EXHIBIT 1.1
BNB CAPITAL TRUST
(a Delaware business trust)
_________ Preferred Securities
____% Cumulative Trust Preferred Securities
(Liquidation Amount $10 per Preferred Security)
UNDERWRITING AGREEMENT
----------------------
June , 1997
Xxxx, Xxxx & Co., Inc.
00 Xxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxxxx 00000
Ladies and Gentlemen:
BNB Capital Trust (the "Trust"), a statutory business trust organized
under the Business Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C. Section 3801 et
seq.), and Broad National Bancorporation, a New Jersey corporation (the
"Company"), as depositor of the Trust and as guarantor (hereafter the Trust and
the Company are referred to collectively as the "Offerors"), hereby confirm
their agreement (the "Agreement") with Xxxx Xxxx & Co., Inc. (the
"Underwriter"), with respect to the issue and sale by the Trust and the purchase
by the Underwriter of 1,000,000 (the "Initial Securities") of the Trust's ____%
Cumulative Trust Preferred Securities (the "Preferred Securities"). The Trust
and the Company also propose to issue and sell to the Underwriter, at the
Underwriter's option, up to an additional 150,000 Preferred Securities (the
"Option Securities") as set forth herein. The term "Preferred Securities" as
used herein, unless indicated otherwise, shall mean the Initial Securities and
the Option Securities.
The Preferred Securities and the Common Securities (as defined herein)
are to be issued pursuant to the terms of an Amended and Restated Trust
Agreement dated as of June __, 1997 (the "Trust Agreement"), among the Offerors,
Bankers Trust Company ("Trust Company"), a New York banking corporation, as
property trustee ("Property Trustee"), and Bankers Trust (Delaware), as Delaware
trustee ("Delaware Trustee"), and Xxxxxx X. Xxxx and Xxxxx Xxxxx (the
"Administrators" and, together with the Property Trustee and the Delaware
Trustee, the "Trustees") and the holders from time to time of undivided
interests in the assets of the Trust. The Preferred Securities will be
guaranteed by the Company, on a subordinated basis and subject to certain
limitations, with respect to distributions and payments upon liquidation,
redemption or otherwise (the "Guarantee") pursuant to the Guarantee Agreement
dated as of June __, 1997 (the "Guarantee Agreement"), between the Company and
the Trust Company, as guarantee trustee (the "Guarantee Trustee"). The assets
of the Trust will consist of ____% junior subordinated debentures due _____ __,
2027 (the "Junior Subordinated Debentures") of the Company which will be issued
under the Indenture dated as of June __, 1997 (the "Indenture"), between the
Company and the Trust Company, as trustee (the "Indenture Trustee"). Under
certain circumstances, the Junior Subordinated Debentures will be distributable
to the holders of undivided beneficial interests in the assets of the Trust.
The entire proceeds from the sale of the Preferred Securities will be combined
with the entire proceeds from the sale by the Trust to the Company of the
Trust's common securities (the "Common Securities"), and will be used by the
Trust to purchase an equivalent amount of the Junior Subordinated Debentures.
The initial public offering price for the Preferred Securities, the
purchase price to be paid by the Underwriter for the Preferred Securities, the
commission per Preferred Security to be paid by the Company to the Underwriters
and the rate of interest to be paid on the Preferred Securities shall be agreed
upon by the Company and the Underwriter, and such agreement shall be set forth
in a separate written instrument substantially in the form of Exhibit A hereto
(the "Price Determination Agreement"). The Price Determination Agreement may
take the form of an exchange of any standard form of written telecommunication
between the Company and the Underwriter and shall specify such applicable
information as is indicated in Exhibit A hereto. The offering of the Preferred
Securities will be governed by this Agreement, as supplemented by the Price
Determination Agreement. From and after the date of the execution and delivery
of the Price Determination Agreement, this Agreement shall be deemed to
incorporate, and all references herein to "this Agreement" shall be deemed to
include, the Price Determination Agreement.
The Offerors have prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-2 (File Nos.
333-28897 and 333-28897-01) for the registration of the Preferred Securities,
the Guarantee and the Junior Subordinated Debentures under the Securities Act of
1933, as amended (the "1933 Act"), including the related preliminary prospectus
or prospectuses, and, if such registration statement has not become effective,
the Company will prepare and file, prior to the effective date of such
registration statement, an amendment to such registration statement, including a
final prospectus. Each prospectus used before the time such registration
statement becomes effective is herein called a "preliminary prospectus". Such
registration statement, including the exhibits thereto and the documents
incorporated by reference therein pursuant to Item 12 of Form S-2 under the 1933
Act, at the time it becomes effective, is herein called the "Registration
Statement", and the prospectus, including the documents incorporated by
reference therein pursuant to Item 12 of Form S-2 under the 1933 Act, included
in the Registration Statement at the time it becomes effective is herein called
the "Prospectus" except that, if any revised prospectus provided to the
Underwriter by the Company for use in connection with the offering of the
Preferred Securities differs from the
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prospectus included in the Registration Statement at the time it becomes
effective (whether or not such prospectus is required to be filed pursuant to
Rule 424(b)), the term "Prospectus" shall refer to such revised prospectus from
and after the time it is first furnished to the Underwriter for such use.
The Company understands that the Underwriter proposes to make a public
offering of the Preferred Securities (the "Offering") as soon as possible after
the Registration Statement becomes effective. The Underwriter may assemble and
manage a selling group of broker-dealers that are members of the National
Association of Securities Dealers, Inc. ("NASD") to participate in the
solicitation of purchase orders for the Preferred Securities under the form of a
master selected dealer agreement or similar form of dealer agreement, which the
Underwriter has entered into with such broker dealers.
Section 1. Representations and Warranties.
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(a) The Offerors jointly and severally represent and warrant to and
agree with the Underwriter that:
(i) The Company meets the requirements for use of Form S-2 under the
1933 Act and when the Registration Statement on such form shall become
effective and at the Closing Time referred to below and, with respect to
Option Securities, on the Date of Delivery referred to below, (A) the
Registration Statement and any amendments and supplements thereto will
comply in all material respects with the requirements of the 1933 Act and
the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations"); (B) neither the Registration Statement nor any amendment
or supplement thereto will contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which
they were made, not misleading; and (C) neither the Prospectus nor any
amendment or supplement thereto will include an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading, except that none of the representations and
warranties in this Section 1(a)(i)(B) & (C) shall apply to statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Offerors by the Underwriter expressly for use
in the Registration Statement or the Prospectus, or any information
contained in any Form T-1 which is an exhibit to the Registration
Statement. The statements contained under the caption "Underwriting" in the
Registration Statement or the Prospectus constitute the only information
furnished to the Offerors in writing by the Underwriter expressly for use
in the Registration Statement or the Prospectus.
(ii) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-2 under the 1933 Act, at the time they were
filed with the Commission, complied in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended (the "1934
Act"), and the rules and regulations of the Commission thereunder (the
"1934 Act Regulations") and, when read together and with the other
information in the
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Prospectus, at the time the Registration Statement becomes effective and at
the Closing Time, will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, in each case after
excluding any statement that does not constitute a part of the Registration
Statement or the Prospectus pursuant to Rule 412 of the 1933 Act
Regulations.
(iii) KPMG Peat Marwick LLP, who are reporting upon the audited
financial statements included or incorporated by reference in the
Registration Statement, are independent public accountants as required by
the 1933 Act and the 1933 Act Regulations.
(iv) This Agreement has been duly authorized, executed and delivered
by the Offerors and, when duly executed by the Underwriter, will constitute
the valid and binding agreement of the Offerors enforceable against the
Offerors in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, or reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally or by
general equitable principles. The Guarantee Agreement, the Junior
Subordinated Debentures, the Trust Agreement and the Indenture have each
been duly authorized by the Company and when validly executed and delivered
by the Company and, in the case of the Guarantee, by the Guarantee Trustee,
in the case of the Trust Agreement, by the Trustees, and in the case of the
Indenture, by the Indenture Trustee, will constitute valid and legally
binding obligations of the Company enforceable in accordance with their
respective terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, or reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally or general equitable
principles; the Junior Subordinated Debentures are entitled to the benefits
of the Indenture; and the Guarantee Agreement, the Junior Subordinated
Debentures, the Trust Agreement and the Indenture conform, in all material
respects, to the descriptions thereof in the Prospectus. The Trust
Agreement, the Guarantee Agreement, and the Indenture have been duly
qualified under the Trust Indenture Act.
(v) The consolidated financial statements, audited and unaudited
(including the Notes thereto), included or incorporated by reference in the
Registration Statement present fairly the consolidated financial position
of the Company and its subsidiaries as of the dates indicated therein and
the consolidated results of operations and cash flows of the Company and
its subsidiaries for the periods specified therein. Such financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved, except as otherwise stated therein. The financial statement
schedules, if any, included in the Registration Statement present fairly
the information required to be stated therein. The selected financial, pro
forma and statistical data included in the Prospectus are accurate in all
material respects and present fairly the information shown therein and have
been compiled on a basis consistent with that of the audited consolidated
financial statements included or incorporated by reference in the
Registration Statement.
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(vi) The Company is a corporation duly organized, validly existing and
in good standing under the laws of New Jersey with corporate power and
authority under such laws to own, lease and operate its properties and
conduct its business as described in all material respects in the
Prospectus. The Company is duly qualified to transact business as a
foreign corporation and is in good standing in each other jurisdiction in
which it owns or leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except to the extent
that the failure to so qualify or be in good standing would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs, assets or business prospects of the Company and
its subsidiaries, considered as one enterprise.
(vii) The Company is duly registered under the Bank Holding Company
Act of 1956, as amended; each subsidiary of the Company that conducts
business as a bank is duly authorized to conduct such business in each
jurisdiction in which such business is currently conducted, except to the
extent that the failure to be so authorized would not have a material
adverse effect on the Company and its subsidiaries, considered as one
enterprise; and the deposit accounts of Broad National Bank (the "Bank")
are insured by the Bank Insurance Fund of the Federal Deposit Insurance
Corporation ("FDIC") up to the maximum allowable limits thereof. The
Offerors have all such power, authority, authorization, approvals and
orders as may be required to enter into this Agreement, to carry out the
provisions and conditions hereof and to issue and sell the Preferred
Securities.
(viii) The Bank is a national banking association duly organized,
validly existing and in good standing under the laws of the United States
with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business; the Bank is duly qualified
to transact business as a foreign corporation and is in good standing in
each other jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification necessary,
except to the extent that the failure to so qualify or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, considered as one enterprise. All of the outstanding shares
of capital stock of the Bank have been duly authorized and validly issued
and are fully paid and non-assessable and are owned by the Company
directly, free and clear of any pledge, lien, security interest, charge,
claim, equity or encumbrance of any kind.
(ix) Except for the Bank and BNB Investment Corp., the Company does
not have any "significant subsidiaries" as defined in Rule 1-02 of
Regulation S-X under the 0000 Xxx.
(x) The Company had at the date indicated a duly authorized and
outstanding capitalization as set forth in the Prospectus under the caption
"Capitalization"; the capital stock of the Company and the Preferred
Securities conform in all material respects to the description thereof
contained or incorporated by reference in the Prospectus and such
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description conforms in all material respects to the rights set forth in
the instruments defining the same.
(xi) The Preferred Securities have been duly and validly authorized by
the Trust for issuance and sale to the Underwriter pursuant to this
Agreement and, when executed and authenticated in accordance with the terms
of the Trust Agreement and delivered by the Trust to the Underwriter
pursuant to this Agreement against payment of the consideration set forth
herein, will be validly issued and fully paid and non-assessable. The
Trust Agreement has been duly authorized by the Trust and, when executed by
the Property Trustee and the Administrators of the Trust and delivered by
the Trust, will have been duly executed and delivered by the Trust and will
constitute the valid and legally binding instrument of the Trust,
enforceable in accordance with its terms, except as enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting enforcement of creditors' rights generally or
by general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law). The Preferred Securities
conform, in all material respects, to the statements relating thereto
contained in the Prospectus and such description conforms, in all material
respects, to the rights set forth in the instruments defining the same; the
holders of the Preferred Securities (the "Security holders") will be
entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware; and the issuance of the Preferred
Securities is not subject to the preemptive or other similar rights of any
security holder of the Company.
(xii) The Common Securities have been duly and validly authorized by
the Trust and upon delivery by the Trust to the Company against payment
therefor as described in the Prospectus, will be duly and validly issued
and fully paid undivided beneficial interests in the assets of the Trust
and will conform, in all material respects, to the description thereof
contained in the Prospectus; the issuance of the Common Securities is not
subject to preemptive or other similar rights; and at the Closing Time, all
of the issued and outstanding Common Securities of the Trust will be
directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(xiii) The Trust has been duly created and is validly existing as a
statutory business trust in good standing under the Delaware Act with the
power and authority to own, lease and operate its properties and conduct
its business in all material respects as described in the Prospectus, and
the Trust has conducted no business to date, and it will conduct no
business in the future that would be inconsistent with the description of
the Trust set forth in the Prospectus; the Trust is not a party to or bound
by any agreement or instrument other than this Agreement, the Trust
Agreement and the agreements and instruments contemplated by the Trust
Agreement or described in the Prospectus; the Trust has no liabilities or
obligations other than those arising out of the transactions contemplated
by this Agreement and the Trust Agreement and described in the Prospectus;
and the Trust is not a party to or subject to any action, suit or
proceeding of any nature.
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(xiv) The issuance and sale of the Preferred Securities and the
Common Securities by the Trust, the compliance by the Trust with all of the
provisions of this Agreement, the purchase of the Junior Subordinated
Debentures by the Trust, and the consummation of the transactions herein
contemplated will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture, loan
agreement, mortgage, deed of trust or other agreement or instrument to
which the Trust is a party or by which the Trust is bound or to which any
of the property or assets of the Trust is subject, nor will such action
result in any violation by the Trust of the provisions of the Trust
Agreement or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Trust or any of
its properties, except in any case for such conflicts, breaches, defaults
or violations that would not have a material adverse effect on the
condition (financial or otherwise), earnings, business affairs, assets or
business prospects of the Company and its subsidiaries, considered as one
enterprise; and no consent, approval, authorization, order, license,
certificate, permit, registration or qualification of or with any such
court or other governmental agency or body is required to be obtained by
the Trust for the issue and sale of the Preferred Securities and the Common
Securities by the Trust, the purchase of the Junior Subordinated Debentures
by the Trust or the consummation by the Trust of the transactions
contemplated by this Agreement and the Trust Agreement, except for such
consents, approvals, authorizations, licenses, certificates, permits,
registrations or qualifications as have already been obtained, or as may be
required under the 1933 Act or the 1933 Act Regulations, 1934 Act or 1934
Act Regulations, state securities laws or under the Trust Indenture Act of
1939, as amended ("TIA").
The issuance by the Company of the Guarantee and the Junior
Subordinated Debentures, the compliance by the Company with all of the
provisions of this Agreement, the execution, delivery and performance by
the Company of the Trust Agreement, the Junior Subordinated Debentures, the
Guarantee Agreement and the Indenture, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any material indenture, loan agreement,
mortgage, deed of trust, or other material agreement or instrument to which
the Company is a party or by which the Company is bound or to which any of
the property or assets of the Company is subject, nor will such action
result in any violation by the Company of the provisions of the Articles of
Incorporation or by-laws of the Company or any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its properties, except in any case
for such conflicts, breaches, defaults or violations that would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs, assets or business prospects of the Company and
its subsidiaries, considered as one enterprise; and no consent, approval,
authorization, order, license, certificate, permit, registration or
qualification of or with any such court or other governmental agency or
body is required to be obtained by the Company for the issue of the
Guarantee and the Junior Subordinated Debentures or the consummation by the
Company of the other transactions contemplated by this Agreement, except
for such consents, approvals, authorizations, licenses, certificates,
permits, registrations or qualifications as
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have already been obtained, or as may be required under the 1933 Act or the
1933 Act Regulations, 1934 Act or 1934 Act Regulations, state securities
laws or under the TIA.
(xv) The Trust is not, and after giving effect to the offering and
sale of the Preferred Securities will not be, an "investment company," or
an entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(xvi) All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid and non-
assessable, and none of the outstanding shares of capital stock was issued
in violation of the preemptive rights of any stockholder of the Company.
(xvii) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as otherwise stated
therein, there has not been (A) any material adverse change in the
condition (financial or otherwise), earnings, business affairs, assets or
business prospects of the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business, (B)
any transaction entered into by the Company or any subsidiary, other than
in the ordinary course of business, that is material to the Company and its
subsidiaries, considered as one enterprise, or (C) any dividend or
distribution of any kind declared, paid or made by the Company on its
capital stock, excluding the regular quarterly dividend paid on its common
stock. Neither the Company nor the Bank has any material liability of any
nature, contingent or otherwise, except as set forth in the Prospectus.
(xviii) Neither the Company nor the Bank is in violation of any
provision of its charter or by-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which it is a party or by which it may be bound
or to which any of its properties may be subject, except for such defaults
that would not have a material adverse effect on the condition (financial
or otherwise), earnings, business affairs, assets or business prospects of
the Company and its subsidiaries, considered as one enterprise.
(xix) Except as disclosed in the Prospectus, there is no action, suit
or proceeding before or by any government, governmental instrumentality or
court, domestic or foreign, now pending or, to the knowledge of the
Company, threatened against the Company or the Bank that is required to be
disclosed in the Prospectus or that could reasonably be expected to result
in any material adverse change in the condition (financial or otherwise),
earnings, business affairs, assets or business prospects of the Company and
its subsidiaries, considered as one enterprise, or that could reasonably be
expected to materially and adversely affect the properties or assets of the
Company and its subsidiaries, considered as one enterprise, or that could
reasonably be expected to materially and adversely affect the consummation
of the transactions contemplated in this Agreement; all pending legal or
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governmental proceedings to which the Company or the Bank is a party that
are not described in the Prospectus, including ordinary routine litigation
incidental to its business, if decided in a manner adverse to the Company,
would not have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company
and its subsidiaries, considered as one enterprise.
(xx) There are no material contracts or documents of a character
required to be described in the Registration Statement or the Prospectus or
to be filed as exhibits to the Registration Statement that are not
described and filed as required.
(xxi) The Company and the Bank each has good and marketable title to
all properties and assets described in the Prospectus as owned by it, free
and clear of all liens, charges, encumbrances or restrictions, except such
as (A) are described in the Prospectus or (B) are neither material in
amount nor materially significant in relation to the business of the
Company and its subsidiaries, considered as one enterprise; all of the
leases and subleases material to the business of the Company and its
subsidiaries, considered as one enterprise, and under which the Company or
the Bank holds properties described in the Prospectus, are in full force
and effect, and neither the Company nor the Bank has any notice of any
material claim that has been asserted by anyone adverse to the rights of
the Company or the Bank under any of the leases or subleases mentioned
above, or affecting or questioning the rights of such corporation to the
continued possession of the leased or subleased premises under any such
lease or sublease.
(xxii) Each of the Company and the Bank owns, possesses or has
obtained all material governmental licenses, permits, certificates,
consents, orders, approvals and other authorizations necessary to own or
lease, as the case may be, and to operate its properties and to carry on
its business as presently conducted, and neither the Company nor the Bank
has received any notice of any restriction upon, or any notice of
proceedings relating to revocation or modification of, any such licenses,
permits, certificates, consents, orders, approvals or authorizations.
(xxiii) Except as disclosed in the Prospectus, no labor problem
exists with the employees of the Company or with employees of the Bank or,
to the best knowledge of the Company, is imminent that, in any such event,
could reasonably be expected to materially adversely affect the Company and
its subsidiaries, considered as one enterprise, and the Company is not
aware of any existing or imminent labor disturbance by the employees of any
of its or the Bank's principal suppliers, contractors or customers that
could reasonably be expected to materially adversely affect the condition
(financial or otherwise), earnings, business affairs or business prospects
of the Company and its subsidiaries, considered as one enterprise.
(xxiv) There are no persons with registration or other similar rights
to have any securities of the Company registered pursuant to the
Registration Statement or otherwise registered by the Company under the
1933 Act.
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(xxv) Except as disclosed in the Prospectus, the Company and the Bank
own or possess all patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets or other unpatented and/or
unpatentable proprietary or confidential information systems or
procedures), trademarks, servicemarks and tradenames (collectively, "patent
and proprietary rights") currently employed by them in connection with the
business now operated by them except where the failure to so own, possess
or acquire such patent and proprietary rights would not reasonably be
expected to have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs, assets or business prospects
of the Company and its subsidiaries considered as one enterprise, and
neither the Company nor the Bank has received any notice nor is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any patent or proprietary rights, and which infringement or
conflict (if the subject of any unfavorable decision, rule and refinement,
singly or in the aggregate) could reasonably be expected to result in any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs, assets or business prospects of the Company and
its subsidiaries considered as one enterprise.
(xxvi) The Company and each subsidiary of the Company have filed when
due all Federal, state and local income, franchise or other tax returns
required to be filed and have made timely payments of all taxes indicated
by such returns and no material deficiency has been asserted with respect
thereto by any taxing authority.
(xxvii) The Company has filed with NASD all documents and notices
required by NASD of companies that have issued securities that are traded
in the over-the-counter market and quotations for which are reported by the
Nasdaq National Market of the Nasdaq Stock Market, Inc. ("Nasdaq Stock
Market").
(xxviii) Neither the Trust nor the Company or any Subsidiary has
taken or will take, directly or indirectly, any action designed to cause or
result in, or which has constituted or which might reasonably be expected
to constitute, the stabilization or manipulation, under the Exchange Act or
otherwise, of the price of the Preferred Securities.
(xxix) Neither the Company nor the Bank is or has been (by virtue of
any action, omission to act, contract to which it is a party or by which it
is bound, or any occurrence or state of facts whatsoever) in violation of
any applicable Federal, state, municipal, or local statutes, laws,
ordinances, rules, regulations and/or orders issued pursuant to foreign,
federal, state, municipal, or local statutes, laws, ordinances, rules, or
regulations (including those relating to any aspect of banking, bank
holding companies, environmental protection, occupational safety and
health, and equal employment practices) heretofore or currently in effect,
except such violation that has been fully cured or satisfied without
recourse or that is not reasonably likely to have a material adverse effect
on the Company and its subsidiaries considered as one enterprise.
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(xxx) The Company and the Bank have no agreement or understanding
with any entity concerning the future acquisition by the Company or the
Bank of a controlling interest in any entity that is required by the 1933
Act or the 1933 Act Regulations to be disclosed by the Company that is not
disclosed in the Prospectus; the Company and the Bank have no agreement or
understanding with any entity concerning the future acquisition of a
controlling interest in the Company or the Bank by any entity that is
required by the 1933 Act or the 1933 Act Regulations to be disclosed by the
Company that is not disclosed in the Prospectus.
(b) Any certificate signed by any authorized officer of the Company or
the Bank and delivered to the Underwriter or to counsel for the Underwriter
pursuant to this Agreement shall be deemed a representation and warranty by the
Company to the Underwriter as to the matters covered thereby.
Section 2. Sale and Delivery to the Underwriter; Closing.
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(a) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, the Trust
agrees to sell to the Underwriter, and the Underwriter agrees to purchase from
the Trust 1,000,000 Initial Securities at the purchase price and terms set forth
herein and in the Price Determination Agreement.
In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Trust
hereby grants an option to the Underwriter to purchase up to 150,000 Option
Securities in accordance with the terms set forth herein and in the Price
Determination Agreement. The option hereby granted will expire at 5:00 p.m. on
the 30th day after the date the Registration Statement is declared effective by
the Commission (or at 5:00 p.m. on the next business day if such 30th day is not
a business day) and may be exercised, on one occasion only, solely 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
Underwriter to the Company setting forth the number of Option Securities as to
which the Underwriter is exercising the option and the time, date and place of
payment and delivery for the Option Securities. Such time and date of delivery
(the "Option Closing Date") shall be determined by the Underwriter but shall not
be later than five full business days after the date on which the notice of the
exercise of the option shall have been given, nor in any event prior to Closing
Time, as hereinafter defined, nor earlier than the second business day after the
date on which the notice of the exercise of the option shall have been given.
(b) Payment of the purchase price for, and delivery of certificates
for, the Initial Securities shall be made at the offices of Pitney, Xxxxxx, Xxxx
& Xxxxx, or at such other place as shall be agreed upon by the Company and the
Underwriter, at 9:30 a.m. on the third full business day after the effective
date of the Registration Statement, or at such other time not more than seven
full business days thereafter as you and the Company shall determine (such date
and time of payment and delivery being herein called the "Closing Time"). In
addition, in the event that any or all of the Option Securities are purchased by
the Underwriter, payment of the purchase price for,
11
and delivery of certificates for, such Option Securities shall be made at the
above-mentioned office of Pitney, Xxxxxx, Xxxx & Xxxxx, or at such other place
as shall be agreed upon by the Company and the Underwriter, on the Option
Closing Date as specified in the notice from the Underwriter to the Company.
Payment for the Initial Securities and the Option Securities, if any, shall be
made to the Company by wire transfer of immediately available funds, against
delivery to the Underwriter for the account of the Underwriter of Preferred
Securities to be purchased by it.
(c) The Initial Securities shall be issued in the form of one or more
fully registered global securities (the "Global Securities") in book-entry form
in such denominations and registered in the name of the nominee of The
Depository Trust Company (the "DTC") or in such names as the Underwriter may
request in writing at least two business days before the Closing Date or the
Option Closing Date, as the case may be. The Global Securities representing the
Initial Securities or the Option Securities to be purchased will be made
available in New York City for examination by the Underwriter and counsel to the
Underwriter not later than 10:00 A.M. on the business day prior to the Closing
Time or the Option Closing Date, as the case may be.
Section 3. Certain Covenants of the Offerors. Each of the Offerors
--------------------------------------------------------
covenants jointly and severally with the Underwriter as follows:
----------------------------------------------------------------
(a) The Offerors will use their best efforts to cause the Registration
Statement to become effective and will notify the Underwriter immediately, and
confirm the notice in writing, (i) when the Registration Statement, or any post-
effective amendment to the Registration Statement, shall have 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 of the Commission to amend the Registration Statement or amend or
supplement 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
Preferred Securities or capital stock, for offering or sale in any jurisdiction,
or of the institution or threatening of any proceedings for any of such
purposes. The Offerors will use every reasonable effort to prevent the issuance
of any such stop order or of any order preventing or suspending such use and, if
any such order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) The Offerors will not at any time file or make any amendment to
the Registration Statement, or any amendment or supplement, if the Offerors have
elected to rely upon Rule 430A, to the Prospectus (including documents
incorporated by reference into such prospectus or to the Prospectus) of which
the Underwriter shall not have previously been advised and have previously been
furnished a copy, or to which the Underwriter or counsel for the Underwriter
shall reasonably object.
(c) The Offerors have furnished or will furnish to the Underwriter as
many signed and conformed copies of the Registration Statement as originally
filed and of each amendment thereto, whether filed before or after the
Registration Statement becomes effective, copies of all exhibits and documents
filed therewith (including documents incorporated by
12
reference into the Prospectus pursuant to Item 12 of Form S-2 under the 0000
Xxx) and signed copies of all consents and certificates of experts as the
Underwriter may reasonably request.
(d) The Offerors will deliver or cause to be delivered to the
Underwriter, without charge, from time to time until the effective date of the
Registration Statement, as many copies of each preliminary prospectus as the
Underwriter may reasonably request, and the Offerors hereby consent to the use
of such copies for purposes permitted by the 1933 Act. The Offerors will deliver
or cause to be delivered to the Underwriter, without charge, as soon as the
Registration Statement shall have become effective (or, if the Offerors have
elected to rely upon Rule 430A, as soon as practicable after the Price
Determination Agreement has been executed and delivered) and thereafter from
time to time as requested during the period when the Prospectus is required to
be delivered under the 1933 Act, such number of copies of the Prospectus (as
supplemented or amended) as the Underwriter may reasonably request.
(e) The Company will comply to the best of its ability 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 Preferred 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 Preferred Securities, any event shall occur or condition exist as a
result of which it is necessary, in the reasonable opinion of counsel for the
Underwriter or counsel for the Offerors, to amend the Registration Statement or
amend or supplement the Prospectus in order that the Prospectus will not include
an untrue statement 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 circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the reasonable opinion of either 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 untrue statement or omission or to make the Registration Statement
or the Prospectus comply with such requirements.
(f) The Offerors will use their best efforts, in cooperation with the
Underwriter, to qualify the Preferred Securities and the Junior Subordinated
Debentures, for offering and sale under the applicable securities laws of such
states and other jurisdictions as the Underwriter may designate in writing and
to maintain such qualifications in effect for a period of not less than one year
from the effective date of the 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. The Company will file such statements and reports as may
be required by the laws of each jurisdiction in which the Preferred Securities
have been qualified as above provided.
(g) The Company will make generally available (within the meaning of
Rule 158) as soon as practible, but not later than the Availability Date (as
defined below) to its security
13
holders, the Underwriter and the Security holders an earnings statement (which
need not be audited) of the Company and its subsidiary (in form complying with
the provisions of Rule 158 of the 1933 Act Regulations) covering a period of at
least 12 months beginning after the effective date of the Registration
Statement. For the purpose of the preceding sentence, "Availability Date" means
the 45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such effective date, except that, if such fourth fiscal
quarter is the last quarter of the Company's fiscal year, "Availability Date"
means the 90th day after the end of such fourth fiscal quarter.
(h) The Trust shall apply the proceeds from its sale of the Preferred
Securities, combined with the entire proceeds from the issuance by the Trust to
the Company of the Trust's Common Securities, to purchase an equivalent amount
of Junior Subordinated Debentures. The Company and the Bank will use the net
proceeds received by them from the sale of the Junior Subordinated Debentures in
the manner specified in the Prospectus under the caption "Use of Proceeds".
(i) The Offerors, during the period when the Prospectus is required to
be delivered under the 1933 Act, will file promptly all documents required to be
filed with the Commission pursuant to Section 13 or 14 of the 1934 Act
subsequent to the time the Registration Statement becomes effective.
(j) For a period of five years after the Closing Time, the Company
will furnish to the Underwriter, copies of all annual reports, quarterly reports
and current reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or
such other similar forms as may be designated by the Commission, and such other
documents, reports, Proxy Statements, and information as shall be furnished by
the Company to its stockholders generally.
(k) The Offerors will cause the Preferred Securities to be listed and
will file with the Nasdaq Stock Market all documents and notices required by the
Nasdaq Stock Market of companies that have issued securities that are traded in
the over-the-counter market and quotations for which are reported by the Nasdaq
Stock Market.
(l) The Company shall pay for the legal fees and related filing fees
to its counsel (or counsel to the Underwriter) to prepare one or more "blue sky"
surveys (each, a "Blue Sky Survey") for use in connection with the offering of
the Preferred Securities as contemplated by the Prospectus and a copy of such
Blue Sky Survey or surveys shall be delivered to each of the Company and the
Underwriter.
(m) If, at the time the Registration Statement becomes effective, any
information shall have been omitted therefrom in reliance upon Rule 430A of the
1933 Act Regulations, then the Offerors will prepare, and file or transmit for
filing with the Commission in accordance with such Rule 430A and Rule 424(b),
copies of an amended Prospectus, or, if required by such Rule 430A, a post-
effective amendment to the Registration Statement (including an amended
Prospectus), containing all information so omitted.
14
(n) The Company will, at its expense, subsequent to the issuance of
the Preferred Securities, prepare and distribute to each of the Underwriter and
counsel to the Underwriter, copies of all the documents used in connection with
the issuance of the Preferred Securities in the form of a bond Closing Binder.
(o) The Offerors will not, prior to the Option Closing Date or thirty
(30) days after the date of this Agreement, whichever occurs first, incur any
material liability or obligation, direct or contingent, or enter into any
material transaction, other than in the ordinary course of business, or any
transaction with a related party which is required to be disclosed in the
Prospectus pursuant to Item 404 of Regulation S-K under the Securities Act,
except as contemplated by the Prospectus.
(p) During a period of ten days from the date of the Prospectus,
neither the Trust nor the Company will, without the prior written consent of the
Underwriter, directly or indirectly, offer, sell, offer to sell, or otherwise
dispose of any Preferred Securities, any other beneficial interests in the
assets of the Trust, or any preferred securities or other securities of the
Trust or the Company which are substantially similar to the Preferred
Securities, including any guarantee of such securities. The foregoing sentence
shall not apply to any of the Preferred Securities to be sold hereunder.
Section 4. Payment of Expenses and Advisory Fee.
----------------------------------------
(a) The Company will pay and bear all costs and expenses incident to
the performance of its and the Trust's obligations under this Agreement,
including (a) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits), as originally filed and as
amended, the preliminary prospectuses and the Prospectus and any amendments or
supplements thereto, and the cost of furnishing copies thereof to the
Underwriter, (b) the preparation, printing and distribution of this Agreement,
the Preferred Securities and the Blue Sky Survey, (c) the issuance and delivery
of the Preferred Securities to the Underwriter, including any transfer taxes
payable upon the sale of the Preferred Securities to the Underwriter, (d) the
fees and disbursements of the Company's counsel and accountants, (e) NASD filing
fees, (f) fees and disbursements of counsel in connection with the Blue Sky
Survey, (g) the qualification of the Preferred Securities under the applicable
securities laws in accordance with Section 3(f) and any filing fee for review of
the offering with the NASD, (h) the legal fees and expenses of the Underwriter's
counsel (such counsel's fees shall not exceed $50,000 (exclusive of out-of-
pocket expenses of counsel) and general out-of-pocket expenses of the
Underwriter not to exceed $15,000, (i) the fees and expenses of the Indenture
Trustee, including the fees and disbursements of counsel for the Indenture
Trustee, in connection with the Indenture and the Junior Subordinated
Debentures; (j) the fees and expenses of the Property Trustee and Delaware
Trustee, including the fees and disbursements of counsel for the Property
Trustee and the Delaware Trustee, in connection with the Trust Agreement and the
Certificate of Trust, and (k) all other costs incident to the performance of the
Offerors' obligations hereunder.
15
(b) In addition to the commissions due to the Underwriter under the
Price Determination Agreement, simultaneous with the payment of the purchase
price at the Closing Time (and at the Option Closing Date with respect to the
Option Securities), the Company shall pay the Underwriter an advisory fee equal
to 1% of the gross proceeds of the Initial Securities issued and sold to the
Underwriter at the Closing Time and, if applicable, 1% of the gross proceeds of
the Option Securities, if any, issued and sold to the Underwriter at the Option
Closing Date.
If (i) the Closing Time does not occur on or before August 31, 1997,
(ii) the Company abandons or terminates the Offering, or (iii) this Agreement is
terminated by the Underwriter in accordance with the provisions of Section 5 or
11(a), the Company shall reimburse the Underwriter for all its reasonable out-
of-pocket expenses, as set forth in this Section 4, including the reasonable
fees and disbursements of counsel for the Underwriter; but the Company shall not
in any event be liable to the Underwriter for damages on account of loss of
anticipated profits from the sale of Preferred Securities.
Section 5. Conditions of Underwriter's Obligations. The obligations
----------------------------------------
of the Underwriter to purchase and pay for the Preferred Securities that it has
agreed to purchase pursuant to this Agreement are subject to the accuracy, as of
the Closing Time, of the representations and warranties of the Offerors
contained herein or in certificates of the officers or trustees of the Offerors
or any subsidiary delivered pursuant to the provisions hereof, to the
performance by the Offerors of their obligations hereunder and to the following
further conditions:
(a) The Registration Statement shall have become effective not later
than 5:30 P.M. on the date of this Agreement or, with the mutual consent of the
Company and the Underwriter, at a later time and date not later, however, than
5:30 P.M. on the first business day following the date hereof, or at such later
time or on such later date as the Company and the Underwriter may agree to in
writing; at the Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act and no
proceedings for that purpose shall have been instituted or shall be pending or,
to the Underwriter's knowledge or the knowledge of the Offerors shall be
contemplated 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 for the Underwriter. If the Offerors have elected to
rely upon Rule 430A, 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).
(b) At the Closing Time, the Underwriter shall have received:
(i) The favorable opinion, dated as of Closing Time, of Xxxxxxx, Mag &
Fizzell, P.C., counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriter, substantially in the form set
forth in Exhibit B.
16
(ii) The favorable opinion, dated as of Closing Time, of Xxxxxxxx,
Xxxxxx & Finger, special Delaware counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriter, substantially in the
form set forth in Exhibit C.
(iii) The favorable opinion, dated as of Closing Time, of Xxxxxx &
Xxxxxx, counsel for the Indenture Trustee and the Delaware Trustee, in form
and substance satisfactory to counsel for the Underwriter, substantially in
the form set forth in Exhibit D.
(iv) The favorable opinion, dated as of Closing Time, of Pitney,
Xxxxxx, Xxxx & Xxxxx, counsel for the Underwriter, in form and substance
satisfactory to the Underwriter.
(v) The favorable opinion, dated as of Closing Time, of Xxxxxxx
Xxxxxxxx & Wood, special New Jersey counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriter, substantially in the form
set forth in Exhibit E.
In giving such opinion, such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the federal law of the United
States, upon opinions of other counsel, who shall be counsel satisfactory to
counsel for the Underwriter (the Underwriter agrees and acknowledges that
Xxxxxxx, Mag & Fizzell, P.C., and Pitney, Xxxxxx, Xxxx & Xxxxx will rely on the
opinion of Xxxxxxxx, Xxxxxx & Finger with respect to matters of Delaware law),
in which case the opinion shall state that counsel believes that the Underwriter
and its counsel are entitled to so rely. 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, the Bank
and the Trust and certificates of public officials.
(c) At the Closing Time and again at the Option Closing Date, (i) the
Registration Statement and the Prospectus, as they may then be amended or
supplemented, shall contain all statements that are required to be stated
therein under the 1933 Act and the 1933 Act Regulations and in all material
respects shall conform to the requirements of the 1933 Act and the 1933 Act
Regulations, the Offerors shall have complied in all material respects with Rule
430A (if they shall have elected to rely thereon) and neither the Registration
Statement nor the Prospectus, as they may then be amended or supplemented, shall
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, (ii) there shall not have been, since the respective dates as of
which information is given in the Registration Statement, any material adverse
change in the condition (financial or otherwise), earnings, business affairs,
assets or business prospects of the Company and its subsidiaries, considered as
one enterprise, whether or not arising in the ordinary course of business, (iii)
no action, suit or proceeding at law or in equity shall be pending or, to the
knowledge of the Offerors, threatened against the Company or any subsidiary or
the Trust that would be required to be set forth in the Prospectus other than as
set forth therein and no proceedings shall be pending or, to the knowledge of
the Offerors, threatened against the Offerors or any subsidiary before or by any
federal, state or other commission, board or administrative agency wherein an
unfavorable decision, ruling or finding could reasonably be expected to
materially adversely affect the condition (financial or otherwise), earnings,
business affairs, assets or business prospects of the Company and
17
its subsidiaries, considered as one enterprise, other than as set forth in the
Prospectus, (iv) each of the Offerors shall have complied, in all material
respects, with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Time, (v) the other
representations and warranties of the Offerors set forth in Section l(a) shall
be accurate in all material respects as though expressly made at and as of the
Closing Time, and (vi) no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for that purpose
been initiated or to the best knowledge of the Offerors threatened by the
Commission. At the Closing Time, the Underwriter shall have received a
certificate of the Chairman or the President, and the Chief Financial Officer or
Controller, of the Company, dated as of the Closing Time, to such effect.
(d) At the time that this Agreement is executed by the Company, the
Underwriter shall have received from KPMG Peat Marwick LLP a letter or letters,
dated such date, in form and substance reasonably satisfactory to the
Underwriter, confirming that they are independent certified public accountants
with respect to the Company within the meaning of the 1933 Act and the published
1933 Act Regulations, and stating in effect that:
With respect to the Company:
(i) in their opinion, the consolidated financial statements as of
December 31, 1996 and 1995, and for each of the years in the three year
period ended December 31, 1996 and the related financial statement
schedules, if any, included or incorporated by reference in the
Registration Statement and the Prospectus and covered by their opinions
included therein comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the published 1933
Act Regulations;
(ii) on the basis of a reading of the minutes of all meetings of the
stockholders of the Company and the Bank, of the Board of Directors of the
Company and the Bank and of the Audit and Executive Committees of the Board
of Directors of the Bank since December 31, 1996, inquiries of certain
officials of the Company and its subsidiaries responsible for financial and
accounting matters, and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) at a specified date not more than three days prior to the
date of this Agreement, there was any increase in notes or
subordinated debentures payable, real estate owned, or any decrease in
allowance for loan losses of the Company and its consolidated
subsidiaries or any decrease in total assets, total deposits or
stockholders' equity of the Company and its consolidated subsidiaries
or any increase in the number of outstanding shares of capital stock
of the Company and its consolidated subsidiaries, in each case as
compared with amounts shown in the financial statements at March 31,
1997 incorporated by reference in the Registration Statement; or
(B) for the period from March 31, 1997 to a specified date not
more than three days prior to the date of this Agreement, there was
any decrease in
18
consolidated net interest income, non-interest income or net income or
the (split-adjusted) total or fully diluted per share amounts of net
income or any increase in the consolidated provision for loan losses,
in each case as compared with the comparable period in the preceding
year.
(iii) in addition to the procedures referred to in clause (ii) above,
they have performed other specified procedures, not constituting an audit,
with respect to certain amounts, percentages, numerical data and financial
information appearing in the Registration Statement (including the Selected
Consolidated Financial Data) (having compared such items with, and have
found such items to be in agreement with, the financial statements of the
Company or general accounting records of the Company, as applicable, which
are subject to the Company's internal accounting controls or other data and
schedules prepared by the Company from such records).
(iv) on the basis of a review of schedules provided to them by the
Company, nothing came to their attention that caused them to believe that
the pro forma information, set forth in the Prospectus under the headings
"Capitalization" on page 21 had not been correctly calculated on the basis
described therein.
(e) At the Closing Time, the Underwriter shall have received from KPMG
Peat Marwick LLP letters, in form and substance reasonably satisfactory to the
Underwriter and dated as of the Closing Time, to the effect that they reaffirm
the statements made in the letter(s) furnished pursuant to Section 5(d), except
that the inquiries specified in Section 5(d) shall be made based upon the latest
available unaudited interim consolidated financial statements and the specified
date referred to shall be a date not more than three days prior to the Closing
Time.
(f) At the Closing Time, counsel for the Underwriter shall have been
furnished with all such documents, certificates and opinions as they reasonably
may request for the purpose of enabling them to pass upon the issuance and sale
of the Preferred Securities as contemplated in this Agreement and the matters
referred to in Section 5(c) and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements of the
Offerors, the performance of any of the covenants of the Offerors, or the
fulfillment of any of the conditions herein contained; all proceedings taken by
the Company at or prior to the Closing Time in connection with the
authorization, issuance and sale of the Preferred Securities and the Junior
Subordinated Debentures as contemplated in this Agreement shall be reasonably
satisfactory in form and substance to the Underwriter and to counsel for the
Underwriter.
(g) Between the date of this Agreement and the Closing Time, (i) no
downgrading shall have occurred in the rating accorded any securities of the
Company or any deposit instruments of the Bank by any "nationally recognized
statistical rating organization," as that term is defined by the Commission for
purposes of Rule 436(g) (2) under the 1933 Act and (ii) no such organization
shall have given any notice of any intended or potential downgrading or of any
surveillance or review, with possible negative implications, of its rating of
any of the Company's securities or any deposit instruments of the Bank.
19
(h) The Company shall have paid, or made arrangements satisfactory to
the Underwriter for the payment of, all such expenses as may be required by
Section 4 hereof.
(i) In the event the Underwriter exercises its option provided in
Section 2 hereof to purchase all or any portion of the Option Securities, the
obligations of the Underwriter to purchase the Option Securities that it has
agreed to purchase shall be subject to the accuracy of the representations and
warranties of the Offerors contained herein and of the statements in any
certificates furnished by the Offerors hereunder as of such Option Closing Date
(as if made on such date), to the performance by the Offerors of their
obligations hereunder and to the receipt by the Underwriter on the Option
Closing Date of:
(1) A certificate, dated the Option Closing Date, of the Chairman
or the President and the Chief Financial Officer or Controller of the
Company confirming that the certificate delivered on the Closing Time
pursuant to Section 5(c) hereof remains true as of the Option Closing
Date;
(2) The favorable opinion of Xxxxxxx, Mag & Fizzell, P.C.,
counsel for the Company, addressed to the Underwriter and dated the
Option Closing Date, in form reasonably satisfactory to Pitney,
Xxxxxx, Xxxx & Xxxxx, counsel for the Underwriter, relating to the
Option Securities and otherwise to the same effect as the opinion
required by Section 5(b) hereof;
(3) The favorable opinion of Xxxxxxxx, Xxxxxx & Finger, special
Delaware counsel for the Offerors, addressed to the Underwriter and
dated the Option Closing Date, in form reasonably satisfactory to
Pitney, Xxxxxx, Xxxx & Xxxxx, counsel for the Underwriter, relating to
the Option Securities and otherwise to the same effect as the opinion
required by Section 5(b) hereof;
(4) The favorable opinion of Xxxxxx & Xxxxxx, counsel for the
Indenture Trustee and the Delaware Trustee, addressed to the
Underwriter and dated the Option Closing Date, relating to the Option
Securities and otherwise to the same effect as the opinion required by
Section 5(b) hereof;
(5) The favorable opinion of Pitney, Xxxxxx, Xxxx & Xxxxx, dated
the Option Closing Date, relating to the Option Shares and otherwise
to the same effect as the opinion required by Section 5(b) hereof;
(6) The favorable opinion of Xxxxxxx Xxxxxxxx & Wood, dated the
Option Closing Date, relating to the Option Securities and otherwise
to the same effect as the opinion required by Section 5(b) hereof, and
(7) Letters from KPMG Peat Marwick LLP addressed to the
Underwriter and dated the Option Closing Date, in form and substance
reasonably satisfactory to the Underwriter and substantially the same
in
20
form and substance as the letters furnished to the Underwriter
pursuant to Section 5(d) hereof.
(j) The Preferred Securities, the Guarantee and the Junior
Subordinated Debentures shall have been qualified or registered for sale, or
subject to an available exemption from such qualification or registration, under
the Blue Sky Laws of such jurisdictions as shall have been reasonably specified
by the Underwriter and the offering contemplated by this Agreement shall have
been cleared by the NASD.
If any of the conditions specified in this Section 5 shall not have
been fulfilled when and as required by this Agreement to be fulfilled, this
Agreement may be terminated by the Underwriter on notice to the Offerors at any
time at or prior to the Closing Time, and such termination shall be without
liability of any party to any other Party, except as provided in Section 4.
Notwithstanding any such termination, the provisions of Sections 6, 7, 10 and 12
shall remain in effect.
Section 5A. Conditions of Offeror's Obligations. The obligations of
-----------------------------------
the Offerors to sell and deliver the portion of the Preferred Securities
required to be delivered as and when specified in this Agreement are subject to
the conditions that the Registration Statement shall have become effective and
that as of the Closing Time (or the Option Closing Date with respect to the
Option Securities) no stop order suspending the effectiveness of the
Registration Statement shall have been issued and in effect or proceedings
therefor initiated or threatened, and there shall have been no change in the
Internal Revenue Code of 1986 or the regulations promulgated thereunder that
reasonably would be expected to adversely effect the ability of the Company to
deduct the interest paid by it under the Junior Subordinated Debentures.
Section 6. Indemnification.
----------------
(a) The Company agrees to indemnify and hold harmless the Underwriter,
officers, directors, employees, agents, and counsel of the Underwriter, and each
person, if any, who controls the Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20(a) of the 1934 Act, against any loss, liability,
claim, damage, and expense whatsoever (which shall include, but not be limited
to amounts incurred in investigating, preparing, or defending against any
litigation, commenced or threatened, or any claim or investigation whatsoever
and any and all amounts paid in settlement of any claim or litigation), as and
when incurred, arising out of, based upon, or in connection with (i) any untrue
statement or alleged untrue statement of a material fact or any omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, contained in (A) any
Preliminary Prospectus, the Registration Statement, or the Prospectus (as from
time to time amended and supplemented), or any amendment or supplement thereto
or in any document incorporated by reference therein or required to be delivered
with any Preliminary Prospectus or the Prospectus or (B) in any application or
other document or communication (collectively called an "application") executed
by or on behalf of the Company or based upon written information furnished by or
on behalf of the Company filed in any jurisdiction in order to qualify the
Preferred Securities under the "blue sky" or securities laws
21
thereof or filed with the Commission or any securities exchange; unless such
statement or omission or alleged statement or omission was made in reliance upon
and in conformity with written information concerning the Underwriter, the
Underwriting Agreement or the compensation of the Underwriter furnished to the
Company by or on behalf of the Underwriter expressly for inclusion in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or in any application, as the case may be, or
(ii) any breach of any representation, warranty, covenant, or agreement of the
Company contained in the Underwriting Agreement. The foregoing indemnification
with respect to any preliminary prospectus shall not inure to the benefit of the
Underwriter (or its directors, officers, employees and controlling persons
within the meaning of the federal securities laws) if the person asserting any
such losses, claims, damages or liabilities against the Underwriter (or such
other persons) purchased Preferred Securities and a copy of the Prospectus (as
then amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) was not sent or given by or on behalf of the Underwriter
to such person, if such is required by law, in connection with the written
confirmation of the sale of such Preferred Securities to such person and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage or liability, provided that the Company
delivered the Prospectus, as amended or supplemented, to the Underwriter on a
timely basis to permit such delivery or sending. For purposes of this section,
the term "expense" shall include, but not be limited to, counsel fees and costs,
court costs, out-of-pocket costs and compensation for the time spent by the
Underwriter's directors, officers, employees and counsel according to his or her
normal hourly billing rates. The indemnification provisions shall also extend to
all affiliates of the Underwriter, its respective directors, officers,
employees, legal counsel, agents and controlling persons within the meaning of
the federal securities laws. The foregoing agreement to indemnify shall be in
addition to any liability the Company may otherwise have to the Underwriter or
the persons entitled to the benefit of these indemnification provisions.
(b) The Underwriter agrees to indemnify and hold harmless the
Offerors, their directors, officers who signed the Registration Statement, and
each person, if any, who controls the Offerors within the meaning of Section 15
of the 1933 Act or Section 20(a) of the 1934 Act, against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) above, 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) or any Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto) or any application in
reliance upon and in conformity with written information about the Underwriter,
the Underwriting Agreement, or the compensation of the Underwriter, furnished to
either of the Offerors by the Underwriter expressly for use in the Registration
Statement (or any amendment thereto) or such Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto) or in any application.
(c) An indemnified party shall give prompt notice to the indemnifying
party if any action, suit, proceeding or investigation is commenced in respect
of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve the indemnifying party from its obligations
to indemnify hereunder, except to the extent that the indemnifying party
22
has been prejudiced in any material respect by such failure. If it so elects
within a reasonable time after receipt of such notice, an indemnifying party may
assume the defense of such action, including the employment of counsel
satisfactory to the indemnified parties and payment of all expenses of the
indemnified party in connection with such action. Such indemnified party or
parties shall have the right to employ its or their own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless the employment of such counsel shall have
been authorized in writing by the indemnifying party in connection with the
defense of such action or the indemnifying party shall not have promptly
employed counsel satisfactory to such indemnified party or parties or such
indemnified party or parties shall have reasonably concluded that there may be
one or more legal defenses available to it or them or to other indemnified
parties which are different from or additional to those available to one or more
of the indemnifying parties, in any of which events such fees and expenses shall
be borne by the indemnifying party and the indemnifying party shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties. The Company shall be liable for any settlement of any claim against the
Underwriter (or its directors, officers, employees, affiliates or controlling
persons), made with the Company's written consent, which consent shall not be
unreasonably withheld. The Company shall not, without the written consent of the
Underwriter, settle or compromise any claim against it based upon circumstances
giving rise to an indemnification claim against the Company hereunder unless
such settlement or compromise provides that the Underwriter and the other
indemnified parties shall be unconditionally and irrevocably released from all
liability in respect to such claim.
(d) In order to provide for just and equitable contribution, if a
claim for indemnification pursuant to these indemnification provisions is made
but it is found in a final judgment by a court that such indemnification may not
be enforced in such case, even though the express provisions hereof provide for
indemnification in such case, then the Company, on the one hand, and the
Underwriter, on the other hand, shall contribute to the amount paid or payable
by such indemnified persons as a result of such loss, liability, claim, damage
and expense in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the Underwriter, on the
other hand, from the underwriting, and also the relative fault of the Company,
on the one hand, and the Underwriter, on the other hand, in connection with the
statements, acts or omissions which resulted in such loss, liability claim,
damage and expense, and any other relevant equitable considerations shall also
be considered. No person found liable for a fraudulent misrepresentation or
omission shall be entitled to contribution from any person who is not also found
liable for such fraudulent misrepresentation or omission. Notwithstanding the
foregoing, the Underwriter shall not be obligated to contribute any amount
hereunder that exceeds the amount of the underwriting commission paid by the
Company to the Underwriter with respect to the Preferred Securities purchased by
the Underwriter.
(e) The indemnity and contribution agreements contained herein are in
addition to any liability which the Company may otherwise have to the
Underwriter.
(f) Neither termination nor completion of the engagement of the
Underwriter nor any investigation made by or on behalf of the Underwriter shall
affect the indemnification
23
obligations of the Company or the Underwriter hereunder, which shall remain and
continue to be operative and in full force and effect.
Section 7. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery. The representations, warranties, indemnities, agreements and other
--------
statements of the Offerors or its officers or trustees set forth in or made
pursuant to this Agreement will remain operative and in full force and effect
regardless of any investigation made by or on behalf of the Offerors or the
Underwriter or any controlling person and will survive delivery of and payment
for the Preferred Securities.
Section 8. Offering by the Underwriter. The Trust and the Company
---------------------------
are advised by the Underwriter that the Underwriter proposes to make a public
offering of the Preferred Securities, on the terms and conditions set forth in
the Registration Statement from time to time as and when the Underwriter deems
advisable after the Registration Statement becomes effective. Because the NASD
is expected to view the Preferred Securities as interests in a direct
participation program, the offering of the Preferred Securities is being made in
compliance with the applicable provisions of Rule 2810 of the NASD's Conduct
Rules.
Section 9. Termination of Agreement.
--------------------------
(a) The Underwriter may terminate this Agreement, by notice to the
Offerors, at any time at or prior to the Closing Time (i) if there has been,
since the respective dates as of which information is given in the Registration
Statement, any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company and
its subsidiaries, considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any outbreak or
escalation of existing hostilities or other national or international calamity
or crisis the effect of which on the financial markets of the United States is
such as to make it, in the Underwriter's reasonable judgment, impracticable to
market the Preferred Securities or enforce contracts for the sale of the
Preferred Securities, or (iii) if trading in any securities of the Company has
been suspended by the Commission or the National Association of Securities
Dealers, Inc., or if trading generally on the New York Stock Exchange or in the
over-the-counter market has been suspended, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices for securities have been
required, by such exchange or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority with
appropriate jurisdiction over such matters, or (iv) if a banking moratorium has
been declared by federal, New Jersey or New York authorities, or (v) if there
shall have been such material and substantial change in the market for
securities in general or in political, financial or economic conditions as in
the Underwriter's reasonable judgment makes it inadvisable to proceed with the
Offering, sale and delivery of the Preferred Securities on the terms
contemplated by the Prospectus, or (vi) if the Underwriter reasonably determines
(which determination shall be in good faith) that there has not been
satisfactory disclosure of all relevant financial information relating to the
Offerors in the Offerors' disclosure documents and that the sale of the
Preferred Securities is unreasonable given such disclosures.
24
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party, except
to the extent provided in Section 4. Notwithstanding any such termination, the
provisions of Sections 6 and 7 shall remain in effect.
Section 10. Notices. All notices and other communications under this
-------
Agreement shall be in writing and shall be deemed to have been duly given if
delivered, mailed or transmitted by any standard form of telecommunication.
Notices shall be addressed as follows:
If to the Underwriter:
Xxxx, Xxxx & Co., Inc.
00 Xxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Senior Vice President
with a copy to:
Xxxxxx X. Xxxxx, Esq.
Pitney, Xxxxxx, Xxxx & Xxxxx
(Mail to)
X.X. Xxx 0000
Xxxxxxxxxx, Xxx Xxxxxx 00000-0000
(Delivery to)
000 Xxxxxx Xxxxx
Xxxxxxx Xxxx, Xxx Xxxxxx 00000
If to the Company or the Trust:
Broad National Bancorporation
000 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx Xxxxx, Senior Vice President
with a copy to:
Xxxxxx X. Xxxx, Esq.
Xxxxxxx, Mag & Fizzell
Suite 2800
Xxxxxx Xxxx, Xxxxxxxx 00000
Section 11. Parties. This Agreement is made solely for the benefit of
-------
the Underwriter, and the officers, directors, employees, agents and counsel of
the Underwriter specified in Section 6, the Trust and the Company and, to the
extent expressed, any person controlling the Trust, the Company or the
Underwriter, and the directors of the Company, or administrators of the
25
Trust, their respective officers who have signed the Registration Statement, and
their respective executors, administrators, successors and assigns, and no other
person shall acquire or have any right under or by virtue of this Agreement. The
term "successors and assigns" shall not include any purchaser, as such
purchaser, from the Underwriter of the Preferred Securities.
Section 12. Arbitration. Any claims, controversies, demands,
-----------
disputes or differences between or among the parties hereto or any persons bound
hereby arising out of, or by virtue of, or in connection with, or otherwise
relating to this Agreement shall be submitted to and settled by arbitration
conducted in New Jersey before one or three arbitrators, each of whom shall be
knowledgeable in the field of securities law and investment banking. Such
arbitration shall otherwise be conducted in accordance with the rules then
obtaining of the American Arbitration Association. The parties hereto agree to
share equally the responsibility for all fees of the arbitrators, abide by any
decision rendered as final and binding, and waive the right to appeal the
decision or otherwise submit the dispute to a court of law for a jury or non-
jury trial. The parties hereto specifically agree that neither party may appeal
or subject the award or decision of any such arbitrator to appeal or review in
any court of law or in equity or in any other tribunal, arbitration system or
otherwise. Judgment upon any award granted by such arbitrator may be enforced in
any court having jurisdiction thereof.
Section 13. Governing Law and Time. This Agreement shall be governed
----------------------
by the laws of the State of New Jersey. Specified times of the day refer to New
York City time.
Section 14. Counterparts. This Agreement may be executed in one or
------------
more counterparts, and when a counterpart has been executed by each party, all
such counterparts taken together shall constitute one and the same agreement.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company, the Trust and the
Underwriter in accordance with its terms.
Very truly yours,
BNB CAPITAL TRUST
By:
------------------------------------
Name:
--------------------
Title: Administrator
BROAD NATIONAL BANCORPORATION
By:
------------------------------------
Name: Xxxxxx Xxxx
00
Title: Chairman and CEO
Confirmed and accepted as of
the date first above written:
XXXX, XXXX & CO., INC.
By:
----------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
27
EXHIBIT LIST TO THE UNDERWRITING AGREEMENT
------------------------------------------
Exhibit A Form of Price Determination Agreement
Exhibit B Form of Opinion of Xxxxxxx, Mag & Fizzell, P.C., counsel for the
Company
Exhibit C Form of Opinion of Xxxxxxxx, Xxxxxx & Finger, special Delaware
counsel for the Offerors
Exhibit D Form of Opinion of Xxxxxx & Xxxxxx, counsel for the Indenture
Trustee and the Delaware Trustee
Exhibit E Form of Opinion of Xxxxxxx Xxxxxxxx & Wood, special New Jersey
counsel for the Offerors
