EXHIBIT 4.5
BEA Systems, Inc.
4% Convertible Subordinated Notes due December 15, 2006
Purchase Agreement
December 14, 1999
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Soundview Technology Group, Inc.
Deutsche Bank Securities, Inc.
XX Xxxxx Securities Corporation
Xxxx Xxxxxxxx Incorporated
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
BEA Systems, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Purchasers named in Schedule I hereto (the "Purchasers") an aggregate of
$450,000,000 principal amount of the 4% Convertible Subordinated Notes due
December 15, 2006, convertible into Common Stock, $0.001 par value per share
("Stock"), of the Company, specified above (the "Firm Securities") and, at the
election of the Purchasers, up to an aggregate of $100,000,000 additional
aggregate principal amount (the "Optional Securities") (the Firm Securities and
the Optional Securities which the Underwriters elect to purchase pursuant to
Section 2 hereof are herein collectively called the "Securities"). The
Purchasers and their direct and indirect transferees will be entitled to the
benefits of a registration rights agreement to be dated as of December 15, 1999
between the Company and the Purchasers (the "Registration Rights Agreement"),
which will be substantially in the form previously delivered to you.
1. The Company represents and warrants to, and agrees with, each of the
Purchasers that:
(a) A preliminary offering circular, dated December 13, 1999
(the "Preliminary Offering Circular") and an offering circular, dated December
14, 1999 (the "Offering Circular"), including in each case the Company's Annual
Report on Form 10-K for the fiscal year ended January 31, 1999 and the Company's
Quarterly Reports on Form 10-Q for the quarters ended April 30, July 31 and
October 31, 1999, each of which is attached to and made a part of the
Preliminary Offering Circular and the Offering Circular, have been prepared in
connection with the offering of the Securities and shares of the Stock issuable
upon conversion thereof. Any reference to
the Preliminary Offering Circular or the Offering Circular shall be deemed to
refer to and include the Company's most recent Annual Report on Form 10-K and
all documents filed with the United States Securities and Exchange Commission
(the "Commission") subsequent to the the date of filing thereof pursuant to
Section 13(a), 13(c) or 15(d) of the United States Securities Exchange Act of
1934, as amended (the "Exchange Act") on or prior to the date of the Preliminary
Offering Circular or the Offering Circular, as the case may be, and any
reference to the Preliminary Offering Circular or the Offering Circular, as the
case may be, as amended or supplemented as of any specified date, shall be
deemed to include (i) any documents filed with the Commission pursuant to
Section 13(a), 13(c) or 15(d) of the Exchange Act after the date of the
Preliminary Offering Circular or the Offering Circular, as the case may be, and
prior to such specified date and (ii) any Additional Issuer Information (as
defined in Section 5(f)) furnished by the Company prior to the completion of the
distribution of the Securities and all documents filed under the Exchange Act
and so deemed to be included in the Preliminary Offering Circular or the
Offering Circular, as the case may be, or any amendment or supplement thereto
are hereinafter called the "Exchange Act Reports". The Exchange Act Reports,
when they were or are filed with the Commission, conformed or will conform in
all material respects to the applicable requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder. The Preliminary
Offering Circular or the Offering Circular and any amendments or supplements
thereto and the Exchange Act Reports did not and will not, as of their
respective dates, contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any statements
or omissions made in reliance upon and in conformity with information furnished
in writing to the Company by a Purchaser through Xxxxxxx, Xxxxx & Co. expressly
for use therein;
(b) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements included in
the Offering Circular any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Offering Circular; and, since
the respective dates as of which information is given in the Offering Circular,
there has not been any change in the capital stock (except for stock options
issued in the ordinary course of business, Stock issued upon exercise of stock
options or Stock issued under the Company's employee stock purchase plan since
the date of the Offering Circular pursuant to stock option or incentive plans in
effect on the date of the Offering Circular) or long-term debt of the Company or
any of its subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Offering Circular;
(c) The Company and its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Offering Circular
or such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and any
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real property and buildings held under lease by the Company and its subsidiaries
are held by them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company and its
subsidiaries;
(d) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its properties
and conduct its business as described in the Offering Circular, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction; and each subsidiary of the Company has
been duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation;
(e) The Company has an authorized capitalization as set forth in
the Offering Circular, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully paid and
non-assessable; the shares of Stock initially issuable upon conversion of the
Securities have been duly and validly authorized and reserved for issuance and,
when issued and delivered in accordance with the provisions of the Securities
and the Indenture referred to below, will be duly and validly issued, fully paid
and non-assessable and will conform to the description of the Stock contained in
the Offering Circular; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and (except for directors' qualifying shares) are
owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(f) The Securities have been duly authorized and, when issued
and delivered pursuant to this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and legally
binding obligations of the Company entitled to the benefits provided by the
indenture to be dated as of December 15, 1999 (the "Indenture"), between the
Company and State Street Bank and Trust Company of California, N.A., as Trustee
(the "Trustee"), under which they are to be issued, which will be substantially
in the form previously delivered to you; the Indenture has been duly authorized
and, when executed and delivered by the Company and the Trustee, the Indenture
will constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles; the
Registration Rights Agreement has been duly authorized and, when executed and
delivered by the Company and the Purchasers, the Registration Rights Agreement
will constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles; and the
Securities, the Registration Rights Agreement and the Indenture will conform to
the descriptions thereof in the Offering Circular and will be in substantially
the form previously delivered to you;
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(g) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of the
Securities) will violate or result in a violation of Section 7 of the Exchange
Act, or any regulation promulgated thereunder, including, without limitation,
Regulations G, T, U, and X of the Board of Governors of the Federal Reserve
System;
(h) Prior to the date hereof, neither the Company nor any of its
affiliates has taken any action which is designed to or which has constituted or
which might have been expected to cause or result in stabilization or
manipulation of the price of any security of the Company in connection with the
offering of the Securities;
(i) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the Indenture, the
Registration Rights Agreement and this Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or result in
a breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company or any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by the
Company of the transactions contemplated by this Agreement, the Registration
Rights Agreement or the Indenture, except the filing of a notice on Form D by
the Company with the Commission pursuant to Section 5(h) hereof and such
consents, approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the purchase
and distribution of the Securities by the Purchasers;
(j) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or in default in the
performance or observance of any material obligation, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound;
(k) The statements set forth in the Offering Circular under the
caption "Description of the Notes" and "Description of Capital Stock", insofar
as they purport to constitute a summary of the terms of the Securities and the
Stock, under the caption "Certain United States Federal Income Tax Consequences"
and under the caption "Underwriting," insofar as they purport to describe the
provisions of documents referred to therein, are accurate, complete and fair;
(l) Other than as set forth in the Offering Circular, there are
no legal or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the Company or any
of its subsidiaries, would individually or in the aggregate have a material
adverse effect on the current or future financial position, stockholders' equity
or results of operations
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of the Company and its subsidiaries; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(m) When the Securities are issued and delivered pursuant to
this Agreement, the Securities will not be of the same class (within the meaning
of Rule 144A under the Securities Act of 1933, as amended (the "Act"), as
securities which are listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system. Except as disclosed in the Offering Circular, no legal or
beneficial owner of any securities of the Company has any rights not effectively
satisfied or waived, to require registration of any shares of capital stock of
the Company in connection with any filing made pursuant to the Registration
Rights Agreement;
(n) The Company is subject to Section 13 or 15(d) of the
Exchange Act;
(o) The Company is not, and after giving effect to the offering
and sale of the Securities, will not be an "investment company", or an entity
"controlled" by an "investment company", as such terms are defined in the United
States Investment Company Act of 1940, as amended (the "Investment Company
Act");
(p) Neither the Company, nor any person acting on its or their
behalf has offered or sold the Securities by means of any general solicitation
or general advertising within the meaning of Rule 502(c) under the Act;
(q) Within the preceding six months, neither the Company nor any
other person acting on behalf of the Company has offered or sold to any person
any Securities, or any securities of the same or a similar class as the
Securities, other than Securities offered or sold to the Purchasers hereunder.
The Company will take reasonable precautions designed to insure that any offer
or sale, direct or indirect, in the United States or to any U.S. person (as
defined in Rule 902 under the Act) of any Securities or any substantially
similar security issued by the Company, within six months subsequent to the date
on which the distribution of the Securities has been completed (as notified to
the Company by Xxxxxxx, Sachs & Co.), is made under restrictions and other
circumstances reasonably designed not to affect the status of the offer and sale
of the Securities in the United States and to U.S. persons contemplated by this
Agreement as transactions exempt from the registration provisions of the Act;
(r) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes; and
(s) Ernst & Young LLP, who have certified certain financial
statements of the Company and its subsidiaries, and Ernst & Young Audit, who
have certified certain financial statements of USL Finance S.A., are each
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
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(t) Except as disclosed in the Offering Circular, the Company is
not subject to any agreements or arrangements which restrict the Company's
ability to engage in business with or to compete with any entity or any type of
business;
(u) Except as disclosed in the Offering Circular, each of the
Company and its subsidiaries owns or possesses adequate licenses or other rights
to use all patents, patent licenses, trademarks, trade names, service marks,
service names, copyrights and other intellectual property rights ("Intellectual
Property") necessary to carry on its business as presently conducted; and
neither the Company nor any of its subsidiaries has received any notice of
infringement or conflict with asserted rights of others with respect to the
Intellectual Property which, singly or in the aggregate, if the subject of any
unfavorable decision, ruling or finding, would result in a material adverse
effect on the business, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole;
(v) The Company and its subsidiaries have obtained any permits,
consents and authorizations required to be obtained by them under applicable
federal, state, local and foreign laws or regulations in order to conduct their
business as described in the Offering Circular, including, but not limited to,
those under laws or regulations relating to the protection of the environment or
concerning the handling, storage, disposal or discharge of toxic materials
(collectively, "Environmental Laws"), and any such permits, consents and
authorizations remain in full force and effect. The Company and its subsidiaries
are in compliance with the Environmental Laws in all material respects, and
there is no pending or, to the Company's knowledge, threatened, action or
proceeding against the Company or any of its subsidiaries alleging violations of
the Environmental Laws;
(w) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (a)
transactions are executed in accordance with management's general or specific
authorizations; (b) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (c) access to assets is
permitted only in accordance with management's general or specific
authorization; and (d) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences; and
(x) The Company has reviewed its operations and that of its
subsidiaries and has made inquiries of the operations of any third parties with
which the Company or any of its subsidiaries has a material relationship to
evaluate the extent to which the business or operations of the Company or any of
its subsidiaries will be affected by the Year 2000 Problem. As a result of such
review, the Company has no reason to believe, and does not believe, that the
Year 2000 Problem will have a material adverse effect on the general affairs,
management, the current or future consolidated financial position, business
prospects, stockholders' equity or results of operations of the Company and its
subsidiaries or result in any material loss or interference with the Company's
business or operations or have a material adverse effect on the power or ability
of the Company to perform its obligations under this Agreement, the Registration
Rights Agreement, the Indenture or
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the Securities or to consummate the transactions contemplated by the Offering
Circular or by the terms of any of the foregoing. The "Year 2000 Problem" as
used herein means any significant risk that computer hardware or software used
in the receipt, transmission, processing, manipulation, storage, retrieval,
retransmission or other utilization of data or in the operation of mechanical or
electrical systems of any kind will not, in the case of dates or time periods
occurring after December 31, 1999, function at least as effectively as in the
case of dates or time periods occurring prior to January 1, 2000.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 97.375% of the principal amount thereof, plus accrued interest, if any,
from December 20, 1999 to the First Time of Delivery, the principal amount of
Securities set forth opposite the name of such Purchaser in Schedule I hereto,
and (b) in the event and to the extent that the Purchasers shall exercise the
election to purchase Optional Securities as provided below, the Company agrees
to issue and sell to each of the Purchasers, and each of the Purchasers agrees,
severally and not jointly, to purchase from the Company, at the same purchase
price set forth in clause (a) of this Section 2, that portion of the aggregate
principal amount of the Optional Securities as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractions), determined
by multiplying such aggregate principal amount of Optional Securities by a
fraction, the numerator of which is the maximum aggregate principal amount of
Optional Securities which such Purchaser is entitled to purchase as set forth
opposite the name of such Purchaser in Schedule I hereto and the denominator of
which is the maximum aggregate principal amount of Optional Securities which all
of the Purchasers are entitled to purchase hereunder.
The Company hereby grants to the Purchasers the right to purchase at their
election up to $100,000,000 aggregate principal amount of Optional Securities,
at the purchase price set forth in clause (a) of the first paragraph of this
Section 2, for the sole purpose of covering overallotments in the sale of Firm
Securities. Any such election to purchase Optional Securities may be exercised
by written notice from you to the Company, given within a period of 30 calendar
days after the date of this Agreement, setting forth the aggregate principal
amount of Optional Securities to be purchased and the date on which such
Optional Securities are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Securities, the
several Purchasers propose to offer the Securities for sale upon the terms and
conditions set forth in this Agreement and the Offering Circular and each
Purchaser hereby represents and warrants to, and agrees with the Company that:
(a) It will offer and sell the Securities only to persons who it
reasonably believes are "qualified institutional buyers" ("QIBs") within the
meaning of Rule 144A under the Act in transactions meeting the requirements of
Rule 144A;
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(b) It is an institution which is an "accredited investor"
within the meaning of Rule 501 under the Act; and
(c) It will not offer or sell the Securities by any form of
general solicitation or general advertising, including but not limited to the
methods described in Rule 502(c) under the Act.
4. (a) The Securities to be purchased by each Purchaser hereunder will
be represented by one or more definitive global Securities in book-entry form
which will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company will deliver the
Securities to Xxxxxxx, Xxxxx & Co., for the account of each Purchaser, against
payment by or on behalf of such Purchaser of the purchase price therefor by wire
transfer, payable to the order of the Company in Federal (same day) funds, by
causing DTC to credit the Securities to the account of Xxxxxxx, Sachs & Co. at
DTC. The Company will cause the certificates representing the Securities to be
made available to Xxxxxxx, Xxxxx & Co. for checking at least twenty-four hours
prior to the Time of Delivery (as defined below) at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Securities, 9:30 a.m.,
New York City time, on December 20, 1999 or such other time and date as Xxxxxxx,
Sachs & Co. and the Company may agree upon in writing, and, with respect to the
Optional Securities, 9:30 a.m., New York City time, on the date specified by
Xxxxxxx, Xxxxx & Co. in the written notice given by Xxxxxxx, Sachs & Co. of the
Purchasers' election to purchase such Optional Securities, or such other time
and date as Xxxxxxx, Xxxxx & Co. and the Company may agree upon in writing. Such
time and date for delivery of the Firm Securities is herein called the "First
Time of Delivery", such time and date for delivery of the Optional Securities,
if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery".
(b) The documents to be delivered at the Time of Delivery by or
on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Securities and any additional documents requested by the
Purchasers pursuant to Section 7 hereof, will be delivered at such time and date
at the offices of Xxxxxxxx & Xxxxxxxx LLP, 000 Xxxx Xxxx Xxxx, Xxxx Xxxx,
Xxxxxxxxxx 00000 (the "Closing Location"), and the Securities will be delivered
at the Designated Office, all at the Time of Delivery. A meeting will be held at
the Closing Location at 3:00 p.m., New York City time, on the New York Business
Day next preceding the Time of Delivery, at which meeting the final drafts of
the documents to be delivered pursuant to the preceding sentence will be
available for review by the parties hereto. For the purposes of this Section 4,
"New York Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Purchasers:
(a) To prepare the Offering Circular in a form approved by you;
to make no amendment or any supplement to the Offering Circular which shall be
reasonably disapproved by you promptly after reasonable notice thereof; and to
furnish you with copies thereof;
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(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities and the shares of Stock issuable
upon conversion of the Securities for offering and sale under the securities
laws of such jurisdictions as you may request and to comply with such laws so as
to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish the Purchasers with five (5) copies of the
Offering Circular and each amendment or supplement thereto signed by an
authorized officer of the Company with the independent accountants' report(s) in
the Offering Circular, and any amendment or supplement containing amendments to
the financial statements covered by such report(s), signed by the accountants,
and additional copies thereof in such quantities as you may from time to time
reasonably request, and if, at any time prior to the expiration of nine months
after the date of the Offering Circular, any event shall have occurred as a
result of which the Offering Circular as then amended or supplemented would
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Offering Circular is
delivered, not misleading, or, if for any other reason it shall be necessary or
desirable during such same period to amend or supplement the Offering Circular,
to notify you and upon your request to prepare and furnish without charge to
each Purchaser and to any dealer in securities as many copies as you may from
time to time reasonably request of an amended Offering Circular or a supplement
to the Offering Circular which will correct such statement or omission or effect
such compliance;
(d) During the period beginning from the date hereof and
continuing until the date 90 days after the date of the Offering Circular, not
to offer, sell contract to sell or otherwise dispose of, except as provided
hereunder any securities of the Company that are substantially similar to the
Securities or the Stock, including but not limited to any securities that are
convertible into or exchangeable for, or that represent the right to receive,
Stock or any such substantially similar securities (other than pursuant to
employee stock option plans or employee stock purchase plans existing on, or
upon the conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without your prior written
consent.
(e) Not to be or become, at any time prior to the expiration of
three years after the Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment company or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act;
(f) At any time when the Company is not subject to Section 13 or
15(d) of the Exchange Act, for the benefit of holders from time to time of
Securities, to furnish at its expense, upon request, to holders of Securities
and prospective purchasers of securities information (the "Additional Issuer
Information") satisfying the requirements of subsection (d)(4)(i) of Rule 144A
under the Act;
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(g) If requested by you, to use its best efforts to cause such
Designated Securities to be eligible for the PORTAL trading system of the
National Association of Securities Dealers, Inc.;
(h) To file with the Commission, not later than 15 days after
the Time of Delivery, five copies of a notice on Form D under the Act (one of
which will be manually signed by a person duly authorized by the Company); to
otherwise comply with the requirements of Rule 503 under the Act; and to furnish
promptly to you evidence of each such required timely filing (including a copy
thereof);
(i) To furnish to the holders of the Securities as soon as
practicable after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders' equity and cash flows of
the Company and its consolidated subsidiaries certified by independent public
accountants) and, as soon as practicable after the end of each of the first
three quarters of each fiscal year (beginning with the fiscal quarter ending
after the date of the Offering Circular), consolidated summary financial
information of the Company and its subsidiaries for such quarter in reasonable
detail;
(j) During a period of five years from the date of the Offering
Circular, to furnish to you copies of all reports or other communications
(financial or other) furnished to stockholders of the Company, and to deliver to
you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any securities exchange
on which the Securities or any class of securities of the Company is listed; and
(ii) such additional information concerning the business and financial condition
of the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission);
(k) During the period of two years after the Time of Delivery
(or such shorter period following the Time of Delivery after which resales of
the Securities may be effected by non-affiliates of the Company in reliance on
paragraph (k) of Rule 144 under the Act, or any successor provision thereto),
the Company will not, and will use reasonable efforts to ensure that its
"affiliates" (as defined in Rule 144 under the Act) do not, resell any of the
Securities which constitute "restricted securities" under Rule 144 that have
been reacquired by any of them other than pursuant to an effective registration
statement or an exemption from the registration requirements under the Act that
results in the Securities no longer constituting restricted securities;
(l) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in the Offering
Circular under the caption "Use of Proceeds";
(m) To reserve and keep available at all times, free of
preemptive rights, shares of Stock for the purpose of enabling the Company to
satisfy any obligations to issue shares of its Stock upon conversion of the
Securities; and
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(n) To use its best efforts to list, subject to notice of
issuance, the shares of Stock issuable upon conversion of the Securities on the
Nasdaq National Market.
6. The Company covenants and agrees with the several Purchasers that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
issue of the Securities and the shares of Stock issuable upon conversion of the
Securities and all other expenses in connection with the preparation, printing
and filing of the Preliminary Offering Circular and the Offering Circular and
any amendments and supplements thereto and the mailing and delivering of copies
thereof to the Purchasers and dealers; (ii) the cost of printing or producing
any Agreement among Purchasers, this Agreement, the Registration Rights
Agreement, the Indenture, the Blue Sky and Legal Investment Memoranda, closing
documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Securities;
(iii) any expenses in connection with the qualification of the Securities and
the shares of Stock issuable upon conversion of the Securities for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the fees and disbursements of counsel for the Purchasers in connection with such
qualification and in connection with the Blue Sky and legal investment surveys;
(iv) any fees charged by securities rating services for rating the Securities;
(v) the cost of preparing the Securities; (vi) the fees and expenses of the
Trustee and any agent of the Trustee and the fees and disbursements of counsel
for the Trustee in connection with the Indenture and the Securities; (vii) any
cost incurred in connection with the designation of the Securities for trading
in PORTAL and the listing of the shares of Stock issuable upon conversion of the
Securities; and (viii) all other costs and expenses incident to the performance
of its obligations hereunder which are not otherwise specifically provided for
in this Section. It is understood, however, that, except as provided in this
Section, and Sections 8 and 11 hereof, the Purchasers will pay all of their own
costs and expenses, including the fees of their counsel, transfer taxes on
resale of any of the Securities by them, and any advertising expenses connected
with any offers they may make.
7. The obligations of the Purchasers hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company shall have performed all of its
obligations hereunder theretofore to be performed, and the following additional
conditions:
(a) Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C., counsel for the
Purchasers, shall have furnished to you such opinion or opinions, dated such
Time of Delivery, with respect to the matters covered in the following clauses
of subsection (b) below, as well as such other related matters as you may
reasonably request: paragraph (i); the clauses of paragraph (ii) concerning
shares of Stock initially issuable upon conversion of the Securities; paragraph
(vii); paragraph (viii); paragraph (ix); the clauses of paragraph (xiii)
concerning the captions "Description of Notes" and "Underwriting"; and paragraph
(xv). Such counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
-11-
(b) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Company, shall have
furnished to you their written opinion, dated such Time of Delivery, in form and
substance satisfactory to you, 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 State
of Delaware, with corporate power and corporate authority to own its properties
and conduct its business as described in the Offering Circular;
(ii) The Company has an authorized capitalization as
set forth in the Offering Circular, and all of the issued shares of capital
stock of the Company have been duly and validly authorized and issued and are
fully paid and non-assessable; and the shares of Stock initially issuable upon
conversion of the Securities have been duly and validly authorized and reserved
for issuance and, when issued and delivered in accordance with the provisions of
the Securities and the Indenture, will be duly and validly issued and fully paid
and non-assessable, and will conform to the description of the Stock contained
in the Offering Circular;
(iii) The Company has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, or is subject to
no material liability or disability by reason of the failure to be so qualified
in any such jurisdiction (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect of matters
of fact upon certificates of officers of the Company, provided that such counsel
shall state that they believe that both you and they are justified in relying
upon such opinions and certificates);
(iv) Each subsidiary of the Company that is a
"Significant Subsidiary" of the Company within the meaning of Regulation S-X
under the Act (each, a "Material Subsidiary") has been duly incorporated and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation; and all of the issued shares of capital stock of
each such subsidiary have been duly and validly authorized and issued, are fully
paid and non-assessable, and (except for directors' qualifying shares) are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims (such counsel being entitled to rely in respect
of the opinion in this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that they believe that both
you and they are justified in relying upon such opinions and certificates);
(v) The Company and the Material Subsidiaries have
good and marketable title in fee simple to all real property owned by them, in
each case free and clear of all liens, encumbrances and defects except such as
are described in the Offering Circular or such as do not materially affect the
value of such property and do not interfere with the use made and proposed to be
made of such property by the Company and the Material Subsidiaries; and any real
property and buildings held under lease by the Company and the Material
Subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company and the
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Material Subsidiaries (in giving the opinion in this clause, such counsel may
state that no examination of record titles for the purpose of such opinion has
been made, and that they are relying upon a general review of the titles of the
Company and the Material Subsidiaries, upon opinions of local counsel and
abstracts, reports and policies of title companies rendered or issued at or
subsequent to the time of acquisition of such property by the Company or the
Material Subsidiaries, upon opinions of counsel to the lessors of such property
and, in respect of matters of fact, upon certificates of officers of the Company
or the Material Subsidiaries, provided that such counsel shall state that they
believe that both you and they are justified in relying upon such opinions,
abstracts, reports, policies and certificates, and that copies of such opinions
and certificates be provided to counsel for the Purchasers.
(vi) To the best of such counsel's knowledge and
other than as set forth in the Offering Circular, there are no legal or
governmental proceedings pending to which the Company or any of the Material
Subsidiaries is a party or of which any property of the Company or any of the
Material Subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate have
a material adverse effect on the current or future consolidated financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries; and, to the best of such counsel's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened by
others;
(vii) This Agreement has been duly authorized,
executed and delivered by the Company;
(viii) The Securities have been duly authorized,
executed, authenticated, issued and delivered and constitute valid and legally
binding obligations of the Company entitled to the benefits provided by the
Indenture; and the Securities, the Registration Rights Agreement and the
Indenture conform in all material respects to the descriptions thereof in the
Offering Circular.
(ix) Each of the Indenture and the Registration
Rights Agreement has been duly authorized, executed and delivered by the parties
thereto and constitutes a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(x) The issue and sale of the Securities being
issued at such Time of Delivery and the compliance by the Company with all of
the provisions of the Securities, the Indenture, the Registration Rights
Agreement and this Agreement and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of the Material
Subsidiaries is a party or by which the Company or any of the Material
Subsidiaries is bound or to which any of the property or assets of the Company
or any of the Material Subsidiaries is subject, nor will such actions result in
any violation of the provisions of the Certificate of Incorporation or By-laws
of the Company or any statute or any order, rule or
-13-
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of the Material Subsidiaries or any of their properties;
(xi) No consent, approval, authorization, order,
registration or qualification of or with any such court or governmental agency
or body is required for the issue and sale of the Securities being issued at
such Time of Delivery or the consummation by the Company of the transactions
contemplated by this Agreement, the Registration Rights Agreement or the
Indenture, except such as may be required under the Act in connection with the
shares of Stock issuable upon conversion of the Securities and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Purchasers;
(xii) Neither the Company nor any of the Material
Subsidiaries is in violation of its Certificate of Incorporation or By-laws or
in default in the performance or observance of any material obligation, covenant
or condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument known to such counsel to which
it is a party or by which it or any of its properties may be bound;
(xiii) The statements set forth in the Offering
Circular under the caption "Description of the Notes" and "Description of
Capital Stock", insofar as they purport to constitute a summary of the terms of
the Securities and the Stock, under the caption "Certain United States Federal
Income Tax Consequences" and under the caption "Underwriting", insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair;
(xiv) The Exchange Act Reports (other than the
financial statements and related schedules therein, as to which such counsel
need express no opinion), when they were filed with the Commission, complied as
to form in all material respects with the requirements of the Exchange Act, and
the rules and regulations of the Commission thereunder; and such counsel has no
reason to believe that any of such documents, when they were so filed, contained
an untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so filed, not
misleading;
(xv) No registration of the Securities under the
Act, and no qualification of an indenture under the United States Trust
Indenture Act of 1939 with respect thereto, is required for the offer, sale and
initial resale of the Securities by the Purchasers in the manner contemplated by
this Agreement, it being understood that no opinion is being expressed as to any
subsequent resale of the Securities;
(xvi) Such counsel have no reason to believe that the
Offering Circular and any further amendments or supplements thereto made by the
Company prior to the Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need express no opinion)
contained as of its date or contains as of such Time of Delivery an untrue
statement of a material fact or omitted or omits, as the case may be, to state a
material fact necessary
-14-
to make the statements therein, in the light of the circumstances under which
they were made, not misleading;
(xvii) The Company is not an "investment company" or
an entity "controlled" by an "investment company"; as such terms are defined in
the Investment Company Act;
(xviii) To the best of such counsel's knowledge, there
is no legal or beneficial owner of any securities of the Company who has any
rights, not effectively satisfied or waived, to require registration of any
shares of capital stock of the Company in connection with the filing of the
registration statement on Form S-3 pursuant to the terms of the Registration
Rights Agreement; and
(xix) To the best of such counsel's knowledge,
neither the Company nor any of its subsidiaries has received any notice of
infringement or conflict with asserted rights of others with respect to any
patents, patent licenses, trademarks, trade names, service marks, service names,
copyrights and other intellectual property rights owned or licensed by the
Company or any of its subsidiaries ("Intellectual Property") which, singly or in
the aggregate, if the subject of any unfavorable decision, ruling or finding,
would result in a material adverse effect on the business, financial condition
or results of operations of the Company and its subsidiaries, taken as a whole;
and, to the best of such counsel's knowledge, there are no judicial proceedings
pending relating to the Intellectual Property to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its
subsidiaries is subject, and, to the best of such counsel's knowledge, except as
set forth in the Offering Circular, no such judicial proceedings are threatened
by the governmental authorities or others.
(c) On the date of the Offering Circular prior to the execution
of this Agreement and also at each Time of Delivery, Ernst & Young LLP shall
have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance reasonably satisfactory to you, to the
effect set forth in Annex I hereto;
(d) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the Offering Circular any loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the Offering Circular,
and (ii) since the respective dates as of which information is given in the
Offering Circular there shall not have been any change in the capital stock
(except for stock options issued in the ordinary course of business, Stock
issued upon exercise of stock options or Stock issued under the Company's
employee stock purchase plan, since the date of the Offering Circular pursuant
to stock option or incentive plans described in the Offering Circular) or long-
term debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, otherwise than as set forth or contemplated in
the Offering Circular, the effect of which, in any such case described in Clause
(i) or (ii), is in the judgment of the Purchasers so material and adverse as to
make it impracticable or inadvisable to proceed with the offering or the
delivery of the Securities
-15-
being issued at such Time of Delivery on the terms and in the manner
contemplated in this Agreement and in the Offering Circular;
(e) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities;
(f) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in trading in
securities generally on the Nasdaq National Market; (ii) a suspension or
material limitation in trading in the Company's securities on the Nasdaq
National Market; (iii) a general moratorium on commercial banking activities
declared by either Federal or New York State authorities; (iv) the outbreak or
escalation of hostilities involving the United States or the declaration by the
United States of a national emergency or war, if the effect of any such event
specified in this Clause (iv), in the judgment of the Purchasers, makes it
impracticable or inadvisable to proceed with the offering or the delivery of the
Securities being issued at such Time of Delivery on the terms and in the manner
contemplated in the Offering Circular; or (v) the occurrence of any material
adverse change in the existing financial, political or economic conditions in
the United States or elsewhere which, in the judgment of the Purchasers, would
materially and adversely affect the financial markets or the markets for the
Securities being issued at such Time of Delivery and other debt securities or
any equity securities.
(g) The Securities have been designated for trading on PORTAL;
(h) The shares of Stock issuable upon conversion of the
Securities shall have been duly listed, subject to notice of issuance, on the
Nasdaq National Market; and
(i) The Company shall have furnished or caused to be furnished
to you at such Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the performance by
the Company of all of its obligations hereunder to be performed at or prior to
such Time of Delivery, as to the matters set forth in subsection (d) of this
Section and as to such other matters as you may reasonably request.
(j) The Company and the Purchasers shall have executed and
delivered the Registration Rights Agreement.
8. (a) The Company will indemnify and hold harmless each Purchaser
against any losses, claims, damages or liabilities, joint or several, to which
such Purchaser may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Offering Circular or the Offering
Circular, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact necessary
to make the statements therein not misleading, and will reimburse
-16-
each Purchaser for any legal or other expenses reasonably incurred by such
Purchaser in connection with investigating or defending any such action or claim
as such expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Offering
Circular or the Offering Circular or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Purchaser through Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) Each Purchaser will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Offering Circular or the Offering Circular, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact 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 any Preliminary Offering Circular or the Offering
Circular or any such amendment or supplement in reliance upon and in conformity
with written information furnished to the Company by such Purchaser through
Xxxxxxx, Sachs & Co. expressly for use therein; and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out
-17-
of such action or claim and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act, by or on behalf of any
indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Purchasers on
the other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Purchasers on the other shall be deemed to be in
the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Purchasers, in each case as set forth
in the Offering Circular. The relative fault 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 on the one hand or the Purchasers
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Purchasers agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to
investors were offered to investors exceeds the amount of any damages which such
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. The Purchasers' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Purchaser within the meaning of the Act; and the obligations of the
Purchasers under this Section 8 shall be in addition to any liability which the
respective Purchasers may otherwise have and shall extend, upon the same terms
and conditions, to
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each officer and director of the Company and to each person, if any, who
controls the Company within the meaning of the Act.
9. (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Securities on
the terms contained herein at a Time of Delivery. If within thirty-six hours
after such default by any Purchaser you do not arrange for the purchase of such
Securities, then the Company shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to you
to purchase such Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so arranged
for the purchase of such Securities, or the Company notifies you that it has so
arranged for the purchase of such Securities, you or the Company shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in the
Offering Circular, or in any other documents or arrangements, and the Company
agrees to prepare promptly any amendments to the Offering Circular which in your
opinion may thereby be made necessary. The term "Purchaser" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of such
Securities which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of all the Securities to be purchased at such Time of
Delivery, then the Company shall have the right to require each non-defaulting
Purchaser to purchase the principal amount of Securities which such Purchaser
agreed to purchase hereunder at such Time of Delivery and, in addition, to
require each non-defaulting Purchaser to purchase its pro rata share (based on
the principal amount of Securities which such Purchaser agreed to purchase
hereunder) of the Securities of such defaulting Purchaser or Purchasers for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal amount
of all the Securities to be purchased at such Time of Delivery, or if the
Company shall not exercise the right described in subsection (b) above to
require non-defaulting Purchasers to purchase Securities of a defaulting
Purchaser or Purchasers, then this Agreement (or, with respect to the Second
Time of Delivery, the obligation of the Purchasers to purchase and of the
Company to sell the Optional Securities) shall thereupon terminate, without
liability on the part of any non-defaulting Purchaser or the Company, except for
the expenses to be borne by the Company and the Purchasers as provided in
Section 6 hereof and the indemnity and contribution agreements in Section 8
hereof; but nothing herein shall relieve a defaulting Purchaser from liability
for its default.
-19-
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Purchasers, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Purchaser or any controlling person of any Purchaser, or the Company, or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Securities.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Purchaser except as
provided in Sections 6 and 8 hereof; but, if for any other reason, the
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Purchasers through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Purchasers in making preparations for the
purchase, sale and delivery of the Securities, but the Company shall then be
under no further liability to any Purchaser except as provided in Sections 6 and
8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Purchaser made or given
by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the Purchasers.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail, telex or
facsimile transmission to you as the Purchasers in care of Xxxxxxx, Sachs & Co.,
00 Xxx Xxxx, 00/xx/ Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; and if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the Offering
Circular, Attention: Secretary; provided, however, that any notice to a
Purchaser pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Purchaser at its address set forth in
its Purchasers' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Purchasers, the Company and, to the extent provided in Sections 8 and 10
hereof, the officers and directors of the Company and each person who controls
the Company or any Purchaser, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Purchaser shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
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16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
-21-
If the foregoing is in accordance with your understanding, please sign and
return to us counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Company for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
BEA Systems, Inc.
By: ____________________________
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Soundview Technology Group, Inc.
Deutsche Bank Securities, Inc.
XX Xxxxx Securities Corporation
Xxxx Xxxxxxxx Incorporated
By: ________________________________
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Purchasers
SCHEDULE I
Principal Amount of Firm Securities and Optional Securities
To Be Purchased (If Maximum)
Firm Securities Optional Securities
Purchaser To Be Purchased To Be Purchased
-------------------------------------------------- ------------------ -----------------------
Xxxxxxx, Xxxxx & Co. $225,000,000 $ 50,000,000
Credit Suisse First Boston Corporation 67,500,000 15,000,000
Soundview Technology Group, Inc. 67,500,000 15,000,000
Deutsche Bank Securities, Inc 33,750,000 7,500,000
XX Xxxxx Securities Corporation 33,750,000 7,500,000
Xxxx Xxxxxxxx Incorporated 22,500,000 5,000,000
------------ ------------
Total $450,000,000 $100,000,000
============ ============
ANNEX I
Pursuant to Section 7(d) of the Purchase Agreement, the accountants shall
furnish letters to the Purchasers to the effect that:
1. They are independent certified public accountants with respect to the
Company and its subsidiaries within the meaning of the Securities Exchange Act
of 1934 (the "Exchange Act") and the applicable published rules and regulations
thereunder.
2. In our opinion, the consolidated financial statements and financial
statement schedules audited by us and included in the Offering Circular comply
as to form in all material respects with the applicable requirements of the
Exchange Act and the related published rules and regulations;
3. The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company for the
five most recent fiscal years included in the Offering Circular agrees with the
corresponding amounts (after restatements where applicable) in the audited
consolidated financial statements for such five fiscal years;
4. On the basis of limited procedures not constituting an audit in
accordance with generally accepted auditing standards, consisting of a reading
of the unaudited financial statements and other information referred to below, a
reading of the latest available interim financial statements of the Company and
its subsidiaries, inspection of the minute books of the Company and its
subsidiaries since the date of the latest audited financial statements included
in the Offering Circular, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing came to
their attention that caused them to believe that:
(a) the unaudited consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Offering Circular are not in conformity with generally accepted accounting
principles applied on the basis substantially consistent with the basis for the
unaudited condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the Offering
Circular;
(b) any other unaudited income statement data and balance sheet items
included in the Offering Circular do not agree with the corresponding items in
the unaudited consolidated financial statements from which such data and items
were derived, and any such unaudited data and items were not determined on a
basis substantially consistent with the basis for the corresponding amounts in
the audited consolidated financial statements included in the Offering Circular;
(c) the unaudited financial statements which were not included in the
Offering Circular but from which were derived any unaudited condensed financial
statements referred to in Clause (A) and any unaudited income statement data and
balance sheet items included in the Offering Circular and referred to in Clause
(B) were not determined on a basis substantially
consistent with the basis for the audited consolidated financial statements
included in the Offering Circular;
(d) any unaudited pro forma consolidated condensed financial
statements included in the Offering Circular do not comply as to form in all
material respects with the applicable accounting requirements or the pro forma
adjustments have not been properly applied to the historical amounts in the
compilation of those statements;
(e) as of a specified date not more than five days prior to the date
of such letter, there have been any changes in the consolidated capital stock
(other than issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and upon conversions
of convertible securities, in each case which were outstanding on the date of
the latest financial statements included in the Offering Circular or any
increase in the consolidated long-term debt of the Company and its subsidiaries,
or any decreases in consolidated net current assets or stockholders' equity or
other items specified by the Purchasers, or any increases in any items specified
by the Purchasers, in each case as compared with amounts shown in the latest
balance sheet included in the Offering Circular except in each case for changes,
increases or decreases which the Offering Circular discloses have occurred or
may occur or which are described in such letter; and
(f) for the period from the date of the latest financial statements
included in the Offering Circular to the specified date referred to in Clause
(E) there were any decreases in consolidated net revenues or operating profit or
the total or per share amounts of consolidated net income or other items
specified by the Purchasers, or any increases in any items specified by the
Purchasers, in each case as compared with the comparable period of the preceding
year and with any other period of corresponding length specified by the
Purchasers, except in each case for decreases or increases which the Offering
Circular discloses have occurred or may occur or which are described in such
letter; and
In addition to the examination referred to in their report(s) included
in the Offering Circular and the limited procedures, inspection of minute books,
inquiries and other procedures referred to in paragraphs (iii) and (iv) above,
they have carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the Purchasers,
which are derived from the general accounting records of the Company and its
subsidiaries, which appear in the Offering Circular, and have compared certain
of such amounts, percentages and financial information with the accounting
records of the Company and its subsidiaries and have found them to be in
agreement.
-25-
AMENDMENT NO. 1 TO PURCHASE AGREEMENT
This Amendment No. 1 to Purchase Agreement (the "Amendment") is dated as of
December 14, 1999 and amends that certain Purchase Agreement dated as of
December 14, 1999 (the "Purchase Agreement") between BEA Systems, Inc., a
Delaware corporation (the "Company"), and the Purchasers, as defined therein.
WHEREAS, the Company and the Purchasers have entered into the Purchase
Agreement for the purpose of the Company's issuance and sale of the Securities,
as defined therein.
WHEREAS, the Company and the Purchasers desire to amend the Purchase
Agreement as set forth herein.
NOW, THEREFORE, for good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties agree as follows.
1. Amendment to Purchase Agreement
1.1 Schedule I to the Purchase Agreement is amended to read in its
entirety as set forth in Schedule I attached hereto, and, in
consequence, the defined term "Purchasers" in the Purchase
Agreement shall henceforth refer to all of the entities listed on
Schedule I hereto.
2. Except as explicitly amended hereby, the Purchase Agreement shall
remain in full force and effect.
3. Counterparts. This Amendment may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their authorized officers as of the day and year first above
written.
BEA Systems, Inc.
By: ________________________
Name:
Title:
Xxxxxxx, Xxxxx & Co.
Credit Suisse First Boston Corporation
Soundview Technology Group, Inc.
Deutsche Bank Securities, Inc.
XX Xxxxx Securities Corporation
Xxxx Xxxxxxxx Incorporated
The Xxxxxxx Companies Incorporated
Xxxxxxxxx & Company, Inc.
Prudential Securities Incorporated
By: ________________________
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Purchasers
SCHEDULE I
Principal Amount of Firm Securities and Optional Securities
To Be Purchased (If Maximum)
Firm Securities Optional Securities
Purchaser To Be Purchased To Be Purchased
------------------------------------------ ------------------------------ -------------------------------
Xxxxxxx, Xxxxx & Co. $216,000,000 $48,000,000
Credit Suisse First Boston Corporation 64,800,000 14,400,000
Soundview Technology Group, Inc. 64,800,000 14,400,000
Deutsche Bank Securities, Inc. 32,400,000 7,200,000
XX Xxxxx Securities Corporation 32,400,000 7,200,000
Xxxx Xxxxxxxx Incorporated 21,600,000 4,800,000
The Xxxxxxx Companies Incorporated 9,000,000 2,000,000
Xxxxxxxxx & Company, Inc. 4,500,000 1,000,000
Prudential Securities Incorporated 4,500,000 1,000,000
----------------------------- -------------------------------
Total $450,000,000 $100,000,000
============================= ===============================
