------------
EXHIBIT 1.01
------------
TRINET GROUP, INC.
3,900,000 Shares of Common Stock*
UNDERWRITING AGREEMENT
----------------------
November __, 2000
XXXXXX X. XXXXX & CO. INCORPORATED
XXXXXXXXX & COMPANY, INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
As Representatives of the Several Underwriters
Identified in Schedule I Annexed Hereto
c/o Xxxxxx X. Xxxxx & Co. Incorporated
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Ladies and Gentlemen:
SECTION 1. Introductory. TriNet Group, Inc., a Delaware corporation
------------
(the "Company"), and Select Appointments North America Inc. (the "Selling
Stockholder") propose to sell 3,900,000 shares (the "Firm Shares") of common
stock, $.0001 par value per share (the "Common Stock"), to the several
underwriters identified in Schedule I annexed hereto (the "Underwriters"), who
are acting severally and not jointly. In addition, the Company has agreed to
grant to the Underwriters an option to purchase up to 585,000 additional shares
of Common Stock (the "Optional Shares") as provided in section 6 hereof. The
Firm Shares and, to the extent such option is exercised, the Optional Shares are
hereinafter collectively referred to as the "Shares."
You, as representatives of the Underwriters (the "Representatives"),
have advised the Company and the Selling Stockholder that the Underwriters
propose to make a public offering of their respective portions of the Shares as
soon hereafter as in your judgment is advisable and that the public offering
price of the Shares initially will be $_____ per share.
In addition, as a part of this offering contemplated by this
Agreement, Xxxxxx X. Xxxxx & Co. Incorporated ("Baird") has agreed to reserve
out of the Shares set forth opposite its name on the Schedule I to this
Agreement, up to 195,000 shares for sale to the Company's employees, officers,
and directors and other parties associated with the Company (collectively,
"Participants"), as set forth in the Prospectus (as hereinafter defined) under
the heading "Underwriting" (the "Directed Share Program"). The Shares to be
sold by Baird pursuant to the
____________________________
* Plus an option to acquire up to 585,000 additional shares of Common
Stock from the Company to cover over-allotments.
Directed Share Program (the "Directed Shares") will be sold by Baird pursuant to
this Agreement at the public offering price. Any Directed Shares not orally
confirmed for purchase by any Participants as of 7:00 a.m. (Milwaukee, Wisconsin
time) on the first day trading of the Shares commences will be offered to the
public by Baird as set forth in the Prospectus.
The Company and the Selling Stockholder hereby confirm their
respective agreements with the Underwriters and each other as follows:
SECTION 2. Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to, and agrees with, the several Underwriters, and shall
be deemed to represent and warrant to the several Underwriters on each Closing
Date (as hereinafter defined), that:
(a) Each of the Company and the subsidiaries of the Company that are
listed on Exhibit 21.1 of the Registration Statement (as hereinafter
defined) (individually, a "Subsidiary" and collectively, the
"Subsidiaries") has been duly incorporated and is validly existing as a
corporation and in good standing under the laws of its jurisdiction of
incorporation, with full corporate power and authority to own, lease and
operate its properties and to conduct its business as presently conducted
and described in the Prospectus (as hereinafter defined) and the
Registration Statement (as hereinafter defined); each of the Company and
the Subsidiaries is duly registered and qualified to do business as a
foreign corporation under the laws of, and is in good standing as such in,
each jurisdiction in which such registration or qualification is required,
except where the failure to so register or qualify would not have a
material adverse effect on the condition (financial or other), business,
property, net worth or results of operations of the Company and the
Subsidiaries, taken as a whole ("Material Adverse Effect"); and no
proceeding has been instituted in any such jurisdiction revoking, limiting
or curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification. Complete and correct copies of the certificate
of incorporation and by-laws, as amended or restated ("Certificate of
Incorporation" and "By-laws," respectively), of the Company and each of the
Subsidiaries as in effect on the date hereof have been delivered to the
Representatives, and no changes thereto will be made on or subsequent to
the date hereof and prior to each Closing Date.
(b) The shares of Common Stock issued and outstanding immediately
prior to the issuance and sale of the Shares to be sold by the Company
hereunder as set forth in the Prospectus have been duly authorized and
validly issued, are fully paid and nonassessable and conform to the
description thereof contained in the Prospectus and the Registration
Statement. The redemption of all of the shares of the Company's Series D
Preferred Stock (the "Redemption") did not violate the Company's
Certificate of Incorporation or By-laws and was effected in accordance with
all laws, regulations, rulings, judgments, injunctions, orders and decrees
applicable to the Company. No shares of the Company's Series D Preferred
Stock are currently issued and outstanding, and there are no threatened or
pending actions, claims or suits regarding any such shares of Series D
Preferred Stock. There are no preemptive, preferential or, except as
described in the Prospectus, other rights to subscribe for or purchase any
shares of Common Stock (including the Shares), and no shares of Common
Stock have been issued
-2-
in violation of such rights. The Shares to be issued and sold by the
Company to the Underwriters have been duly authorized and, when issued,
delivered and paid for pursuant to this Agreement, will be validly issued,
fully paid and nonassessable and will conform to the description thereof
contained in the Prospectus and the Registration Statement. The Shares to
be purchased by the Underwriters from the Selling Stockholder, when issued,
were validly issued, fully paid and nonassessable. The delivery of
certificates for the Shares to be issued and sold by the Company hereunder
and payment therefor pursuant to the terms of this Agreement will pass
valid title to such Shares to the Underwriters, free and clear of any lien,
claim, encumbrance or defect in title. Except as described in the
Prospectus, there are no outstanding options, warrants or other rights of
any description, contractual or otherwise, entitling any person to be
issued any class of security by the Company or any Subsidiary, and there
are no holders of Common Stock or other securities of the Company or any
Subsidiary, or of securities that are convertible or exchangeable into
Common Stock or other securities of the Company or any Subsidiary, that
have rights to the registration of such Common Stock or securities under
the Securities Act of 1933, as amended, and the regulations thereunder
(together, the "Act") or the securities laws or regulations of any of the
states (the "Blue Sky Laws"). There are no persons with registration or
other similar rights to have any equity or debt securities registered for
sale under the Registration Statement or included in the offering
contemplated by this Agreement, other than the Selling Stockholder with
respect to the Shares included in the Registration Statement, except for
such rights as have been duly waived.
(c) Except for the Subsidiaries, and as otherwise set forth in the
Prospectus, the Company has no subsidiaries and does not own any equity
interest in or control, directly or indirectly, any other corporation,
limited liability company, partnership, joint venture, association, trust
or other business organization. The Company owns directly all of the issued
and outstanding capital stock of each Subsidiary, free and clear of any and
all liens, claims, encumbrances or security interests, and all such capital
stock has been duly authorized and validly issued and is fully paid and
nonassessable. There are no outstanding options, warrants or other rights
of any description, contractual or otherwise, entitling any person to
subscribe for or purchase any shares of capital stock of any Subsidiary. No
Subsidiary 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 the Prospectus.
(d) The Company has full corporate power and authority to enter into
and perform this Agreement, and the execution and delivery by the Company
of this Agreement and the performance by the Company of its obligations
hereunder and the consummation of the transactions described herein, have
been duly authorized with respect to the Company by all necessary corporate
action and will not: (i) violate any provisions of the Certificate of
Incorporation or By-laws of the Company or any Subsidiary; (ii) violate any
provisions of, or result in the breach, modification or termination of, or
constitute a default under, any provision of any agreement, lease,
-3-
franchise, license, indenture, permit, mortgage, deed of trust, evidence of
indebtedness or other instrument to which the Company or any Subsidiary is
a party or by which the Company or any Subsidiary, or any property owned or
leased by the Company or any Subsidiary, may be bound or affected; (iii)
violate any statute, ordinance, rule or regulation applicable to the
Company or any Subsidiary, or order or decree of any court, regulatory or
governmental body, arbitrator, administrative agency or instrumentality of
the United States or other country or jurisdiction having jurisdiction over
the Company or any Subsidiary; or (iv) result in the creation or imposition
of any lien, charge or encumbrance upon any property or assets of the
Company or any Subsidiary. No consent, approval, authorization or other
order of any court, regulatory or governmental body, arbitrator,
administrative agency or instrumentality of the United States or other
country or jurisdiction is required for the execution and delivery of this
Agreement by the Company, the performance of its obligations hereunder or
the consummation of the transactions contemplated hereby, except for
compliance with the Act, the Securities Exchange Act of 1934, as amended,
and the regulations thereunder (together, the "Exchange Act"), the Blue Sky
Laws applicable to the public offering of the Shares by the several
Underwriters and the clearance of such offering and the underwriting
arrangements evidenced hereby with the National Association of Securities
Dealers, Inc. (the "NASD"). This Agreement has been duly executed and
delivered by and on behalf of the Company and is a valid and binding
agreement of the Company enforceable against the Company in accordance with
its terms.
(e) A registration statement on Form S-1 (Reg. No. 333-31534) with
respect to the Shares, including a preliminary form of prospectus, has been
prepared by the Company in conformity with the requirements of the Act and
has been filed with the Securities and Exchange Commission (the
"Commission"). Such registration statement, as finally amended and revised
at the time such registration statement was or is declared effective by the
Commission (including the information contained in the form of final
prospectus, if any, filed with the Commission pursuant to Rule 424(b) and
Rule 430A under the Act and deemed to be part of the registration statement
if the registration statement has been declared effective pursuant to Rule
430A(b)) and as thereafter amended by post-effective amendment, if any, is
herein referred to as the "Registration Statement." The related final
prospectus in the form first filed with the Commission pursuant to Rule
424(b) or, if no such filing is required, as included in the Registration
Statement, or any supplement thereto, is herein referred to as the
"Prospectus." The prospectus subject to completion in the form included in
the Registration Statement at the time of the initial filing of the
Registration Statement with the Commission, and each such prospectus as
amended from time to time until the date of the Prospectus, is referred to
herein as the "Preliminary Prospectus." The Company has prepared and filed
such amendments to the Registration Statement since its initial filing with
the Commission, if any, as may have been required under the Act to the date
hereof, and will file such additional amendments thereto as may hereafter
be required under the Act. There have been delivered to the Representatives
three signed copies of the Registration Statement and each amendment
thereto, if any, together with three copies of each exhibit filed
therewith, and such number of conformed copies for each of the Underwriters
of the Registration Statement and each amendment thereto, if any (but
without exhibits), and of each Preliminary Prospectus and of the Prospectus
as the Representatives have requested.
-4-
(f) Neither the Commission nor any state securities commission has
issued any order preventing or suspending the use of any Preliminary
Prospectus nor, to the knowledge of the Company, have any proceedings for
that purpose been initiated or threatened, and each Preliminary Prospectus
filed with the Commission as part of the Registration Statement as
originally filed or as part of any amendment or supplement thereto complied
in all material respects, when so filed, with the requirements of the Act
and, as of its date, did not include any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. As of the
effective date of the Registration Statement, and at all times subsequent
thereto up to each Closing Date, the Registration Statement and the
Prospectus conformed or will conform in all material respects to the
requirements of the Act, and neither the Registration Statement nor the
Prospectus included or will include any untrue statement of a material fact
or omitted or will omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. Neither
the Company, nor any person that controls, is controlled by (including the
Subsidiaries) or is under common control with the Company, has distributed
or will distribute prior to each Closing Date any offering material in
connection with the offering and sale of the Shares other than a
Preliminary Prospectus, the Prospectus, the Registration Statement or other
materials permitted by the Act and provided to the Representatives.
(g) Ernst & Young LLP, which has expressed its opinion with respect
to the consolidated financial statements and schedules filed with the
Commission and included as a part of each Preliminary Prospectus, the
Prospectus or the Registration Statement are independent accountants as
required by the Act.
(h) The consolidated financial statements and the related notes
thereto included in each Preliminary Prospectus, the Prospectus and the
Registration Statement present fairly the financial position, results of
operations and cash flows of the Company as of their respective dates or
for the respective periods covered thereby, all in conformity with
generally accepted accounting principles consistently applied throughout
the periods involved. The financial statement schedules, if any, included
in the Registration Statement present fairly the information required to be
stated therein on a basis consistent with the consolidated financial
statements of the Company contained therein. The Company had an outstanding
capitalization as set forth in the Registration Statement and under
"Capitalization" in the Prospectus as of the date indicated therein, and
there has been no material change thereto since such date except as
disclosed in the Prospectus. The financial and statistical information and
data relating to the Company in each Preliminary Prospectus, the Prospectus
and the Registration Statement are accurately presented and prepared on a
basis consistent with the audited consolidated financial statements and
books and records of the Company. The consolidated financial statements and
schedules and the related notes thereto included in each Preliminary
Prospectus, the Prospectus or the Registration Statement are the only such
financial statements and schedules required under the Act to be set forth
therein.
-5-
(i) Neither the Company nor any Subsidiary is, nor with the giving of
notice or passage of time or both, would be, in violation or in breach of:
(i) its respective Certificate of Incorporation or By-laws; (ii) any
statute, ordinance, order, rule or regulation applicable to the Company or
such Subsidiary where such violation or breach could result in a Material
Adverse Effect; (iii) any order or decree of any court, regulatory body,
arbitrator, administrative agency or other instrumentality of the United
States or other country or jurisdiction having jurisdiction over the
Company or such Subsidiary where such violation or breach could result in a
Material Adverse Effect; or (iv) any material provision of any agreement,
lease, franchise, license, indenture, permit, mortgage, deed of trust,
evidence of indebtedness or other instrument to which the Company or such
Subsidiary is a party or by which any property owned or leased by the
Company or such Subsidiary is bound or affected. Neither the Company nor
any Subsidiary has received notice of any violation of any applicable
statute, ordinance, order, rule or regulation applicable to the Company or
any Subsidiary. The Company and each Subsidiary have obtained and hold, and
are in material compliance with, all permits, certificates, licenses,
approvals, registrations, franchises, consents and authorizations of
governmental or regulatory authorities required under all rules and
regulations in connection with their businesses (hereinafter "permit" or
"permits"), and to the knowledge of the Company, all of such permits are in
full force and effect; and the Company and each Subsidiary have materially
fulfilled and performed all of their respective obligations with respect to
each such permit and no event has occurred which would result in, or after
notice or lapse of time would result in, revocation or termination of any
such permit or result in any other impairment of the rights of the holder
of such permit. Neither the Company nor any Subsidiary is or has been (by
virtue of any action, omission to act, contract to which it is a party or
other occurrence) in material violation of any applicable foreign, federal,
state, municipal or local statutes, laws, ordinances, rules, regulations or
orders (including those relating to environmental protection, occupational
safety and health and equal employment practices) heretofore or currently
in effect.
(j) There are no legal or governmental proceedings or investigations
pending or, to the knowledge of the Company, threatened to which the
Company or any Subsidiary is or may be a party or to which any property
owned or leased by the Company or any Subsidiary is or may be subject,
including, without limitation, any such proceedings that are related to
environmental or employment discrimination matters, which are required to
be described in the Registration Statement or the Prospectus which are not
so described, or which question the validity of this Agreement or any
action taken or to be taken pursuant hereto. Except as described in the
Registration Statement or the Prospectus, neither the Company nor any
Subsidiary: (i) owns or operates any real property contaminated with any
substance that is subject to any statute, ordinance, rule or regulation, or
any decision, order or decree of any court, regulatory body, arbitrator,
administrative agency or other instrumentality of the United States or
other country or jurisdiction having jurisdiction over the Company or such
Subsidiary relating to the use, disposal or release of hazardous or toxic
substances or relating to the protection or restoration of the
environmental or human exposure to hazardous or toxic substances
(collectively, "environmental laws"); (ii) is liable for any off-site
disposal or contamination pursuant to any environmental laws; or (iii) is
subject to any claim relating
-6-
to any environmental laws, which violation, contamination, liability or
claim could have a Material Adverse Effect.
(k) There is no transaction, relationship, obligation, agreement or
other document required to be described in the Registration Statement or
the Prospectus or to be filed or deemed to be filed as an exhibit to the
Registration Statement by the Act, which has not been described or filed as
required. All such contracts or agreements to which the Company or any
Subsidiary is a party have been duly authorized, executed and delivered by
the Company or such Subsidiary, constitute valid and binding agreements of
the Company or such Subsidiary, and are enforceable by and against the
Company or such Subsidiary, in accordance with the respective terms
thereof.
(l) Neither the Company nor any Subsidiary owns any real property.
The Company or a Subsidiary has good and valid title to all property and
assets reflected as owned by the Company or such Subsidiary in the
Company's consolidated financial statements included in the Registration
Statement (or elsewhere in the Registration Statement or the Prospectus),
free and clear of all liens, claims, mortgages, security interests or other
encumbrance of any kind or nature whatsoever except those, if any,
reflected in such financial statements (or elsewhere in the Registration
Statement or the Prospectus) and except such as do not materially and
adversely affect the value of such property and assets and do not
materially interfere with the use made or proposed to be made of such
property or assets by the Company or such Subsidiary. All property (real
and personal) held or used by the Company or a Subsidiary under leases,
licenses, franchises or other agreements is held by the Company or such
Subsidiary under valid, binding and enforceable leases, franchises,
licenses or other agreements.
(m) Neither the Company nor any person that controls, is controlled
by (including the Subsidiaries) or is under common control with the Company
has taken or will take, directly or indirectly, any action designed to
cause or result in, or which constituted, or which could cause or result
in, stabilization or manipulation, under the Exchange Act or otherwise, of
the price of any security of the Company to facilitate the sale or resale
of the Common Stock.
(n) Except as described in the Registration Statement or the
Prospectus, since the respective dates as of which information is given in
the Registration Statement or the Prospectus and prior to each Closing
Date: (i) neither the Company nor any Subsidiary has or will have incurred
any liability or obligation, direct or contingent, or entered into any
transaction, that is material to the Company, except as in the ordinary
course of business; (ii) the Company has not and will not have paid or
declared any dividend or other distribution with respect to its capital
stock and neither the Company nor any Subsidiary is or will be delinquent
in the payment of principal or interest on any outstanding debt obligation;
and (iii) there has not been and will not have been any change in the
capital stock, any material change in the indebtedness of the Company or
any Subsidiary, or any change or development involving or which reasonably
could be expected to involve, a Material Adverse Effect, whether or not
arising from transactions in the ordinary course of business.
-7-
(o) Neither the Company nor any person that controls, is controlled
by (including the Subsidiaries) or is under common control with the Company
has, directly or indirectly: (i) made any unlawful contribution to any
candidate for political office, or failed to disclose fully any
contribution in violation of law; or (ii) made any payment to any federal,
state or foreign governmental officer or official, or other person charged
with similar public or quasi-public duties, other than payments required or
permitted by the laws of the United States or any jurisdiction thereof or
applicable foreign jurisdictions.
(p) The Company or a Subsidiary owns or possesses adequate rights to
use all patents, patent applications, trademarks, service marks, trade
names, trademark registrations, service xxxx registrations, copyrights and
licenses (collectively, "Intellectual Property Rights") presently used in
or necessary for the conduct of its business or ownership of its
properties, and neither the Company nor any Subsidiary, to each of their
respective knowledge, has violated or infringed upon the rights of others,
or received any notice of conflict with the asserted rights of others, in
respect thereof.
(q) The Company or a Subsidiary has in place and effective such
policies of insurance, with limits of liability in such amounts, as are
normal and prudent in the ordinary course of the business of the Company
and its Subsidiaries. The Company has no reasonable basis to believe that
it or any Subsidiary will not be able to (i) renew its existing insurance
coverage as and when such policies expire or (ii) obtain comparable
coverage from similar institutions as may be necessary or appropriate to
conduct its business as now conducted and at a cost that would not result
in a Material Adverse Effect. Neither the Company nor any Subsidiary has
been denied any insurance coverage that it has sought or for which it has
applied.
(r) No labor dispute with the employees of the Company or any
Subsidiary exists or, to the knowledge of the Company is imminent, and
neither the Company nor any Subsidiary is a party to any collective
bargaining agreement and, to the knowledge of the Company, no union
organizational attempts have occurred or are pending. Since the most recent
filing of the Registration Statement or the Prospectus, there has been no
change in the relationship of the Company or any Subsidiary with any of its
principal suppliers, manufacturers, contractors or customers resulting in
or that could result in a Material Adverse Effect.
(s) Neither the Company nor any Subsidiary is, and after receipt of
payment for the Shares none of such parties will be, an "investment
company", an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act").
The Company will conduct its business in a manner so that it will not
become subject to the Investment Company Act.
(t) All federal, state and local tax returns required to be filed by
or on behalf of the Company or any Subsidiary have been filed (or are the
subject of valid extension) with the appropriate federal, state and local
authorities, and all such tax returns, as filed, are accurate in all
material respects; all federal, state and local taxes (including estimated
tax payments) required to be shown on all such tax returns or claimed to be
due from or
-8-
with respect to the business of the Company or such Subsidiary have been
paid or reflected as a liability on the financial statements of the Company
or such Subsidiary for appropriate periods except for such taxes, if any,
as are being contested in good faith and as to which adequate reserves have
been provided; all deficiencies asserted as a result of any federal, state
or local tax audits have been paid or finally settled, and no issue has
been raised in any such audit which, by application of the same or similar
principles, reasonably could be expected to result in a proposed deficiency
for any other period not so audited; to the knowledge of the Company, no
state of facts exist or has existed which would constitute grounds for the
assessment of any tax liability with respect to the periods which have not
been audited by appropriate federal, state or local authorities; there are
no outstanding agreements or waivers extending the statutory period of
limitation applicable to any federal, state or local tax return of any
period; and neither the Company nor any Subsidiary has ever been a member
of an affiliated group of corporations filing consolidated federal income
tax returns, other than a group of which the Company is and has been the
common parent.
(u) Except for the Company's Employee Benefit Plan & Plan Trust, and
its Employer Group, Inc. 401(k) Plan (collectively, the "Plans"), neither
the Company nor any Subsidiary is a participating employer or plan sponsor
with respect to any employee pension benefit plan as defined in Section
3(2) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or any employee welfare benefit plan as defined in Section 3(1)
of ERISA, including, without limitation, any multiemployer welfare or
pension plan. With respect to the Plans, the Company is in substantial
compliance with all applicable laws, including ERISA and the Code. With
respect to each defined benefit retirement plan, such plan does not have
benefit liabilities (as defined in Section 4001(a)(16) of ERISA) exceeding
the assets of the plan. The Company or the administrator of each of the
Plans, as the case may be, has timely filed the reports required to be
filed by ERISA and the Code in connection with the maintenance of the
Plans, and no facts, including, without limitation, any "reportable event"
as defined by ERISA and the regulations thereunder, exist in connection
with the Plans which, under applicable law, would constitute grounds for
the termination of any of the Plans by the Pension Benefit Guaranty
Corporation or for the appointment by the appropriate United States
District Court of a trustee to administer any of the Plans.
(v) The Company and each Subsidiary maintain a system of internal
accounting controls sufficient to provide reasonable assurances that: (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of consolidated financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorizations; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(w) None of the Company, any Subsidiary, nor, to the Company's
knowledge, any officer or director of the Company or of any Subsidiary, or
any person who owns, of record or beneficially, any class of securities
issued by the Company is: (i) an officer,
-9-
director or partner of any brokerage firm, broker or dealer that is a
member of the NASD ("NASD Member"); or (ii) directly or indirectly, a
"person associated with" an NASD Member or an "affiliate" of an NASD
Member, as such terms are used in the NASD Rules or By-Laws. In addition,
neither the Company nor any Subsidiary has issued or transferred any Common
Stock, warrants, options or other securities, or any other items of value,
to any of the Underwriters or any "related person" of any Underwriter, as
such term is used in the NASD Rules, except as provided in this Agreement.
(x) The Common Stock has been registered pursuant to Section 12(b) of
the Exchange Act. Such registration statement either has been declared
effective by the Commission under the Exchange Act or will be declared
effective by the Commission prior to or concurrently with the commencement
of the public offering of the Shares. The Common Stock has been approved
for designation upon notice of issuance as a Nasdaq National Market
security on The Nasdaq Stock Market ("Nasdaq").
(y) Neither the Company, any Subsidiary nor any affiliate of the
Company or such Subsidiary does business with the government of Cuba or
with any person or affiliate located in Cuba within the meaning of Section
517.075 of the Florida Statutes, and the Company agrees to comply with such
Section if, prior to the completion of the distribution of the Shares, the
Company, any Subsidiary or any affiliate of the Company or such Subsidiary
commences doing such business.
(z) All offers and sales of the securities of the Company prior to
the date hereof were made in compliance with the Act and all other
applicable state and federal laws or regulations.
(aa) The Company has obtained for the benefit of the Underwriters the
agreement substantially in the form attached hereto as Exhibit A (each, a
"Lock-Up Agreement"), enforceable by Baird, of each of the officers and
directors of the Company, and each of the warrantholders and stockholders
of the Company who is not a Selling Stockholder listed on Schedule II
annexed hereto. The Company has provided to counsel for the Underwriters
true, accurate and complete copies of all of the Lock-up Agreements
presently in effect or effected hereby. The Company hereby represents and
warrants that it will not release any of its officers, directors or other
stockholders from any Lock-up Agreements currently existing or hereafter
effected without the prior written consent of Baird.
(bb) A copy of the Power of Attorney and the Custody Agreement
executed by the Selling Stockholder and a copy of the Selling Stockholder's
Selling Stockholders' Questionnaire has been furnished to counsel for the
Underwriters prior to the date hereof, along with such other information as
such counsel may reasonably request in connection with their review
thereof.
(cc) The execution and delivery of the Agreement and Plan of Merger
effective as of __________, 2000 (the "Merger Agreement") by and among
TriNet Employer Group, Inc., a California corporation (the "California
Corporation"), TriNet Subsidiary Corporation, a California corporation, and
the Company, effecting the restructuring of the
-10-
California Corporation whereby it became a wholly-owned subsidiary of the
Company (the "Restructuring"), were duly authorized by all necessary
corporate action on the part of each of the California Corporation and the
Company; and each of the California Corporation and the Company had all
corporate power and authority to execute and deliver the Merger Agreement
and the Certificate of Merger and Articles of Merger attached as exhibits
thereto to which they are a party, to file such Certificate of Merger with
the Secretary of State of the State of Delaware, to file such Articles of
Merger with the Secretary of State of the State of California and to
consummate the Restructuring contemplated by the Merger Agreement, and the
Merger Agreement at the time of execution and immediately prior to the
effectiveness of the Restructuring constituted a valid and binding
obligation of each of the California Corporation and the Company, subject
to the effect of (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar federal or state laws affecting the rights of
creditors and (ii) general principles of equity.
(dd) There are no Year 2000 issues related to the Company, or any of
its Subsidiaries, that (i) are of a character required to be described or
referred to in the Registration Statement or Prospectus by the Act which
have not been accurately described in the Registration Statement or
Prospectus or (ii) might reasonably be expected to result in any Material
Adverse Effect.
(ee) 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 and sale by the Company of the Shares.
(ff) No consent, approval, authorization or order of, or qualification
with, any governmental body or agency, other than those obtained, is
required in connection with the offering of the Directed Shares in any
jurisdiction where the Directed Shares are being offered. The Company has
not offered, or caused Baird to offer, Shares to any person pursuant to the
Directed Share Program with the specific intent to unlawfully influence (i)
a customer or supplier of the Company to alter the customer's or supplier's
level or type of business with the Company or (ii) a trade journalist or
publication to write or publish favorable information about the Company or
its products.
A certificate signed by any officer of the Company and delivered to
the Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby. A certificate delivered by the Company to its counsel for
purposes of enabling such counsel to render the opinion referred to in section
10(d) will also be furnished to the Representatives and counsel for the
Underwriters and shall be deemed to be additional representations and warranties
to the Underwriters by the Company as to the matters covered thereby.
SECTION 3. Representations and Warranties of the Selling Stockholder.
---------------------------------------------------------
Selling Stockholder represents and warrants to and agrees with the several
Underwriters and the Company, and shall be deemed to represent and warrant to
the several Underwriters and the Company on each Closing Date, that:
-11-
(a) The Selling Stockholder has duly executed, and not revoked, a
power of attorney ("Power of Attorney") naming Xxxxxx Xxxxxxx and Xxxx
Xxxxxx or either of them, as the Selling Stockholder's attorney(s)-in-fact
("Attorneys-in-Fact") for the purpose of entering into and carrying out
this Agreement and a custody agreement ("Custody Agreement") naming Xxxxx
Fargo Bank Minnesota N.A. as custodian ("Custodian") of the Shares of the
Selling Stockholder for the purpose of selling and delivering such Shares
to the Underwriters on each Closing Date and receiving payment therefor.
(b) All consents, approvals, authorizations and orders necessary for
the execution and delivery by the Selling Stockholder of this Agreement,
the Power of Attorney and the Custody Agreement, and for the sale and
delivery of the Shares to be sold by the Selling Stockholder hereunder have
been obtained. The Selling Stockholder has, and at the time of delivery
thereof the Selling Stockholder will have, good and valid title to the
Shares proposed to be sold by the Selling Stockholder hereunder, free and
clear of all voting trust arrangements, liens, encumbrances, security
interests, equities, claims and community or marital property rights, other
than any created by the Power of Attorney and the Custody Agreement or this
Agreement for the benefit of the Underwriters. The Selling Stockholder has
full right, power and authority to enter into this Agreement, the Power of
Attorney and the Custody Agreement and to sell, assign, transfer and
deliver such Shares hereunder, free and clear of all voting trust
arrangements, liens, encumbrances, security interests, equities, claims and
community or marital property rights, other than any created by the Power
of Attorney, the Custody Agreement or this Agreement for the benefit of the
Underwriters. Upon delivery of and payment for such Shares hereunder, the
Underwriters will acquire good and valid title thereto, free and clear of
all voting trust arrangements, liens, encumbrances, security interests,
equities, claims and community or marital property rights.
(c) The Selling Stockholder has not distributed and will not
distribute any Preliminary Prospectus, the Prospectus or any other material
in connection with the offering and sale of the Shares. The Selling
Stockholder has not taken and will not take, directly or indirectly, any
action designed to or which could 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 Common
Stock.
(d) The execution, delivery and performance by the Selling
Stockholder of this Agreement, the Power of Attorney and the Custody
Agreement will not, if applicable, result in the violation of any
provisions of the charter, bylaws or other governing documents of the
Selling Stockholder, or constitute a breach, or be in contravention, of any
provision of any agreement, franchise, license, indenture, mortgage, deed
of trust or other instrument to which the Selling Stockholder is a party or
by which the Selling Stockholder or the Selling Stockholder's property may
be bound or affected, or any statute, rule or regulation applicable to the
Selling Stockholder, or violate any order or decree of any court,
regulatory body, administrative agency or other governmental body having
jurisdiction over the Selling Stockholder or any of the Selling
Stockholder's property. No consent, approval, authorization or other order
of any court, regulatory body, administrative agency or other governmental
body is required for the
-12-
execution and delivery of, and performance under, this Agreement by the
Selling Stockholder or the consummation by the Selling Stockholder of the
transactions contemplated by this Agreement, except for compliance with the
Act, the Exchange Act, the Blue Sky Laws applicable to the public offering
of the Shares by the Underwriters and the clearance of such offering with
the NASD. The Selling Stockholder hereby represents and warrants that each
Attorney-in-Fact has been duly appointed as attorney-in-fact by the Selling
Stockholder for the purpose of entering into and carrying out this
Agreement, and the Power of Attorney and the Custody Agreement has been
duly executed and delivered by or on behalf of the Selling Stockholder to
the Representatives.
(e) This Agreement, the Power of Attorney and the Custody Agreement
are each valid and binding agreements of the Selling Stockholder
enforceable in accordance with their respective terms.
(f) The Selling Stockholder has deposited in custody, under the
Custody Agreement, certificates in negotiable form for the Shares to be
sold hereunder by the Selling Stockholder for the purpose of further
delivery pursuant to this Agreement. The Selling Stockholder agrees that
the Shares of the Selling Stockholder on deposit with the Custodian are
subject to the interests of the Company and the Underwriters, that the
arrangements made for such custody, and the appointment of the Attorneys-
in-Fact pursuant to the Power of Attorney and the Custody Agreement, are to
that extent irrevocable, and that the obligations of the Selling
Stockholder hereunder and under the Power of Attorney and the Custody
Agreement shall not be terminated, except as provided in this Agreement and
the Power of Attorney and the Custody Agreement, by any act of the Selling
Stockholder, by operation of law or by the dissolution, winding up or other
event affecting the legal life of such entity, or by the occurrence of any
other event. If any partnership or corporation should be terminated, or if
any other event should occur before the delivery of the Shares hereunder,
the certificates for Shares then on deposit with the Custodian shall, to
the extent such Shares are purchased by the Underwriters, be delivered by
the Custodian in accordance with the terms and conditions of this Agreement
and the Power of Attorney and the Custody Agreement as if such termination
or other event had not occurred, regardless of whether or not the Custodian
shall have received notice thereof. The Selling Stockholder represents that
each Attorney-in-Fact has been authorized by the Selling Stockholder to
execute and deliver this Agreement and the Custodian has been authorized to
receive and acknowledge receipt of the proceeds of sale of the Shares sold
by the Selling Stockholder against delivery thereof and otherwise to act on
behalf of the Selling Stockholder.
(g) Attached hereto as Exhibit B is a list of certain provisions of
the Prospectus and Registration Statement (the "Selected Provisions"). The
Selected Provisions, as of the applicable date, have not included any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein not misleading; and on the
effective date of the Registration Statement and at all times subsequent
thereto up to each Closing Date, none of the Selected Provisions did or
will include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading.
-13-
(h) To the knowledge of the Selling Stockholder, the representations
and warranties of the Company set forth in section 2 hereof are true and
correct.
(i) The information contained in the Selling Stockholder's Selling
Stockholders' Questionnaire completed in connection with the Company's
public offering and delivered to the Representatives was, as of the date of
such questionnaire, and is, as of the date of this Agreement, true and
correct.
(j) The Selling Stockholder does not have any registration or other
similar rights to have any equity or debt securities registered for sale by
the Company under the Registration Statement or included in the offering
contemplated by this Agreement, except for such rights as are described in
the Prospectus under "Shares Eligible for Future Sale". The Selling
Stockholder does not have, or has waived prior to the date hereof, any
preemptive right, co-sale right or right of first refusal or other similar
right to purchase any of the Shares that are to be sold by the Company to
the Underwriters pursuant to this Agreement; and the Selling Stockholder
does not own any warrants, options or similar rights to acquire, and does
not have any right or arrangement to acquire, any capital stock, right,
warrants, options or other securities from the Company, other than those
described in the Registration Statement and the Prospectus.
(k) All information furnished by or on behalf of the Selling
Stockholder in writing expressly for use in the Registration Statement and
Prospectus is, and on the First Closing Date and the Second Closing Date
(as defined below) will be, true, correct, and complete in all material
respects, and does not, and on the First Closing Date and the Second
Closing Date will not, contain any untrue statement of a material fact or
omit to state any material fact necessary to make such information not
misleading. The Selling Stockholder confirms as accurate the number of
shares set forth opposite the Selling Stockholder's name in the Prospectus
under the caption "Principal and Selling Stockholders" (both prior to and
after giving effect to the sale of the Shares).
A certificate signed directly by the Selling Stockholder (as opposed
to signed by persons granted a Power of Attorney) and delivered to the
Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Selling Stockholder to the Underwriters as to
the matters covered thereby. A certificate delivered by or on behalf of the
Selling Stockholder to counsel for the Selling Stockholder for purposes of
enabling such counsel to render the opinion referred to in section 10(e) will
also be furnished to the Representatives and counsel for the Underwriters and
shall be deemed to be additional representations and warranties to the
Underwriters by the Selling Stockholder as to the matters covered thereby.
SECTION 4. Representation of Underwriters. The Representatives will
------------------------------
act as the representatives for the several Underwriters in connection with the
public offering of the Shares, and any action under or in respect of this
Agreement taken by the Representatives will be binding upon all of the
Underwriters.
SECTION 5. Information Furnished by the Underwriters. The
-----------------------------------------
information set forth on the outside front cover page of the Prospectus
concerning the terms of the offering by the Underwriters and the first, second
and third paragraphs and the paragraph entitled
-14-
"Stabilization" appearing under the caption "Underwriting" in the Prospectus
constitute all of the information furnished to the Company by and on behalf of
the Underwriters for use in connection with the preparation of the Registration
Statement and the Prospectus, as such information is referred to in this
Agreement.
SECTION 6. Purchase, Sale and Delivery of Shares.
-------------------------------------
(a) On the basis of the representations, warranties and agreements
herein contained, and subject to the terms and conditions herein set forth,
the Company agrees to sell to the Underwriters identified in Schedule I
annexed hereto 3,100,000 Firm Shares, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company the number of Firm
Shares as hereinafter set forth at the price per share of $__________. The
obligation of each Underwriter to the Company shall be to purchase from the
Company that number of full Firm Shares which (as nearly as practicable in
full shares as determined by the Representatives) bears the same proportion
to the number of Firm Shares to be sold by the Company as the number of
shares set forth opposite the name of such Underwriter in Schedule I
annexed hereto bears to the total number of Firm Shares to be purchased by
all of the Underwriters under this Agreement.
(b) On the basis of the representations, warranties and agreements
herein contained, and subject to the terms and conditions herein set forth,
the Selling Stockholder agrees to sell to the Underwriters 800,000 Firm
Shares and each of the Underwriters agrees, severally and not jointly, to
purchase from the Selling Stockholder the number of Firm Shares as
hereinafter set forth at the same purchase price per share as stated in the
preceding paragraph. The obligation of each Underwriter to the Selling
Stockholder shall be to purchase from the Selling Stockholder that number
of full Firm Shares which (as nearly as practicable in full shares as
determined by the Representatives) bears the same proportion to the number
of Firm Shares to be sold by the Selling Stockholder as the number of
shares set forth opposite the name of such Underwriter in Schedule I
annexed hereto bears to the total number of Firm Shares to be purchased by
all of the Underwriters under this Agreement; provided, however, that if,
at the request of the Underwriters, the Selling Stockholder is unable to
sell any Firm Shares and the Underwriters subsequently elect to purchase
Option Shares, then prior to purchasing any Option Shares from the Company,
the Underwriters shall purchase such Option Shares from the Selling
Stockholder.
(c) On the First Closing Date (as hereinafter defined), the Company
and the Custodian on behalf of the Selling Stockholder will deliver to the
Representatives, at the offices of Xxxxxx X. Xxxxx & Co. Incorporated, 000
Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, or through the
facilities of The Depository Trust Company, for the accounts of the several
Underwriters, certificates representing the Firm Shares to be sold by them
against payment in Milwaukee, Wisconsin of the purchase price therefor by
certified or official bank check or checks in New York Clearing House (next
day) funds payable to the order of the Company with respect to the Firm
Shares being sold by the Company and to the order of the Custodian with
respect to the Firm Shares being sold by the Selling Stockholder. As
referred to in this Agreement, the "First Closing Date" shall be on the
third full business day after the date of the Prospectus, at 9:00 a.m.,
Milwaukee,
-15-
Wisconsin time, or at such other date or time not later than ten full
business days after the date of the Prospectus as the Representatives, the
Company and the Attorneys-in-Fact (or either of them) may agree. The
certificates for the Firm Shares to be so delivered will be in
denominations and registered in such names as the Representatives request
by notice to the Company and the Attorneys-in-Fact, or either of them,
prior to the First Closing Date, and such certificates will be made
available for checking and packaging at 9:00 a.m., Milwaukee, Wisconsin
time on the first full business day preceding the First Closing Date at a
location to be designated by the Representatives.
(d) In addition, on the basis of the representations, warranties and
agreements herein contained, and subject to the terms and conditions herein
set forth, the Company hereby agrees to sell to the Underwriters, and the
Underwriters, severally and not jointly, shall have the right at any time
within thirty days after the date of the Prospectus to purchase up to
585,000 Optional Shares from the Company at the purchase price per share to
be paid for the Firm Shares, for use solely in covering any over-allotments
made by the Underwriters in the sale and distribution of the Firm Shares.
The option granted hereunder may be exercised upon notice by the
Representatives to the Company within thirty days after the date of the
Prospectus setting forth the aggregate number of Optional Shares to be
purchased by the Underwriters and sold by the Company, the names and
denominations in which the certificates for such shares are to be
registered and the date and place at which such certificates will be
delivered. Such date of delivery (the "Second Closing Date") shall be
determined by the Representatives, provided that the Second Closing Date,
which may be the same as the First Closing Date, shall not be earlier than
the First Closing Date and, if after the First Closing Date, shall not be
earlier than three nor later than ten full business days after delivery of
such notice to exercise. The number of Optional Shares to be sold by the
Company pursuant to such notice shall equal that number of full Optional
Shares which (as nearly as practicable in full shares as determined by the
Representatives) bears the same proportion to the number of Optional Shares
to be purchased by the Underwriters as the number of Firm Shares to be sold
by the Company under this Agreement bears to the total number of Firm
Shares. Certificates for the Optional Shares will be made available for
checking and packaging at 9:00 a.m., Milwaukee, Wisconsin time, on the
first full business day preceding the Second Closing Date at a location to
be designated by the Representatives. The manner of payment for and
delivery of (including the denominations of and the names in which
certificates are to be registered) the Optional Shares shall be the same as
for the Firm Shares.
(e) The Representatives have advised the Company and the Attorneys-
in-Fact that each Underwriter has authorized the Representatives to accept
delivery of the Shares and to make payment therefor. It is understood that
the Representatives, individually and not as representatives of the
Underwriters, may (but shall not be obligated to) make payment for any
Shares to be purchased by any Underwriter whose funds shall not have been
received by the Representatives by the First Closing Date or the Second
Closing Date, as the case may be, for the account of such Underwriter, but
any such payment shall not relieve such Underwriter from any obligation
under this Agreement. As referred to in this Agreement, "Closing Date"
shall mean either the First Closing Date or the Second Closing Date.
-16-
SECTION 7. Covenants of the Company. The Company covenants and
------------------------
agrees with the several Underwriters that:
(a) If the effective time of the Registration Statement is not prior
to the execution and delivery of this Agreement, the Company will use its
best efforts to cause the Registration Statement to become effective at the
earliest possible time and, upon notification from the Commission that the
Registration Statement has become effective, will so advise the
Representatives and counsel to the Underwriters promptly. If the effective
time of the Registration Statement is prior to the execution and delivery
of this Agreement and any information shall have been omitted therefrom in
reliance upon Rule 430A, the Company, at the earliest possible time, will
furnish the Representatives with a copy of the Prospectus to be filed by
the Company with the Commission to comply with Rule 424(b) and Rule 430A
under the Act and, if the Representatives do not object to the contents
thereof, will comply with such Rules. Upon compliance with such Rules, the
Company will so advise the Representatives promptly. The Company will
advise the Representatives and counsel to the Underwriters and the
Attorneys-in-Fact promptly of the issuance by the Commission or any state
securities commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for that
purpose, or of any notification of the suspension of qualification of the
Shares for sale in any jurisdiction or the initiation or threatening of any
proceedings for that purpose, and will also advise the Representatives and
counsel to the Underwriters and the Attorneys-in-Fact promptly of any
request of the Commission for amendment or supplement of the Registration
Statement, of any Preliminary Prospectus or of the Prospectus, or for
additional information, and the Company will not file any amendment or
supplement to the Registration Statement (either before or after it becomes
effective), to any Preliminary Prospectus or to the Prospectus (including a
prospectus filed pursuant to Rule 424(b)) if the Representatives have not
been furnished with a copy prior to such filing (with a reasonable
opportunity to review such amendment or supplement) or if the
Representatives objects to such filing.
(b) If, at any time when a prospectus relating to the Shares is
required by law to be delivered in connection with sales by an Underwriter
or dealer, any event occurs as a result of which the Prospectus would
include an untrue statement of a material fact, or would omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to supplement the
Prospectus to comply with the Act, the Company promptly will advise the
Representatives and counsel to the Underwriters and the Attorneys-in-Fact
thereof and will promptly prepare and file with the Commission, at its
expense, an amendment to the Registration Statement which will correct such
statement or omission or an amendment which will effect such compliance;
and, if any Underwriter is required to deliver a prospectus after the
effective date of the Registration Statement, the Company, upon request of
the Representatives, will prepare promptly such prospectus or prospectuses
as may be necessary to permit compliance with the requirements of Section
10(a)(3) of the Act. The Company consents to the use, in accordance with
the provisions of the Act and with the Blue Sky Laws of the jurisdictions
in which the Shares are offered by the several Underwriters and by dealers,
of each Preliminary Prospectus.
-17-
(c) Neither the Company nor any Subsidiary will, prior to the Second
Closing Date, if any, incur any liability or obligation, direct or
contingent, or enter into any material transaction, other than in the
ordinary course of business, or enter into any transaction with an
"affiliate," as defined in Rule 405 under the Act, which is required to be
described in the Prospectus pursuant to Item 404 of Regulation S-K under
the Act, except as described in the Prospectus.
(d) Neither the Company nor any Subsidiary will, prior to the Second
Closing Date, if any, acquire any of the Common Stock nor will the Company
declare or pay any dividend or make any other distribution upon its Common
Stock payable to stockholders of record on a date prior to such earlier
date, except as described in the Prospectus.
(e) The Company will make generally available to its security holders
and the Representatives an earnings statement as soon as practicable
covering a period of twelve consecutive calendar months beginning after the
effective date of the Registration Statement, which will satisfy the
provisions of the last paragraph of Section 11(a) of the Act and Rule 158
promulgated thereunder.
(f) During such period as a prospectus is required by law to be
delivered in connection with sales by an Underwriter or dealer, the Company
will furnish to the Representatives, at the expense of the Company, copies
of the Registration Statement, the Prospectus, any Preliminary Prospectus
and all amendments and supplements to any such documents in each case as
soon as available and in such quantities as the Representatives may
reasonably request.
(g) The Company will apply the net proceeds from the sale of the
Shares to be sold by it hereunder for the purposes set forth in the
Prospectus.
(h) The Company will cooperate with the Representatives and counsel
to the Underwriters in qualifying or registering the Shares for sale under
the Blue Sky Laws of such jurisdictions as the Representatives designates,
and will continue such qualifications or registrations in effect so long as
reasonably requested by the Representatives to effect the distribution of
the Shares. The Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any such
jurisdiction where it is not presently qualified. In each jurisdiction
where any of the Shares shall have been qualified as provided above, the
Company will file such reports and statements as may be required to
continue such qualification for a period of not less than one year from the
date of the Prospectus. The Company shall promptly prepare and file with
the Commission, from time to time, such reports as may be required to be
filed by the Act and the Exchange Act, and the Company shall comply in all
respects with the undertakings given by the Company in connection with the
qualification or registration of the Shares for offering and sale under the
Blue Sky Laws.
(i) During the period of three years from the date of the Prospectus,
the Company will furnish to each of the Representatives and to each of the
other Underwriters who may so request, as soon as available, each report,
statement or other document of the Company or its Board of Directors mailed
to its stockholders or filed
-18-
with the Commission, and such other information concerning the Company as
the Representatives may reasonably request.
(j) The Company shall deliver the requisite notice of issuance to
Nasdaq and shall take all necessary or appropriate action within its power
to maintain the authorization for trading of the Common Stock as a Nasdaq
National Market security, or take such action to authorize the Common Stock
for listing on the New York Stock Exchange or the American Stock Exchange,
for a period of at least thirty-six months after the date of the
Prospectus.
(k) Except for the issuance and sale by the Company of Common Stock
upon exercise of presently existing outstanding stock options, the sale of
the Shares to be sold by the Company pursuant to this Agreement, and the
grant of employee stock options pursuant to the Company's Stock Option
Plan, a copy of which is filed as an exhibit to the Registration Statement,
and provided that none of such options shall be exercisable during the 180-
day period herein described, the Company shall not, for a period of 180
days after the date of the Prospectus, without the prior written consent of
Xxxxx, directly or indirectly, offer, sell or otherwise dispose of,
contract to sell or otherwise dispose of, or cause or in any way permit to
be sold or otherwise disposed of, any: (i) shares of Common Stock; (ii)
rights to purchase shares of Common Stock; or (iii) securities that are
convertible or exchangeable into shares of Common Stock.
(l) The Company will maintain a transfer agent and, if required by
law or the rules of The Nasdaq Stock Market or any national securities
exchange on which the Common Stock is listed, a registrar (which, if
permitted by applicable laws and rules, may be the same entity as the
transfer agent) for its Common Stock. The Company shall, as soon as
practicable after the date hereof, use its best efforts to obtain listing
in Standard and Poor's Stock Guide, or such other recognized securities
manuals for which it may qualify for listing, and the Company shall use its
best efforts to maintain such listings for at least five years after the
First Closing Date.
(m) If at any time when a prospectus relating to the Shares is
required to be delivered under the Act, any rumor, publication or event
relating to of affecting the Company shall occur as a result of which, in
the opinion of Xxxxx, the market price of the Common Stock has been or is
likely to be materially affected (regardless of whether such rumor,
publication or event necessitates a supplement to the Prospectus), the
Company will, after written notice from Xxxxx advising the Company of any
of the matters set forth above, promptly consult with Xxxxx concerning the
advisability and substance of, and, if the Company and Xxxxx determine that
it is appropriate, disseminate, a press release or other public statement
responding to or commenting on, such rumor, publication or event.
(n) If the sale to the Underwriters of the Shares is not consummated
for any reason other than termination of this Agreement pursuant to section
13 hereof, without limiting any other rights the Underwriters may have, the
Company agrees to reimburse the Underwriters upon demand for all out-of-
pocket expenses (including reasonable fees and expenses of counsel for the
Underwriters), that shall have been incurred by the
-19-
Underwriters in connection with the proposed purchase and sale of the
Shares, and the provisions of sections 9 and 12 hereof shall at all times
be effective and apply.
(o) The Company will comply or cause to be complied with the
conditions to the obligations of the Underwriters in section 10 hereof.
SECTION 8. Covenants of the Selling Stockholder. The Selling
------------------------------------
Stockholder covenants and agrees with the several Underwriters and the Company
as follows:
(a) If the effective time of the Registration Statement is not prior
to the execution and delivery of this Agreement, the Selling Stockholder
will cooperate to the extent necessary to cause the Registration Statement
to become effective at the earliest possible time; and the Selling
Stockholder will do and perform all things to be done and performed by the
Selling Stockholder prior to each Closing Date, as prescribed pursuant to
this Agreement or the Power of Attorney and the Custody Agreement.
(b) The Selling Stockholder agrees to deliver to the Custodian on or
prior to the First Closing Date a properly completed and executed United
States Treasury Department Form W-9 (or other applicable substitute form or
statement specified by Treasury Department regulations in lieu thereof).
(c) The Selling Stockholder will pay all federal and other taxes, if
any, on the transfer or sale of the Shares being sold by the Selling
Stockholder to the Underwriters.
(d) The Selling Stockholder hereby agrees that the Selling
Stockholder will not, directly or indirectly, offer to sell, contract to
sell, or otherwise sell, dispose of, loan, pledge or grant any rights with
respect to (collectively, a "Disposition") any shares of Common Stock, any
options or warrants to purchase any shares of Common Stock or any
securities convertible into or exchangeable for shares of Common Stock
(collectively, "Securities") now owned or hereafter acquired directly by
the Selling Stockholder or with respect to which the Selling Stockholder
has or hereafter acquires the power of disposition, otherwise than (i) as a
bona fide gift or gifts, provided the donee or donees thereof agree in
writing to be bound by this restriction, (ii) as a distribution to partners
or shareholders of the Selling Stockholder, provided that the distributees
thereof agree in writing to be bound by the terms of this restriction,
(iii) with respect to Dispositions of Common Stock acquired on the open
market, (iv) with respect to sales or purchases of Common Stock acquired on
the open market or (v) with the prior written consent of Xxxxx, for a
period commencing on the date hereof and continuing to a date 180 days
after the date of the final prospectus for the Offering (the "Lock-up
Period"). The foregoing restriction has been expressly agreed to preclude
the holder of the Securities from engaging in any hedging or other
transaction which is designed to or reasonably expected to lead to or
result in a Disposition of Securities during the Lock-up Period, even if
such Securities would be disposed of by someone other than such holder.
Such prohibited hedging or other transactions would include, without
limitation, any short sale (whether or not against the box) or any
purchase, sale or grant of any right (including, without limitation, any
put or call option) with respect to any Securities or with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or
-20-
derives any significant part of its value from Securities. The Selling
Stockholder also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of Securities held by the Selling Stockholder except in compliance
with the foregoing restrictions.
(e) The Selling Stockholder will furnish any documents, instruments
or other information which the Representatives may reasonably request in
connection with the sale and transfer of the Shares to the Underwriters.
SECTION 9. Payment of Expenses. Whether or not the transactions
-------------------
contemplated hereunder are consummated or this Agreement becomes effective, or
if this Agreement is terminated for any reason, the Company will pay its pro
rata share of the costs, fees and expenses incurred in connection with the
public offering of the Shares. Such costs, fees and expenses to be paid by the
Company include, without limitation:
(a) All costs, fees and expenses (excluding the expenses incurred by
the Underwriters and the legal fees and disbursements of counsel for the
Underwriters, but including such fees and disbursements described in
subsection (b) of this section 9) incurred in connection with the
performance of the Company's obligations hereunder, including without
limiting the generality of the foregoing: the registration fees related to
the filing of the Registration Statement with the Commission; the fees and
expenses related to the quotation or listing of the Shares on Nasdaq or
other national securities exchange; the fees and expenses of the Company's
counsel, accountants, transfer agent and registrar; the fees and expenses
of Xxxxxx Xxxxxx LLP, counsel to the Selling Stockholder, not to exceed
$15,000; the costs and expenses incurred in connection with the
preparation, printing, shipping and delivery of the Registration Statement,
each Preliminary Prospectus and the Prospectus (including all exhibits and
financial statements) and all agreements and supplements provided for
herein, this Agreement and the Preliminary and Supplemental Blue Sky
Memoranda and the Power of Attorney and the Custody Agreement, including,
without limitation, shipping expenses via overnight delivery and/or courier
service to comply with applicable prospectus delivery requirements; and the
costs and expenses associated with the production of materials related to,
and travel expenses incurred by the management of the Company in connection
with, the various meetings to be held between the Company's management and
prospective investors.
(b) All registration fees and expenses, including legal fees and
disbursements of counsel for the Underwriters incurred in connection with
qualifying or registering all or any part of the Shares for offer and sale
under the Blue Sky Laws and the clearing of the public offering and the
underwriting arrangements evidenced hereby with the NASD.
(c) All fees and expenses related to printing of the certificates for
the Shares, and all transfer taxes, if any, with respect to the sale and
delivery of the Shares.
(d) All fees and expenses of, or incurred by, the Attorneys-in-Fact
or the Custodian and under the Power of Attorney and the Custody Agreement.
-21-
(e) All federal and other taxes, if any, on the transfer or sale of
the Shares being sold by the Selling Stockholder to the Underwriters.
All costs and expenses incurred by the Selling Stockholder in the performance of
its obligations hereunder which are not otherwise specifically provided for in
this section will be borne and paid solely by the Selling Stockholder. In the
event the Selling Stockholder shall fail to pay the Selling Stockholder's costs,
fees and expenses described in this section within five days after demand by the
Representatives therefor, the Company shall be obligated to pay such costs, fees
and expenses on demand.
SECTION 10. Conditions to the Obligations of the Underwriters. The
-------------------------------------------------
obligations of the several Underwriters under this Agreement shall be subject to
the accuracy of the representations and warranties on the part of the Company
and the Selling Stockholder herein set forth as of the date hereof and as of
each Closing Date, to the accuracy of the statements of the Company's officers,
the Selling Stockholder and the Attorneys-in-Fact on behalf of the Selling
Stockholder made pursuant to the provisions hereof, to the performance by the
Company and the Selling Stockholder of their respective obligations hereunder,
and to the following additional conditions, unless waived in writing by the
Representatives:
(a) The Registration Statement shall have been declared effective by
the Commission not later than 5:30 p.m., Washington, D. C. time, prior to
the date of this Agreement, or such later time as shall have been consented
to by the Representatives, which consent shall be deemed to have been given
if the Registration Statement shall have been declared effective on or
before the date and time requested in the acceleration request submitted on
behalf of the Representatives pursuant to Rule 461 under the Act; all
filings required by Rules 424(b) and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the Registration
Statement shall have been issued by the Commission or any state securities
commission nor, to the knowledge of the Company shall any proceedings for
that purpose have been initiated or threatened; and any request of the
Commission or any state securities commission for inclusion of additional
information in the Registration Statement, or otherwise, shall have been
complied with to the satisfaction of the Representatives.
(b) Since the dates as of which information is given in the
Registration Statement:
(i) there shall not have occurred any change or development
involving, or which could be expected to involve, a Material Adverse
Effect, whether or not arising from transactions in the ordinary
course of business; and
(ii) the Company shall not have sustained any loss or
interference from any labor dispute, strike, fire, flood, windstorm,
accident or other calamity (whether or not insured) or from any court
or governmental action, order or decree, the effect of which on the
Company, in any such case described in clause (i) or (ii) above, is in
the opinion of the Representatives so material and adverse as to make
it impracticable or inadvisable to proceed with the public offering or
the
-22-
delivery of the Shares on the terms and in the manner contemplated in
the Registration Statement and the Prospectus.
(c) The Representatives shall not have advised the Company that the
Registration Statement or the Prospectus contains an untrue statement of
fact that, in the opinion of the Representatives or counsel for the
Underwriters, is material, or omits to state a fact that, in the opinion of
the Representatives or such counsel, is material and is required to be
stated therein or necessary to make the statements therein not misleading.
(d) The Representatives shall have received an opinion of Xxxxxx
Godward LLP, counsel for the Company addressed to the Representatives, as
the representatives of the Underwriters, and dated the First Closing Date
or the Second Closing Date, as the case may be, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with corporate power and authority
to own, lease and operate its properties and conduct its business as
described in the Prospectus; the Company is duly qualified to do
business as a foreign corporation and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or
the conduct of its business requires such qualification except where
the failure to be so qualified would not have a Material Adverse
Effect;
(ii) The authorized capital stock of the Company consists of
100,000,000 shares of Common Stock, par value $.0001 per share, and
5,000,000 shares of Preferred Stock, par value $.0001 per share, and
all such stock conforms as to legal matters to the descriptions
thereof in the Prospectus and the Registration Statement;
(iii) The issued and outstanding shares of capital stock of the
Company immediately prior to the issuance and sale of the Shares have
been duly and validly issued, are fully paid and nonassessable, and
there are no preemptive, preferential or, to such counsel's knowledge
and except as described in the Prospectus, other similar rights, and
to such counsel's knowledge, no shares of capital stock of the Company
have been issued in violation of such rights;
(iv) Except for the Subsidiaries, the Company has no
subsidiaries, and the Company does not own any equity interest in or
control, directly or indirectly, any other corporation, limited
liability company, partnership, joint venture, association, trust or
other business organization except as described in the Prospectus and
the Registration Statement; TriNet Employer Group, Inc., a California
corporation (the "Major Subsidiary") has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation, with corporate power and authority
to own, lease and operate its properties and to conduct its business
as described in the Prospectus and the Registration Statement. The
Major Subsidiary is duly registered or qualified to do business as a
foreign corporation under the laws of, and is in good standing as
-23-
such in, each jurisdiction in which such registration or qualification
is required, except where the failure to so register or qualify would
not have a Material Adverse Effect. The issued and outstanding shares
of the capital stock of the Major Subsidiary have been duly and
validly issued, are fully paid and nonassessable and there are no
preemptive, preferential or, to such counsel's knowledge, other rights
to subscribe for or purchase any shares of capital stock of the Major
Subsidiary, and to such counsel's knowledge, no shares of capital
stock of the Major Subsidiary have been issued in violation of such
rights; the Company owns directly and, to such counsel's knowledge,
beneficially all of the issued and outstanding capital stock of the
Major Subsidiary, free and clear of any and all liens, claims,
encumbrances and security interests;
(v) The certificates for the Shares to be delivered hereunder
are valid as to form under the General Corporation Law of the State of
Delaware; and the Shares to be sold by the Company pursuant to the
terms of this Agreement have been duly authorized and, upon issuance
and delivery against payment therefor in accordance with the
provisions of this Agreement, will be duly and validly issued, fully
paid and nonassessable, and free of any preemptive, preferential, co-
sale, first refusal or other similar rights;
(vi) The Registration Statement was declared effective under the
Act, and to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or are threatened
under the Act or any Blue Sky Laws; the Registration Statement and the
Prospectus derived therefrom and contained therein (except for the
financial statements schedules, related notes, and other financial
data and statistical data derived therefrom and contained therein as
to which such counsel need express no opinion) comply as to form in
all material respects with the requirements of the Act; to such
counsel's knowledge, there are no legal or governmental proceedings
pending or threatened required to be described in the Registration
Statement or the Prospectus by the Act which are not so described or
which question the validity of this Agreement or any action taken or
to be taken pursuant thereto, nor is there any transaction,
relationship, agreement, contract or other document that are required
by the Act to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement,
which is not so described or filed;
(vii) The Company has the corporate power and authority to enter
into and perform this Agreement; this Agreement has been duly
authorized, executed and delivered by and on behalf of the Company,
and assuming due authorization, execution and delivery by the
Representatives, is a valid and binding agreement of the Company
enforceable against the Company in accordance with its terms, except
as rights to indemnification or contribution may be limited by
applicable law and except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights, and subject to general equity principles
and to limitations on availability of equitable relief, including
specific performance; no consent, approval, authorization or other
order
-24-
or decree of any court, arbitrator, governmental body or agency having
jurisdiction over the Company is required for the performance by the
Company of its obligations under this Agreement, except such as (i)
have been obtained under the Act, (ii) may be required under Blue Sky
Laws in connection with the purchase and the distribution of the
Shares by the Underwriters, as to which such counsel need express no
opinion, and (iii) may be required under the federal or provincial
laws of Canada;
(viii) The execution, delivery and performance of this Agreement
by the Company (other than performance of the Company's
indemnification and contribution obligations hereunder, as to which
such counsel need express no opinion) will not: (A) violate any
provisions of the Certificate of Incorporation or By-laws of the
Company or the Major Subsidiary; (B) materially violate any provisions
of, or result in the breach, modification or termination of, or
constitute a default under, any agreement, evidence of indebtedness or
other instrument to which the Company or the Major Subsidiary is a
party or by which such party is bound or to which any of their
respective properties is subject, and which is filed as an exhibit to
the Registration Statement; or (C) materially violate any statute,
rule, or regulation known to such counsel of any court, arbitrator,
governmental body or agency having jurisdiction over the Company or
the Major Subsidiary;
(ix) To such counsel's knowledge, except as described in the
Prospectus, there are no holders of Common Stock or other securities
of the Company, or securities that are convertible or exchangeable
into Common Stock or other securities of the Company, that have rights
to the registration of such securities and, except as set forth in the
Prospectus, all holders of securities of the Company having rights
known to such counsel to registration of such securities, because of
the filing of the Registration Statement by the Company, have, with
respect to the offering contemplated thereby, waived such rights or
such rights have expired by reason of lapse of time following
notification of the Company's intent to file the Registration
Statement or the Company has included securities in the Registration
Statement pursuant to the exercise of such rights;
(x) The Common Stock has been designated for inclusion as a
National Market security on The Nasdaq Stock Market and is registered
under the Exchange Act;
(xi) Neither the Company nor any Subsidiary is, nor with the
giving of notice or passage of time or both would be, (x) in violation
of its respective Certificate of Incorporation or By-laws, or (y) to
such counsel's knowledge, in default in any material respect in the
performance of any agreement, lease, franchise, license, permit,
mortgage, deed of trust, evidence of indebtedness or other instrument,
or any other document that is filed as an exhibit to the Registration
Statement, to which the Company or any Subsidiary is subject or bound;
-25-
(xii) Neither the Company nor any Subsidiary is an "investment
company" as such term is defined in the Investment Company Act of
1940, as amended and, upon its receipt of any proceeds from the sale
of the Shares, neither the Company nor any Subsidiary will be required
to register as an Investment Company thereunder;
(xiii) The information in the Prospectus under the caption
"Description of Capital Stock," to the extent that it constitutes
matters of law or legal conclusions, has been reviewed by us and is a
fair summary of such matters and conclusions; and the forms of
certificates evidencing the Common Stock and filed as exhibits to the
Registration Statement comply with Delaware law;
(xiv) The description in the Registration Statement and the
Prospectus of the charter and bylaws of the Company, the Delaware
General Corporation Law, the Internal Revenue Code, Rule 144 and 701
and other provisions of and rules under the Securities Act of 1933 and
the Securities Exchange Act of 1934 (the "designated statutes"),
insofar as they purport to describe the provisions of such documents
and statutes, fairly and correctly present, in all material respects,
the information required to be included therein by the Act;
(xv) All offers and sales by the Company of its capital stock
before the date hereof were at all relevant times duly registered
under or exempt from the registration requirements of the Act, and
were duly registered under or the subject of an available exemption
from the registration requirements of any applicable Blue Sky Laws;
(xvi) The execution and delivery of the documents effecting the
Restructuring (the "Restructuring Documents") have been duly
authorized by all necessary corporate action on the part of each of
the Company and the California Corporation;
(xvii) Each of the California Corporation and the Company had
all corporate power and authority necessary to execute and deliver the
Restructuring Documents and to consummate the Restructuring
contemplated by the Restructuring Documents, and the Restructuring
Documents at the time of execution and immediately prior to the
effectiveness of the Restructuring constituted a valid and binding
obligation of each of the California Corporation and the Company,
subject to the effect of (x) bankruptcy, insolvency, reorganization,
arrangement, moratorium, fraudulent transfer or other similar federal
or state laws affecting the rights of creditors and (y) to general
principles of equity; and
(xviii) The offer and sale of the Company's securities, including
without limitation, the Common Stock, Series A Preferred Stock, Series
B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock,
Series E Preferred Stock and Series F Preferred Stock, pursuant to the
terms of the Restructuring
-26-
Documents are exempt from the qualification requirements of the
California Corporate Securities Law of 1968, as amended.
During the course of the preparation of the Registration Statement, we
participated in conferences with you and with officers and other representatives
of the Company, its counsel and its independent public accountants at which the
contents of the Registration Statement and Prospectus were discussed. While we
have not independently verified and are not passing upon the accuracy
completeness or fairness of the statements made in the Registration Statement
and Prospectus, except as set forth in paragraph (vii) above, on the basis of
the foregoing, no facts have come to our attention that have caused us to
believe that the Registration Statement, as of the time it became effective,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus, as of its date or the date hereof,
contained or contains any untrue statement of a material fact or omitted or
omits to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
that we express no comment with respect to the financial statements and
schedules, related notes, other financial data and statistical data derived
therefrom included in the Registration Statement and Prospectus.
In rendering such opinion, counsel for the Company may rely, to the extent
counsel deems such reliance proper, as to matters of fact upon certificates of
officers of the Company and of governmental officials, and copies of all such
certificates shall be furnished to the Representatives and for the Underwriters
on or before each Closing Date.
(e) The Representatives shall have received an opinion from Xxxxxx
Xxxxxx LLP, counsel for the Selling Stockholder, dated the First Closing
Date or the Second Closing Date, as the case may be, to the effect that:
(i) Each of this Agreement, the Power of Attorney and the
Custody Agreement has been duly authorized, executed and delivered by
or on behalf of the Selling Stockholder and each such agreement
constitutes the valid and binding agreement of the Selling
Stockholder, enforceable in accordance with its respective terms,
except that rights to indemnity or contribution thereunder may be
limited by applicable law and except as enforceability of such
agreement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws generally affecting the rights of creditors
and by equitable principles limiting the right to specific performance
or other equitable relief;
-27-
(ii) The execution and delivery of this Agreement, the Power of
Attorney and the Custody Agreement and the consummation of the
transactions herein and therein contemplated will not, if applicable,
result in the violation of any provisions of the charter, bylaws or
other governing documents of the Selling Stockholder, or to our
knowledge, constitute a breach, or be in contravention, of any
provision of any agreement or other instrument to which the Selling
Stockholder is a party or by which the Selling Stockholder or the
Selling Stockholder's property may be bound or affected, or any
statute, rule or regulation applicable to the Selling Stockholder, or
violate any order or decree of any court governmental body or agency
having jurisdiction over the Selling Stockholder or any of the Selling
Stockholder's property, which violation would reasonably be expected
to have a material adverse effect on the condition (financial or
otherwise), business, properties, net worth or results of operations
of the Selling Stockholder;
(iii) The Selling Stockholder has the legal right, power and
authority, and has secured any consent, approval, authorization and
order required to enter into and perform this Agreement, the Power of
Attorney and the Custody Agreement and to sell, assign, transfer and
deliver title to the Shares to be sold by the Selling Stockholder as
provided herein; and upon delivery to the Underwriters or upon the
order of the Representatives against payment of the agreed
consideration therefor in accordance with the provisions of this
Agreement, the Underwriters will acquire good and marketable title to
the Shares to be sold hereunder by the Selling Stockholder, free and
clear of all voting trust arrangements, liens, encumbrances, security
interests, equities, claims and community or marital property rights;
and
(iv) To such counsel's knowledge, the information concerning the
Selling Stockholder contained in the Prospectus under the caption
"Principal and Selling Stockholder" complies in all material respects
with the Act.
In rendering such opinion, counsel for the Selling Stockholder may rely, to
the extent counsel deems such reliance proper, as to matters of fact upon a
certificate of the Selling Stockholder, and copies of such certificate shall be
furnished to the Representatives and counsel for the Underwriters on or before
each Closing Date.
(f) The Representatives shall have received an opinion of Xxxxxxx,
Phleger & Xxxxxxxx LLP, counsel for the Underwriters, dated the First
Closing Date or the Second Closing Date, as the case may be, with respect
to the issuance and sale of the Shares by the Company, the Registration
Statement and other related matters as the Representatives may require, and
the Company shall have furnished to such counsel such documents and shall
have exhibited to them such papers and records as they request for the
purpose of enabling them to pass upon such matters.
(g) The Representatives shall have received on each Closing Date, a
certificate of Xxxxxx Xxxxxxx, President and Chief Executive Officer, and
Xxxx X. Xxxxxx, Chief Financial Officer and Treasurer, of the Company, to
the effect that:
-28-
(i) The representations and warranties of the Company set forth in
section 2 hereof are true and correct as of the date of this Agreement and
as of the date of such certificate, and the Company has complied with all
the agreements and satisfied all the conditions to be performed or
satisfied by it at or prior to the date of such certificate;
(ii) The Commission has not issued an order preventing or suspending
the use of the Prospectus or any Preliminary Prospectus or any amendment or
supplement thereto; no stop order suspending the effectiveness of the
Registration Statement has been issued; and to the knowledge of the
respective signatories, no proceedings for that purpose have been initiated
or are pending or contemplated under the Act or under the Blue Sky Laws of
any jurisdiction;
(iii) Each of the respective signatories has examined the Registration
Statement and the Prospectus, and any amendment or supplement thereto, and
such documents contain all statements required by the Act to be stated
therein, and do not include any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and since the date on which the
Registration Statement was initially filed, no event has occurred that was
required to be set forth in an amended or supplemented prospectus or in an
amendment to the Registration Statement that has not been so set forth; and
(iv) Since the date on which the Registration Statement was initially
filed with the Commission, there shall not have occurred any change or
development involving, or which reasonably could be expected to involve, a
Material Adverse Effect, whether or not arising from transactions in the
ordinary course of business, except as disclosed in the Prospectus and the
Registration Statement as heretofore amended or (but only if the
Representatives expressly consent thereto in writing) as disclosed in an
amendment or supplement thereto filed with the Commission and delivered to
the Representatives after the execution of this Agreement; since such date
and except as so disclosed or in the ordinary course of business, the
Company has not incurred any liability or obligation, direct or indirect,
or entered into any transaction which is material to the Company; since
such date and except as so disclosed, there has not been any change in the
outstanding capital stock of the Company, or any change that is material to
the Company in the short-term debt or long-term debt of the Company; since
such date and except as so disclosed, the Company has not acquired any of
the Common Stock or other capital stock of the Company nor has the Company
declared or paid any dividend, or made any other distribution, upon its
outstanding Common Stock payable to stockholders of record on a date prior
to such Closing Date; since such date and except as so disclosed, the
Company has not incurred any material contingent obligations, and no
material litigation is pending or threatened against the Company; and,
since such date and except as so disclosed, the Company has not sustained
any material loss or interference from any strike, fire, flood, windstorm,
accident or other calamity (whether or not insured) or from any court or
governmental action, order or decree.
-29-
The delivery of the certificate provided for in this subsection (g)
shall be and constitute a representation and warranty of the Company as to
the facts required in the immediately foregoing clauses (i), (ii), (iii)
and (iv) to be set forth in said certificate.
(h) The Representatives shall have received a certificate from the
Selling Stockholder (which may be signed by the Selling Stockholder's
Attorneys-in-Fact, or either of them), dated the First Closing Date or the
Second Closing Date, as the case may be, to the effect that: (i) the
representations and warranties of the Selling Stockholder in Section 3 of
this Agreement are true and correct as of the date of this Agreement and as
of the date of such certificate, as if again made on and as of such Closing
Date, and the Selling Stockholder has complied with all of the agreements
and satisfied all of the conditions to be performed or satisfied by the
Selling Stockholder at or prior to such Closing Date; and (ii) the Selling
Stockholder has no reason to believe that the Selected Provisions of the
Registration Statement or any amendment thereto at the time it was declared
effective by the Commission 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
Selected Provisions of the Prospectus, as amended or supplemented, contains
any untrue statement of a material fact 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.
(i) At the time this Agreement is executed and also on each Closing
Date, there shall be delivered to the Representatives a letter addressed to
the Representatives, as representatives of the Underwriters, from Ernst &
Young LLP, the Company's independent accountants, the first letter to be
dated the date of this Agreement, the second letter to be dated the First
Closing Date and the third letter (if applicable) to be dated the Second
Closing Date, which shall be in form and substance satisfactory to the
Representatives and shall contain information as of a date within five days
of the date of such letter. There shall not have been any change or
decrease set forth in any of the letters referred to in this subsection (i)
which makes it impracticable or inadvisable in the judgment of the
Representatives to proceed with the public offering or purchase of the
Shares as contemplated hereby.
(j) The Shares shall have been qualified or registered for sale under
the Blue Sky Laws of such jurisdictions as shall have been specified by the
Representatives, the underwriting terms and arrangements for the offering
shall have been cleared by the NASD, and the Common Stock shall have been
designated for inclusion as a Nasdaq National Market security on the Nasdaq
Stock Market and shall have been registered under the Exchange Act.
(k) Such further certificates and documents as the Representatives
may reasonably request (including certificates of officers of the Company).
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are satisfactory to the
Representatives and to Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, counsel for the
Underwriters. The Company and the Selling Stockholder shall
-30-
furnish the Representatives with such manually signed or conformed copies of
such opinions, certificates, letters and documents as the Representatives may
reasonably request.
If any condition to the Underwriters' obligations hereunder to be
satisfied prior to or at either Closing Date is not so satisfied, this Agreement
at the election of the Representatives will terminate upon notification to the
Company and the Attorneys-in-Fact, or any one of them, for the Selling
Stockholder without liability on the part of any Underwriter, including the
Representatives, the Company or the Selling Stockholder except for the
provisions of section 7(n) hereof, the expenses to be paid by the Company and
the Selling Stockholder pursuant to section 9 hereof and except to the extent
provided in section 12 hereof.
SECTION 11. Maintain Effectiveness of Registration Statement. The
------------------------------------------------
Company will use its best efforts to prevent the issuance of any stop order
suspending the effectiveness of the Registration Statement, and, if such stop
order is issued, to obtain as soon as possible the lifting thereof.
SECTION 12. Indemnification.
---------------
(a) The Company subject to the last paragraph of this Section 12,
agrees to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of the Act or the
Exchange Act, from and against any losses, claims, damages, expenses,
liabilities or actions in respect thereof ("Claims"), joint or several, to
which such Underwriter or each such controlling person may become subject
under the Act, the Exchange Act, Blue Sky Laws or other federal or state
statutory laws or regulations, at common law or otherwise (including
payments made in settlement of any litigation), insofar as such Claims
arise out of or are based upon any breach of any representation, warranty
or covenant made by the Company in this Agreement, or any untrue statement
or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or in any application filed under any Blue
Sky Law or other document executed by the Company for that purpose or based
upon written information furnished by the Company and filed in any state or
other jurisdiction to qualify any or all of the Shares under the securities
laws thereof (any such document, application or information being
hereinafter called a "Blue Sky Application") or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading. The Company subject to the last paragraph of this Section
12, agrees to reimburse each Underwriter and each such controlling person
for any legal fees or other expenses incurred by such Underwriter or any
such controlling person in connection with investigating or defending any
such Claim; provided, however, that the Company will not be liable in any
such case to the extent that: (i) any such Claim arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus,
the Prospectus or supplement thereto or in any Blue Sky Application in
reliance upon and in conformity with the written information furnished to
the Company pursuant to section 5 of this Agreement; or (ii) such statement
or omission was contained or made in any Preliminary Prospectus and
corrected in the Prospectus and (1) any such Claim suffered or incurred
-31-
by any Underwriter (or any person who controls any Underwriter) resulted
from an action, claim or suit by any person who purchased Shares which are
the subject thereof from such Underwriter in the offering, and (2) such
Underwriter failed to deliver or provide a copy of the Prospectus to such
person at or prior to the confirmation of the sale of such Shares in any
case where such delivery is required by the Act, unless such failure was
due to failure by the Company to provide copies of the Prospectus to the
Underwriters as required by this Agreement. The indemnification obligations
of the Company as provided above are in addition to and in no way limit any
liabilities the Company may otherwise have.
(b) The Selling Stockholder agrees to indemnify and hold harmless
each Underwriter and each controlling person from and against any Claims to
which such Underwriter or each such controlling person may become subject
under the Act, the Exchange Act, Blue Sky Laws or other federal or state
statutory laws or regulations, at common law or otherwise (including
payments made in settlement of any litigation), insofar as such Claims
arise out of or are based upon any breach of any representations, warranty
or covenant made by the Selling Stockholder in this Agreement.
(c) Each Underwriter, severally and not jointly, will indemnify and
hold harmless the Company, each of its directors and each of its officers
who signs the Registration Statement, and each person, if any, who controls
the Company within the meaning of the Act or the Exchange Act, and the
Selling Stockholder against any Claim to which the Company, or any such
director, officer, controlling person, or Selling Stockholder may become
subject under the Act, the Exchange Act, Blue Sky Laws or other federal or
state statutory laws or regulations, at common law or otherwise (including
payments made in settlement of any litigation, if such settlement is
effected with the written consent of such Underwriter and Xxxxx), insofar
as such Claim arises out of or is based upon any untrue or alleged untrue
statement of any material fact contained in the Registration Statement, any
Preliminary Prospectus, the Prospectus, or any amendment or supplement
thereto, or in any Blue Sky Application, or arises out of or is based upon
the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto, or in
any Blue Sky Application, in reliance solely upon and in conformity with
the written information furnished by the Representatives to the Company
pursuant to section 5 of this Agreement. Each Underwriter will severally
reimburse any legal fees or other expenses incurred by the Company, or any
such director, officer, controlling person, or Selling Stockholder in
connection with investigating or defending any such Claim, and from any and
all Claims resulting from failure of an Underwriter to deliver a
Prospectus, if the person asserting such Claim purchased Shares from such
Underwriter and a copy of the Prospectus (as then amended if the Company
shall have furnished any amendments thereto) was not sent or given by or on
behalf of such Underwriter to such person, if required by law so to have
been delivered, at or prior to the written confirmation of the sale of the
Shares to such person, and if the Prospectus (as so amended) would have
cured the defect giving rise to such Claim. The indemnification obligations
of each Underwriter as provided above are
-32-
in addition to any liabilities any such Underwriter may otherwise have.
Notwithstanding the provisions of this section, no Underwriter shall be
required to indemnify or reimburse the Company, or any officer, director,
controlling person, or Selling Stockholder in an aggregate amount in excess
of the total price at which the Shares purchased by any such Underwriter
hereunder were offered to the public, less the amount of any damages such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
(d) Promptly after receipt by an indemnified party under this section
of notice of the commencement of any action in respect of a Claim, such
indemnified party will, if a Claim in respect thereof is to be made against
an indemnifying party under this section, notify the indemnifying party in
writing of the commencement thereof, but the omission so to notify the
indemnifying party will not relieve an indemnifying party from any
liability it may have to any indemnified party under this section or
otherwise. In case any such action is brought against any indemnified
party, and such indemnified party notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate in and, to the extent that he, she or it may wish, jointly with
all other indemnifying parties, similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party;
provided, however, if the defendants in any such action include both the
indemnified party and any indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses available
to the indemnified party and/or other indemnified parties which are
different from or additional to those available to any indemnifying party,
the indemnified party or parties shall have the right to select separate
counsel to assume such legal defenses and to otherwise participate in the
defense of such action on behalf of such indemnified party or parties.
(e) Upon receipt of notice from the indemnifying party to such
indemnified party of the indemnifying party's election to assume the
defense of such action and upon approval by the indemnified party of
counsel selected by the indemnifying party, the indemnifying party will not
be liable to such indemnified party under this section for any legal fees
or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless:
(i) the indemnified party shall have employed separate counsel
in connection with the assumption of legal defenses in accordance with
the proviso to the last sentence of subsection (e) of this section (it
being understood, however, that the indemnifying party shall not be
liable for the legal fees and expenses of more than one separate
counsel, approved by Xxxxx, if one or more of the Underwriters or
their controlling persons are the indemnified parties);
(ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after the indemnified
party's notice to the indemnifying party of commencement of the
action; or
-33-
(iii) the indemnifying party has authorized the employment of
counsel at the expense of the indemnifying party.
(f) If the indemnification provided for in this section is
unavailable to an indemnified party under subsection (a), (b), (c) or (d)
hereof in respect of any Claim referred to therein, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall, subject to
the limitations hereinafter set forth, contribute to the amount paid or
payable by such indemnified party as a result of such Claim:
(i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, the Selling Stockholder and the
Underwriters from the offering of the Shares; or
(ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i)
above, but also the relative fault of the Company, the Selling
Stockholder and the Underwriters in connection with the statements or
omissions which resulted in such Claim, as well as any other relevant
equitable considerations.
The relative benefits received by each of the Company, the Selling
Stockholder and the Underwriters shall be deemed to be in such proportion so
that the Underwriters are responsible for that portion represented by the
percentage that the amount of the underwriting discounts and commissions per
share appearing on the cover page of the Prospectus bears to the public offering
price per share appearing thereon, and the Company (including its officers and
directors and controlling persons) and the Selling Stockholder are responsible
for the remaining portion. The relative fault of the Company, the Selling
Stockholder and the Underwriters shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the Selling Stockholder or the Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid
or payable by a party as a result of the Claims referred to above shall be
deemed to include, subject to the limitations set forth in subsections (e) and
(f) of this section, any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action or claim.
(g) The Company, the Selling Stockholder and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this
section were determined by pro rata or per capita allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method or allocation which does not take into account the equitable
considerations referred to in subsection (f) of this section.
Notwithstanding the other provisions of this section, no Underwriter shall
be required to contribute any amount that is greater than the amount by
which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of section 11(f) of the
-34-
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this section are several in proportion to their
respective underwriting commitments and not joint.
(h) Notwithstanding any provision in this Agreement or any other
agreement to the contrary, nothing herein shall limit, restrict or
supersede the indemnification provisions in favor of the Selling
Stockholder (and its partners, officers, directors, and other persons and
entities named therein (the "Related Parties")) provided in that certain
Amended and Restated Investor's Rights Agreement, dated as of March 2,
2000, by and among the Company, the Selling Stockholder, Bessemer Venture
Partners V L.P., Bessec Ventures V L.P. and BVE LLC, and the liability of
the Selling Stockholder arising under this section 12 shall not exceed the
purchase price received by the Selling Stockholder from the Underwriters
for the Shares sold by the Selling Stockholder.
SECTION 13. Default of Underwriters. It shall be a condition to the
-----------------------
obligations of each Underwriter to purchase the Shares in the manner as
described herein, that, except as hereinafter provided in this section, each of
the Underwriters shall purchase and pay for all the Shares agreed to be
purchased by such Underwriter hereunder upon tender to the Representatives of
all such Shares in accordance with the terms hereof. If any Underwriter or
Underwriters default in their obligations to purchase Shares hereunder on either
the First Closing Date or the Second Closing Date and the aggregate number of
Shares which such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed ten percent (10%) of the total number of Shares which
the Underwriters are obligated to purchase on such Closing Date, the
Representatives may make arrangements for the purchase of such Shares by other
persons, including any of the Underwriters, but if no such arrangements are made
by such Closing Date the nondefaulting Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the Shares which such defaulting Underwriters agreed but failed to purchase on
such Closing Date. If any Underwriter or Underwriters so default and the
aggregate number of Shares with respect to which such default or defaults occur
is greater than ten percent (10%) of the total number of Shares which the
Underwriters are obligated to purchase on such Closing Date, and arrangements
satisfactory to the Representatives for the purchase of such Shares by other
persons are not made within thirty-six hours after such default, this Agreement
will terminate without liability on the part of any nondefaulting Underwriter,
the Company or the Selling Stockholder except for the expenses to be paid by the
Company and the Selling Stockholder pursuant to section 9 hereof and except to
the extent provided in section 12 hereof.
In the event that Shares to which a default relates are to be
purchased by the nondefaulting Underwriters or by another party or parties, the
Representatives shall have the right to postpone the First Closing Date or the
Second Closing Date, as the case may be, for not more than seven business days
in order that the necessary changes in the Registration Statement, Prospectus
and any other documents, as well as any other arrangements, may be effected. As
used in this Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
-35-
SECTION 14. Effective Date. This Agreement shall become effective
--------------
upon the execution and delivery of this Agreement by the parties hereto. Such
execution and delivery shall include an executed copy of this Agreement sent by
telecopier, facsimile transmission or other means of transmitting written
documents.
SECTION 15. Termination. Without limiting the right to terminate
-----------
this Agreement pursuant to any other provision hereof, this Agreement may be
terminated by the Representatives prior to or on the First Closing Date and the
over-allotment option from the Company referred to in section 6 hereof, if
exercised, may be cancelled by the Representatives at any time prior to or on
the Second Closing Date, if in the judgment of the Representatives, payment for
and delivery of the Shares is rendered impracticable or inadvisable because:
(a) additional governmental restrictions, not in force and effect on
the date hereof, shall have been imposed upon trading in securities
generally or minimum or maximum prices shall have been generally
established on the New York Stock Exchange or the American Stock Exchange,
or trading in securities generally shall have been suspended or materially
limited on either such exchange or on The Nasdaq Stock Market or a general
banking moratorium shall have been established by either federal or state
authorities in New York, California or Wisconsin;
(b) any event shall have occurred or shall exist which makes untrue
or incorrect in any material respect any statement or information contained
in the Registration Statement or which is not reflected in the Registration
Statement but should be reflected therein to make the statements or
information contained therein not misleading in any material respect; or
(c) an outbreak or escalation of hostilities or other national or
international calamity or any substantial change in political, financial or
economic conditions shall have occurred or shall have accelerated to such
extent, in the judgment of the Representatives, as to have a material
adverse effect on the financial markets of the United States, or to make it
impracticable or inadvisable to proceed with completion of the sale of and
payment for the Shares as provided in this Agreement.
Any termination pursuant to this Section shall be without liability on
the part of any Underwriter to the Company or the Selling Stockholder, or on the
part of the Company or the Selling Stockholder to any Underwriter, except for
expenses to be paid by the Company and the Selling Stockholder pursuant to
section 9 hereof or reimbursed by the Company pursuant to section 7(n) hereof
and except as to indemnification to the extent provided in section 12 hereof.
SECTION 16. Representations and Indemnities to Survive Delivery. The
---------------------------------------------------
respective indemnities, agreements, representations, warranties, covenants and
other statements of the Company, of its officers or directors, of the Selling
Stockholder, and of the several 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, the Selling Stockholder
or the Company or any of its or their partners, officers, directors or any
controlling person, as the case may be, and will survive delivery of and payment
for the Shares sold hereunder.
-36-
SECTION 17. Notices. All communications hereunder will be in
-------
writing and, if sent to the Representatives, will be mailed, delivered,
telecopied (with receipt confirmed) or telegraphed and confirmed to Xxxxxx X.
Xxxxx & Co. Incorporated at 000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx
00000, Attention: Xxxxxx X. Xxxx, Associate, with a copy to Xxxxx X. Xxxxxx,
Esq., Xxxxxxx, Phleger & Xxxxxxxx LLP, 00 Xxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx
00000, and if sent to the Company, will be mailed, delivered, telecopied (with
receipt confirmed) or telegraphed and confirmed to the Company at 000 Xxxxxx
Xxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxx Xxxxxxx, with a copy to
Xxxxxx Godward LLP, Xxxxxxxxxxx Xxxxxxxx, Esq., Xxx Xxxxxxxx Xxxxx, 00xx Xxxxx,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-0000; and, if sent to the Selling Stockholder,
will be mailed, delivered, telecopied (with receipt confirmed) or telegraphed
and confirmed to the Attorneys-in-Fact, or either of them, in care of the
Company, with copies to Xxxxxx Xxxxxx LLP, 000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxx.
SECTION 18. Successors. This Agreement will inure to the benefit
----------
of and be binding upon the parties hereto and their respective successors,
personal representatives and assigns, and to the benefit of the officers and
directors and controlling persons referred to in section 12 hereof and no other
person will have any right or obligation hereunder. The term "successors" shall
not include any purchaser of the Shares as such from any of the Underwriters
merely by reason of such purchase.
SECTION 19. Partial Unenforceability. If any section, paragraph,
------------------------
clause or provision of this Agreement is for any reason determined to be invalid
or unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph clause or provision hereof.
SECTION 20. Applicable Law; Counterparts. This Agreement shall be
----------------------------
governed by and construed in accordance with the internal laws of the State of
Wisconsin without reference to conflict of law principles thereunder. This
Agreement may be signed in various counterparts which together shall constitute
one and the same instrument, and shall be effective when at least one
counterpart hereof shall have been executed by or on behalf of each party
hereto.
-37-
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholder and the several Underwriters, including the Representatives, all in
accordance with its terms.
Very truly yours,
TRINET GROUP, INC.
By: ________________________________________
Xxxxxx Xxxxxxx, President
THE SELLING STOCKHOLDER:
By: ________________________________________
Attorney-in-Fact
By: ________________________________________
Attorney-in-Fact
-38-
The foregoing Underwriting
Agreement is hereby confirmed
and accepted as of the date
first above written.
XXXXXX X. XXXXX & CO. INCORPORATED
XXXXXXXXX & COMPANY, INC.
XXXX XXXXX XXXX XXXXXX, INCORPORATED
By: XXXXXX X. XXXXX & CO. INCORPORATED
Acting as Representatives of the several
Underwriters (including themselves) identified in
Schedule I annexed hereto.
By: ________________________________________
Authorized Representative
-39-
Trinet Group, Inc.
Schedule I
Number of Firm
Name of Underwriter Shares to
------------------- be Purchased
------------
Xxxxxx X. Xxxxx & Co. Incorporated..................
Xxxxxxxxx & Company, Inc............................
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated................
Schedule II
Lock-Up Agreements
Xxxxxxxxxx, Xxxxxx X. and Xxxxxxx X.
Xxxxxxx, Xxxxxx and Xxxxxx, Trustees of the Xxxxxxx Trust dated 7-16-95
Xxxx, Xxxxx
Bessemer Venture Partners V XX
Xxxxxx Ventures V LP
BVE LLC
Bessemer Venture Investors II LP
Browenstein, Xxxxxxx X.
Xxxxx, Xxxxx
Xxxxxxx, Xxxxx
Xxxxxx, Xxxx
Xxxxxx, Xxxxxxx
XxXxxx, Xxxx
Xxxxxxx, Xxxxxxx X.
Xxxxxxx, Xxxxxx
Xxxxxx, Xxxx X.
Xxxxxxx, Xxxxxxx X.
Xxxxxx, Xxxxx X. and Xxxxxx X., Husband and Wife as Community Property
Xxxxxx, Xxxxx X. and Xxxxxx X. Accountancy Corporation Profit Sharing Plan #1
Xxxxxxx, X. Xxxx
Transcorp Pension Services CF Xxxxxx G.A. Xxxxx SEP
Xxxxx, Xxxxxx G.A.
Xxxxxxx, Xxxxx X. Transcorp FBO
XxXxxxxxx, Xxxxxxx X.
XxXxxxxx, Xxxxx
Xxxxx Trustee Limited
Xxxxxxxx, Xxx and Xxxxxxx, Trustees of the Xxxxxxxx 1995 Trust u/d/t/ 4/29/95
Ramanchandran, Manju
Xxxxxxxxx, Xxxxx
Xxxxxxx, Xxxxx Xxxxxx
Select Appointments North America Inc.
Xxxxxxx, Xxxxxxx
Xxxxxx, Xxxxxx
Xxxxxx, Xxxxxx, Transcorp Pension Services CF
Xxxxxx, Xxxxxx As Custodian for Xxxxxxx Xxxxxx under CUTMA
Xxxxxx, T. Xxx
Xxxxxxx, Xxxx
Xxxxxxx, Xxxxxxx X.
Exhibit A
Form of Lock-Up Agreement
Lock-Up Agreement
Xxxxxx X. Xxxxx & Co. Incorporated
As Representative of the Several Underwriters
c/o Xxxxxx X. Xxxxx & Co. Incorporated
000 Xxxx Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
RE: TriNet Group, Inc. (the "Company")
Ladies & Gentlemen:
The undersigned is an owner of record or beneficially of certain
shares of Common Stock of the Company ("Common Stock") or securities convertible
into or exchangeable or exercisable for Common Stock. The Company proposes to
carry out a public offering of Common Stock (the "Offering") for which you will
act as the representative (the "Representative") of the underwriters. The
undersigned recognizes that the Offering will be of benefit to the undersigned
and will benefit the Company by, among other things, raising additional capital
for its operations. The undersigned acknowledges that you and the other
underwriters are relying on the representations and agreements of the
undersigned contained in this letter in carrying out the Offering and in
entering into underwriting arrangements with the Company with respect to the
Offering.
In consideration of the foregoing, the undersigned hereby agrees that
the undersigned will not, directly or indirectly, offer to sell, contract to
sell, or otherwise sell, dispose of, loan, pledge or grant any rights with
respect to (collectively, a "Disposition") any shares of Common Stock, any
options or warrants to purchase any shares of Common Stock or any securities
convertible into or exchangeable for shares of Common Stock (collectively,
"Securities") now owned or hereafter acquired directly by such person or with
respect to which such person has or hereafter acquires the power of disposition,
otherwise than (i) as a bona fide gift or gifts, provided the donee or donees
thereof agree in writing to be bound by this restriction, (ii) as a distribution
to partners or shareholders of such person, provided that the distributees
thereof agree in writing to be bound by the terms of this restriction, (iii)
with respect to Dispositions of Common Stock acquired on the open market, (iv)
with respect to sales or purchases of Common Stock acquired on the open market
or (v) with the prior written consent of Xxxxxx X. Xxxxx & Co. Incorporated, for
a period commencing on the date hereof and continuing to a date 180 days after
the date of the final prospectus for the Offering (the "Lock-up Period"). The
foregoing restriction has been expressly agreed to preclude the holder of the
Securities from engaging in any hedging or other transaction which is designed
to or reasonably expected to lead to or result in a Disposition of Securities
during the Lock-up Period, even if such Securities would be disposed of by
someone other than such holder. Such prohibited hedging or other transactions
would include, without limitation, any short sale (whether or not against the
box) or any purchase, sale or grant of any right (including, without limitation,
any put or call option) with respect to any Securities or with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or derives any significant part of its value from Securities. The
undersigned also agrees and consents to the entry of stop transfer instructions
with the
Company's transfer agent and registrar against the transfer of Securities held
by the undersigned except in compliance with the foregoing restrictions.
The undersigned represents and warrants that the undersigned has full
power and authority to enter into this agreement and acknowledges that this
agreement is enforceable against the undersigned by the Representative. This
agreement is irrevocable and will be binding on the undersigned and the
respective successors, heirs, personal representatives, and assigns of the
undersigned.
Dated
------------------------------------------------
-----------------------------------------------------
Printed Name of Holder
By:
--------------------------------------------------
Signature
-----------------------------------------------------
Printed Name of Person Signing
(and indicate capacity of person signing if signing
as custodian, trustee, or on behalf of an entity)
Exhibit B
Selected Provisions
Use of Proceeds: the fifth and sixth sentences of the second paragraph.
---------------
Liquidity and Capital Resources: the fifth paragraph of this section.
-------------------------------
Management-- Executive Officer, Directors and Key Employees: information in the
-----------------------------------------------------------
table relating to Xxxxxxx X. Xxxxxx and the eleventh paragraph of this section.
Management-- Board Composition: the third sentence of the first paragraph.
------------------------------
Management-- Board Committees: the first sentence of the third paragraph.
-----------------------------
Management-- Director Compensation: the first sentence of the first paragraph.
----------------------------------
Management-- Compensation Committee Interlocks and Insider Participation: the
------------------------------------------------------------------------
second sentence.
Relationships with Third Parties and Related Transactions: the first, second,
---------------------------------------------------------
third, fifth and seventh paragraphs.
Principal and Selling Stockholders: information in the table relating to the
----------------------------------
Selling Stockholder and footnote number one to the table
Description of Capital Stock -- Registration Rights of Stockholders: the first
-------------------------------------------------------------------
paragraph
Shares Eligible for Future Sale -- Registration Rights: the first paragraph.
------------------------------------------------------
Part II; Item 15: the second item
----------------
