<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 7, 2000
REGISTRATION NO. 333-32620
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------------
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
FINISAR CORPORATION
(Exact name of Registrant as specified in its charter)
--------------------------
<TABLE>
<S> <C> <C>
DELAWARE 3674 94-3038428
(State or other jurisdiction of (Primary Standard (I.R.S. Employer
incorporation or organization) Industrial Identification No.)
Classification Code number)
</TABLE>
1308 MOFFETT PARK DRIVE
SUNNYVALE, CALIFORNIA 94089
(408) 548-1000
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
------------------------------
JERRY S. RAWLS
CHIEF EXECUTIVE OFFICER
FINISAR CORPORATION
1308 MOFFETT PARK DRIVE
SUNNYVALE, CALIFORNIA 94089
(408) 548-1000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------------
PLEASE SEND COPIES OF ALL COMMUNICATIONS TO:
<TABLE>
<S> <C>
DENNIS C. SULLIVAN, ESQ. GAVIN B. GROVER, ESQ.
JOHN M. FOGG, ESQ. MATTHEW BURNS, ESQ.
JULIE L. HSU, ESQ. BRIAN H. BILLS, ESQ.
GRAY CARY WARE & FREIDENRICH LLP MORRISON & FOERSTER LLP
400 HAMILTON AVENUE 425 MARKET STREET
PALO ALTO, CALIFORNIA 94301-1825 SAN FRANCISCO, CALIFORNIA 94105
(650) 328-6561 (415) 268-7000
</TABLE>
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
--------------------------
If any of the securities being registered on this form are being offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. / /
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration statement for the same offering. / / _________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. / / _________
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. /X/ Registration Statement File No. 333-32620
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. / /
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO
SECTION 8(a), MAY DETERMINE.
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<PAGE>
EXPLANATORY NOTE
This Post-Effective Amendment to the Registration Statement on Form S-1,
File No. 333-32620 is being filed with the Securities and Exchange Commission
pursuant to Rule 462(d) under the Securities Act of 1933, as amended. This
Amendment is being filed for the sole purpose of adding Exhibit Numbers 1.1
and 5.1 to the Registration Statement.
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Post-Effective Amendment No. 1 to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in
Sunnyvale, State of California, on April 6, 2000.
<TABLE>
<S> <C> <C>
FINISAR CORPORATION
BY: /S/ JERRY S. RAWLS
-----------------------------------------
Jerry S. Rawls
PRESIDENT AND
CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act, this Post-Effective
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ JERRY S. RAWLS President and Chief Executive April 6, 2000
---------------------------------------- Officer (PRINCIPAL
Jerry S. Rawls EXECUTIVE OFFICER)
/s/ FRANK H. LEVINSON* Chairman of the Board and April 6, 2000
---------------------------------------- Chief Technical Officer
Frank H. Levinson
Vice President, Finance, April 6, 2000
/s/ STEPHEN K. WORKMAN Chief Financial Officer and
---------------------------------------- Secretary (PRINCIPAL
Stephen K. Workman FINANCIAL AND ACCOUNTING
OFFICER)
/s/ MICHAEL C. CHILD* Director April 6, 2000
----------------------------------------
Michael C. Child
/s/ ROGER C. FERGUSON* Director April 6, 2000
----------------------------------------
Roger C. Ferguson
/s/ RICHARD B. LIEB* Director April 6, 2000
----------------------------------------
Richard B. Lieb
/s/ LARRY D. MITCHELL* Director April 6, 2000
----------------------------------------
Larry D. Mitchell
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ JERRY S. RAWLS
--------------------------------------
Jerry S. Rawls
ATTORNEY-IN-FACT
</TABLE>
II-1
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------------------- -----------------------
<C> <S>
1.1* Form of Purchase Agreement
3.4 Bylaws of Registrant (1)
3.5 Restated Certificate of Incorporation of Registrant (1)
4.1 Specimen certificate representing the common stock (1)
5.1* Opinion of Gray Cary Ware & Freidenrich LLP
10.1 Form of Indemnity Agreement between Registrant and
Registrant's directors and officers (1)
10.2 1989 Stock Option Plan (1)
10.3 1999 Stock Option Plan (1)
10.4 1999 Employee Stock Purchase Plan (1)
10.5 Securities Purchase Agreement between Registrant and certain
investors, dated as of November 6, 1998 (1)
10.6 Shareholders' Agreement among Registrant and certain of its
shareholders, dated as of November 6, 1998 (1)
10.7 Voting Agreement among Registrant and certain of its
shareholders, dated as of November 6, 1998 (1)
10.8 Loan Agreement between Registrant and Fleet National Bank,
dated as of November 6, 1998 (1)
10.9 Security Agreement between Registrant and Fleet National
Bank, dated as of November 4, 1998 (1)
10.10 Security Agreement Re: Contracts, Leases, License and
Permits between Registrant and Fleet National Bank, dated as
of November 4, 1998 (1)
10.11 Building Office Lease for 582 Market Street, Suite 609-610,
San Francisco, CA, dated December 17, 1996 between
Registrant and Niantic Corporation (1)
10.12 Building Lease for 274 Ferguson Drive, Mountain View, CA,
dated April 30, 1997 between Registrant and DM Group VIII
and DM Group VIII-E (1)
10.13 Building Lease for 1308 Moffett Park Drive, Sunnyvale, CA,
dated May 26, 1999 between Registrant and Aetna Life
Insurance Company (1)
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Gray Cary Ware & Freidenrich LLP (included in
Exhibit 5.1)
24.1 Power of Attorney
27.1 Financial Data Schedule (2)
</TABLE>
- ------------------------
(1) Incorporated by reference to the same numbered exhibit to Registrant's
Registration Statement on Form S-1 (File No. 333-87017).
(2) Incorporated by reference to the same numbered exhibit to Registrant's
Quarterly Report on Form 10-Q filed March 10, 2000.
* Filed herewith. All other exhibits previously filed.
<PAGE>
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FINISAR CORPORATION
(a Delaware corporation)
7,700,000 Shares of Common Stock
PURCHASE AGREEMENT
Dated: April 6, 2000
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<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
PURCHASE AGREEMENT................................................................................................1
SECTION 1. Representations and Warranties..................................................................3
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY...................................................3
(i) Compliance with Registration Requirements..............................................3
(ii) Independent Accountants................................................................3
(iii) Financial Statements...................................................................4
(iv) No Material Adverse Change in Business.................................................4
(v) Good Standing of the Company...........................................................4
(vi) No Subsidiaries........................................................................4
(vii) Capitalization.........................................................................4
(viii) Authorization of Agreement.............................................................4
(ix) Authorization and Description of Securities............................................5
(x) Absence of Defaults and Conflicts......................................................5
(xi) Absence of Labor Dispute...............................................................5
(xii) Absence of Proceedings.................................................................5
(xiii) Accuracy of Exhibits...................................................................6
(xiv) Possession of Intellectual Property....................................................6
(xv) Absence of Further Requirements........................................................6
(xvi) Possession of Licenses and Permits.....................................................6
(xvii) Title to Property......................................................................7
(xviii) Compliance with Cuba Act...............................................................7
(xix) Investment Company Act.................................................................7
(xx) Environmental Laws.....................................................................7
(xxi) Year 2000 Preparedness.................................................................8
(xxii) Related Party Transactions.............................................................8
(b) OFFICER'S CERTIFICATES..........................................................................8
(c) REPRESENTATIONS AND WARRANTIES BY THE SELLING STOCKHOLDERS......................................8
(i) Accurate Disclosure....................................................................8
(ii) Authorization of Agreements............................................................8
(iii) Good and Marketable Title..............................................................9
(iv) Due Execution of Power of Attorney and Custody Agreement...............................9
(v) Absence of Manipulation................................................................9
(vi) Absence of Further Requirements........................................................9
(vii) Restriction On Sale of Securities.....................................................10
(viii) Certificates Suitable for Transfer....................................................10
(ix) No Association With NASD..............................................................11
SECTION 2. Sale and Delivery to Underwriters; Closing.....................................................11
(a) INITIAL SECURITIES.............................................................................11
(b) OPTION SECURITIES..............................................................................11
(c) PAYMENT........................................................................................11
(d) DENOMINATIONS; REGISTRATION....................................................................12
</TABLE>
i
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 3. Covenants of the Company.......................................................................12
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS.................................12
(b) FILING OF AMENDMENTS...........................................................................13
(c) DELIVERY OF REGISTRATION STATEMENTS............................................................13
(d) DELIVERY OF PROSPECTUSES.......................................................................13
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS......................................................13
(f) BLUE SKY QUALIFICATIONS........................................................................14
(g) RULE 158.......................................................................................14
(h) USE OF PROCEEDS................................................................................14
(i) LISTING........................................................................................14
(j) RESTRICTION ON SALE OF SECURITIES..............................................................14
(k) REPORTING REQUIREMENTS.........................................................................15
SECTION 4. Payment of Expenses............................................................................15
(a) EXPENSES.......................................................................................15
(b) EXPENSES OF THE SELLING STOCKHOLDERS...........................................................15
(c) TERMINATION OF AGREEMENT.......................................................................15
(d) ALLOCATION OF EXPENSES.........................................................................15
SECTION 5. Conditions of Underwriters' Obligations........................................................16
(a) EFFECTIVENESS OF REGISTRATION STATEMENT........................................................16
(b) OPINION OF COUNSEL FOR COMPANY.................................................................16
(c) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDERS................................................16
(d) OPINION OF COUNSEL FOR UNDERWRITERS............................................................16
(e) OFFICERS' CERTIFICATE..........................................................................17
(f) CERTIFICATE OF SELLING STOCKHOLDERS............................................................17
(g) ACCOUNTANT'S COMFORT LETTER....................................................................17
(h) BRING-DOWN COMFORT LETTER......................................................................17
(i) APPROVAL OF LISTING............................................................................17
(j) NO OBJECTION...................................................................................17
(k) LOCK-UP AGREEMENTS.............................................................................17
(l) CONDITIONS TO PURCHASE OF OPTION SECURITIES....................................................17
(i) Officers' Certificate.................................................................18
(ii) Certificate of Selling Stockholders...................................................18
(iii) Opinion of Counsel for the Company....................................................18
(iv) Opinion of Counsel for the Selling Stockholders.......................................18
(v) Opinion of Counsel for Underwriters...................................................18
(vi) Bring-down Comfort Letter.............................................................18
(m) ADDITIONAL DOCUMENTS...........................................................................18
(n) TERMINATION OF AGREEMENT.......................................................................19
SECTION 6. Indemnification................................................................................19
(a) INDEMNIFICATION OF UNDERWRITERS................................................................19
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS AND SELLING STOCKHOLDERS....................20
(c) ACTIONS AGAINST PARTIES; NOTIFICATION..........................................................20
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE.............................................21
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C> <C>
(e) OTHER AGREEMENTS WITH RESPECT TO INDEMNIFICATION...............................................21
SECTION 7. Contribution...................................................................................21
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.................................22
SECTION 9. Termination of Agreement.......................................................................22
(a) TERMINATION; GENERAL...........................................................................22
(b) LIABILITIES....................................................................................23
SECTION 10. Default by One or More of the Underwriters.....................................................23
SECTION 11. Default by One or More of the Selling Stockholders or the Company..............................23
SECTION 12. Notices........................................................................................24
SECTION 13. Parties........................................................................................24
SECTION 14. Governing Law and Time.........................................................................25
SECTION 15. Effect of Headings.............................................................................25
</TABLE>
<TABLE>
<S> <C>
SCHEDULES
Schedule A - List of Underwriters.................................................................Sch A-1
Schedule B - List of Selling Stockholders ........................................................Sch B-1
Schedule C - Pricing Information..................................................................Sch C-1
Schedule D - List of Persons subject to Lock-up...................................................Sch D-1
EXHIBITS
Exhibit A-1 - Form of Opinion of Company's Counsel.....................................................A-1
Exhibit A-2 - Form of Opinion of Company's Counsel.....................................................A-2
Exhibit B - Form of Opinion of Company's Patent Counsel ...............................................B-1
Exhibit C - Form of Lock-up Letter.....................................................................C-1
</TABLE>
iii
<PAGE>
FINISAR CORPORATION
(a Delaware corporation)
7,700,000 Shares of Common Stock
($0.001 Par Value Per Share)
PURCHASE AGREEMENT
April 6, 2000
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
J.P. Morgan Securities Inc.
A.G. Edwards & Sons, Inc.
CIBC World Markets Corp.
Dain Rauscher Incorporated
Morgan Keegan & Company, Inc.
SoundView Technology Group, Inc.
Advanced Clearing, Inc.
C/O MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Finisar Corporation, a Delaware corporation (the "Company") and the
persons listed in Schedule B hereto (the "Selling Stockholders"), confirm their
respective agreements with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Merrill Lynch, J.P. Morgan Securities Inc., A.G. Edwards &
Sons, Inc., CIBC World Markets Corp., Dain Rauscher Incorporated, Morgan Keegan
& Company, Inc., Sound View Technology Group, Inc., and Advanced Clearing, Inc.
are acting as representatives (in such capacity, the "Representatives"), with
respect to (i) the sale by the Company and the Selling Stockholders and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of shares of Common Stock, no par value, of the Company
("Common Stock") set forth in Schedules A and B hereto, and (ii) the grant by
the Company and certain of the Selling Stockholders to the Underwriters, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of
1
<PAGE>
1,155,000 additional shares of Common Stock to cover over-allotments, if any.
The aforesaid 7,700,000 shares of Common Stock (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the 1,155,000 shares of
Common Stock subject to the option described in Section 2(b) hereof (the "Option
Securities") are hereinafter called, collectively, the "Securities". For the
purposes of this Agreement, the term Securities includes additional shares of
Common Stock payable with respect to such Securities pursuant to the stock
dividends declared but not paid as of the date of this Agreement.
The Company and the Selling Stockholders understand that the
Underwriters propose to make a public offering of the Securities as soon as the
Representatives deem advisable after this Agreement has been executed and
delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-32620) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of
the 1933 Act Regulations or (ii) if the Company has elected to rely upon Rule
434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). The
information included in such prospectus or in such Term Sheet, as the case may
be, that was omitted from such registration statement at the time it became
effective but that is deemed to be part of such registration statement at the
time it became effective (a) pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is
referred to as "Rule 434 Information." Each prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto, schedules thereto, if any, and the
documents incorporated by reference therein pursuant to Item 16 of Form S-1
under the 1933 Act, at the time it became effective and including the Rule 430A
Information and the Rule 434 Information, as applicable, is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. The final prospectus,
including the documents incorporated by reference therein pursuant to Item 16 of
Form S-1 under the 1933 Act, in the form first furnished to the Underwriters for
use in connection with the offering of the Securities is herein called the
"Prospectus." If Rule 434 is relied on, the term "Prospectus" shall refer to the
preliminary prospectus dated March 22, 2000 together with the Term Sheet and all
references in this Agreement to the date of the Prospectus shall mean the date
of the Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the Prospectus or any Term
Sheet or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("EDGAR").
2
<PAGE>
SECTION 1 REPRESENTATIONS AND WARRANTIES.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. Each of the
Registration Statement and any Rule 462(b) Registration Statement has become
effective under the 1933 Act and no stop order suspending the effectiveness
of the Registration Statement or any Rule 462(b) Registration Statement has
been issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are
contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations and did not and will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or supplement was
issued and at the Closing Time (and, if any Option Securities are purchased,
at the Date of Delivery), included or will include an untrue statement of a
material fact or omitted or will omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. If Rule 434 is used, the Company
will comply with the requirements of Rule 434. The representations and
warranties in this subsection shall not apply to statements in or omissions
from the Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through Merrill Lynch expressly for use in the Registration
Statement or Prospectus.
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR,
except to the extent permitted by Regulation S-T.
(ii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act and
the 1933 Act Regulations.
3
<PAGE>
(iii) FINANCIAL STATEMENTS. The financial statements included in
the Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company at
the dates indicated and the statement of operations, stockholders' equity
and cash flows of the Company for the periods specified; said financial
statements, unless otherwise indicated, have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The supporting schedules,
if any, included in the Registration Statement present fairly in accordance
with GAAP the information required to be stated therein. The selected
financial data and the summary financial information included in the
Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial statements
included in the Registration Statement.
(iv) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, whether or
not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the Company,
other than those in the ordinary course of business, which are material with
respect to the Company, and (C) there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital stock.
(v) GOOD STANDING OF THE COMPANY. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its obligations
under this Agreement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not result
in a Material Adverse Effect.
(vi) NO SUBSIDIARIES. The Company has no subsidiaries.
(vii) CAPITALIZATION. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Prospectus in the column
entitled "Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to this Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of convertible securities or options referred to in
the Prospectus). The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights of
any securityholder of the Company.
(viii) AUTHORIZATION OF AGREEMENT. This Agreement has been duly
authorized, executed and delivered by the Company.
4
<PAGE>
(ix) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities
have been duly authorized for issuance and sale to the Underwriters pursuant
to this Agreement and, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth herein, will
be validly issued, fully paid and non-assessable; the Common Stock conforms
to all statements relating thereto contained in the Prospectus and such
description conforms to the rights set forth in the instruments defining the
same; no holder of the Securities will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder of
the Company.
(x) ABSENCE OF DEFAULTS AND CONFLICTS. The Company is not in
violation of its charter or bylaws or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which the Company is a party
or by which it may be bound, or to which any of the property or assets of
the Company is subject (collectively, "Agreements and Instruments") except
for such defaults that would not result in a Material Adverse Effect; and
the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein and in the Registration
Statement (including the sale of the Securities and the use of the proceeds
from the sale of the Securities as described in the Prospectus under the
caption "Use of Proceeds") and compliance by the Company with its
obligations hereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of notice
or passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company pursuant to, the Agreements and Instruments (except
for such conflicts, breaches or defaults or liens, charges or encumbrances
that would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the charter or bylaws of the
Company or any applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any of its
assets, properties or operations. As used herein, a "Repayment Event" means
any event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of all
or a portion of such indebtedness by the Company.
(xi) ABSENCE OF LABOR DISPUTE. No labor dispute with the employees
of the Company exists or, to the knowledge of the Company, is imminent, and
the Company is not aware of any existing or imminent labor disturbance by
the employees of any of its principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result in
a Material Adverse Effect.
(xii) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company, which is required
to be disclosed in the Registration Statement
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(other than as disclosed therein), or which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably be expected
to materially and adversely affect the properties or assets thereof or the
consummation of the transactions contemplated in this Agreement or the
performance by the Company of its obligations hereunder; the aggregate of
all pending legal or governmental proceedings to which the Company is a
party or of which any of its property or assets is the subject which are not
described in the Registration Statement, including ordinary routine
litigation incidental to the business, could not reasonably be expected to
result in a Material Adverse Effect.
(xiii) ACCURACY OF EXHIBITS. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required.
(xiv) POSSESSION OF INTELLECTUAL PROPERTY. The Company owns or
possesses, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets
and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks, trade names
or other intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now operated by it, and the Company has
not received any notice and is not otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company therein, and which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy, singly
or in the aggregate, would result in a Material Adverse Effect other than as
disclosed in the Registration Statement.
(xv) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency is
necessary or required for the performance by the Company of its obligations
hereunder, in connection with the offering, issuance or sale of the
Securities hereunder or the consummation of the transactions contemplated by
this Agreement, except (i) such as have been already obtained or as may be
required under the 1933 Act or the 1933 Act Regulations or state securities
laws or (ii) such as may be required by the rules and regulations of the
National Association of Securities Dealers, Inc. (the "NASD").
(xvi) POSSESSION OF LICENSES AND PERMITS. The Company possesses
such permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct
the business now operated by it, except where the failure to possess a
Governmental License would not have a Material Adverse Effect; the Company
is in compliance with the terms and conditions of all such Governmental
Licenses, except where the failure so to comply would not, singly or in the
aggregate, have a
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Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except where the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not have a Material Adverse Effect; and the Company has not
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
(xvii) TITLE TO PROPERTY. The Company has good and marketable title
to all real property owned by the Company and good title to all other
properties owned by it, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of
any kind except such as (a) are described in the Prospectus or (b) do not,
singly or in the aggregate, materially affect the value of such property and
do not interfere with the use made and proposed to be made of such property
by the Company; and all of the leases and subleases material to the business
of the Company and under which the Company holds properties described in the
Prospectus, are in full force and effect (except where the failure to be in
full force and effect would not, singly or in the aggregate, result in a
Material Adverse Effect), and the Company does not have notice of any
material claim of any sort that has been asserted by anyone adverse to the
rights of the Company under any of the leases or subleases mentioned above,
or affecting or questioning the rights of the Company to the continued
possession of the leased or subleased premises under any such lease or
sublease that would result in a Material Adverse Effect.
(xviii) COMPLIANCE WITH CUBA ACT. The Company has complied with, and
is and will be in compliance with, the provisions of that certain Florida
act relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulations thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(xix) INVESTMENT COMPANY ACT. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be, 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 "1940 Act").
(xx) ENVIRONMENTAL LAWS. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, (A) the Company is not in material violation of any
federal, state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the release
or threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"), (B) the Company
has all permits, authorizations and approvals required under any applicable
Environmental Laws and is in material compliance with their requirements,
(C) there are no pending or threatened
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administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation, investigation
or proceedings relating to any Environmental Law against the Company and (D)
there are no events or circumstances that might reasonably be expected to
form the basis of an order for clean-up or remediation, or an action, suit
or proceeding by any private party or governmental body or agency, against
or affecting the Company relating to Hazardous Materials or any
Environmental Laws.
(xxi) YEAR 2000 PREPAREDNESS. There are no issues related to the
Company's preparedness for the Year 2000 that (i) are of a character
required to be described or referred to in the Registration Statement or
Prospectus by the 1933 Act which have not been accurately described in the
Registration Statement or Prospectus or (ii) might reasonably be expected to
result in any Material Adverse Effect.
(xxii) RELATED PARTY TRANSACTIONS. There are no business
relationships or related-party transactions involving the Company or any
other person required to be described in the Prospectus which have not been
described as required.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company delivered to the Representatives or to counsel for the Underwriters
shall be deemed a representation and warranty by the Company to each Underwriter
as to the matters covered thereby.
(c) REPRESENTATIONS AND WARRANTIES BY THE SELLING STOCKHOLDERS. The Selling
Stockholders each represent and warrant to each Underwriter as of the date
hereof, as of the Closing Time, and, if the Selling Stockholders are selling
Option Securities on a Date of Delivery, as of each such Date of Delivery, and
agree with each Underwriter, as follows:
(i) ACCURATE DISCLOSURE.The information in the Registration
Statement under the caption "Principal and Selling Stockholders," which
specifically relates to such Selling Stockholders, does not, and will not at
the Closing Time and on the Date of Delivery contain any untrue statement of
a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading. Such Selling Stockholder is not prompted to sell
the Securities to be sold by such Selling Stockholder hereunder by any
information concerning the Company which is not set forth in the Prospectus.
(ii) AUTHORIZATION OF AGREEMENTS.Such Selling Stockholder has the
full right, power and authority to enter into this Agreement and a Power of
Attorney and Custody Agreement (the "Power of Attorney and Custody
Agreement") and to sell, transfer and deliver the Securities to be sold by
such Selling Stockholder hereunder. The execution and delivery of this
Agreement and the Power of Attorney and Custody Agreement and the sale and
delivery of the Securities to be sold by such Selling Stockholder and the
consummation of the transactions contemplated herein and compliance by such
Selling Stockholder with its obligations hereunder have been duly authorized
by such Selling Stockholder and do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or constitute
a breach of, or default under, or result
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in the creation or imposition of any tax, lien, charge or encumbrance upon
the Securities to be sold by such Selling Stockholder or any property or
assets of such Selling Stockholder pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, license, lease or
other agreement or instrument to which such Selling Stockholder is a party
or by which such Selling Stockholder may be bound, or to which any of the
property or assets of such Selling Stockholder is subject, nor will such
action result in any violation of the provisions of the charter or bylaws or
other organizational instrument of such Selling Stockholder, if applicable,
or any applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over such Selling Stockholder or
any of its properties.
(iii) GOOD AND MARKETABLE TITLE..Such Selling Stockholder has and
will at the Closing Time and, if any Option Securities are purchased, on the
Date of Delivery have good and marketable title to the Securities to be sold
by such Selling Stockholder hereunder, free and clear of any security
interest, mortgage, pledge, lien, charge, claim, equity or encumbrance of
any kind, other than pursuant to this Agreement; and upon delivery of such
Securities and payment of the purchase price therefor as herein
contemplated, assuming each such Underwriter has no notice of any adverse
claim, each of the Underwriters will receive good and marketable title to
the Securities purchased by it from such Selling Stockholder, free and clear
of any security interest, mortgage, pledge, lien, charge, claim, equity or
encumbrance of any kind.
(iv) DUE EXECUTION OF POWER OF ATTORNEY AND CUSTODY AGREEMENT.Such
Selling Stockholder has duly executed and delivered, in the form heretofore
furnished to the Representatives, the Power of Attorney and Custody
Agreement with Jerry S. Rawls and Stephen K. Workman as attorneys-in-fact
and America Stock Transfer & Trust Company as custodian (the "Custodian");
the Custodian is authorized to deliver the Securities to be sold by such
Selling Stockholder hereunder and to accept payment therefor; and each
Attorney-in-Fact is authorized to execute and deliver this Agreement and the
certificate referred to in Section 5(f) or that may be required pursuant to
Sections 5(l) or 5(m) on behalf of such Selling Stockholder, to sell, assign
and transfer to the Underwriters the Securities to be sold by such Selling
Stockholder hereunder, to determine the purchase price to be paid by the
Underwriters to such Selling Stockholder, as provided in Section 2(a)
hereof, to authorize the delivery of the Securities to be sold by such
Selling Stockholder hereunder, to accept payment therefor, and otherwise to
act on behalf of such Selling Stockholder in connection with this Agreement.
(v) ABSENCE OF MANIPULATION.Such Selling Stockholder has not
taken, and will not take, directly or indirectly, any action which is
designed to or which has constituted or which might reasonably be expected
to cause or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Securities.
(vi) ABSENCE OF FURTHER REQUIREMENTS.No filing with, or consent,
approval, authorization, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or foreign, is
necessary or required for the performance by
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such Selling Stockholder of its obligations hereunder or in the Power of
Attorney and Custody Agreement, or in connection with the sale and delivery
of the Securities hereunder or the consummation of the transactions
contemplated by this Agreement, except (A) such as may have previously been
made or obtained or as may be required under the 1933 Act or the 1933 Act
Regulations or state securities law, and (B) such as have been obtained
under the laws and regulations of jurisdictions outside the United States in
which the Reserved Securities are offered.
(vii) RESTRICTION ON SALE OF SECURITIES.If the Prospectus is dated
on or after April 21, 2000, then from the date hereof and through the end of
the 90-day period after the date of the Prospectus, such Selling Stockholder
will not, without the prior written consent of Merrill Lynch, directly or
indirectly (A) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant for the sale of, or otherwise dispose of or
transfer any share of Common Stock or any securities convertible into or
exchangeable or exercisable for Common Stock, whether now owned or hereafter
acquired by the undersigned or with respect to which the undersigned has or
hereafter acquires the power of disposition, or file any registration
statement under the 1933 Act, with respect to any of the foregoing or (B)
enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock, whether any such swap or
transaction is to be settled by delivery of Common Stock or other
securities, in cash or otherwise; PROVIDED, HOWEVER, that the restrictions
in clauses (A) and (B) above shall not prohibit the transfer of the
Company's Common Stock (I) as a bona fide gift or gifts (whether by will or
intestacy or to a trust the beneficiaries of which are exclusively the
undersigned and/or a member or members of his or her immediate family),
provided the donee or donees thereof agree in writing to be bound by such
restrictions; (II) with respect to dispositions of Common Stock acquired on
the open market; (III) as a distribution to limited partners, constituent
members or shareholders of such Selling Stockholder, provided the transferee
or transferees thereof agree in writing to be bound by such restrictions; or
(IV) with the prior written consent of Merrill Lynch; PROVIDED FURTHER, that
the undersigned agrees to give Merrill Lynch and the Company written notice
three business days prior to taking any of the actions set forth in clauses
(A) or (B) above pursuant to the preceding proviso; and PROVIDED FURTHER,
that if the Prospectus is dated prior to April 21, 2000, the restrictions in
clauses (A) and (B) above shall cease to apply to (x) 50% of the Company's
Securities beneficially owned by such Selling Shareholder 70 days after the
date of the Prospectus, and (y) 50% of the Company's Securities beneficially
owned by such Selling Stockholder 110 days after the date of the Prospectus.
(viii) CERTIFICATES SUITABLE FOR TRANSFER.Certificates for all of
the Securities to be sold by such Selling Stockholder pursuant to this
Agreement, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank with signatures
guaranteed, have been placed in custody with the Custodian with irrevocable
conditional instructions to deliver such Securities to the Underwriters
pursuant to this Agreement.
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(ix) NO ASSOCIATION WITH NASD.Neither such Selling Stockholder nor
any of his/her/its affiliates directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with, or has any other association with (within the meaning of Article I,
section 1(m) of the Bylaws of the National Association of Securities
Dealers, Inc.), any member firm of the National Association of Securities
Dealers, Inc.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and the Selling Stockholders, severally and not jointly,
agree to sell to the Underwriters, at the purchase price set forth in Schedule
C, the number of Initial Securities set forth in Schedule B opposite the name of
the Company and the respective Selling Shareholders, and each Underwriter,
severally and not jointly, agrees to purchase from the Company and the Selling
Stockholders, at the price per share set forth in Schedule C, the number of
Initial Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Initial Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) OPTION SECURITIES. In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and the Selling Stockholders hereby grant an option to the
Underwriters, severally and not jointly, to purchase up to an additional
1,155,000 shares of Common Stock, as set forth in Schedule B, at the price per
share set forth in Schedule C, less an amount per share equal to any dividends
or distributions declared by the Company and payable on the Initial Securities
but not payable on the Option Securities. The option hereby granted will expire
30 days after the date hereof and may be exercised in whole or in part from time
to time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial Securities upon
notice by the Representatives to the Company and the Selling Stockholders
setting forth the number of Option Securities as to which the several
Underwriters are then exercising the option and the time and date of payment and
delivery for such Option Securities. Any such time and date of delivery (a "Date
of Delivery") shall be determined by the Representatives, but shall not be later
than seven full business days after the exercise of said option, nor in any
event prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the Option Securities, each of the
Underwriters, acting severally and not jointly, will purchase that proportion of
the total number of Option Securities then being purchased which the number of
Initial Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such
adjustments as the Representatives in their discretion shall make to eliminate
any sales or purchases of fractional shares. If the option is exercised only as
to a portion of the Option Securities, the Company and the Selling Stockholders
will sell that proportion of the total number of Option Securities then being
purchased which the number of Option Securities set forth in Schedule B opposite
their respective name to the total number of Option Securities.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Gray
Cary Ware & Freidenrich LLP, 400 Hamilton Avenue, Palo Alto, California, or at
such other place as shall be agreed upon by
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the Representatives and the Company, at 7:00 A.M. (California time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date hereof (unless postponed in accordance with the
provisions of Section 10), or such other time not later than ten business days
after such date as shall be agreed upon by the Representatives and the Company
(such time and date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives,
the Company and the Selling Stockholders on each Date of Delivery as specified
in the notice from the Representatives to the Company.
Payment shall be made to the Company and the Selling Stockholders by
wire transfer of immediately available funds to bank accounts designated by the
Company and the Custodian pursuant to each Selling Stockholder's Power of
Attorney and Custody Agreement, as the case may be, against delivery to the
Representatives for the respective accounts of the Underwriters of certificates
for the Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. Merrill Lynch, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representatives may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in The City of San Francisco not later than 7:00 A.M. (Pacific
time) on the business day prior to the Closing Time or the relevant Date of
Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with each
Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Representatives immediately, and
confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt
of any comments from the Commission, (iii) of any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information, and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of any
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proceedings for any of such purposes. The Company will promptly effect the
filings necessary pursuant to Rule 424(b) and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus transmitted for
filing under Rule 424(b) was received for filing by the Commission and, in the
event that it was not, it will promptly file such prospectus. The Company will
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) FILING OF AMENDMENTS. The Company will give the Representatives notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether pursuant
to the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934
Act"), or otherwise, will furnish the Representatives with copies of any such
documents a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file or use any such document to which the
Representatives or counsel for the Underwriters shall object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or will
deliver to the Representatives and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply with
the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the
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circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may reasonably
request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Representatives may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) USE OF PROCEEDS. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds".
(i) LISTING. The Company will use its best efforts to effect and maintain
the quotation of the Securities on the Nasdaq National Market and will file with
the Nasdaq National Market all documents and notices required by the Nasdaq
National Market of companies that have securities that are traded in the
over-the-counter market and quotations for which are reported by the Nasdaq
National Market.
(j) RESTRICTION ON SALE OF SECURITIES. During a period of 90 days from the
date of the Prospectus, the Company will not, without the prior written consent
of Merrill Lynch, directly or indirectly (A) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant for the sale of, or otherwise
dispose of or transfer any share of Common Stock or any securities convertible
into or exchangeable or exercisable for Common Stock, or file any registration
statement under the 1933 Act, with respect to any of the foregoing or (B) enter
into any swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction is to be settled by delivery
of Common Stock or other securities, in cash or otherwise.
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(k) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company and the Selling Stockholders will pay all
expenses incident to the performance of their obligations under this Agreement,
including (i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities to the Underwriters, (iv) the fees
and disbursements of the Company's counsel, accountants and other advisors, (v)
the qualification of the Securities under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to the Underwriters of copies of each
preliminary prospectus, any Term Sheets and of the Prospectus and any amendments
or supplements thereto, (vii) the preparation, printing and delivery to the
Underwriters of copies of the Blue Sky Survey and any supplement thereto, (viii)
the fees and expenses of any transfer agent or registrar for the Securities and
(ix) the filing fees incident to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review by the NASD of the
terms of the sale of the Securities and (x) the fees and expenses incurred in
connection with the inclusion of the Securities in the Nasdaq National Market.
(b) EXPENSES OF THE SELLING STOCKHOLDERS.The Selling Stockholders,
severally and not jointly, will pay all expenses incident to the performance of
their respective obligations under, and the consummation of the transactions
contemplated by this Agreement, including (i) any stamp duties, capital duties
and stock transfer taxes, if any, payable upon the sale of the Securities to the
Underwriters, and their transfer between the Underwriters pursuant to an
agreement between such Underwriters, and (ii) the fees and disbursements of
their respective counsel and accountants.
(c) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company and the Selling Stockholders shall reimburse the
Underwriters for all of their reasonable out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
(d) ALLOCATION OF EXPENSES. The provisions of this Section shall not affect
any agreement that the Company and the Selling Stockholders may make for the
sharing of such costs and expenses.
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SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Selling Stockholders
contained in Section 1 hereof or in certificates of any officer of the Company
or on behalf of the Selling Stockholders delivered pursuant to the provisions
hereof, to the performance by the Company of its covenants and other obligations
hereunder, and to the following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement,
including any Rule 462(b) Registration Statement, shall have become effective
and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the Representatives
shall have received the favorable opinions, dated as of Closing Time, of Gray
Cary Ware & Freidenrich LLP, counsel for the Company, and Pennie & Edmonds,
patent counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters, together with signed or reproduced copies of such opinions
for each of the other Underwriters to the effect set forth in Exhibit A-1 and
A-2 hereto and to such further effect as counsel to the Underwriters may
reasonably request.
(c) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Gray Cary Ware & Freidenrich LLP, counsel for the Selling Stockholders,
in form and substance satisfactory to counsel for the Underwriters, together
with signed or reproduced copies of such opinion for each of the other
Underwriters to the effect set forth in Exhibit B hereto and to such further
effect as counsel to the Underwriters may reasonably request.
(d) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Morrison & Foerster LLP, counsel for the Underwriters, together with
signed or reproduced copies of such opinion for each of the other Underwriters
with respect to the matters set forth in clauses (i), (ii), (v), (vi) (solely as
to preemptive or other similar rights arising by operation of law or under the
charter or bylaws of the Company), (viii) through (x), inclusive, (xiii), (xv)
(solely as to the information in the Prospectus under "Description of Capital
Stock--Common Stock") and the penultimate paragraph of Exhibit A-1 hereto. In
giving such opinion such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of California and the
General Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and certificates of
public officials.
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(e) OFFICERS' CERTIFICATE. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any event which constitutes a Material Adverse Effect
on the Company, whether or not arising in the ordinary course of business, and
the Representatives shall have received a certificate of the Chief Executive
Officer or a Vice President of the Company and of the chief financial or chief
accounting officer of the Company, dated as of Closing Time, to the effect that
(i) there has been no such Material Adverse Effect, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same force and
effect as though expressly made at and as of Closing Time, (iii) the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(f) CERTIFICATE OF SELLING STOCKHOLDERS.At Closing Time, the Representative
shall have received a certificate of an Attorney-in-Fact on behalf of each
Selling Stockholder, dated as of Closing Time, to the effect that (i) the
representations and warranties of each Selling Stockholder contained in Section
1(b) hereof are true and correct in all respects with the same force and effect
as those expressly made at and as of Closing time and (ii) each Selling
Stockholder has complied in all material respects with all agreements and all
conditions on its part to be performed under this Agreement at or prior to
Closing Time.
(g) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the Representatives shall have received from Ernest & Young LLP a
letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(h) BRING-DOWN COMFORT LETTER. At Closing Time, the Representatives shall
have received from Ernest & Young LLP a letter, dated as of Closing Time, to the
effect that they reaffirm the statements made in the letter furnished pursuant
to subsection (g) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.
(i) APPROVAL OF LISTING. At Closing Time, the Securities shall have been
approved for inclusion in the Nasdaq National Market, subject only to official
notice of issuance.
(j) NO OBJECTION. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(k) LOCK-UP AGREEMENTS. At the date of this Agreement, the Representatives
shall have received an agreement substantially in the form of Exhibit C hereto
signed by the persons listed on Schedule D hereto.
(l) CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option
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Securities, the representations and warranties of the Company and the Selling
Stockholders contained herein and the statements in any certificates furnished
by the Company and the Selling Stockholders hereunder shall be true and correct
as of each Date of Delivery and, at the relevant Date of Delivery, the
Representatives shall have received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date of
Delivery, of the Chief Executive Officer or a Vice President of the Company
and of the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time pursuant to
Section 5(e) hereof remains true and correct as of such Date of Delivery.
(ii) CERTIFICATE OF SELLING STOCKHOLDERS. A certificate, dated
such Date of Delivery, of an Attorney-in-Fact on behalf of each Selling
Stockholder confirming that the certificate delivered at Closing Time
pursuant to Section 5(f) remains true and correct as of such Date of
Delivery.
(iii) OPINION OF COUNSEL FOR THE COMPANY. The favorable opinion of
Gray Cary Ware & Freidenrich LLP, counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(b) hereof.
(iv) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDERS. The
favorable opinion of Gray Cary Ware & Freidenrich, LLP, counsel for the
Selling Stockholders, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Securities
to be purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(c) hereof.
(v) OPINION OF COUNSEL FOR UNDERWRITERS. The favorable opinion of
Morrison & Foerster LLP, counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(d) hereof.
(vi) BRING-DOWN COMFORT LETTER. A letter from Ernest & Young LLP,
in form and substance satisfactory to the Representatives and dated such
Date of Delivery, substantially in the same form and substance as the letter
furnished to the Representatives pursuant to Section 5(h) hereof, except
that the "specified date" in the letter furnished pursuant to this paragraph
shall be a date not more than five days prior to such Date of Delivery.
(m) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company and the Selling Stockholders in connection with the
issuance and sale of
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the Securities as herein contemplated shall be satisfactory in form and
substance to the Representatives and counsel for the Underwriters.
(n) TERMINATION OF AGREEMENT. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities, on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representatives by notice to the Company at
any time at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact included
in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, as set forth in
Section 6(a)(i), or any such alleged untrue statement or omission; provided
that (subject to Section 6(d) below) any such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Merrill Lynch),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or (ii)
above;
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PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Merrill Lynch expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS AND SELLING
STOCKHOLDERS. Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each Selling
Stockholder and each person, if any, who controls each Selling Stockholder
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information, if applicable,
or any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through Merrill Lynch expressly for use in
the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Merrill Lynch, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii)
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does not include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into, and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(e) OTHER AGREEMENTS WITH RESPECT TO INDEMNIFICATION.The provisions of this
Section shall not affect any agreement among the Company and the Selling
Stockholders with respect to indemnification.
SECTION 7. Contribution.If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (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 Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) 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 and the Selling Stockholders on the one hand and
of the Underwriters on the other hand in connection with the statements or
omissions, which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Securities pursuant to this Agreement shall
be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Selling Stockholders and the total
underwriting discount received by the Underwriters, in each case as set forth on
the cover of the Prospectus, or, if Rule 434 is used, the corresponding location
on the Term Sheet, bear to the aggregate initial public offering price of the
Securities as set forth on such cover.
The relative fault of the Company and the Selling Stockholders on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company and the Selling Stockholders or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
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The Company, the Selling Stockholders and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7
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 which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or any
Selling Stockholder within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company or
such Selling Stockholder, as the case may be. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the number of Initial Securities set forth opposite their respective names in
Schedule A hereto and not joint.
The provisions of this Section shall not affect any agreement among the
Company and the Selling Stockholders with respect to contribution.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or the Selling
Stockholders submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company or the
Selling Stockholders, and shall survive delivery of the Securities to the
Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Representatives may terminate this Agreement,
by notice to the Company and the Selling Stockholders, at any time at or prior
to Closing Time (i) if there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
Prospectus, any material adverse change in the condition, financial or
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otherwise, or in the earnings, business affairs or business prospects of the
Company whether or not arising in the ordinary course of business, or (ii) if
there has occurred any material adverse change in the financial markets in the
United States, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the National Association of Securities Dealers, Inc. or
any other governmental authority, or (iv) if a banking moratorium has been
declared by either Federal or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, but not
the obligation, within 24 hours thereafter, to make arrangements for one or more
of the non-defaulting Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within such 24-hour
period, then this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter.
No action pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company or Selling Stockholders to sell the
relevant Option Securities, as the case may be, either the (i) Representatives
or (ii) the Company and any Selling Stockholder shall have the right to postpone
Closing Time or the relevant Date of Delivery, as the case may be, for a period
not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
As used herein, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 10.
SECTION 11. DEFAULT BY ONE OR MORE OF THE SELLING STOCKHOLDERS OR THE
COMPANY.(a) If a Selling Stockholder shall fail at Closing Time or at a Date of
Delivery to sell and deliver the number of Securities which such Selling
Stockholder is obligated to sell hereunder, and the Company and the remaining
Selling Stockholders do not exercise the right hereby granted to
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increase, pro rata or otherwise, the number of Securities to be sold by them
hereunder to the total number to be sold by the Company and all Selling
Stockholders as set forth in Schedule B hereto, then the Underwriters may, at
the option of the Representatives, by notice from the Representatives to the
Company and the non-defaulting Selling Stockholders, either (a) terminate this
Agreement without any liability on the fault of any non-defaulting party except
that the provisions of Sections 1, 4, 6, 7 and 8 shall remain in full force and
effect or (b) elect to purchase the Securities which the non-defaulting Selling
Stockholders and the Company has agreed to sell hereunder. No action taken
pursuant to this Section 11 shall relieve any Selling Stockholder so defaulting
from liability, if any, in respect of such default.
In the event of a default by any Selling Stockholder as referred to in
this Section 11, each of the Representatives, the Company and the non-defaulting
Selling Stockholders shall have the right to postpone Closing Time or Date of
Delivery for a period not exceeding seven days in order to effect any required
change in the Registration Statement or Prospectus or in any other documents or
arrangements.
(b) If the Company shall fail at Closing Time or at any Date of Delivery to
sell the number of Securities that it is obligated to sell hereunder, then this
Agreement shall terminate without any liability on the part of any
non-defaulting party; PROVIDED, HOWEVER, that the provisions of Sections 1, 4,
6, 7 and 8 shall remain in full force and effect. No action taken pursuant to
this Section shall relieve the Company from liability, if any, in respect of
such default.
SECTION 12. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at Merrill Lynch & Co.,
North Tower, World Financial Center, New York, New York 10281-1201 and 101
California Street, Suite 1420, San Francisco, California 94111, attention of
Gary Kirkham; and notices to the Company shall be directed to it at 1308 Moffett
Park Drive, Sunnyvale, CA 94089-1133, attention of Jerry S. Rawls, President,
and notices to the Selling Stockholders shall be directed to them at 1308
Moffett Park Drive, Sunnyvale, CA 94089-1133; attention of Jerry S. Rawls, and
Stephen K. Workman, Attorneys-in-fact.
SECTION 13. PARTIES. This Agreement shall each inure to the benefit of
and be binding upon the Underwriters, the Company and the Selling Stockholders
and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters, the Company and the Selling
Stockholders and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters, the Company and Selling Stockholders and
their respective successors, and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of
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Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS
OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. EFFECT OF HEADINGS. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Underwriters, the Company and the Selling Stockholders in accordance
with its terms.
Very truly yours,
FINISAR CORPORATION
By
-------------------------------
Title:
By
-------------------------------
Name
As Attorney-in-Fact acting on behalf of
the Selling Stockholders named in
Schedule B hereto
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
J.P. Morgan Securities Inc.
A.G. Edwards & Sons, Inc.
CIBC World Markets Corp.
Dain Rauscher Incorporated
Morgan Keegan & Company, Inc.
SoundView Technology Group, Inc.
Advanced Clearing, Inc.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By
----------------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
26
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Number of
Initial
Name of Underwriter Securities
------------------- ----------
<S> <C>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
J.P. Morgan Securities Inc.
A.G. Edwards & Sons, Inc.
CIBC World Markets Corp.
Dain Rauscher Incorporated
Morgan Keegan & Company, Inc.
SoundView Technology Group, Inc.
Advanced Clearing, Inc.
-----------
Total........................................... 7,700,000
-----------
-----------
</TABLE>
Sch A-1
<PAGE>
SCHEDULE B
<TABLE>
<CAPTION>
Number of Number of
Initial Option
Name of Selling Party Securities Securities
--------------------- ---------- ----------
<S> <C> <C>
Finisar Corporation:
Selling Stockholders:
--------- ---------
Total........................ 7,700,000 1,155,000
--------- ---------
--------- ---------
</TABLE>
Sch. B-1
<PAGE>
SCHEDULE C
FINISAR CORPORATION
7,000,000 Shares of Common Stock
(Par Value $0.001 Per Share)
1. The public offering price per share for the Securities, determined
as provided in said Section 2, shall be ______________________________.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be _______________, being an amount equal to the
public offering price set forth above less _______________ per share; provided
that the purchase price per share for any Option Securities purchased upon the
exercise of the overallotment option described in Section 2(b) shall be reduced
by an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities.
Sch. C-1
<PAGE>
[SCHEDULE D]
[List of persons and entities
subject to lock-up]
Sch D-1
<PAGE>
Exhibit A-1
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware.
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Purchase
Agreement.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus in the column entitled "Actual" under
the caption "Capitalization" (except for subsequent issuances, if any, pursuant
to the Purchase Agreement or pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectus or pursuant to the exercise of
convertible securities or options referred to in the Prospectus); the shares of
issued and outstanding capital stock of the Company, including the Securities to
be purchased by the Underwriters from the Selling Stockholders, have been duly
authorized and validly issued and are fully paid and non-assessable; and none of
the outstanding shares of capital stock of the Company was issued in violation
of the preemptive or other similar rights of any securityholder of the Company.
(v) The Securities to be purchased by the Underwriters from the
Company have been duly authorized for issuance and sale to the Underwriters
pursuant to the Purchase Agreement and, when issued and delivered by the Company
pursuant to the Purchase Agreement against payment of the consideration set
forth in the Purchase Agreement, will be validly issued and fully paid and
non-assessable and no holder of the Securities is or will be subject to personal
liability by reason of being such a holder.
(vi) The issuance and sale of the Securities by the Company and
the sale of the Option Securities by the Selling Stockholder is not subject to
the preemptive or other similar rights of any securityholder of the Company
provided by law, by the Company's Certificate of Incorporation or Bylaws, or, to
the best of our knowledge, otherwise.
(vii) To the best of our knowledge, the Company does not have any
subsidiaries.
Exhibit A-1
<PAGE>
(viii) The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
(ix) Each Power of Attorney and Custody Agreement constitutes the
legal, valid and binding agreement of each Selling Stockholder.
(x) The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under the 1933 Act; any
required filing of the Prospectus pursuant to Rule 424(b) has been made in the
manner and within the time period required by Rule 424(b); and, to the best of
our knowledge, no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or threatened by the Commission.
(xi) The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the Rule 434 Information,
as applicable, the Prospectus, and each amendment or supplement to the
Registration Statement and Prospectus, as of their respective effective or issue
dates (other than the financial statements and supporting schedules and other
financial data included therein or omitted therefrom, as to which we need
express no opinion) complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations.
(xii) If Rule 434 has been relied upon, the Prospectus was not
"materially different," as such term is used in Rule 434, from the prospectus
included in the Registration Statement at the time it became effective.
(xiii) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory requirements,
with any applicable requirements of the charter and bylaws of the Company and
the requirements of the Nasdaq National Market.
(xiv) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company is a party, or to which the property of the Company is subject, before
or brought by any court or governmental agency or body, domestic or foreign,
which might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in the Purchase Agreement or the performance by the Company of its
obligations thereunder, except as disclosed in the Prospectus .
(xv) The information in the Prospectus under "Description of
Capital Stock--Common Stock", "Description of Capital Stock--Preferred Stock"
and in the Registration Statement under Item 14, to the extent that it
constitutes (a) matters of law, (b) summaries of legal matters, the Company's
charter and bylaws or legal proceedings, or (c) legal conclusions, has been
reviewed by us and is correct in all material respects.
(xvi) To the best of our knowledge, there are no statutes or
regulations that are required to be described in the Prospectus that are not
described as required.
Exhibit A-2
<PAGE>
(xvii) All descriptions in the Registration Statement of contracts
and other documents to which the Company or its subsidiaries are a party are
accurate in all material respects; to the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
(xviii) To the best of our knowledge, the Company is not in violation
of its charter or bylaws and no default by the Company exists in the due
performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument that is described or referred to in the
Registration Statement or the Prospectus or filed or incorporated by reference
as an exhibit to the Registration Statement, except for alleged defaults
disclosed in the Registration Statement.
(xix) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign (other than under the 1933 Act and the
1933 Act Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states or foreign jurisdictions, as
to which we express no opinion) is necessary or required in connection with the
due authorization, execution and delivery of the Purchase Agreement or for the
offering, issuance, sale or delivery of the Securities.
(xx) The execution, delivery and performance of the Purchase
Agreement by the Company and the consummation by it of the transactions
contemplated in the Purchase Agreement and in the Registration Statement
(including the issuance and sale of the Securities and the use of the proceeds
from the sale of the Securities as described in the Prospectus under the caption
"Use Of Proceeds") and compliance by the Company with its obligations under the
Purchase Agreement do not and will not, whether with or without the giving of
notice or lapse of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined in Section 1(a)(x) of the Purchase
Agreement) under or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company pursuant to any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease or any
other agreement or instrument, known to us, to which the Company is a party or
by which it or any of them may be bound, or to which any of the property or
assets of the Company is subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not have a Material
Adverse Effect), nor will such action result in any violation of the provisions
of the charter or bylaws of the Company, or any applicable law, statute, rule,
regulation, judgment, order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any subsidiary or any of their respective properties, assets
or operations.
Exhibit A-3
<PAGE>
(xxi) To the best of our knowledge, there are no persons with
registration rights or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise registered by the Company
under the 1933 Act, except as disclosed in the Registration Statement.
(xxii) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 1940
Act.
(xxiii) Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto, including the
Rule 430A Information and Rule 434 Information (if applicable), (except for
financial statements and schedules and other financial data included therein or
omitted therefrom, as to which we need make no statement), at the time such
Registration Statement or any such 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 or any amendment or supplement thereto (except for
financial statements and schedules and other financial data included therein or
omitted therefrom, as to which we make no statement), at the time the Prospectus
was issued, at the time any such amended or supplemented prospectus was issued
or at the Closing Time, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials, and
with respect to the opinion in paragraph (ix), on the opinion of counsel to the
Selling Stockholders.
Exhibit A-4
<PAGE>
Exhibit A-2
FORM OF OPINION OF COMPANY'S PATENT COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The information in the Prospectus under "Risk Factors -- We
are subject to a pending legal proceeding" and "Business--Pending Litigation"
has been reviewed by us and is correct in all material respects.
(ii) To our knowledge, there are no legal or governmental
proceedings other than proceedings described in the sections of the Prospectus
referred to above in paragraph (i) and patent applications pending, relating to
patent rights of the Company to which the Company is a party, and, to our
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or others.
(iii) To our knowledge, the Company has not received any
communication in which it is alleged that the Company is infringing or violating
the patent rights of third parties other than with respect to the proceedings
described in the sections of the Prospectus referred to above in paragraph (i).
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
Exhibit A-5
<PAGE>
Exhibit B
FORM OF OPINION OF COUNSEL FOR THE SELLING STOCKHOLDERS
TO BE DELIVERED PURSUANT TO SECTION 5(c)
(i) No filing with, or consent, approval, authorization, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, (other than the issuance of the order
of the Commission declaring the Registration Statement effective and such
authorizations, approvals or consents as may be necessary under state securities
laws, as to which we need express no opinion) is necessary or required to be
obtained by the Selling Stockholders for the performance by each Selling
Stockholder of its obligations under the Purchase Agreement or in the Power of
Attorney and Custody Agreement, or in connection with the offer, sale or
delivery of the Securities.
(ii) Each Power of Attorney and Custody Agreement has been duly
executed and delivered by the respective Selling Stockholder named therein.
(iii) The Purchase Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Stockholder.
(iv) Each Attorney-in-Fact has been duly authorized by the Selling
Stockholders to deliver the Securities on behalf of the Selling Stockholders in
accordance with the terms of the Purchase Agreement.
(v) The execution, delivery and performance of the Purchase
Agreement and the Power of Attorney and Custody Agreement and the sale and
delivery of the Securities and the consummation of the transactions contemplated
in the Purchase Agreement and in the Registration Statement and compliance by
the Selling Stockholders with their obligations under the Purchase Agreement
have been duly authorized by all necessary action on the part of the Selling
Stockholders and do not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or constitute a breach of, or
default under or result in the creation or imposition of any tax, lien, charge
or encumbrance upon the Securities or any property or assets of the Selling
Stockholders pursuant to, any contract, indenture, mortgage, deed of trust, loan
or credit agreement, note, license, lease or other instrument or agreement to
which any Selling Stockholder is a party or by which it may be bound, or to
which any of the property or assets of the Selling Stockholders may be subject
nor will such action result in any violation of the provisions of the charter or
bylaws of the Selling Stockholders, if applicable, or any law, administrative
regulation, judgment or order of any governmental agency or body or any
administrative or court decree having jurisdiction over such Selling Stockholder
or any of its properties.
(vi) To the best of our knowledge, each Selling Stockholder has
valid and marketable title to the Securities to be sold by such Selling
Stockholder pursuant to the Purchase Agreement, free and clear of any pledge,
lien, security interest, charge, claim, equity or encumbrance of any kind, and
has full right, power and authority to sell, transfer and deliver such
Securities pursuant
Exhibit B-1
<PAGE>
to the Purchase Agreement. By delivery of a certificate or certificates therefor
such Selling Stockholder will transfer to the Underwriters who have purchased
such Securities pursuant to the Purchase Agreement (without notice of any defect
in the title of such Selling Stockholder and who are otherwise bona fide
purchasers for purposes of the Uniform Commercial Code) valid and marketable
title to such Securities, free and clear of any pledge, lien, security interest,
charge, claim, equity or encumbrance of any kind.
Exhibit B-2
<PAGE>
Exhibit C
FORM OF LOCK-UP LETTER
March 15, 2000
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
J.P. Morgan Securities Inc.
A.G. Edwards & Sons, Inc.
CIBC World Markets Corp.
Dain Rauscher Incorporated
Morgan Keegan & Company, Inc.
Sound View Technology Group, Inc.
Ameritrade
as Representatives of the several
Underwriters to be named in the
within-mentioned Purchase Agreement
C/O MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
North Tower
World Financial Center
New York, New York 10281-1209
Re: PUBLIC OFFERING BY FINISAR CORPORATION
Dear Sirs:
The undersigned, a securityholder and/or an officer and/or director of
Finisar Corporation, a Delaware corporation (the "Company"), understands that
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch") proposes to enter into a Purchase Agreement (the "Purchase
Agreement") with the Company providing for the public offering (the "Public
Offering") of shares (the "Securities") of the Company's common stock, no par
value (the "Common Stock"). In recognition of the benefit that the Public
Offering will confer upon the undersigned as a stockholder and/or an officer
and/or director of the Company, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the undersigned
agrees with each underwriter to be named in the Purchase Agreement that, if the
final prospectus relating to the Public Offering (the "Final Prospectus") is
dated after April 21, 2000, then from the date hereof and through the end of the
90-day period
Exhibit C-1
<PAGE>
after the date of the Final Prospectus, the undersigned will not, without the
prior written consent of Merrill Lynch, directly or indirectly
(i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant for the sale of, or otherwise dispose of or
transfer any shares of the Company's Common Stock or any securities
convertible into or exchangeable or exercisable for Common Stock, whether
now owned or hereafter acquired by the undersigned or with respect to which
the undersigned has or hereafter acquires the power of disposition, or file
any registration statement under the 1933 Act with respect to any of the
foregoing; or
(ii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock, whether any such swap or
transaction is to be settled by delivery of Common Stock or other
securities, in cash or otherwise;
PROVIDED, HOWEVER; that the restrictions in clauses (i) and (ii) above shall not
prohibit the transfer of the Company's Securities (A) as a bona fide gift or
gifts (whether by will or intestacy or to a trust the beneficiaries of which are
exclusively the undersigned and/or a member or members of his or her immediate
family), provided the donee or donees thereof agree in writing to be bound by
these restrictions; and (B) with respect to dispositions of Common Stock
acquired on the open market; (C) as a distribution to limited partners,
constituent members or shareholders of the undersigned, provided the transferee
or transferees thereof agree in writing to be bound by these restrictions; or
(D) with the prior written consent of Merrill Lynch; PROVIDED FURTHER, that the
undersigned agrees to give Merrill Lynch and the Company written notice three
business days prior to taking any of the actions set forth in clauses (i) and
(ii) above pursuant to the preceding proviso; and PROVIDED FURTHER, that if the
Final Prospectus is dated on or prior to April 21, 2000, the restrictions in
clauses (ii) and (ii) above shall cease to apply to (A) 50% of the Company's
Securities beneficially owned by the undersigned 70 days after the date of the
Final Prospectus, and (B) 50% of the Company's Securities beneficially owned by
the undersigned 110 days after the date of the Final Prospectus.
This agreement shall terminate and be of no further effect if the
registration statement for the offering of the Securities is not declared
effective by the Securities and Exchange Commission by May 15, 2000.
Very truly yours,
Signature:
----------------------------------
Print Name:
---------------------------------
Exhibit C-2
<PAGE>
EXHIBIT 5.1
[GRAY CARY WARE & FREIDENRICH LLP Letterhead]
April 6, 1999
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: FINISAR CORPORATION REGISTRATION STATEMENT ON FORM S-1
Ladies and Gentlemen:
As counsel to Finisar Corporation (the "Company"), we are rendering this
opinion in connection with a proposed sale of those certain shares of the
Company's newly-issued Common Stock as set forth in the Registration Statement
on Form S-1 to which this opinion is being filed as Exhibit 5.1 (the "Shares").
We have examined all instruments, documents and records which we deemed relevant
and necessary for the basis of our opinion hereinafter expressed. In such
examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity to
the originals of all documents submitted to us as copies.
Based on such examination, we are of the opinion that the Shares identified
in the above-referenced Registration Statement will be, upon effectiveness of
the Registration Statement and receipt by the Company of payment therefor,
validly authorized, legally issued, fully paid, and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
above-referenced Registration Statement and to the use of our name wherever it
appears in said Registration Statement, including the Prospectus constituting a
part thereof, as originally filed or as subsequently amended.
Very truly yours,
/s/ GRAY CARY WARE & FREIDENRICH LLP
GRAY CARY WARE & FREIDENRICH LLP
