EXHIBIT 1.1
[_____________] Shares
Common Stock
($0.001 Par Value)
UNDERWRITING AGREEMENT
_______________, 2002
UNDERWRITING AGREEMENT
____________ ___, 2002
UBS Warburg LLC
CIBC World Markets Corp.
Raymond James & Associates, Inc.
As representatives of the several underwriters
named in Schedule A hereto
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c/o UBS Warburg LLC
299 Park Avenue
New York, New York 10171-0026
Ladies and Gentlemen:
InterVideo, Inc., a Delaware corporation (the "Company"), proposes to issue
and sell to the underwriters named in Schedule A annexed hereto (the
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"Underwriters") an aggregate of [________________] shares (the "Firm Shares") of
Common Stock, $0.001 par value (the "Common Stock"), of the Company. In
addition, solely for the purpose of covering over-allotments, the Company
proposes to grant to the Underwriters the option to purchase from the Company up
to an additional [_____________] shares of Common Stock (the "Additional
Shares"). The Firm Shares and the Additional Shares are hereinafter collectively
sometimes referred to as the "Shares." The Shares are described in the
Prospectus which is referred to below.
The Company has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively
called the "Act"), with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1, (File No. 333-76640)
including a prospectus, relating to the Shares. The Company has furnished to
you, for use by the Underwriters and by dealers, copies of one or more
preliminary prospectuses (each thereof being herein called a "Preliminary
Prospectus") relating to the Shares. Except where the context otherwise
requires, the registration statement, as amended when it becomes effective,
including all documents filed as a part thereof, and including any information
contained in a prospectus subsequently filed with the Commission pursuant to
Rule 424(b) under the Act and deemed to be part of the registration statement at
the time of effectiveness pursuant to Rule 430(A) under the Act and also
including any registration statement filed pursuant to Rule 462(b) under the
Act, is herein called the Registration Statement, and the prospectus, in the
form filed by the Company with the Commission pursuant to Rule 424(b) under the
Act on or before the second business day after the date hereof (or such earlier
time as may be required under the Act) or, if no such filing is required, the
form of final prospectus included in the Registration Statement at the time it
became effective, is herein called the Prospectus.
The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the warranties and representations
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and subject to the terms and conditions herein set forth, the Company agrees to
sell to the respective Underwriters and each of the Underwriters, severally and
not jointly, agrees to purchase from the Company the aggregate number of Firm
Shares set forth opposite the name of such Underwriter in Schedule A annexed
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hereto, in each case at a purchase price of $[______] per Share. The Company is
advised by you that the Underwriters intend (i) to make a public offering of
their respective portions of the Firm Shares as soon after the effective date of
the Registration Statement as in your judgment is advisable and (ii) initially
to offer the Firm Shares upon the terms set forth in the Prospectus. You may
from time to time increase or decrease the public offering price after the
initial public offering to such extent as you may determine.
In addition, the Company hereby grants to the several Underwriters the
option to purchase, and upon the basis of the warranties and representations and
subject to the terms and conditions herein set forth, the Underwriters shall
have the right to purchase, severally and not jointly, from the Company, ratably
in accordance with the number of Firm Shares to be purchased by each of them
(subject to such adjustment as you shall determine to avoid fractional shares),
all or a portion of the Additional Shares as may be necessary to cover
over-allotments made in connection with the offering of the Firm Shares, at the
same purchase price per share to be paid by the Underwriters to the Company for
the Firm Shares. This option may be exercised by you on behalf of the several
Underwriters at any time on or before the thirtieth day following the date
hereof, by written notice to the Company. Such notice shall set forth the
aggregate number of Additional Shares as to which the option is being exercised,
and the date and time when the Additional Shares are to be delivered (such date
and time being herein referred to as the "Additional Time of Purchase");
provided, however, that the Additional Time of Purchase shall not be earlier
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than the Time of Purchase (as defined below) nor earlier than the second
business day1 after the date on which the option shall have been exercised nor
later than the tenth business day after the date on which the option shall have
been exercised. The number of Additional Shares to be sold to each Underwriter
shall be the number which bears the same proportion to the aggregate number of
Additional Shares being purchased as the number of Firm Shares set forth
opposite the name of such Underwriter on Schedule A hereto bears to the total
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number of Firm Shares (subject, in each case, to such adjustment as you may
determine to eliminate fractional shares).
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/(1)/ As used herein "business day" shall mean a day on which the New York
Stock Exchange is open for trading.
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2. Payment and Delivery. Payment of the purchase price for the Firm Shares
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shall be made to the Company by Federal (same-day) funds wire transfer, against
delivery of the Firm Shares to you through the facilities of the Depository
Trust Company ("DTC") for the respective accounts of the Underwriters. Such
payment and delivery shall be made at 10:00 A.M., New York City time, on
[______________], 2002 (unless another time shall be agreed to by you and the
Company or unless postponed in accordance with the provisions of Section 8
hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the "Time of Purchase." Certificates for the Firm
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second business day
preceding the Time of Purchase. For the purpose of expediting the checking of
the certificates for the Firm Shares by you, the Company agrees to make such
certificates available to you for such purpose at least two full business days
preceding the Time of Purchase.
Payment of the purchase price for the Additional Shares shall be made at
the Additional Time of Purchase in the same manner and at the same office as the
payment for the Firm Shares. Certificates for the Additional Shares shall be
delivered to you in definitive form in such names and in such denominations as
you shall specify no later than the business day preceding the Additional Time
of Purchase. For the purpose of expediting the checking of the certificates for
the Additional Shares by you, the Company agrees to make such certificates
available to you for such purpose at least one full business day preceding the
Additional Time of Purchase.
3. Representations and Warranties of the Company. The Company represents
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and warrants to each of the Underwriters that:
(a) the Company has not received, and has no notice of, any order of the
Commission preventing or suspending the use of any Preliminary Prospectus, or
instituting or threatening proceedings for that purpose, and each Preliminary
Prospectus filed after January 11, 2002, at the time of filing thereof,
conformed in all material respects to the requirements of the Act and did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading; and
when the Registration Statement became effective, the Registration Statement and
the Prospectus complied in all material respects with the provisions of the Act,
and the Registration Statement does not and, as amended or supplemented, if
applicable, will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, and the Prospectus, and any amendments or
supplements thereto, if applicable, will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; any statutes, regulations, legal or
governmental proceedings, contracts, leases or other documents that are required
to be described in the Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement have been so described or filed;
provided, however, that the Company makes no warranty or representation with
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respect to
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any statement contained in the Registration Statement, any Preliminary
Prospectus or the Prospectus in reliance upon and in conformity with information
concerning the Underwriters and furnished in writing by or on behalf of any
Underwriter through you to the Company expressly for use in the Registration
Statement, a Preliminary Prospectus or the Prospectus; and the Company has not
distributed any offering material in connection with the offering or sale of the
Shares other than the Registration Statement, the Preliminary Prospectuses or
the Prospectus;
(b) as of the date of this Agreement (except for shares issued upon the
exercise of stock options after [December 31, 2001] and the issuance of
[_____________] shares to Dell Products, L.P. ("Dell")), the Company has the
authorized and outstanding capitalization as set forth in the section of the
Prospectus entitled "Capitalization" under the "Actual" column and, as of the
Time of Purchase and the Additional Time of Purchase, as the case may be
(following the filing of an amended and restated certificate of incorporation,
as contemplated by the Prospectus), the Company shall have the authorized
capitalization as set forth under the heading entitled "Pro Forma As Adjusted"
in the section of the Prospectus entitled "Capitalization"; other than as
described in the Prospectus and except for stock options granted under the
Company's 1998 Stock Option Plan, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to convert
any obligation into shares of capital stock or ownership interests in the
Company are outstanding; all of the issued and outstanding shares of capital
stock including Common Stock and Preferred Stock of the Company have been duly
and validly authorized and issued and are fully paid and non-assessable, have
been issued in compliance with all federal and state securities laws and were
not issued in violation of any preemptive right, co-sale right, right of first
refusal or similar right;
(c) 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 full
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the Prospectus;
(d) the Company is duly qualified to do business as a foreign corporation
in good standing in each jurisdiction where the ownership or leasing of its
properties or the conduct of its business requires such qualification, except
where the failure to so qualify would not have a material adverse effect on the
business, properties, financial condition or results of operation of the Company
and its Subsidiaries (as hereinafter defined) taken as a whole (a "Material
Adverse Effect"). The Company has no subsidiaries (as defined in Rule 405 of the
rules and regulations under the Act) other than Digital Technology Corp. (the
"Significant Subsidiary"), InterVideo Japan, KK, InterVideo Digital Technology
(Europe) b.v., InterVideo (BVI) Holding, Ltd. and InterVideo Digital Technology
(Shenzhen) Co. Ltd. (collectively, including the Significant Subsidiary, the
"Subsidiaries"); the Company owns 100% of the outstanding capital stock of each
of the Subsidiaries other than a de minimis number of shares held by employees
or former employees of the Subsidiaries for the purposes of qualifying under
local laws and other than the outstanding capital stock of InterVideo Digital
Technology (Shenzhen) Co. Ltd. which is 100%
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owned by InterVideo (BVI) Holding, Ltd.; other than the Subsidiaries, the
Company does not own, directly or indirectly, any shares of stock or any other
equity or long-term debt securities of any corporation or have any equity
interest in any firm, partnership, joint venture, association or other entity;
complete and correct copies of the charter documents, certificates or articles
of incorporation and of the bylaws of the Company and the Significant Subsidiary
and all amendments thereto have been delivered to you, and except as set forth
in the exhibits to the Registration Statement no changes therein will be made
subsequent to the date hereof and prior to the Time of Purchase or, if later,
the Additional Time of Purchase; each Subsidiary has been duly incorporated and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with full corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Prospectus; each Subsidiary is duly qualified to do business as a foreign
corporation in good standing in each jurisdiction where the ownership or leasing
of the properties or the conduct of its business requires such qualification,
except where the failure to so qualify would not have a Material Adverse Effect;
all of the outstanding shares of capital stock of each of the Subsidiaries have
been duly authorized and validly issued, are fully paid and non-assessable and
(except as otherwise described in this Section 3(d)) are owned by the Company
subject to no security interest, other encumbrance or adverse claims; no
options, warrants or other rights to purchase, agreements or other obligations
to issue or other rights to convert any obligation into shares of capital stock
or ownership interests in the Subsidiaries are outstanding;
(e) the Company and each of its Subsidiaries are in compliance in all
material respects with the laws, orders, rules, regulations and directives
issued or administered by each jurisdiction applicable to it, except where
non-compliance will not singly or in the aggregate result in a Material Adverse
Effect;
(f) the agreement and plan of merger dated as of [____________], 2002 (the
"Reincorporation Agreement") entered into by the Company in connection with the
merger of InterVideo, Inc., a California corporation (the "California
Corporation"), with and into the Company (the "Reincorporation") was duly and
validly authorized, executed and delivered by the Company, and at the time of
execution and filing constituted a valid and binding obligation of each of the
Company and the California Corporation, enforceable in accordance with its
terms, except as enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws affecting creditors' rights
generally, or by general equitable principles. The Reincorporation has been
validly effected in accordance with the laws of the states of California and
Delaware;
(g) neither the Company nor any of its Subsidiaries is in breach of, or in
default under (nor has any event occurred which with notice, lapse of time, or
both would result in any breach of, or constitute a default under), (A) its
respective charter or bylaws or (B) any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, bank loan
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or credit agreement or other evidence of indebtedness, or any lease, contract or
other agreement or instrument to which the Company or any of its Subsidiaries is
a party or by which any of them or any of their properties is bound, except in
the case of (B) above for breaches and defaults that would not have a Material
Adverse Effect; and the execution, delivery and performance of this Agreement,
the issuance and sale of the Shares and the consummation of the transactions
contemplated hereby will not conflict with, or result in any breach of or
constitute a default under (nor constitute any event which with notice, lapse of
time, or both would result in any breach of, or constitute a default under), (C)
any provisions of the charter or bylaws, of the Company or the Significant
Subsidiary or (D) any provision of any license, indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which any of them or their respective
properties may be bound or affected, or (E) any federal, state, local or foreign
law, regulation or rule or any decree, judgment or order applicable to the
Company or any of its Subsidiaries, except in the case of (D) and (E) for
breaches and defaults that would not have a Material Adverse Effect;
(h) this Agreement has been duly authorized, executed and delivered by the
Company and is a legal, valid and binding agreement of the Company enforceable
in accordance with its terms, except as rights to indemnity may be limited by
applicable federal or state securities laws and except as the enforcement hereof
may be limited by applicable bankruptcy, insolvency, reorganization or other
similar laws affecting creditors' rights generally, or by general equitable
principles;
(i) the capital stock of the Company, including the Shares, conforms in all
material respects to the description thereof contained in the Prospectus and the
certificates for the Shares are in due and proper form and the holders of the
Shares will not be subject to personal liability solely by reason of being such
holders;
(j) the Shares have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and validly
issued and fully paid and non-assessable;
(k) no approval, authorization, consent or order of or filing with any
national, state or local governmental or regulatory commission, board, body,
authority or agency is required in connection with the issuance and sale of the
Shares or the consummation by the Company of the transaction as contemplated
hereby other than registration of the Shares under the Act and any necessary
qualification under the securities or blue sky laws of the various jurisdictions
in which the Shares are being offered by the Underwriters or under the rules and
regulations of the National Association of Securities Dealers, Inc. ("NASD") and
except for such approvals, authorizations, consents, orders or filings that, if
not obtained or made, would not have a material
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impact on the consummation by the Company of the transaction as contemplated
hereby. No approval, authorization, consent or order of or filing with any
foreign governmental or regulatory commission, board, body, authority or agency
is required in connection with the issuance and sale of the portion of the
Shares that are being sold pursuant to the directed share program other than
filings which have been made or will be made in the applicable time period;
(l) no person has any right, contractual or otherwise, to cause the Company
to issue to it, or register pursuant to the Act, any shares of capital stock of
the Company that is triggered by the issue and sale of the Shares to the
Underwriters hereunder, nor does any person have preemptive rights, co-sale
rights, rights of first refusal or other rights to purchase any of the Shares
other than those that have been expressly waived prior to the date hereof;
(m) Arthur Andersen, whose report on the consolidated financial statements
of the Company and its subsidiaries is filed with the Commission as part of the
Registration Statement and Prospectus, are independent public accountants as
required by the Act; and TN Soong & Co, a member firm of Andersen Worldwide, SC,
whose report on the financial statements of the Audio/Video Products Division of
Formosoft International Inc. is filed with the Commission as part of the
Registration Statement and Prospectus, are independent public accountants as
required by the Act;
(n) each of the Company and its Subsidiaries has all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any federal, state, local or foreign law, regulation or rule, and
has obtained all necessary authorizations, consents and approvals from other
persons, in order to conduct its respective business, except for such licenses,
authorizations, consents, approvals or filings that, if not obtained or made,
would not have a Material Adverse Effect; neither the Company nor any of its
Subsidiaries is in violation of, or in default under, any such license,
authorization, consent or approval or any federal, state, local or foreign law,
regulation or rule or any decree, order or judgment applicable to the Company or
any of its Subsidiaries the effect of which could have a Material Adverse
Effect;
(o) except in each case as described in the Prospectus, there are no
actions, suits, claims, investigations or proceedings pending or threatened to
which the Company or any of its Subsidiaries or any of their respective officers
is a party or of which any of their respective properties is subject at law or
in equity, or before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency which could reasonably
be expected to result in a judgment, decree or order having a Material Adverse
Effect or prevent consummation of the transactions contemplated hereby;
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(p) the audited financial statements and summary consolidated financial
data included in the Registration Statement and the Prospectus present fairly
the consolidated financial position of the Company and its Subsidiaries as of
the dates indicated and the consolidated results of operations and cash flows of
the Company and the Subsidiaries for the periods specified; the financial
statements have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis during the periods involved; the
audited financial statements and summary consolidated financial data included in
the Registration Statement and the Prospectus present fairly the consolidated
financial position of the Audio/Video Products Division of Formosoft
International Inc. as of the dates indicated and the consolidated results of
operations and cash flows of the Audio/Video Products Division of Formosoft
International Inc. for the periods specified; the financial statements of the
Audio/Video Products Division of Formosoft International Inc. have been prepared
in conformity with generally accepted accounting principles applied on a
consistent basis during the periods involved;
(q) subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been (i) any
material adverse change, or any development which, in the Company's reasonable
judgment, is likely to cause a material adverse change, in the business,
properties or assets described or referred to in the Registration Statement and
the Prospectus, or the results of operations, condition (financial or
otherwise), business or operations of the Company and its Subsidiaries taken as
a whole, (ii) any transaction which is material to the Company or its
Subsidiaries taken as a whole, except transactions in the ordinary course of
business, (iii) any obligation, direct or contingent, which is material to the
Company and its Subsidiaries taken as a whole, incurred by the Company or its
Subsidiaries, except obligations incurred in the ordinary course of business,
(iv) any change in the capital stock (other than upon the issuance of stock
options under the Company's 1998 Stock Option Plan or exercise of outstanding
stock options) or outstanding indebtedness of the Company or its Subsidiaries,
except the incurrence or discharge of indebtedness in the ordinary course of
business or (v) any dividend or distribution of any kind declared, paid or made
on the capital stock of the Company.
(r) during the six months prior to the date hereof, neither the Company nor
any person acting on behalf of the Company has offered or sold to any person any
capital stock of the Company, other than (i) the Shares, (ii) options to
purchase shares of Common Stock or Common Stock issued upon the exercise of
outstanding stock options, (iii) to Dell or (iv) under restrictions and other
circumstances so as to ensure that such offers or sales do not become integrated
into the offer and sale of the Shares;
(s) the Company has obtained the agreement (in the form approved by you)
(the "Lock-Up Agreements") of each of its directors, officers, optionholders and
holders of at least [___]% of its outstanding Common Stock and Preferred Stock
(on an as converted basis) not to sell, offer to sell, contract to sell,
hypothecate, grant any option to sell or otherwise dispose of, directly or
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indirectly, any shares of Common Stock or securities convertible into or
exchangeable for Common Stock or warrants or other rights to purchase Common
Stock for a period of 180 days after the date of the Prospectus. Any remaining
shares not subject to the Lock-Up Agreements are subject to embedded lock-ups
substantially similar to the Lock-up Agreements and the Company has imposed stop
transfer instructions with respect to such shares and will not cancel such stop
transfer instructions prior to the end of the 180 day period without the prior
written consent of UBS Warburg LLC;
(t) the Company is not and, after giving effect to the offering and sale of
the Shares, will not be an "investment company" or an entity "controlled" by an
"investment company," as such terms are defined in the Investment Company Act of
1940, as amended (the "Investment Company Act");
(u) the Company and its Subsidiaries have good and marketable title to all
property (real and personal) described in the Prospectus as being owned by them,
free and clear of all liens, claims, security interests or other encumbrances or
defects except such as are described in the Prospectus and except as would not
individually or in the aggregate have a Material Adverse Effect. All the
property being held under lease by the Company and its Subsidiaries is held
thereby under valid, subsisting and enforceable leases, except where the failure
to so hold such lease would not have a Material Adverse Effect;
(v) the Company and its Subsidiaries, taken as a whole, are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amount as are customary in the business in which they are engaged.
All policies of insurance insuring the Company, the Subsidiaries or any of their
businesses, material assets, employees, officers and directors are in full force
and effect, and each of the Company and each of its Subsidiaries is in
compliance with the terms of such policies, except where the failure to be in
compliance would not have a Material Adverse Effect. There are no material
claims by the Company or any of its Subsidiaries under any such policy or
instrument as to which any insurance company is denying liability or defending
under a reservation of rights clause;
(w) the Company has received the written consent to the use of all
statistical and market-related data included in the Prospectus from appropriate
sources to the extent required;
(x) Except as described in the Prospectus, the Company owns or has obtained
licenses (which licenses are enforceable against the Company and, to the
Company's knowledge, the other parties thereto) for the patents, patent
applications, inventions, technology, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information
systems or procedures), trademarks, trademark registrations, service marks,
service mark registrations, mask work rights, trade names, copyrights, and other
rights (collectively, the
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"Intellectual Property") described in the Prospectus as being owned or used by
or licensed to the Company or its Subsidiaries. Except for matters relating to
third parties expressly identified and named under the captions in the
Prospectus entitled "Risk factors--Risks Related to our Business--We have
received notices of claims, and may receive additional notices of claims in the
future, regarding the alleged infringement of third parties' intellectual
property rights that may result in restrictions or prohibitions on the sale of
our products and cause us to pay license fees and damages" or
"Business--Intellectual Property" (together, the "Intellectual Property
Sections") or otherwise disclosed to the representatives of the Underwriters,
the Company and its Subsidiaries own or have obtained licenses, or can acquire
licenses on reasonable terms that will not have a Material Adverse Effect, all
Intellectual Property necessary for the conduct of their respective businesses
as currently conducted or proposed to be conducted as described in the
Prospectus. Each employee of and consultant to the Company and its Subsidiaries
has entered into a confidentiality and invention assignment agreement in favor
of the Company or the related Subsidiary as a condition of his or her employment
or retention in service, except where failure to enter into such an agreement
will not have a Material Adverse Effect. Except for matters relating to third
parties expressly identified and named under the Intellectual Property Sections
of the Prospectus or otherwise disclosed to the representatives of the
Underwriters: (i) to the Company's knowledge, there are no rights of third
parties to any Intellectual Property owned by or licensed to the Company or its
Subsidiaries that conflict with the rights of the Company or its Subsidiaries
related to such Intellectual Property that would have a Material Adverse Effect;
(ii) there is no infringement by third parties of any Intellectual Property
owned by or exclusively licensed to the Company or its Subsidiaries that would
have a Material Adverse Effect; (iii) other than in connection with assertions
or inquiries made by patent office examiners in the ordinary course of the
prosecution of the Company's patent applications, to the knowledge of the
Company, there is no pending or threatened action, suit, proceeding or claim by
others challenging the Company's or any of its Subsidiaries' rights in or to any
Intellectual Property that would have a Material Adverse Effect, and the Company
is unaware of any facts which would form a reasonable basis for any such claim;
(iv) other than in connection with assertions or inquiries made by patent office
examiners in the ordinary course of the prosecution of the Company's patent
applications, to the knowledge of the Company, there is no pending or threatened
action, suit, proceeding or claim by others challenging the validity or scope of
any Intellectual Property owned by or licensed to the Company or its
Subsidiaries that would have a Material Adverse Effect, and the Company is
unaware of any facts which would form a reasonable basis for any such claim; (v)
to the knowledge of the Company, there is no pending or threatened action, suit,
proceeding or claim by others that the Company or any of its Subsidiaries
infringes or otherwise violates, or would infringe or otherwise violate upon
commercialization of its products and product candidates described in the
Prospectus, any patent, trademark, copyright, trade secret or other proprietary
rights of others, and there are no facts which would form a reasonable basis for
any action, suit, proceeding or claim by others that the Company or any of its
Subsidiaries infringes or otherwise violates, or would infringe or otherwise
violate upon commercialization of its products and product candidates described
in the Prospectus, any patent, trademark, copyright, trade secret or other
proprietary rights of others that would have a Material Adverse Effect; and (vi)
to the Company's knowledge there is no patent or patent application which
contains claims that interfere with any Intellectual Property described in the
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Prospectus as being owned by or licensed to the Company or any of its
Subsidiaries or that is necessary for the conduct of their respective businesses
as currently or contemplated to be conducted that would have a Material Adverse
Effect;
(y) neither the Company nor any of its Subsidiaries has violated any
foreign, federal, state or local law or regulation relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants, nor any federal or state law relating to
discrimination in the hiring, promotion or pay of employees nor any applicable
federal or state wages and hours laws, nor any provisions of the Employee
Retirement Income Security Act or the rules and regulations promulgated
thereunder, which violation individually or in the aggregate could reasonably be
expected to result in a Material Adverse Effect;
(z) the Company and the Subsidiaries, taken as a whole, 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 authorization; (ii) records (including sales contracts) are kept in
accordance with management's general or specific authorization and true and
accurate copies are provided to the Company's independent auditors; (iii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iv) access to assets is permitted only in
accordance with management's general or specific authorization; and (v) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences;
(aa) each of the Company and its Subsidiaries has filed all federal, state,
local and foreign tax returns and tax forms required to be filed, except where
failure to so file would not have a Material Adverse Effect. Such returns and
forms are complete and correct in all material respects, and all taxes shown by
such returns or otherwise assessed that are due or payable have been paid,
except such taxes as are being contested in good faith and as to which adequate
reserves have been provided. All payroll withholdings required to be made by the
Company and each of its Subsidiaries with respect to employees have been made,
except where failure to make such withholdings would not have a Material Adverse
Effect. The charges, accruals and reserves on the books of the Company and each
of its Subsidiaries in respect of any tax liability for any year not finally
determined are, in management's determination, adequate to meet any assessments
or reassessments for additional taxes. There have been no tax deficiencies
asserted and, to the knowledge of the Company, no tax deficiency might be
reasonably asserted or threatened against the Company or any of its Subsidiaries
which individually or in the aggregate could have a Material Adverse Effect; and
(bb) immediately after the Time of Purchase, no shares of preferred stock
of the Company shall be issued and outstanding, and no holder of any shares of
capital stock, securities
11
convertible into or exchangeable or exercisable for capital stock or options,
warrants or other rights to purchase capital stock or any other securities of
the Company shall have any existing or future right to acquire any shares of
preferred stock of the Company.
In addition, any certificate signed by any executive officer of the Company
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Shares shall be deemed to be a representation and
warranty by the Company, as to matters covered thereby, to each Underwriter.
4. Certain Covenants of the Company. The Company hereby agrees:
--------------------------------
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the securities or
blue sky laws of such states as you may designate and to maintain such
qualifications in effect so long as required for the distribution of the Shares;
provided that the Company shall not be required to qualify as a foreign
- --------
corporation (unless it is already so qualified) or to consent to the service of
process under the laws of any such state (except service of process with respect
to the offering and sale of the Shares); and to promptly advise you of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon as
practicable after the Registration Statement becomes effective, and thereafter
from time to time to furnish to the Underwriters, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company shall
have made any amendments or supplements thereto after the effective date of the
Registration Statement) as the Underwriters may request for the purposes
contemplated by the Act; in case any Underwriter is required to deliver a
prospectus within the nine-month period referred to in Section 10(a)(3) of the
Act in connection with the sale of the Shares, the Company will prepare promptly
upon request, but at the expense of such Underwriter, such amendment or
amendments to the Registration Statement and such prospectuses as may be
necessary to permit compliance with the requirements of Section 10(a)(3) of the
Act;
(c) to advise you promptly and (if requested by you) to confirm such advice
in writing, (i) if Rule 430A under the Act is not used, when the Registration
Statement has become effective and when any post-effective amendment thereto
becomes effective and (ii) if Rule 430A under the Act is used, when the
Prospectus is filed with the Commission pursuant to Rule 424(b) under the Act
(which the Company agrees to file in a timely manner under such Rules);
(d) to advise you promptly, and (if requested by you) to confirm such
advice in writing, of any request by the Commission for amendments or
supplements to the Registration Statement or the Prospectus or for additional
information with respect thereto, or of notice of institution of proceedings
for, or the entry of a stop order suspending the effectiveness of the
Registration
12
Statement and, if the Commission should enter a stop order suspending the
effectiveness of the Registration Statement, to make every reasonable effort to
obtain the lifting or removal of such order as soon as possible; to advise you
promptly of any proposal to amend or supplement the Registration Statement or
Prospectus and to file no such amendment or supplement to which you shall object
in writing;
(e) to file promptly all reports and any definitive proxy or information
statement required to be filed by the Company with the Commission and otherwise
take all actions in order to comply with the Exchange Act subsequent to the date
of the Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the shares;
(f) if necessary or appropriate, to file a registration statement pursuant
to Rule 462(b) under the Act;
(g) to furnish to you and, upon request, to each of the other Underwriters
for a period of five years from the date of this Agreement (i) copies of any
reports or other communications which the Company shall send to its stockholders
or shall from time to time publish or publicly disseminate, (ii) copies of all
annual, quarterly and current reports filed with the Commission on Forms 10-K,
10-Q and 8-K, or such other similar form as may be designated by the Commission,
(iii) copies of documents or reports filed with any national securities exchange
or authorized quotation system on which any class of securities of the Company
is listed, and (iv) such other information as you may reasonably request
regarding the Company or any of its Subsidiaries, in each case as soon as such
communications, documents or information becomes available;
(h) to advise the Underwriters promptly of the happening of any event known
to the Company within the time during which a Prospectus relating to the Shares
is required to be delivered under the Act which, in the judgment of the Company,
would require the making of any change in the Prospectus then being used so that
the Prospectus would not include an untrue statement of material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading and, during such
time, to prepare and furnish, at the Company's expense, to the Underwriters
promptly such amendments or supplements to such Prospectus as may be necessary
to reflect any such change and to furnish you a copy of such proposed amendment
or supplement before filing any such amendment or supplement with the
Commission;
(i) to make generally available to its security holders, and to deliver to
you, an earnings statement of the Company (which will satisfy the provisions of
Section 11(a) of the Act) covering a period of twelve months beginning after the
effective date of the Registration Statement (as defined in Rule 158(c) of the
Act) as soon as is reasonably practicable after the termination of such
twelve-month period but not later than eighteen months after such effective
date;
(j) to furnish to its stockholders as soon as practicable after the end of
each fiscal year an annual report (including a balance sheet and statements of
income, shareholders' equity and of
13
cash flow of the Company for such fiscal year), accompanied by a copy of the
certificate or report thereon of nationally recognized independent certified
public accountants;
(k) to furnish to you three (3) signed copies of the Registration
Statement, as initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto) and sufficient conformed copies of the
foregoing (other than exhibits) for distribution of a copy to each of the other
Underwriters;
(l) to furnish to you as early as practicable prior to the Time of Purchase
and the Additional Time of Purchase, as the case may be, but not later than two
business days prior thereto, a copy of the latest available unaudited interim
consolidated financial statements, if any, of the Company and its Subsidiaries
which have been reviewed by the Company's independent certified public
accountants, as stated in their letter to be furnished pursuant to Section 6(d)
hereof;
(m) to apply the net proceeds from the sale of the Shares in the manner set
forth under the caption "Use of Proceeds" in the Prospectus;
(n) to furnish to you, before filing with the Commission subsequent to the
effective date of the Registration Statement and during the period referred to
in paragraph (e) above, a copy of any document proposed to be filed pursuant to
Section 13, 14 or 15(d) of the Exchange Act;
(o) not to issue, sell, offer or agree to sell, contract to sell, grant any
option to sell or otherwise dispose of, directly or indirectly, any shares of
capital stock or securities convertible into or exchangeable or exercisable for
capital stock or warrants or other rights to purchase capital stock or any other
securities of the Company that are substantially similar to capital stock or
permit the registration under the Act of any shares of capital stock, without
the prior written consent of UBS Warburg LLC, except (i) for the registration of
the Shares and the sales to the Underwriters pursuant to this Agreement, (ii)
except for issuances of Common Stock or options to purchase Common Stock
pursuant to employee benefit plans described in Prospectus for a period of 180
days after the date hereof and (iii) in connection with any acquisition of, or
merger with, another company or the acquisition of any assets of another
company; provided, however, that with respect to (iii), any such acquisition or
merger involves an amount of the Company's securities that is less than or equal
to five percent (5%) of the Company's outstanding share capital, which shall be
measured at the time a definitive agreement is signed in connection with such
acquisition, merger or strategic transaction; and provided, further, that it
shall be a condition to the closing of any such transaction that any person or
entity who becomes a holder of the Company's Common Stock or any securities
substantially similar to the Common Stock, including but not limited to any
securities convertible into or exchangeable for, or that represents the right to
receive Common Stock or any such securities, shall execute a Lock-Up Agreement;
(p) to use its best efforts to cause the Common Stock to be included for
quotation on the Nasdaq National Market;
14
(q) to pay all costs, expenses, fees and taxes (other than any transfer
taxes and fees and disbursements of counsel for the Underwriters except as set
forth under Section 5 hereof and (iii), (iv) and (vi) below) in connection with
(i) the preparation and filing of the Registration Statement, each Preliminary
Prospectus, the Prospectus, and any amendments or supplements thereto, and the
printing and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (ii) the registration,
issuance, sale and delivery of the Shares, (iii) the word processing and/or
printing of this Agreement, any Agreement Among Underwriters, any dealer
agreements, any Statements of Information, any Powers of Attorney and any
closing documents (including compilations thereof) and the reproduction and/or
printing and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (iv) the qualification of the
Shares for offering and sale under state laws and the determination of their
eligibility for investment under state law as aforesaid (including the
reasonable legal fees and filing fees and other disbursements of counsel to the
Underwriters) and the printing and furnishing of copies of any blue sky surveys
or legal investment surveys to the Underwriters and to dealers, (v) any listing
of the Shares on any securities exchange or qualification of the Shares for
quotation on the Nasdaq Stock Market and any registration thereof under the
Exchange Act, (vi) the filing for review of the public offering of the Shares by
the NASD, including reasonable attorneys' fees related thereto, and (vii) the
performance of the Company's other obligations hereunder; and
(r) not to waive any lock-up provisions in any agreements it has with Dell
without the prior written consent of UBS Warburg LLC.
5. Reimbursement of Underwriters' Expenses. If the Shares are not delivered
---------------------------------------
for any reason other than the default by one or more of the Underwriters in its
or their respective obligations hereunder, the Company shall, in addition to
paying the amounts described in Section 4(q) hereof, reimburse the Underwriters
for all of their out-of-pocket expenses, including the fees and disbursements of
their counsel.
6. Conditions of Underwriters' Obligations. The several obligations of the
---------------------------------------
Underwriters hereunder are subject to the accuracy of the representations and
warranties on the part of the Company on the date hereof and at the Time of
Purchase (and the several obligations of the Underwriters at the Additional Time
of Purchase are subject to the accuracy of the representations and warranties on
the part of the Company on the date hereof and at the Time of Purchase (unless
previously waived) and at the Additional Time of Purchase, as the case may be),
the performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(s) The Company shall furnish to you at the Time of Purchase and at the
Additional Time of Purchase, as the case may be, a written opinion of Wilson
Sonsini Goodrich & Rosati, P.C., counsel for the Company, addressed to the
Underwriters, and dated the Time of Purchase or the
15
Additional Time of Purchase, as the case may be, with reproduced copies for each
of the other Underwriters and in form satisfactory to Brobeck, Phleger &
Harrison LLP, counsel for the Underwriters, stating that:
(i) the Company is duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the Prospectus (and any supplement
thereto), to execute and deliver the Underwriting Agreement and to issue,
sell and deliver the Shares as therein contemplated;
(ii) the Company is duly qualified to transact business in the states
of Delaware and California;
(iii) the Underwriting Agreement has been duly authorized, executed
and delivered by the Company and the Company has corporate power and
authority to enter into the Underwriting Agreement and authorize, issue and
sell the Shares as contemplated by the Underwriting Agreement;
(iv) the authorized, issued and outstanding capital stock as of
[December 31, 2001] was as set forth under the "Actual" column under
heading "Capitalization" in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly authorized and
issued and to our knowledge are fully paid and non-assessable and conform
to the description thereof contained in the Prospectus;
(v) to our knowledge, except as described in the Prospectus, there are
no outstanding securities of the Company convertible or exchangeable into,
or evidencing the right to purchase or subscribe for any shares of capital
stock of the Company and there are no outstanding or authorized options,
warrants or rights of a similar character in writing obligating the Company
to issue any shares of its capital stock or any securities convertible or
exchangeable into, or evidencing the right to purchase or subscribe for,
any shares of such stock. The stockholders of the Company have no
preemptive rights pursuant to the Company's charter or bylaws;
(vi) the Shares to be sold by the Company have been duly authorized,
and, when issued and delivered in accordance with the terms of the
Underwriting Agreement, will be validly issued, fully paid and
non-assessable;
(vii) the Shares, when issued, will, to our knowledge, be free of
contractual preemptive rights, rights of first refusal and similar rights;
the certificates for the Shares are in due and proper form and conform in
all material respects to the requirements of the Delaware General
Corporation Law;
16
(viii) we do not know of any legal or governmental proceedings pending
or overtly threatened in writing against the Company, or to which the
Company is a party or of which any property of the Company is the subject
which are required to be described in the Prospectus that are not so
described;
(ix) [reserved];
(x) the statements set forth under the caption "Description of capital
stock" in the Prospectus, insofar as such statements purport to summarize
certain provisions of the capital stock of the Company, provide a fair
summary of such provisions in all material respects; the statements set
forth under the captions "Risk factors--Risks Related to our Business--We
have received notices of claims, and may receive additional notices of
claims in the future, regarding the alleged infringement of third parties'
intellectual property rights that may result in restrictions or
prohibitions on the sale of our products and cause us to pay license fees
and damages" (solely with respect to statements relating to the license
agreement with MPEG LA and the settlement agreement with Dell); "Risk
Factors--Risks Relating to this Offering--We have implemented anti-takeover
provisions that could discourage a third party from acquiring us and
consequently decrease the market value of your investment;"
"Business--Intellectual Property" (solely with respect to statements
relating to the license agreement with MPEG LA and the settlement agreement
with Dell); "--Legal Proceedings;" "Management--Executive
Compensation--1998 Stock Option Plan;" "--2002 Stock Option Plan;" "--2002
Employee Stock Purchase Plan;" "Related Party Transactions;" "Shares
eligible for future sale" and "Underwriting" (to the extent it is a
description of this Agreement) in the Prospectus, in each case insofar as
such statements constitute summaries of the legal matters, documents or
proceedings referred to therein, have been reviewed by us, are correct in
all material respects and fairly summarize the matters referred to therein
to the extent required by the Act;
(xi) other than as set forth in the Prospectus or expressly waived in
writing, there are no contracts, agreements or understandings known to us
between the Company and any person granting such person the right,
contractual or otherwise, to cause the Company to sell, or to permit them
to underwrite the sale of, any of the capital stock of the Company or to
require the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement;
(xii) the Registration Statement and all post-effective amendments, if
any, were declared effective under the Act and the Prospectus was filed
with the Commission pursuant to Rule 424(b) under the Act; to our
knowledge, no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued, and no proceedings for that
purpose have been instituted or are pending or, to our knowledge, are
contemplated under the Act;
17
(xiii) no approval, authorization, consent or order of or filing with
any governmental or regulatory commission, board, body, authority, agency
or court is required in connection with the issuance and sale of the Shares
and consummation by the Company of the transactions contemplated hereby
other than registration of the Shares under the Act (except such counsel
need express no opinion as to any necessary qualification under the state
securities or blue sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters);
(xiv) the execution, delivery and performance of the Underwriting
Agreement by the Company and the consummation by the Company of the
transactions contemplated thereby do not and will not result in any breach
or violation of, or constitute a default under (nor constitute any event
which with notice, lapse of time, or both, would result in any breach of or
constitute a default under), any provisions of the charter or bylaws of the
Company or under any agreement or instrument filed as an exhibit to the
Registration Statement pursuant to Item 601 of Regulation S-K to which the
Company is a party or by which the Company is bound, or under any statute,
regulation or rule or any decree, judgment or order known to us to be
customarily applicable to the Company and transactions of this nature;
(xv) we do not know of any contracts, licenses, agreements, leases or
documents of a character required to be filed as exhibits to the
Registration Statement which are not described or filed as required;
(xvi) the Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described
in the Prospectus, will not be an "investment company" as defined in the
Investment Company Act of 1940, as amended;
(xvii) the Shares have been approved for quotation on the Nasdaq
National Market upon issuance as contemplated by the Underwriting
Agreement;
(xviii) the execution and delivery of the Agreement and Plan of Merger
(the "Merger Agreement"), dated ______________, 2002 between the Company
and InterVideo, Inc., a California corporation (the "California
Corporation"), effecting the reincorporation of the California Corporation
under the laws of the State of Delaware, was duly authorized by all
necessary corporate action on the part of each of the California
Corporation and the Company; and
(xix) each of the California Corporation and the Company had all
corporate power and authority necessary to execute and file the Certificate
of Ownership and Merger with the Secretary of State of the State of
California and the Secretary of State of the State of Delaware and to
consummate the merger of the California Corporation with and into the
Company contemplated by the Merger Agreement, and the
18
Merger Agreement at the time of execution and immediately prior to the
effectiveness of the Merger 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) general principles of equity.
In addition, such counsel shall state that it has participated in
conferences with certain officers and other representatives of the Company, its
intellectual property counsel, the Representatives, counsel for the Underwriters
and the independent certified public accountants of the Company, at which
conferences the contents of the Registration Statement and Prospectus and
related matters were discussed. Such counsel shall state that, although it does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or Prospectus except for
those referred to in paragraph [(x)] above, no facts have come to its attention
that have caused it to believe that, (i) as of its effective date and as of the
date hereof, the Registration Statement or any amendment thereto (other than the
financial statements and related schedules and the financial and statistical
data derived from such financial statements or schedules, as to which such
counsel need express no belief) contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or (ii) as of
its issue date or as of the date hereof, the Prospectus or any amendment or
supplement thereto (other than the financial statements and related schedules
and the financial and statistical data derived from such financial statements or
schedules, as to which such counsel need express no belief) contained any untrue
statement of a material fact or omitted to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. In addition, such counsel shall confirm
that each of the Registration Statement and the Prospectus, and each amendment
or supplement thereto (other than the financial statements and related schedules
and the financial and statistical data derived from such financial statements or
schedules, as to which it need express no belief) as of their respective
effective or issue dates, complied as to form in all material respects with the
requirements of the Securities Act and the Rules and Regulations.
In rendering such opinion, such counsel may state that their opinion is
limited to the federal laws of the United States, the Delaware General
Corporation Law and the laws of the State of California.
(b) The Company shall furnish to you at the Time of Purchase and at the
Additional Time of Purchase, as the case may be, (i) an opinion of Coudert
Brothers LLP in the form set forth in Annex A attached hereto, (iii) an opinion
-------
of Knobbe Martens, Olson and Bear in the form set forth in Annex B attached
-------
hereto and (iv) an opinion of Crosby, Heafey, Roach & May in the form set forth
in Annex C attached hereto, each special counsel for the Company on certain
-------
intellectual property matters, addressed to the Underwriters, and dated the Time
of Purchase or the Additional Time of Purchase, as the case may be, with
reproduced copies for each of the other Underwriters.
19
(c) The Company shall furnish to you at the Time of Purchase and at the
Additional Time of Purchase, as the case may be, a written opinion of Lee and
Li, counsel for the Significant Subsidiary, addressed to the Underwriters, and
dated the Time of Purchase or the Additional Time of Purchase, as the case may
be, with reproduced copies for each of the other Underwriters and in form
satisfactory to Brobeck, Phleger & Harrison LLP, counsel for the Underwriters,
stating that:
(i) the Significant Subsidiary is 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 conduct its business;
(ii) the Significant Subsidiary is duly qualified to transact business
in its jurisdiction of incorporation and [_________________];
(iii) we do not know of any legal or governmental proceedings pending
or threatened against the Significant Subsidiary, or to which the
Significant Subsidiary is a party or of which any property of the
Significant Subsidiary is the subject which are required to be described in
the Prospectus that are not so described;
(iv) all of the outstanding shares of capital stock of the Significant
Subsidiary have been duly authorized and validly issued, are fully paid and
non-assessable and, except as otherwise stated in the Prospectus, are owned
by the Company, subject to no security interest, other encumbrance or
adverse claim; to our knowledge, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligation into shares of capital stock or ownership interests
in the Significant Subsidiary are outstanding; and
(v) the execution, delivery and performance of the Underwriting
Agreement by the Company and the consummation by the Company of the
transactions contemplated thereby do not and will not result in any breach
or violation of, or constitute a default under (nor constitute any event
which with notice, lapse of time, or both, would result in any breach of or
constitute a default under), any provisions of the charter or bylaws of the
Significant Subsidiary or under any material agreement or instrument to
which the Significant Subsidiary is a party or by which the Significant
Subsidiary is bound, or under any statute, regulation or rule or any
decree, judgment or order known to us and applicable to the Significant
Subsidiary or any of its properties.
(d) You shall have received from Arthur Andersen LLP, letters dated,
respectively, the date of this Agreement and the Time of Purchase and Additional
Time of Purchase, as the case may be, and addressed to the Underwriters (with
reproduced copies for each of the Underwriters) in the forms heretofore approved
by UBS Warburg LLC; and you shall have received from TN Soong & Co., a member
firm of Andersen Worldwide, SC, letters dated, respectively, the date of this
Agreement and the Time of Purchase and Additional Time of
20
Purchase, as the case may be, and addressed to the Underwriters (with reproduced
copies for each of the Underwriters) in the forms heretofore approved by UBS
Warburg LLC.
(e) The Company shall have complied with the provisions of Section 4(b)
hereof with respect to the furnishing of copies of the Prospectus as soon as
practicable after the Registration Statement becomes effective.
(f) You shall have received at the Time of Purchase and at the Additional
Time of Purchase, as the case may be, the favorable opinion of Brobeck, Phleger
& Harrison LLP, counsel for the Underwriters, dated the Time of Purchase or the
Additional Time of Purchase, as the case may be, as to the matters referred to
in subparagraphs (iii), (vi), and (xii) of paragraph (a) of this Section 6.
In addition, such counsel shall state that such counsel have participated
in conferences with officers and other representatives of the Company, counsel
for the Company, representatives of the independent public accountants of the
Company and representatives of the Underwriters at which the contents of the
Registration Statement and Prospectus and related matters were discussed and,
although such counsel is not passing upon and does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained in the
Registration Statement and Prospectus, on the basis of the foregoing (relying as
to materiality to a large extent upon the opinions of officers and other
representatives of the Company), no facts have come to the attention of such
counsel which lead them to believe that the Registration Statement or any
amendment thereto at the time such Registration Statement or amendment 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 any supplement
thereto as of its date 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, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
comment with respect to the financial statements and schedules and other
financial and statistical data derived therefrom included in the Registration
Statement or Prospectus).
(g) No amendment or supplement to the Registration Statement or Prospectus
shall have been filed prior to the time the Registration Statement becomes
effective to which you had objected in writing.
(h) The Registration Statement shall have become effective, or if Rule 430A
under the Act is used, the Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) under the Act, at or before 5:00 P.M., New York City
time, on the second full business day after the date of this Agreement);
provided, however, that the Company and you and any group of Underwriters,
- -------- -------
including you, who have agreed hereunder to purchase in the aggregate at least
50% of the Firm Shares may from time to time agree on a later date.
21
(i) Prior to the Time of Purchase or the Additional Time of Purchase, as
the case may be, (i) no stop order with respect to the effectiveness of the
Registration Statement shall have been issued under the Act or proceedings
initiated under Section 8(d) or 8(e) of the Act; (ii) the Registration Statement
and all amendments thereto, or modifications thereof, if any, shall not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
and (iii) the Prospectus and all amendments or supplements thereto, or
modifications thereof, if any, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they are made, not misleading.
(j) Between the time of execution of this Agreement and the Time of
Purchase or the Additional Time of Purchase, as the case may be, (i) no material
and unfavorable change, financial or otherwise (other than as referred to in the
Registration Statement and Prospectus), in the business or condition of the
Company and its Subsidiaries taken as a whole shall occur or become known and
(ii) no transaction which is material and unfavorable to the Company shall have
been entered into by the Company or any of its Subsidiaries.
(k) The Company will, at the Time of Purchase or Additional Time of
Purchase, as the case may be, deliver to you a certificate of two of its
executive officers to the effect that the representations and warranties of the
Company as set forth in this Agreement are true and correct as of each such
date, that the Company shall perform such of its obligations under this
Agreement as are to be performed at or before the Time of Purchase and at or
before the Additional Time of Purchase, as the case may be, and the conditions
set forth in paragraphs (h) and (i) of this Section 6 have been met.
(l) You shall have received the Lock-Up Agreements, dated the date of this
Agreement, from each of the directors, officers, optionholders and holders of at
least [____]% of the Company's outstanding Common Stock and Preferred Stock (on
an as converted basis) to the effect that such persons shall not sell, offer or
agree to sell, contract to sell, grant any option to sell or otherwise dispose
of, directly or indirectly, any shares of Common Stock of the Company or
securities convertible into or exchangeable or exercisable for Common Stock or
warrants or other rights to purchase Common Stock for a period of 180 days after
the date of the Prospectus without the prior written consent of UBS Warburg LLC.
Any remaining shares will have stop transfer instructions imposed on them until
the end of the 180 day period which stop transfer instructions may not be
canceled without the prior written consent of UBS Warburg LLC.
(m) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the Time of Purchase and the
Additional Time of Purchase, as the case may be, as you may reasonably request.
22
(n) The Shares shall have been approved for quotation on the Nasdaq
National Market, subject only to notice of issuance at or prior to the Time of
Purchase or the Additional Time of Purchase, as the case may be.
(o) Between the time of execution of this Agreement and the Time of
Purchase or Additional Time of Purchase, as the case may be, there shall not
have occurred any downgrading, nor shall any notice or announcement have been
given or made of (i) any intended or potential downgrading or (ii) any review or
possible change that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company or any of its Subsidiaries by any
"nationally recognized statistical rating organization" as that term is defined
in Rule 436(g)(2) under the Act.
7. Effective Date of Agreement; Termination. This Agreement shall become
----------------------------------------
effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be subject to
termination in the absolute discretion of you or any group of Underwriters
(which may include you) which has agreed to purchase in the aggregate at least
50% of the Firm Shares, if, since the time of execution of this Agreement or the
respective dates as of which information is given in the Registration Statement
and Prospectus, (i) there has been any material adverse and unfavorable change,
financial or otherwise (other than as referred to in the Registration Statement
and Prospectus), in the operations, business or condition of the Company and its
Subsidiaries taken as a whole, which would, in your judgment or in the judgment
of such group of Underwriters, make it impracticable to market the Shares; or
(ii) there shall have occurred any downgrading, or any notice shall have been
given of (x) any intended or potential downgrading or (y) any review or possible
change that does not indicate an improvement, in the rating accorded any
securities of or guaranteed by the Company or any of its Subsidiaries by any
"nationally recognized statistical rating organization" as that term is defined
in Rule 436(g)(2) under the Act; or (iii) if, at any time prior to the Time of
Purchase or, with respect to the purchase of any Additional Shares, the
Additional Time of Purchase, as the case may be, trading in securities on the
New York Stock Exchange, the American Stock Exchange or the Nasdaq Stock Market
shall have been suspended or limitations or minimum prices shall have been
established on the New York Stock Exchange, the American Stock Exchange or the
Nasdaq Stock Market, or if a banking moratorium shall have been declared either
by the United States or New York State authorities; or (iv) if the United States
shall have declared war in accordance with its constitutional processes or there
shall have occurred any material outbreak or escalation of hostilities or other
national or international calamity or crisis of such magnitude in its effect on
the financial markets of the United States as, in your judgment or in the
judgment of such group of Underwriters, to make it impracticable to market the
Shares.
23
If you or any group of Underwriters elects to terminate this Agreement as
provided in this Section 7, the Company and each other Underwriter shall be
notified promptly by letter, facsimile or email.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because the Company shall be
unable to comply with any of the terms of this Agreement, the Company shall not
be under any obligation or liability under this Agreement (except to the extent
provided in Sections 4(q), 5 and 9 hereof), and the Underwriters shall be under
no obligation or liability to the Company under this Agreement (except to the
extent provided in Section 9 hereof) or to one another hereunder.
8. Increase in Underwriters' Commitments. Subject to Sections 6 and 7, if
-------------------------------------
any Underwriter shall default in its obligation to take up and pay for the Firm
Shares to be purchased by it hereunder (otherwise than for reasons sufficient to
justify the termination of this Agreement under the provisions of Section 7
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters shall take up and
pay for (in addition to the number of Firm Shares they are obligated to purchase
pursuant to Section 1 hereof) the number of Firm Shares agreed to be purchased
by all such defaulting Underwriters, as hereinafter provided. Such Shares shall
be taken up and paid for by such non-defaulting Underwriter or Underwriters in
such amount or amounts as you may designate with the consent of each Underwriter
so designated or, in the event no such designation is made, such Shares shall be
taken up and paid for by all non-defaulting Underwriters pro rata in proportion
to the aggregate number of Firm Shares set opposite the names of such
non-defaulting Underwriters in Schedule A.
----------
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that the
Company will not sell any Firm Shares hereunder unless all of the Firm Shares
are purchased by the Underwriters (or by substituted Underwriters selected by
you with the approval of the Company or selected by the Company with your
approval).
If a new Underwriter or Underwriters are substituted by the Underwriters or
by the Company for a defaulting Underwriter or Underwriters in accordance with
the foregoing provision, the Company or you shall have the right to postpone the
Time of Purchase for a period not exceeding seven business days in order that
any necessary changes in the Registration Statement and Prospectus and other
documents may be effected.
The term Underwriter as used in this Agreement shall refer to and include
any Underwriter substituted under this Section 8 with like effect as if such
substituted Underwriter had originally been named in Schedule A.
----------
24
If the aggregate number of Shares which the defaulting Underwriter or
Underwriters agreed to purchase exceeds 10% of the total number of Shares which
all Underwriters agreed to purchase hereunder, and if neither the non-defaulting
Underwriters nor the Company shall make arrangements within the seven business
day period stated above for the purchase of all the Shares which the defaulting
Underwriter or Underwriters agreed to purchase hereunder, this Agreement shall
be terminated without further act or deed and without any liability on the part
of the Company to any non-defaulting Underwriter except for the expenses to be
borne by the Company pursuant to Section 4 (q) above and without any liability
on the part of any non-defaulting Underwriter to the Company. Nothing in this
paragraph, and no action taken hereunder, shall relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
9. Indemnity and Contribution.
--------------------------
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, any such
Underwriter or any such person may incur under the Act, the Exchange Act, common
law or otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company) or in a Prospectus (the term Prospectus for the purpose of this Section
9 being deemed to include any Preliminary Prospectus, the Prospectus and the
Prospectus as amended or supplemented by the Company), or arises out of or is
based upon any omission or alleged omission to state a material fact required to
be stated in either such Registration Statement or Prospectus or necessary to
make the statements made therein not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact contained in and
in conformity with information furnished in writing by or on behalf of any
Underwriter through you to the Company expressly for use with reference to such
Underwriter in such Registration Statement or such Prospectus or arises out of
or is based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in such Registration
Statement or such Prospectus or necessary to make such information not
misleading; provided, however, that the foregoing indemnity agreement with
-------- -------
respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such loss, damage, expense,
liability or claim purchased Shares, or any person controlling such Underwriter,
if a copy of the Prospectus (as then amended or supplemented) was timely
furnished by the Company to such Underwriter and the Prospectus (as then amended
or supplemented) 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 or supplemented) would have cured the defect giving
rise to such loss, damage, expense, liability or claim.
25
If any action, suit or proceeding (together, a "Proceeding") is brought
against an Underwriter or any such person in respect of which indemnity may be
sought against the Company pursuant to the foregoing paragraph, such Underwriter
or such person shall promptly notify the Company in writing of the institution
of such Proceeding and the Company shall assume the defense of such Proceeding,
including the employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses; provided, however, that the omission
-------- -------
to so notify the Company shall not relieve the Company from any liability which
the Company may have to any Underwriter or any such person or otherwise. Such
Underwriter or such controlling person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such Underwriter or of such person unless the
employment of such counsel shall have been authorized in writing by the Company
in connection with the defense of such Proceeding or the Company shall not have,
within a reasonable period of time in light of the circumstances, employed
counsel to have charge of the defense of such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from, additional to or in conflict
with those available to the Company (in which case the Company shall not have
the right to direct the defense of such Proceeding on behalf of the indemnified
party or parties), in any of which events such fees and expenses shall be borne
by the Company and paid as incurred (it being understood, however, that the
Company shall not be liable for the expenses of more than one separate counsel
(in addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified parties who
are parties to such Proceeding). The Company shall not be liable for any
settlement of any such Proceeding effected without its written consent but if
settled with the written consent of the Company, the Company agrees to indemnify
and hold harmless any Underwriter and any such person from and against any loss
or liability by reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such Proceeding and does not include an admission
of fault, culpability or a failure to act, by or on behalf of such indemnified
party.
(b) Each Underwriter, severally and not jointly, agrees to indemnify,
defend and hold harmless the Company, its directors and officers, and any person
who controls the
26
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, the Company or any such
person may incur under the Act, the Exchange Act, common law or otherwise,
insofar as such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
contained in and in conformity with information furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use with
reference to such Underwriter in the Registration Statement (or in the
Registration Statement as amended by or on behalf of any post-effective
amendment thereof by the Company) or in the Prospectus, or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in such Registration
Statement or Prospectus or necessary to make such information not misleading.
If any Proceeding is brought against the Company or any such person in
respect of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing of the institution of such Proceeding and such
Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses, provided, however, that the omission to so
-------- -------
notify such Underwriter shall not relieve such Underwriter, from any liability
which such Underwriter may have to the Company or any such person or otherwise.
The Company or such person shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the expense of
the Company or such person unless the employment of such counsel shall have been
authorized in writing by such Underwriter in connection with the defense of such
Proceeding or such Underwriter shall not have employed counsel to have charge of
the defense of such Proceeding or such indemnified party or parties shall have
reasonably concluded that there may be defenses available to it or them which
are different from or additional to or in conflict with those available to such
Underwriter (in which case such Underwriter shall not have the right to direct
the defense of such Proceeding on behalf of the indemnified party or parties,
but such Underwriter may employ counsel and participate in the defense thereof
but the fees and expenses of such counsel shall be at the expense of such
Underwriter), in any of which events such fees and expenses shall be borne by
such Underwriter and paid as incurred (it being understood, however, that such
Underwriter shall not be liable for the expenses of more than one separate
counsel (in addition to any local counsel) in any one Proceeding or series of
related Proceedings in the same jurisdiction representing the indemnified
parties who are parties to such Proceeding). No Underwriter shall be liable for
any settlement of any such Proceeding effected without the written consent of
such Underwriter but if settled with the written consent of such Underwriter,
such Underwriter agrees to indemnify and hold harmless the Company and any such
person from and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if (i) such
settlement is entered into more than 60 business days after receipt by such
indemnifying party of the aforesaid request,
27
(ii) such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30 days'
prior notice of its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any
pending or threatened Proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding.
(c) If the indemnification provided for in this Section 9 is unavailable to
an indemnified party under subsections (a) and (b) of this Section 9 in respect
of any losses, damage, expenses, liabilities or claims referred to therein, then
each applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, damages, expenses, liabilities or claims (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand 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 on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
damages, expenses, liabilities or claims, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
respective proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and the total underwriting discounts and commissions received by
the Underwriters, bear to the aggregate public offering price of the shares. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by 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 losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating, preparing to defend or defending any claim or
Proceeding.
(d) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in subsection (c) above. Notwithstanding
the provisions of this Section 9, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Shares
underwritten by such Underwriter and distributed to the public were offered to
the public exceeds the amount of any damage which such Underwriter has otherwise
been required to pay by reason of such untrue statement or alleged untrue
statement or omission or alleged omission.
28
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 9 are several in proportion to their
respective underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this Section 9
and the covenants, warranties and representations of the Company contained in
this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, its partners, directors
or officers or any person (including each partner, officer or director of such
person) who controls any Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, or by or on behalf of the Company, its
directors or officers or any person who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, and shall survive
any termination of this Agreement or the issuance and delivery of the Shares.
The Company and each Underwriter agree promptly to notify each other
commencement of any Proceeding against it and, in the case of the Company,
against any of the Company's officers or directors in connection with the
issuance and sale of the Shares, or in connection with the Registration
Statement or Prospectus.
10. Notices. Except as otherwise herein provided, all statements, requests,
-------
notices and agreements shall be in writing or by telegram and, if to the
Underwriters, shall be sufficient in all respects if delivered or sent to UBS
Warburg LLC, 299 Park Avenue, New York, N.Y. 10171-0026, Attention: Syndicate
Department and, if to the Company, shall be sufficient in all respects if
delivered or sent to the Company at the offices of the Company at 47350 Fremont
Blvd., Fremont, CA 94538, Attention: Chief Financial Officer.
11. Governing Law; Construction. This Agreement and any claim, counterclaim
---------------------------
or dispute of any kind or nature whatsoever arising out of or in any way
relating to this Agreement ("Claim"), directly or indirectly, shall be governed
by, and construed in accordance with, the laws of the State of New York. The
Section headings in this Agreement have been inserted as a matter of convenience
of reference and are not a part of this Agreement.
12. Submission to Jurisdiction. Except as set forth below, no Claim may be
--------------------------
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim arising out of or in any way relating to this
Agreement is brought by any third party against UBS Warburg LLC or any
indemnified party. Each of UBS Warburg LLC and the Company (on its behalf and,
to the extent permitted by applicable law, on behalf of its stockholders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The Company agrees that a final judgment
in any such action, proceeding or counterclaim brought in any such court shall
be conclusive and binding upon the
29
Company and may be enforced in any other courts in the jurisdiction of which the
Company is or may be subject, by suit upon such judgment.
13. Parties at Interest. The Agreement herein set forth has been and is
-------------------
made solely for the benefit of the Underwriters and the Company and to the
extent provided in Section 9 hereof the controlling persons, directors and
officers referred to in such section, and their respective successors, assigns,
heirs, pursuant representatives and executors and administrators. No other
person, partnership, association or corporation (including a purchaser, as such
purchaser, from any of the Underwriters) shall acquire or have any right under
or by virtue of this Agreement.
14. Counterparts. This Agreement may be signed by the parties in one or
------------
more counterparts which together shall constitute one and the same agreement
among the parties.
15. Successors and Assigns. This Agreement shall be binding upon the
----------------------
Underwriters and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's and any of the
Underwriters' respective businesses and/or assets.
16. Miscellaneous. UBS Warburg LLC, an indirect, wholly owned subsidiary of
-------------
UBS AG, is not a bank and is separate from any affiliated bank, including any
U.S. branch or agency of UBS AG. Because UBS Warburg LLC is a separately
incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales and
purchases of securities. Securities sold, offered or recommended by UBS Warburg
LLC are not deposits, are not insured by the Federal Deposit Insurance
Corporation, are not guaranteed by a branch or agency, and are not otherwise an
obligation or responsibility of a branch or agency.
A lending affiliate of UBS Warburg LLC may have lending relationships with
issuers of securities underwritten or privately placed by UBS Warburg LLC. To
the extent required under the securities laws, prospectuses and other disclosure
documents for securities underwritten or privately placed by UBS Warburg LLC
will disclose the existence of any such lending relationships and whether the
proceeds of the issue will be used to repay debts owed to affiliates of UBS
Warburg LLC.
30
If the foregoing correctly sets forth the understanding among the Company
and the Underwriters, please so indicate in the space provided below for the
purpose, whereupon this letter and your acceptance shall constitute a binding
agreement among the Company and the Underwriters, severally.
Very truly yours,
INTERVIDEO, INC.
By:__________________________________
Name:________________________________
Title:_______________________________
Accepted and agreed to as of the date first
above written, on behalf of themselves and
the other several Underwriters named in
Schedule A
- ----------
UBS WARBURG LLC
___________________________________________
___________________________________________
By: UBS WARBURG LLC
By: ______________________________________
Title:
By: ______________________________________
Title:
31
SCHEDULE A
Underwriter Number of Firm Shares
- ----------- ---------------------
UBS WARBURG LLC [___________]
CIBC WORLD MARKETS CORP. [___________]
RAYMOND JAMES & ASSOCIATES, INC. [___________]
Total [___________]
=============
BPH DRAFT 4/17/02
ANNEX A
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Opinion of Patent Counsel
Coudert Brothers LLP shall state that they served as special counsel to the
Company with respect to patents and proprietary rights, and shall opine that:
1. On behalf of the Company, we have prepared and filed eight patent
applications in the United States and eight patent applications internationally,
each of which is listed on Exhibit A hereto (the "Coudert-filed Patents"). To
---------
the best of our knowledge and belief, all of the inventors' rights in the
Coudert-filed Patents have been assigned to the Company or, with respect to the
Coudert-filed Patents listed on Exhibit B, the inventors are obligated to assign
---------
their rights to the Company and the execution of appropriate assignments are
currently in process. Nothing has come to our attention that there is any claim
of any party other than the Company to any ownership interest or lien with
respect to any of the Coudert-filed Patents.
2. To the best of our knowledge and belief, (a) there are no governmental
proceedings pending relating to patent rights, trade secrets, trademarks,
service marks or other proprietary information or materials of the Company and
(b) no such proceedings are threatened by governmental authorities.
3. We have no knowledge of any facts which would preclude the Company from
having clear title to the Coudert-filed Patent. We are not aware of any facts
which form a basis for a finding of unenforceability or invalidity of the
Coudert-filed Patents.
4. We are not aware of any material fact with respect to the Coudert-filed
Patents that (a) would preclude the issuance of patents with respect to such
applications or (b) would lead us to conclude that such patents, when issued,
would not be valid and enforceable in accordance with applicable regulations.
ANNEX B
Opinion of Patent Counsel
Knobbe Martens, Olson and Bear shall state that they served as special
counsel to the Company with respect to patents and proprietary rights, and shall
opine that:
1. [_______] provisional patent applications listed on listed in Exhibit A
---------
hereto (the "Applications"), have been filed on behalf of the Company by Counsel
and Counsel has not represented the Company with respect to any other patents or
patent applications. To Counsel's actual knowledge and belief, there is no claim
of any party other than the Company to any ownership interest or lien with
respect to the Applications.
2. To Counsel's actual knowledge and belief, (a) there are no legal or
governmental proceedings pending relating to patent rights, trade secrets,
trademarks, service marks or other proprietary information or materials of the
Company and (b) no such proceedings are threatened or contemplated by
governmental authorities.
3. Counsel does not know of any contracts or other documents, relating to
the Applications of a character required to be filed as an exhibit to the
Registration Statement or required to be described in the Registration Statement
or the Prospectus, that are not filed or described as required.
4. Counsel has no actual knowledge of any facts which would preclude the
Company from having clear title to the Applications.
In rendering this opinion, Counsel has relied on certain factual
representations of the Company and Counsel has not independently verified the
accuracy and completeness of such representations. As Counsel's representation
of the Company has been limited to the filing of the Applications, Counsel
cannot opine on the accuracy or completeness of the statements in the
Registration Statement and the Prospectus. Counsel has not been requested to nor
has Counsel performed any clearance searches for the Company. Counsel has not
been requested to nor has Counsel performed any investigation into any ownership
issues with relation to the Applications for the Company.
2
ANNEX C
Opinion of Patent Counsel
Crosby, Heafey, Roach & May shall state that they served as special counsel
to the Company with respect to patents and proprietary rights, and shall opine
that:
1. We have filed on behalf and in the name of the Company with the United
States Patent and Trademark Office ("USPTO") the patent applications listed on
the attached Exhibit A to this letter (the "Applications") and we have not
---------
represented the Company with respect to any other patents or patent
applications. To the best of our knowledge, written assignments to the
Applications have been executed and delivered by all named inventors, and the
assignments have been recorded as noted in Exhibit A with the USPTO. To the best
---------
of our knowledge, there are no claims of third parties to any ownership interest
in or lien on any of the Applications.
2. We have acted as special counsel to the Company for the matters listed
in Exhibits A and B only. To the best of our knowledge, the statements in the
Registration Statement and the Prospectus under the captions "Risk
Factors--RISKS RELATED TO OUR BUSINESS--We have received notices of claims, and
may receive additional notices of claims in the future, regarding the alleged
infringement of third parties' intellectual property rights that may result in
restrictions or prohibitions on the sale of our products and cause us to pay
license fees and damages" (other than the last paragraph thereof, for which we
provide no confirmation) and in the third and fourth paragraphs of
"Business--INTELLECTUAL PROPERTY", taken together with the statements in
attached Exhibit B, are accurate and complete summaries of the matters described
---------
in such sections.
3. Nothing has come to our attention that causes us to believe that the
above-identified portions of the Registration Statement at the time such
Registration Statement 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
above-identified portions of the Prospectus or any supplement thereto, at the
date of such Prospectus or supplement contained an untrue statement of material
fact or omitted to state a material fact required to be stated therein or
necessary to make therein, in light of the circumstances under which they were
made, not misleading.
4. To the best of our knowledge, there are no legal or governmental
proceedings pending relating to patent rights, trade secrets, trademarks,
service marks or other proprietary information or materials of the Company.
Except as noted in the Registration Statement, the Prospectus, and the attached
Exhibit B, to the best of our knowledge, there are no other threatened or
- --------- -----
contemplated proceedings.
5. We are not aware of any infringement by third-parties of any of the
Company's patents, trade secrets, trademarks, service marks or other proprietary
information or materials.
3
6. Except as described in the Registration Statement, Prospectus and
Exhibit B, we are not aware of any infringement or other violations by the
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Company of any patents, trade secrets, trademarks, service marks or other
proprietary information or materials of others.
7. We are not aware of any facts which would preclude the Company from
having clear title to the Applications.
8. We are not aware of any reason that would preclude the Applications from
issuing as patents, or any reason that any patents, if and when issued by the
USPTO, would not be valid and enforceable.
4