain eligible for
registration by the Company on a Rule 405 “automatic shelf
registration statement” consistent with paragraph
(1)(i)(A) of the definition of a “well-known seasoned
issuer” in Rule 405. The Company has not received from the
Commission any notice pursuant to Rule 401(g)(2) of the 1933 Act
Regulations objecting to the use of the automatic shelf
registration statement form.
At the time of filing the Original
Registration Statement, at the earliest time thereafter that the
Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) of the 1933 Act
Regulations) of the Securities and at the date hereof, the Company
was not and is not an “ineligible issuer,” as defined
in Rule 405.
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(ii) Registration Statement,
Prospectus and Disclosure at Time of Sale . The Original
Registration Statement became effective upon filing under Rule
462(e) of the 1933 Act Regulations (“Rule 462(e)”) on
December 1, 2005, and any post-effective amendment thereto
also became effective upon filing under Rule 462(e). No stop order
suspending the effectiveness of the 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.
Any offer that is a written
communication relating to the Securities made prior to the filing
of the Original Registration Statement by the Company or any person
acting on its behalf (within the meaning, for this paragraph only,
of Rule 163(c) of the 1933 Act Regulations) has been filed with the
Commission in accordance with the exemption provided by Rule 163 of
the 1933 Act Regulations (“Rule 163”) and otherwise
complied with the requirements of Rule 163, including without
limitation the legending requirement, to qualify such offer for the
exemption from Section 5(c) of the 1933 Act provided by Rule
163.
At the respective times the Original
Registration Statement and each amendment thereto became effective,
at each deemed effective date with respect to the Underwriters
pursuant to Rule 430B(f)(2) of the 1933 Act Regulations and at the
Closing Time, the Registration Statement 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, at the time the Prospectus or
any such amendment or supplement 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.
Each preliminary prospectus
(including the prospectus or prospectuses filed as part of the
Original Registration Statement or any amendment thereto) 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 was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
As of the Applicable Time, neither
(x) the Issuer General Use Free Writing Prospectus(es) (as
defined below), if any, issued at or prior to the Applicable Time
(as defined below), the Statutory Prospectus (as defined below),
all considered together (collectively, the “General
Disclosure Package”), nor (y) any individual Issuer
Limited Use Free Writing Prospectus, if any, when considered
together with the General Disclosure Package, included any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not
misleading.
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As used in this subsection and
elsewhere in this Agreement:
“Applicable Time” means
7:00 p.m. (Eastern time) on December 7, 2005 or such other
time as agreed by the Company and Merrill Lynch.
“Issuer Free Writing
Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433 of the 1933 Act
Regulations (“Rule 433”), relating to the Securities
that (i) is required to be filed with the Commission by the
Company, (ii) is a “road show that is a written
communication” within the meaning of Rule 433(d)(8)(i),
whether or not required to be filed with the Commission (a
“Written Communication Road Show”) or (iii) is
exempt from filing pursuant to Rule 433(d)(5)(i) because it
contains a description of the Securities or of the offering that
does not reflect the final terms, in each case in the form filed or
required to be filed with the Commission or, if not required to be
filed, in the form retained in the Company’s records pursuant
to Rule 433(g).
“Issuer General Use Free
Writing Prospectus” means any Issuer Free Writing Prospectus
that is intended for general distribution to prospective investors,
as evidenced by its being specified in Schedule C
hereto.
“Issuer Limited Use Free
Writing Prospectus” means any Issuer Free Writing Prospectus
that is not an Issuer General Use Free Writing
Prospectus.
“Statutory Prospectus”
as of any time means the prospectus relating to the Securities that
is included in the Registration Statement immediately prior to that
time, including any document incorporated by reference therein and
any preliminary or other prospectus deemed to be a part
thereof.
Each Issuer Free Writing Prospectus,
if any, as of its issue date and at all subsequent times through
the completion of the public offer and sale of the Securities or
until any earlier date that the issuer notified or notifies Merrill
Lynch as described in Section 3(e), did not, does not and will
not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration
Statement or the Prospectus, including any document incorporated by
reference therein and any preliminary or other prospectus deemed to
be a part thereof that has not been superseded or
modified.
The representations and warranties
in this subsection shall not apply to statements in or omissions
from the Registration Statement, the Prospectus or any amendment or
supplement thereto or any Issuer Free Writing Prospectus made in
reliance upon and in conformity with written information furnished
to the Company by any Underwriter through Merrill Lynch expressly
for use therein.
(iii) Incorporated Documents
. The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, when
they became effective or at the time they were or hereafter are
filed with the Commission, complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations or the 1934 Act and the rules and regulations of the
Commission thereunder (the “1934 Act Regulations”), as
applicable, and, when read together with the other information in
the Prospectus, (a) at the time the Original Registration
Statement became effective, (b) at the earlier of time the
Prospectus was first used and the date and time of the first
contract of sale of Securities in this offering and (c) at the
Closing Time, 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.
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(iv) 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.
(v) Financial Statements .
The financial statements included in the Registration Statement,
the General Disclosure Package and the Prospectus, together with
the related schedules and notes, present fairly the financial
position of the Company and its consolidated subsidiaries at the
dates indicated and the statement of operations,
stockholders’ equity and cash flows of the Company and its
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, if
any, present fairly in accordance with GAAP the information
required to be stated therein. 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 financial statements included in the Registration
Statement.
(vi) No Material Adverse Change
in Business . Since the respective dates as of which
information is given in the Registration Statement, the General
Disclosure Package or 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 its subsidiaries
considered as one enterprise, whether or not arising in the
ordinary course of business (a “Material Adverse
Effect”), (B) there have been no transactions entered
into by the Company or any of its subsidiaries, other than those in
the ordinary course of business, which are material with respect to
the Company and its 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 capital
stock.
(vii) 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.
(viii) Good Standing of
Subsidiaries . Each “significant subsidiary” of the
Company (as such term is defined in Rule 1-02 of Regulation S-X)
(each a “Subsidiary” and, collectively, the
“Subsidiaries”) has been duly organized and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate 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 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 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,
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pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of any
Subsidiary was issued in violation of the preemptive or similar
rights of any securityholder of such Subsidiary. The only
subsidiaries of the Company are the subsidiaries listed on Schedule
D hereto.
(ix) Capitalization . The
authorized, issued and outstanding capital stock of the Company is
as set forth in the Prospectus as of the date hereof in the column
entitled “Actual” under the caption
“Capitalization” (except for subsequent issuances, if
any, pursuant to this Agreement, 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; 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.
(x) Authorization of
Agreement . This Agreement has been duly authorized, executed
and delivered by the Company.
(xi) Authorization and
Description of Securities . The Securities have been duly
authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Company
pursuant to this Agreement against payment of the consideration set
forth herein, will be validly issued, fully paid and
non-assessable; the Common Stock conforms in all material respects
to all statements relating thereto contained in the Prospectus; no
holder of the Securities will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities
is not subject to the preemptive or other similar rights of any
securityholder of the Company.
(xii) Absence of Defaults and
Conflicts . Neither the Company nor any of its Subsidiaries is
in violation of its charter or by-laws 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 its 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
herein and in the Registration Statement (including the issuance
and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the Prospectus under the
caption “Use of Proceeds”) and compliance by the
Company with its obligations hereunder 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, defaults or
Repayment Events 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 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
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.
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(xiii) 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, which, in either case, would result in a Material Adverse
Effect.
(xiv) 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 result
in a Material Adverse Effect, or which might 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 result in a
Material Adverse Effect.
(xv) Accuracy of Exhibits .
There are no contracts or documents which are required to be
described in the Registration Statement, the Prospectus or the
documents incorporated by reference therein or to be filed as
exhibits thereto which have not been so described and filed as
required.
(xvi) Possession of Intellectual
Property . Except as disclosed in the Prospectus, to the
Company’s knowledge the Company and its Subsidiaries own or
possess, or can acquire on reasonable terms, adequate rights to
patents, 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, except where the failure to so
possess or the inability to so acquire would not have a Material
Adverse Effect, and neither the Company nor any of its Subsidiaries
has received any written 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 decree, order or
judgment that has rendered any Intellectual Property owned by the
Company or any of its Subsidiaries invalid or unenforceable, and
which infringement or conflict (if the subject of any unfavorable
decision, ruling or finding) or invalidity or unenforceability,
singly or in the aggregate, would result in a Material Adverse
Effect.
(xvii) Absence of
Manipulation . Neither the Company nor to the Company’s
knowledge any affiliate of the Company has taken, nor will the
Company take, directly or indirectly, any action which is designed
to or which has constituted or which would 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.
(xviii) 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, issuance or sale of the
Securities hereunder, the consummation of the transactions
contemplated by this Agreement, except such as have been already
obtained or where the failure to make any such filing or to obtain
any such authorization, approval, consent, license, order,
registration, qualification or decree would not result in a
Material Adverse Effect.
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(xix) Possession of Licenses and
Permits . Except as disclosed in the Prospectus, the Company
and its 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, except
where the failure so to possess would not, singly or in the
aggregate, result in a Material Adverse Effect; the Company and its
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, result in a Material Adverse
Effect; all of the Governmental Licenses are valid and in full
force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not, singly or in the aggregate, result in a
Material Adverse Effect; and neither the Company nor any of its
Subsidiaries has received any written 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.
(xx) Title to Property . The
Company and its Subsidiaries have good and marketable title to all
real property owned by the Company and its 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 materially interfere with the use made and proposed to
be made of such property by the Company or any of its Subsidiaries;
and all of the leases and subleases material to the business of the
Company and its Subsidiaries, considered as one enterprise, and
under which the Company or any of its Subsidiaries holds properties
described in the Prospectus, are in full force and effect (assuming
compliance therewith by the other parties thereto), 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.
(xxi) Investment Company Act
. The Company is not required, and upon the issuance and sale of
the Securities as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be
required, to register as an “investment company” under
the Investment Company Act of 1940, as amended (the “1940
Act”).
(xxii) ERISA . The Company is
in compliance in all material respects with all presently
applicable provisions 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 material
liability under (A) Title IV of ERISA with respect to the
termination of, or withdrawal from, any “pension plan”
or (B) Section 412 or 4971 of the Internal Revenue Code
of 1986, as amended, including the regulations and published
interpretations thereunder (the “Code”); 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.
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(xxiii) Accounting Controls and
Disclosure Controls . The Company maintains a system of
internal accounting controls sufficient to provide reasonable
assurances that (1) transactions are executed in accordance
with management’s general or specific authorization;
(2) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (3) access to assets is
permitted only in accordance with management’s general or
specific authorization; and (4) the recorded accountability
for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences. Except as described in the Prospectus, since the end
of the Company’s most recent audited fiscal year, there has
been (I) no material weakness in the Company’s internal
control over financial reporting (whether or not remediated) and
(II) no change in the Company’s internal control over
financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control
over financial reporting.
The Company and its consolidated
subsidiaries employ disclosure controls and procedures that are
designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the 1934 Act
is recorded, processed, summarized and reported, within the time
periods specified in the Commission’s rules and forms, and is
accumulated and communicated to the Company’s management,
including its principal executive officer or officers and principal
financial officer or officers, as appropriate, to allow timely
decisions regarding disclosure.
(xxiv) Compliance with the
Sarbanes-Oxley Act . The Company and its directors and
officers, in their capacities as such, has complied in all material
respects with the provisions of the Sarbanes-Oxley Act of 2002 and
the rules and regulations promulgated in connection therewith (the
“Sarbanes-Oxley Act”), including Section 402
related to loans and Sections 302 and 906 related to
certifications.
(xxv) Payment of Taxes . All
United States federal income tax returns of the Company and its
Subsidiaries required by law to be filed have been filed and all
taxes shown by such returns or otherwise assessed, which are due
and payable, have been paid, except assessments against which
appeals have been or will be promptly taken and as to which
adequate reserves have been provided, except a Material Adverse
Effect. The United States federal income tax returns of the Company
through the fiscal year ended June 30, 2005 have been settled
and no assessment in connection therewith has been made against the
Company. The Company and its Subsidiaries have filed all other tax
returns that are required to have been filed by them pursuant to
applicable foreign, state, local or other law except insofar as the
failure to file such returns would not result in a Material Adverse
Effect, and has paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company and its
Subsidiaries, except for such taxes, if any, as are being contested
in good faith and as to which adequate reserves have been provided,
except a Material Adverse Effect. The charges, accruals and
reserves on the books of the Company in respect of any income and
corporation tax liability for any years not finally determined are
adequate to meet any assessments or re-assessments for additional
income tax for any years not finally determined, except to the
extent of any inadequacy that would not result in a Material
Adverse Effect.
(xxvi) Statistical and
Market-Related Data . Any statistical and market-related data
included in the Registration Statement and the Prospectus are based
on or derived from sources that the Company believes to be reliable
and accurate.
(xxvii) Pending Proceedings and
Examinations . The Registration Statement is not the subject of
a pending proceeding or examination under Section 8(d) or 8(e)
of the 1933 Act, and the Company is not the subject of a pending
proceeding under Section 8A of the 1933 Act in connection with
the offering of the Securities.
9
(b) Officer’s
Certificates . Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Representative
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.
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, the
Company agrees to sell to each Underwriter, severally and not
jointly, and each Underwriter, severally and not jointly, agrees to
purchase from the Company, at the price per share set forth in
Schedule B, the number of Initial Securities set forth in Schedule
A 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.
(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,
the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional 2,340,000 shares
of Common Stock at the price per share set forth in Schedule B,
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
overallotments which may be made in connection with the offering
and distribution of the Initial Securities upon notice by Merrill
Lynch 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 (a “Date of
Delivery”) shall be determined by Merrill Lynch, 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 A opposite the
name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as Merrill
Lynch 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 Skadden Arps, Slate,
Meagher & Flom LLP, 525 University Avenue, Suite 1100,
Palo Alto, CA 94301, or at such other place as shall be agreed upon
by the Representative 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
days after such date as shall be agreed upon by the Representative
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
Representative and the Company, on each Date of Delivery as
specified in the notice from the Representative to the
Company.
10
Payment shall be made to the Company
by wire transfer of immediately available funds to a bank account
designated by the Company, against delivery to the Representative
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 Representative, 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. Merrill Lynch, 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 Representative 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
Representative 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; Payment of Filing Fees .
The Company, subject to Section 3(b), will comply with the
requirements of Rule 430B and will notify the Representative
immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement or new
registration statement relating to the Securities 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 the
filing of a new registration statement or any amendment or
supplement to the Prospectus or any document incorporated by
reference therein or otherwise deemed to be a part thereof or for
additional information, (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration
Statement or such new 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 or of any
examination pursuant to Section 8(e) of the 1933 Act
concerning the Registration Statement and (v) if the Company
becomes the subject of a proceeding under Section 8A of the
1933 Act in connection with the offering of the Securities. The
Company will effect the filings required under Rule 424(b), in the
manner and within the time period required by Rule 424(b) (without
reliance on Rule 424(b)(8)), and will take such steps as it deems
necessary to ascertain promptly 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
