EXHIBIT 1.1
F5 Networks, Inc.
Underwriting Agreement
New York, New York
November 11, 2003
To the Representatives
named in Schedule I
hereto of the Under-
writers named in
Schedule II hereto
Ladies and Gentlemen:
F5 Networks, Inc., a corporation organized under the laws of the
State of Washington (the "Company"), proposes to sell to the several
underwriters named in Schedule I hereto (the "Underwriters"), for whom Citigroup
Capital Markets Inc., ▇▇▇▇▇▇ Brothers Inc. and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated (the "Representatives") are acting as representatives, the
number of shares of Common Stock, no par value ("Common Stock"), of the Company
set forth in Schedule I hereto (said shares to be issued and sold by the Company
being hereinafter called the "Underwritten Securities"). The Company also
proposes to grant to the Underwriters an option to purchase up to the number of
additional shares of Common Stock set forth in Schedule II hereto to cover
over-allotments (the "Option Securities"; the Option Securities, together with
the Underwritten Securities, being hereinafter called the "Securities"). The
terms Representatives and Underwriters shall mean either the singular or plural
as the context requires. Any reference herein to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall
be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the Exchange Act
on or before the Effective Date of the Registration Statement or the issue date
of the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, as the case may be; and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall
be deemed to refer to and include the filing of any document under the Exchange
Act after the Effective Date of the Registration Statement or the issue date of
the Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus,
as the case may be, deemed to be incorporated therein by reference. Certain
terms used herein are defined in Section 17 HEREOF.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1.
(a) The Company meets the requirements for use of Form S-3 under the
Act and has prepared and filed with the Commission a registration
statement (the file number of
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which is set forth in Schedule I hereto) on Form S-3, including a related
basic prospectus, for registration under the Act of the offering and sale
of the Securities. The Company may have filed one or more amendments
thereto, including a Preliminary Final Prospectus, each of which has
previously been furnished to you. The Company will next file with the
Commission one of the following: (i) after the Effective Date of such
registration statement, a final prospectus supplement relating to the
Securities in accordance with Rules 430A and 424(b), (ii) prior to the
Effective Date of such registration statement, an amendment to such
registration statement (including the form of final prospectus supplement)
or (iii) a final prospectus in accordance with Rules 415 and 424(b). In
the case of clause (i), the Company has included in such registration
statement, as amended at the Effective Date, all information (other than
Rule 430A Information) required by the Act and the rules thereunder to be
included in such registration statement and the Final Prospectus. As
filed, such final prospectus supplement or such amendment and form of
final prospectus supplement shall contain all Rule 430A Information,
together with all other such required information, and, except to the
extent the Representatives shall agree in writing to a modification, shall
be in all substantive respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other changes
(beyond that contained in the Basic Prospectus and any Preliminary Final
Prospectus) as the Company has advised you, prior to the Execution Time,
will be included or made therein. The Registration Statement, at the
Execution Time, meets the requirements set forth in Rule 415(a)(1)(x).
(b) On the Effective Date, the Registration Statement did or will,
and when the Final Prospectus is first filed (if required) in accordance
with Rule 424(b) and on the Closing Date (as defined herein) and on any
date on which Option Securities are purchased, if such date is not the
Closing Date (a "settlement date"), the Final Prospectus (and any
supplement thereto) will, comply in all material respects with the
applicable requirements of the Act and the Exchange Act and the respective
rules thereunder; on the Effective Date and at the Execution Time, the
Registration Statement did not or will not contain any untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Final Prospectus, if not filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date and any settlement date, the Final
Prospectus (together with any supplement thereto) will not, include any
untrue statement of a 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; provided,
however, that the Company makes no representations or warranties as to the
information contained in or omitted from the Registration Statement or the
Final Prospectus (or any supplement thereto) in reliance upon and in
conformity with information furnished in writing to the Company by or on
behalf of any Underwriter through the Representatives specifically for
inclusion in the Registration Statement or the Final Prospectus (or any
supplement thereto), which information consists solely of the information
specified in the last sentence of Section 8(b) hereof.
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(c) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is chartered or organized
with full corporate power and authority to own or lease, as the case may
be, and to operate its properties and conduct its business as described in
the Final Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification.
(d) All the outstanding shares of capital stock of each subsidiary
have been duly and validly authorized and issued and are fully paid and
nonassessable, and, except as otherwise set forth in the Final Prospectus,
all outstanding shares of capital stock of the subsidiaries are owned by
the Company either directly or through wholly owned subsidiaries free and
clear of any perfected security interest or any other security interests,
claims, liens or encumbrances.
(e) The Company's authorized equity capitalization is as set forth
in the Final Prospectus; the capital stock of the Company conforms in all
material respects to the description thereof contained in the Final
Prospectus; the outstanding shares of Common Stock have been duly and
validly authorized and issued and are fully paid and nonassessable; the
Securities have been duly and validly authorized, and, when issued and
delivered to and paid for by the Underwriters pursuant to this Agreement,
will be fully paid and nonassessable; the Securities are duly listed, and
admitted and authorized for trading, subject to official notice of
issuance, on the Nasdaq National Market; the certificates for the
Securities are in valid and sufficient form; the holders of outstanding
shares of capital stock of the Company are not entitled to preemptive or
other rights to subscribe for the Securities; and, except as set forth in
the Final Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital stock
of or ownership interests in the Company are outstanding;
(f) There is no franchise, contract or other document of a character
required to be described in the Registration Statement or Final
Prospectus, or to be filed as an exhibit thereto, which is not described
or filed as required; and the statements in the Basic Prospectus under the
heading "Description of Capital Stock" insofar as such statements
summarize legal matters, agreements, documents or proceedings discussed
therein, are accurate and fair summaries of such legal matters,
agreements, documents or proceedings.
(g) This Agreement has been duly authorized, executed and delivered
by the Company.
(h) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Final Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940, as amended.
(i) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
transactions
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contemplated herein, except such as have been obtained under the Act and
such as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the
Underwriters in the manner contemplated herein and in the Final
Prospectus.
(j) Neither the issue and sale of the Securities nor the
consummation of any other of the transactions herein contemplated nor the
fulfillment of the terms hereof will conflict with, result in a breach or
violation of, or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its subsidiaries pursuant to,
(i) the charter or by-laws of the Company or any of its subsidiaries, (ii)
the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or any of its subsidiaries is
a party or bound or to which its or their property is subject, or (iii)
any statute, law, rule, regulation, judgment, order or decree applicable
to the Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or any of its subsidiaries or any of
its or their properties.
(k) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.
(l) The consolidated historical financial statements and schedules
of the Company and its consolidated subsidiaries included in the Final
Prospectus and incorporated by reference in the Registration Statement
present fairly in all material respects the financial condition, results
of operations and cash flows of the Company as of the dates and for the
periods indicated, comply as to form with the applicable accounting
requirements of the Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein). The
selected financial data set forth under the caption "Selected Consolidated
Financial Data" in the Final Prospectus and incorporated by reference in
the Registration Statement fairly present, on the basis stated in the
Final Prospectus and the Registration Statement, the information included
or incorporated by reference therein. The pro forma financial statements
included in the Final Prospectus and incorporated by reference in the
Registration Statement include assumptions that provide a reasonable basis
for presenting the significant effects directly attributable to the
transactions and events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma adjustments reflect the proper application of those adjustments to
the historical financial statement amounts in the pro forma financial
statements included in the Final Prospectus and incorporated by reference
in the Registration Statement. The pro forma financial statements included
in the Final Prospectus and incorporated by reference in the Registration
Statement comply as to form in all material respects with the applicable
accounting requirements of Regulation S-X under the Act and the pro forma
adjustments have been properly applied to the historical amounts in the
compilation of those statements.
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(m) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property is pending or,
to the best knowledge of the Company, threatened that (i) could reasonably
be expected to have a material adverse effect on the performance of this
Agreement or the consummation of any of the transactions contemplated
hereby or (ii) could reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Prospectus
(exclusive of any supplement thereto).
(n) Each of the Company and each of its subsidiaries owns or leases
all such properties as are necessary to the conduct of its operations as
presently conducted.
(o) Neither the Company nor any subsidiary is in violation or
default of (i) any provision of its charter or bylaws, (ii) the terms of
any indenture, contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject, or (iii) any statute, law, rule, regulation, judgment, order or
decree of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company
or such subsidiary or any of its properties, as applicable.
(p) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered
their report with respect to the audited consolidated financial statements
and schedules of the Company and its consolidated subsidiaries included
and incorporated by reference in the Final Prospectus, are independent
public accountants with respect to the Company within the meaning of the
Act and the applicable published rules and regulations thereunder.
(q) There are no transfer taxes or other similar fees or charges
under Federal law or the laws of any state, or any political subdivision
thereof, required to be paid in connection with the execution and delivery
of this Agreement or the issuance by the Company or sale by the Company of
the Securities.
(r) The Company has 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 have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto)) and has
paid all taxes required to be paid by it and any other assessment, fine or
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 on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions
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in the ordinary course of business, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto).
(s) No labor problem or dispute with the employees of the Company or
any of its subsidiaries exists or is threatened or imminent, and the
Company is not aware of any existing or imminent labor disturbance by the
employees of any of its or its subsidiaries' principal suppliers,
contractors or customers, that could have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto).
(t) The Company and each of its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and
in such amounts as are prudent and customary in the businesses in which
they are engaged; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force
and effect; the Company and its subsidiaries are in compliance with the
terms of such policies and instruments in all material respects; and there
are no claims by the Company or any of its subsidiaries under any such
policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; 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 on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto).
(u) No subsidiary of the Company is currently prohibited, directly
or indirectly, from paying any dividends to the Company, from making any
other distribution on such subsidiary's capital stock, from repaying to
the Company any loans or advances to such subsidiary from the Company or
from transferring any of such subsidiary's property or assets to the
Company or any other subsidiary of the Company, except as described in or
contemplated by Final the Prospectus (exclusive of any supplement
thereto).
(v) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate
Federal, state or foreign regulatory authorities necessary to conduct
their respective businesses, and neither the Company nor any such
subsidiary has received any notice of proceedings relating to the
revocation or modification of any such licenses, certificate,
authorization or permit which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or
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not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Prospectus (exclusive of any
supplement thereto).
(w) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(x) The Company has not taken, directly or indirectly, any action
designed to or that would constitute or that might reasonably be expected
to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(y) The Company and its subsidiaries are (i) in compliance with any
and all applicable foreign, Federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received and are in compliance with all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) have
not received notice of any actual or potential liability under any
environmental law, except where such non-compliance with Environmental
Laws, failure to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, have a material
adverse change in the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the Final
Prospectus (exclusive of any supplement thereto). Except as set forth in
the Final Prospectus, neither the Company nor any of the subsidiaries has
been named as a "potentially responsible party" under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended.
(z) Each "pension plan" as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended, and the regulations
and published interpretations thereunder ("ERISA"), that is sponsored or
maintained by the Company or its subsidiaries and which is intended to be
qualified under Section 401 of the Code, is in compliance in all material
respects with the currently applicable provisions of the Code; neither the
Company nor any of its subsidiaries sponsors or maintains (or has ever
sponsored or maintained) a pension plan that is subject to Section 302 or
Section 515 of ERISA, or Title IV of ERISA; neither the Company nor any of
its subsidiaries maintains or is required to contribute to a "welfare
plan" (as defined in Section 3(1) of ERISA) which provides retiree or
other post-employment welfare benefits or insurance coverage
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(other than "continuation coverage" (as defined in Section 602 of ERISA));
and each pension plan and welfare plan established or maintained by the
Company and/or one or more of its subsidiaries is in compliance in all
material respects with the currently applicable provisions of ERISA.
(aa) There is and has been no failure on the part of the Company and
any of the Company's directors or officers, in their capacities as such,
to comply with any provision 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.
(bb) Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is aware of or has
taken any action, directly or indirectly, that would result in a violation
by such Persons of the FCPA, including, without limitation, making use of
the mails or any means or instrumentality of interstate commerce corruptly
in furtherance of an offer, payment, promise to pay or authorization of
the payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any "foreign official"
(as such term is defined in the FCPA) or any foreign political party or
official thereof or any candidate for foreign political office, in
contravention of the FCPA and the Company, its subsidiaries and, to the
knowledge of the Company, its affiliates have conducted their businesses
in compliance with the FCPA and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith. "FCPA" means Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder.
(cc) The operations of the Company and its subsidiaries are and have
been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering
statutes of all jurisdictions, the rules and regulations thereunder and
any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the
"Money Laundering Laws") and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator
involving the Company or any of its subsidiaries with respect to the Money
Laundering Laws is pending or, to the best knowledge of the Company,
threatened.
(dd) Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is currently subject
to any U.S. sanctions administered by the Office of Foreign Assets Control
of the U.S. Treasury Department ("OFAC"); and the Company will not
directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any U.S.
sanctions administered by OFAC.
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(ee) The Company does not have any significant subsidiaries, as
defined by Rule 1-02 of Regulation S-X.
(ff) The Company and its subsidiaries own, possess, license or have
other rights to use, on reasonable terms, all patents, patent
applications, trade and service marks, trade and service ▇▇▇▇
registrations, trade names, copyrights, licenses, inventions, trade
secrets, technology, know-how and other intellectual property
(collectively, the "Intellectual Property") necessary for the conduct of
the Company's business as now conducted or as proposed in the Final
Prospectus to be conducted. Except as set forth in the Final Prospectus
(i) there are no rights of third parties to any such Intellectual
Property; (ii) to the Company's knowledge there is no material
infringement by third parties of any such Intellectual Property; (iii)
there is no pending or threatened action, suit, proceeding or claim by
others challenging the Company's rights in or to any such Intellectual
Property, and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (iv) there is no pending or
threatened action, suit, proceeding or claim by others challenging the
validity or scope of any such Intellectual Property, and the Company is
unaware of any facts which would form a reasonable basis for any such
claim; (v) there is no pending or threatened action, suit, proceeding or
claim by others that the Company infringes or otherwise violates any
patent, trademark, copyright, trade secret or other proprietary rights of
others, and the Company is unaware of any other fact which would form a
reasonable basis for any such claim; (vi) there is no U.S. patent or
published U.S. patent application which contains claims that dominate or
may dominate any Intellectual Property described in the Final Prospectus
as being owned by or licensed to the Company or that interferes with the
issued or pending claims of any such Intellectual Property; and (vii)
there is no prior art of which the Company is aware that may render any
U.S. patent held by the Company invalid or any U.S. patent application
held by the Company unpatentable which has not been disclosed to the U.S.
Patent and Trademark Office.
(gg) The statements made or incorporated by reference in the Final
Prospectus under the captions "Risk Factors -- Risks Related to Our
Business -- We may not adequately protect our intellectual property and
our products may infringe on the intellectual property rights of third
parties" and "Business -- Intellectual Property" insofar as such
statements summarize legal matters, agreements, documents, or proceedings
discussed therein, are accurate and fair summaries of such legal matters,
agreements, documents or proceedings.
(hh) Except as disclosed in the Registration Statement and the
Prospectus, the Company (i) does not have any material lending or other
relationship with any bank or lending affiliate of Citigroup Global
Markets Holdings Inc. and (ii) does not intend to use any of the proceeds
from the sale of the Securities hereunder to repay any outstanding debt
owed to any affiliate of Citigroup Global Markets Holdings Inc.
Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Underwriters in connection with the offering
of the Securities shall be deemed a representation and warranty by the Company,
as to matters covered thereby, to
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each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, at a purchase price of $22.0875 per
share, the amount of the Underwritten Securities set forth opposite such
Underwriter's name in Schedule II hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants an
option to the several Underwriters to purchase, severally and not jointly, up to
Option Securities at the same purchase price per share as the Underwriters shall
pay for the Underwritten Securities. Said option may be exercised only to cover
over-allotments in the sale of the Underwritten Securities by the Underwriters.
Said option may be exercised in whole or in part at any time on or before the
30th day after the date of the Final Prospectus upon written or telegraphic
notice by the Representatives to the Company setting forth the number of shares
of the Option Securities as to which the several Underwriters are exercising the
option and the settlement date. The number of shares of the Option Securities to
be purchased by each Underwriter shall be the same percentage of the total
number of shares of the Option Securities to be purchased by the several
Underwriters as such Underwriter is purchasing of the Underwritten Securities,
subject to such adjustments as you in your absolute discretion shall make to
eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the third Business
Day prior to the Closing Date) shall be made on the date and at the time
specified in Schedule I hereto or at such time on such later date not more than
three Business Days after the foregoing date as the Representatives shall
designate, which date and time may be postponed by agreement between the
Representatives and the Company or as provided in Section 9 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Securities shall be made to the Representatives
for the respective accounts of the several Underwriters against payment by the
several Underwriters through the Representatives of the purchase price thereof
to or upon the order of the Company by wire transfer payable in same-day funds
to an account specified by the Company. Delivery of the Underwritten Securities
and the Option Securities shall be made through the facilities of The Depository
Trust Company unless the Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised after
the third Business Day prior to the Closing Date, the Company will deliver the
Option Securities (at the expense of the Company) to the Representatives, at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ the date specified by the
Representatives (which shall be within three Business Days after exercise of
said option) for the respective accounts of the several Underwriters, against
payment by the several Underwriters through the Representatives of the purchase
price thereof to or upon the order of the Company by wire transfer payable in
same-day funds to an account specified by the Company. If settlement for the
Option Securities occurs after the Closing Date, the Company will deliver to the
Representatives on the settlement date for the Option Securities,
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and the obligation of the Underwriters to purchase the Option Securities shall
be conditioned upon receipt of, supplemental opinions, certificates and letters
confirming as of such date the opinions, certificates and letters delivered on
the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Final Prospectus.
5. Agreements. The Company agrees with the several Underwriters
that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment
thereof, to become effective. Prior to the termination of the offering of
the Securities, the Company will not file any amendment of the
Registration Statement or supplement (including the Final Prospectus or
any Preliminary Final Prospectus) to the Basic Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a copy
for your review prior to filing and will not file any such proposed
amendment or supplement to which you reasonably object. Subject to the
foregoing sentence, if the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of the Final Prospectus is
otherwise required under Rule 424(b), the Company will cause the Final
Prospectus, properly completed, and any supplement thereto to be filed in
a form approved by the Representatives with the Commission pursuant to the
applicable paragraph of Rule 424(b) within the time period prescribed and
will provide evidence satisfactory to the Representatives of such timely
filing. The Company will promptly advise the Representatives (i) when the
Registration Statement, if not effective at the Execution Time, shall have
become effective, (ii) when the Final Prospectus, and any supplement
thereto, shall have been filed (if required) with the Commission pursuant
to Rule 424(b) or when any Rule 462(b) Registration Statement shall have
been filed with the Commission, (iii) when, prior to termination of the
offering of the Securities, any amendment to the Registration Statement
shall have been filed or become effective, (iv) of any request by the
Commission or its staff for any amendment of the Registration Statement,
or any Rule 462(b) Registration Statement, or for any supplement to the
Final Prospectus or for any additional information, (v) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding
for that purpose and (vi) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the institution or threatening
of any proceeding for such purpose. The Company will use its best efforts
to prevent the issuance of any such stop order or the suspension of any
such qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of
which the Final Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Final Prospectus to comply
with the
12
Act or the Exchange Act or the respective rules thereunder, the Company
promptly will (i) notify the Representatives of such event, (ii) prepare
and file with the Commission, subject to the second sentence of paragraph
(a) of this Section 5, an amendment or supplement which will correct such
statement or omission or effect such compliance and (iii) supply any
supplemented Final Prospectus to you in such quantities as you may
reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act.
(d) The Company will furnish to the Representatives and counsel for
the Underwriters, without charge, signed copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so long
as delivery of a prospectus by an Underwriter or dealer may be required by
the Act, as many copies of each Preliminary Final Prospectus and the Final
Prospectus and any supplement thereto as the Representatives may
reasonably request. The Company will pay the expenses of printing or other
production of all documents relating to the offering.
(e) The Company will arrange, if necessary, for the qualification of
the Securities for sale under the laws of such jurisdictions as the
Representatives may designate, will maintain such qualifications in effect
so long as required for the distribution of the Securities and will pay
any fee of the National Association of Securities Dealers, Inc., in
connection with its review of the offering; provided that in no event
shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action that
would subject it to service of process in suits, other than those arising
out of the offering or sale of the Securities, in any jurisdiction where
it is not now so subject.
(f) The Company will not, without the prior written consent of
Citigroup Global Markets Inc., offer, sell, contract to sell, pledge, or
otherwise dispose of, (or enter into any transaction which is designed to,
or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash
settlement or otherwise) by the Company or any affiliate of the Company or
any person in privity with the Company or any affiliate of the Company)
directly or indirectly, including the filing (or participation in the
filing) of a registration statement with the Commission in respect of, or
establish or increase a put equivalent position or liquidate or decrease a
call equivalent position within the meaning of Section 16 of the Exchange
Act, any other shares of Common Stock or any securities convertible into,
or exercisable, or exchangeable for, shares of Common Stock; or publicly
announce an intention to effect any such transaction, until the Business
Day set forth on Schedule I hereto, provided, however, that the Company
may issue and sell Common Stock pursuant to any employee stock option
plan, stock ownership plan or dividend reinvestment plan of the Company in
effect at the Execution Time and the Company may issue Common Stock
issuable upon
13
the conversion of securities or the exercise of warrants outstanding at
the Execution Time.
(g) The Company will comply with all applicable securities and other
applicable laws, rules and regulations, including, without limitation, the
Sarbanes Oxley Act, and to use its best efforts to cause the Company's
directors and officers, in their capacities as such, to comply with such
laws, rules and regulations, including, without limitation, the provisions
of the Sarbanes Oxley Act.
(h) The Company will not take, directly or indirectly, any action
designed to or that would constitute or that might reasonably be expected
to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(i) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation, printing or reproduction and
filing with the Commission of the Registration Statement (including
financial statements incorporated by reference therein an exhibits
thereto), the Basic Prospectus, any Preliminary Final Prospectus and the
Final Prospectus and each amendment or supplement to any of them; (ii) the
printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of such copies of the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus and the Final Prospectus and all amendments or supplements to
any of them, as may, in each case, be reasonably requested for use in
connection with the offering and sale of the Securities; (iii) the
preparation, printing, authentication, issuance and delivery of
certificates for the Securities, including any stamp or transfer taxes in
connection with the original issuance and sale of the Securities; (iv) the
printing (or reproduction) and delivery of this Agreement, any blue sky
memorandum and all other agreements or documents printed (or reproduced)
and delivered in connection with the offering of the Securities; (v) any
registration or qualification of the Securities for offer and sale under
the securities or blue sky laws of the several states (including filing
fees and the reasonable fees and expenses of counsel for the Underwriters
relating to such registration and qualification); (vi) any filings
required to be made with the National Association of Securities Dealers,
Inc. (including filing fees and the reasonable fees and expenses of
counsel for the Underwriters relating to such filings); (vii) the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers
of the Securities; (viii) the fees and expenses of the Company's
accountants and the fees and expenses of counsel (including local and
special counsel) for the Company; and (ix) all other costs and expenses
incident to the performance by the Company of its obligations hereunder.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company made in any
14
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than (i)
6:00 PM New York City time on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Final Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Final Prospectus, and any such supplement,
will be filed in the manner and within the time period required by Rule
424(b); and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
(b) The Company shall have requested and caused ▇▇▇▇▇▇ ▇▇▇▇▇▇ White
& ▇▇▇▇▇▇▇▇▇ LLP, counsel for the Company, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Washington,
with full corporate power and authority to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Final Prospectus;
(ii) the Company's authorized equity capitalization is as set
forth in the Final Prospectus; the capital stock of the Company
conforms in all material respects to the description thereof
contained in the Final Prospectus; the outstanding shares of Common
Stock have been duly and validly authorized and issued and are fully
paid and nonassessable; the Securities have been duly and validly
authorized, and, when issued and delivered to and paid for by the
Underwriters pursuant to this Agreement, will be fully paid and
nonassessable; the Securities are duly listed, and admitted and
authorized for trading, subject to official notice of issuance, on
the Nasdaq National Market; the certificates for the Securities are
in valid and sufficient form; the holders of outstanding shares of
capital stock of the Company are not entitled to preemptive or other
rights to subscribe for the Securities under the Washington Business
Corporation Act or the Company's articles of incorporation or
bylaws, or, to the knowledge of such counsel, any other agreement to
which the Company is a party; and, except as set forth in the Final
Prospectus, to the knowledge of such counsel, no options, warrants
or other rights to purchase, agreements or other obligations to
issue, or rights to convert any obligations into or exchange any
securities for, shares of capital stock of or ownership interests in
the Company are outstanding;
(iii) to the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving
the Company or any of its
15
subsidiaries or its or their property of a character required to be
disclosed in the Registration Statement that is not disclosed in the
Final Prospectus, and, to the knowledge of such counsel, there is no
franchise, contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or to
be filed as an exhibit thereto, which is not described or filed as
required; and the statements included or incorporated by reference
in the Basic Prospectus under the heading "Description of Capital
Stock" insofar as such statements summarize legal matters,
agreements, documents or proceedings discussed therein, are accurate
and fair summaries of such legal matters, agreements, documents or
proceedings;
(iv) the Registration Statement has become effective under the
Act; any required filing of the Basic Prospectus, any Preliminary
Final Prospectus and the Final Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); to the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued, no proceedings for that
purpose have been instituted or threatened and the Registration
Statement and the Final Prospectus (other than the financial
statements and other financial and statistical information contained
therein, as to which such counsel need express no opinion) comply as
to form in all material respects with the applicable requirements of
the Act and the Exchange Act and the respective rules thereunder;
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) the Company is not and, after giving effect to the
offering and sale of the Securities and the application of the
proceeds thereof as described in the Final Prospectus, will not be
an "investment company" as defined in the Investment Company Act of
1940, as amended;
(vii) no consent, approval, authorization, filing with or
order of any court or governmental agency or body is required in
connection with the transactions contemplated herein, except such as
have been obtained under the Act and such as may be required under
the blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the Underwriters in
the manner contemplated in this Agreement and in the Final
Prospectus and such other approvals (specified in such opinion) as
have been obtained;
(viii) neither the issue and sale of the Securities, nor the
fulfillment of the terms hereof will (A) conflict with the charter
or by-laws of the Company, (B) result in a breach or violation of,
or imposition of any lien, charge or encumbrance upon any property
or assets of the Company pursuant to the terms of any agreement or
instrument to which the Company is a party or bound or to which its
property is
16
subject and which is identified on an annex to such counsel's
opinion (such annex to list all material agreements and instruments
that the Company or its subsidiaries is a party or bound or to which
its or their property is subject, as identified by the Company), or
(C) violate any statute, any rule or regulation of any governmental
agency or body, or to the knowledge of such counsel, any judgment,
order or decree applicable to the Company of any court, regulatory
body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its
properties; and
(ix) to the knowledge of such counsel, no holders of
securities of the Company have rights to the registration of such
securities under the Registration Statement.
Such opinion shall also include a statement to the effect that:
Although such counsel has not undertaken to determine independently
the accuracy, completeness or fairness of any of the statements made
in the Registration Statement or the Final Prospectus, such counsel
has reviewed the Registration Statement and the Final Prospectus and
participated in conferences with representatives of the Company, its
accountants, the Underwriters and Underwriters' counsel at which the
contents of the Registration Statement and the Final Prospectus and
related matters were discussed and reviewed. On the basis of the
information which was developed in the course of the performance of
the services referred to above, considered in the light of such
counsel's understanding of the applicable law, including the
requirements of Form S-3, such counsel has no reason to believe that
on the Effective Date the Registration Statement contained any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Final Prospectus as of
its date and on the Closing Date included or includes any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (in each
case, other than the financial statements and other financial and
statistical information contained therein, as to which such counsel
need express no opinion). The limitations inherent in the
independent verification of factual matters and the character of
determinations involved in the registration process are such,
however, that such counsel does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained
in the Registration Statement and the Basic Prospectus except to the
extent set forth in the last sentence of paragraph (iii) above.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State
of Washington or the Federal laws of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters and (B) as to matters of
fact, to the extent they deem proper, on certificates of responsible
officers of the Company and public officials. References to the Final
Prospectus in this paragraph (b) shall also include any supplements
thereto at the Closing Date.
17
(c) The Representatives shall have received from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters, such opinion or opinions,
dated the Closing Date and addressed to the Representatives, with respect
to the issuance and sale of the Securities, the Registration Statement,
the Final Prospectus (together with any supplement thereto) and other
related matters as the Representatives may reasonably require, and the
Company shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the
Company, dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the Final
Prospectus, any supplements to the Final Prospectus and this Agreement and
that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with
the same effect as if made on the Closing Date and the Company has
complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included or incorporated by reference in the Final Prospectus
(exclusive of any supplement thereto), there has been no material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth
in or contemplated in the Final Prospectus (exclusive of any
supplement thereto).
(e) (i) The Company shall have requested and caused
PricewaterhouseCoopers LLP to have furnished to the Representatives, at
the Execution Time and at the Closing Date, letters (which may refer to
letters previously delivered to one or more of the Representatives), dated
respectively as of the Execution Time and as of the Closing Date, in form
and substance satisfactory to the Representatives, confirming that they
are independent accountants within the meaning of the Act and the Exchange
Act and the respective applicable rules and regulations adopted by the
Commission thereunder and stating in effect that:
(1) in their opinion the audited financial statements and
financial statement schedule audited by them and the pro forma
financial statements included or incorporated by reference in the
Registration Statement and the Final Prospectus comply as to form in
all material respects with the applicable accounting requirements of
the Act and the related rules and regulations adopted by the
Commission;
18
(2) on the basis of carrying out certain specified procedures
(but not an examination in accordance with generally accepted
auditing standards) which would not necessarily reveal matters of
significance with respect to the comments set forth in such letter;
a reading of the minutes of the 2003 meetings of the Company's
stockholders, and the Company's board of directors and its
committees; and inquiries of certain officials of the Company who
have responsibility for financial and accounting matters of the
Company and its subsidiaries as to transactions and events
subsequent to September 30, 2003, nothing came to their attention
which caused them to believe that:
(x) with respect to the period subsequent to September
30, 2003, there was any change, at a specified date not more
than five days prior to the date of the letter, in the capital
stock, increase in long-term debt or decrease in consolidated
net current assets (working capital) or stockholders' equity
of the Company and its consolidated subsidiaries as compared
with the amounts shown on the September 30, 2003 consolidated
balance sheet included or incorporated by reference in the
Registration Statement and the Final Prospectus, or for the
period from October 1, 2003, to such specified date there were
any decreases, as compared with the corresponding period in
the preceding fiscal year in net revenues or in the total or
per share amounts of net income or loss of the Company and its
subsidiaries, except in all instances for changes or decreases
set forth in such letter, in which case the letter shall be
accompanied by an explanation by the Company as to the
significance thereof unless said explanation is not deemed
necessary by the Representatives; or
(y) the information included or incorporated by
reference in the Registration Statement and Final Prospectus
in response to Regulation S-K, Item 301 (Selected Financial
Data), Item 302 (Supplementary Financial Information), Item
402 (Executive Compensation) and Item 503(d) (Ratio of
Earnings to Fixed Charges) is not in conformity with the
applicable disclosure requirements of Regulation S-K;
(3) they have performed certain other specified procedures as
a result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Registration Statement and the Final Prospectus and in
Exhibit 12 to the Registration Statement, including the information
set forth under the captions "Summary", "Capitalization", "Selected
Consolidated Financial Data" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the
Final Prospectus, the information included or incorporated by
reference in Items 1, 2, 6, 7, 11 and 13 of the Company's Annual
Report on Form 10-K, incorporated by reference in the Registration
Statement and the Final Prospectus agrees with the accounting
19
records of the Company and its subsidiaries, excluding any questions
of legal interpretation; and
(4) on the basis of a reading of the unaudited pro forma
financial statements included or incorporated by reference in the
Registration Statement and the Final Prospectus (the "pro forma
financial statements"); carrying out certain specified procedures;
inquiries of certain officials of the Company and uRoam, Inc. who
have responsibility for financial and accounting matters; and
proving the arithmetic accuracy of the application of the pro forma
adjustments to the historical amounts in the pro forma financial
statements, nothing came to their attention which caused them to
believe that the pro forma financial statements do not comply as to
form in all material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical amounts
in the compilation of such statements.
(ii) The Company shall have requested and caused BDO ▇▇▇▇▇▇▇ LLP to
have furnished to the Representatives, at the Execution Time and at the
Closing Date, letters dated respectively as of the Execution Time and as
of the Closing Date, in form and substance satisfactory to the
Representatives.
(iii) The Company shall have requested and caused the Company's
chief financial officer to have furnished to the Representatives, at the
Execution Time and at the Closing Date, letters, dated respectively as of
the Execution Time and as of the Closing Date, in form and substance
satisfactory to the Representatives.
References to the Final Prospectus in this paragraph (e) include any
supplement thereto at the date of the applicable letter.
(f) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified
in the letter or letters referred to in paragraph (e) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Prospectus (exclusive
of any supplement thereto) the effect of which, in any case referred to in
clause (i) or (ii) above, is, in the sole judgment of the Representatives,
so material and adverse as to make it impractical or inadvisable to
proceed with the offering or delivery of the Securities as contemplated by
the Registration Statement (exclusive of any amendment thereof) and the
Final Prospectus (exclusive of any supplement thereto).
(g) Prior to the Closing Date, the Company shall have furnished to
the Representatives such further information, certificates and documents
as the Representatives may reasonably request.
20
(h) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act) or any notice given of any intended
or potential decrease in any such rating or of a possible change in any
such rating that does not indicate the direction of the possible change.
(i) The Securities shall have been listed and admitted and
authorized for trading on the Nasdaq National Market, and satisfactory
evidence of such actions shall have been provided to the Representatives.
(j) At the Execution Time, the Company shall have furnished to the
Representatives a lock-up agreement substantially in the form of Exhibit A
hereto from each officer and director of the Company addressed to the
Representatives.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as provided in this Agreement, or if any of the opinions
and certificates mentioned above or elsewhere in this Agreement shall not be in
reasonably satisfactory in form and substance to the Representatives and counsel
for the Underwriters, this Agreement and all obligations of the Underwriters
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancelation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the
Underwriters, at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, on the
Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally through Citigroup Global Markets Inc. on demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Securities.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Securities as originally filed or in any amendment thereof, or in the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission
21
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for inclusion
therein. This indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify
and hold harmless the Company, each of its directors, each of its officers who
signs the Registration Statement, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company acknowledges that the statements
set forth in the last paragraph of the cover page regarding delivery of the
Securities and, under the heading "Underwriting" (i) the list of Underwriters
and their respective participation in the sale of the Securities, (ii) the
sentences related to concessions and reallowances and (iii) the paragraph
related to stabilization, syndicate covering transactions and penalty bids in
any Preliminary Final Prospectus and the Final Prospectus constitute the only
information furnished in writing by or on behalf of the several Underwriters for
inclusion in any Preliminary Final Prospectus or the Final Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
22
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the Company
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the Securities;
provided, however, that in no case shall any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount
or commission applicable to the Securities purchased by such Underwriter
hereunder. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company and the Underwriters severally shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
of the Underwriters on the other in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Company shall be deemed to be equal to
the total net proceeds from the offering (before deducting expenses) received by
it, and benefits received by the Underwriters shall be deemed to be equal to the
total underwriting discounts and commissions, in each case as set forth on the
cover page of the Final Prospectus. Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information provided by the Company on the one hand or
the Underwriters on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Underwriters agree that it
would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee and
agent of an Underwriter shall have the same rights to contribution as such
23
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule II hereto bears to the aggregate amount
of Securities set forth opposite the names of all the remaining Underwriters)
the Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase; provided, however, that in the event that the aggregate
amount of Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase shall exceed 10% of the aggregate amount of Securities set
forth in Schedule II hereto, the remaining Underwriters shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the
Securities, and if such nondefaulting Underwriters do not purchase all the
Securities, this Agreement will terminate without liability to any nondefaulting
Underwriter or the Company. In the event of a default by any Underwriter as set
forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding five Business Days, as the Representatives shall determine in
order that the required changes in the Registration Statement and the Final
Prospectus or in any other documents or arrangements may be effected. Nothing
contained in this Agreement shall relieve any defaulting Underwriter of its
liability, if any, to the Company and any nondefaulting Underwriter for damages
occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the Company
prior to delivery of and payment for the Securities, if at any time prior to
such time (i) trading in the Company's Common Stock shall have been suspended by
the Commission or the Nasdaq National Market or trading in securities generally
on the New York Stock Exchange or the Nasdaq National Market shall have been
suspended or limited or minimum prices shall have been established on such
Exchange or the Nasdaq National Market, (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Representatives, impractical or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Final Prospectus
(exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Securities.
The provisions of Sections 7
24
and 8 hereof shall survive the termination or cancelation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel (fax
no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to the General Counsel, Citigroup Global
Markets Inc., at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention:
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to (▇▇▇) ▇▇▇-▇▇▇▇ and confirmed to it at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Financial Officer.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the prospectus referred to in
paragraph 1(a) above contained in the Registration Statement at the
Effective Date including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies
are authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto (including
Post-Effective Amendment No. 1) and any Rule 462(b) Registration Statement
became or become effective.
25
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Securities that was first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus.
"Post-Effective Amendment No. 1" shall mean post-effective amendment
no. 1 to the Registration Statement filed by the Company with the
Commission on October 28, 2003.
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Securities and the
offering thereof and is used prior to filing of the Final Prospectus,
together with the Basic Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective), as
amended by Post-Effective Amendment No. 1, and, in the event any
additional post-effective amendment thereto or any Rule 462(b)
Registration Statement becomes effective prior to the Closing Date, shall
also mean such registration statement as so amended or such Rule 462(b)
Registration Statement, as the case may be. Such term shall include any
Rule 430A Information deemed to be included therein at the Effective Date
as provided by Rule 430A.
"Rule 415", "Rule 424", "Rule 430A" and "Rule 462" refer to such
rules under the Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement referred to
in Section 1(a) hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
F5 Networks, Inc.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President of
Finance and Chief Financial
Officer
[SIGNATURE PAGE TO UNDERWRITING AGREEMENT]
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
Citigroup Global Markets Inc.
▇▇▇▇▇▇ Brothers Inc.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
By: Citigroup Global Markets Inc.
By: /s/ Aamer Hai
-------------------------
Name: Aamer Hai
Title: Vice President
For themselves and the other
several Underwriters, if any,
named in Schedule II to the
foregoing Agreement.
[SIGNATURE PAGE TO UNDERWRITING AGREEMENT]
