ADMIRALTY BANCORP, INC.
1,100,000 SHARES*
COMMON STOCK
(NO PAR VALUE)
UNDERWRITING AGREEMENT
----------------------
August 25, 1998
First Colonial Securities Group, Inc.
As Representative of the several
Underwriters named in Schedule I hereto.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
Admiralty Bancorp, Inc., a Delaware corporation (the "Company"), confirms
its agreement with the several underwriters (the "Underwriters") for whom you
are acting as representative (the "Representative") for the Company to issue and
sell 1,100,000 shares of the Company's common stock, no par value per share (the
"Underwritten Shares") to the Underwriters. The Company's common stock is more
fully described in the Registration Statement and the Prospectus hereinafter
mentioned.
For the sole purpose of covering over-allotments in connection with the
sale of the Underwritten Shares, the Company shall grant to the Underwriters the
option (the "Option") described in Section 2 hereof to purchase all or any part
of an additional 165,000 shares of the Company's common stock (the "Option
Shares"). The Underwritten Shares and the Option Shares purchased pursuant to
this Underwriting Agreement (this "Agreement") are herein called the "Shares"
and the proposed offering of the Shares by the Underwriters is hereinafter
referred to as the "Public Offering."
The Company has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the "Act"),
and published rules and regulations adopted by the Commission under the Act (the
"Rules"), a Registration Statement on Form SB-2 ("Form SB-2") (File No.
333-60307), including a Preliminary Prospectus, relating to the Shares, and such
amendments to such Registration Statement as may have been filed with the
Commission to the date of this Agreement. The Company will also file with the
Commission one of the following: (A) prior to effectiveness of such Registration
Statement, a further amendment to such Registration Statement, including the
form of final
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* Plus up to 165,000 additional shares of common stock to cover over-allotments.
prospectus, and/or (B) after effectiveness of such Registration Statement, a
final prospectus in accordance with Rules 430A and 424(b). The Company has
furnished to the Representative copies of such Registration Statement, each
amendment to it filed by the Company with the Commission, and each Preliminary
Prospectus filed by the Company with the Commission. The Registration Statement
as amended at the time it becomes or became effective (the "Effective Date"),
including financial statements and all exhibits and any information deemed to be
included by Rule 430A, is called the "Registration Statement." The term
"Preliminary Prospectus" means any Preliminary Prospectus (as referred to in
Rule 430 or Rule 430A of the Rules) included at any time as a part of the
Registration Statement and the term "Prospectus" means the prospectus relating
to the Shares that is first filed pursuant to Rule 424(b) after the date hereof.
Any reference herein to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents incorporated by reference therein on or before the Effective Date or
the date of such Preliminary Prospectus or the Prospectus, as the case may be.
As the Representative, you have advised the Company that (a) you are
authorized to enter into this Agreement on behalf of the several Underwriters
and (b) the Underwriters are willing, acting severally and not jointly, to
purchase the amounts of the Underwritten Shares set forth opposite their
respective names in Schedule I hereto, plus their pro rata portion of the Option
Shares if you elect to exercise the over-allotment Option in whole or in part
for the accounts of the several Underwriters.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the Company
and the Underwriters hereby agree as follows:
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY
(a) The Company represents and warrants to, and agrees with, each
Underwriter as follows:
(i) The Company has been duly organized, is in compliance with its
Certificate of Incorporation, and is validly existing as a corporation in
good standing under the laws of the State of Delaware, with full power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus. Each significant subsidiary (as
defined by the Act) of the Company (each a "Subsidiary" and collectively,
the "Subsidiaries") has been duly incorporated and is validly existing as a
corporation, in good standing under the laws of the jurisdiction of its
organization, with full power and authority (corporate and other) to own or
lease its properties, and conduct its business. The Company and the
Subsidiaries are duly qualified to transact business in all jurisdictions
in which the conduct of its business or the ownership or lease of its
properties requires such qualifications except where the failure to be so
qualified would not reasonably be expected to have a Material Adverse
Effect (as defined below). The
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Company owns all of the outstanding capital stock of its Subsidiaries free
and clear of any pledge, lien, security interest, encumbrance, claim or
equitable interest.
(ii) The outstanding shares of common stock of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable; the Shares are duly and validly authorized, and, if not now
issued, when issued and paid for as contemplated herein, will be fully paid
and non-assessable. As of the Closing Date, there will be no preemptive or
other similar rights to subscribe for or to purchase, or any restriction
upon the voting or transfer of the Shares pursuant to the Company's
Certificate of Incorporation, bylaws, or other governing documents or any
agreement or other instrument to which the Company or any of its
Subsidiaries is a party or by which any of them may be bound. Neither the
filing of the Registration Statement nor the offering of the Shares as
contemplated by this Agreement gives rise to any rights, other than those
which have been waived or satisfied, for or relating to the registration of
any shares of any class of the Company's capital stock. The Shares have
been approved for listing on The NASDAQ subject to official notice of
issuance.
(iii) The Shares conform in all material respects with the statements
concerning them in the Prospectus. As of the Closing Date (as defined
below) and any Option Closing Date (as defined below), if applicable, the
Company will have the authorized capital stock set forth under the caption
"Description of Capital Stock" in the Prospectus. No further corporate
approval or authority on behalf of the Company will be required for the
issuance and sale of the Shares to be sold by the Company as contemplated
herein.
(iv) Any Preliminary Prospectus, the Prospectus and the Registration
Statement comply as to form with the requirements of the Act and the Rules,
including Form SB-2.
(v) Neither the Commission nor any other agency, body, authority,
court or arbitrator of competent jurisdiction has, by order or otherwise,
prohibited or suspended the use of any Preliminary Prospectus or the
Prospectus relating to the proposed offering of the Shares or, to the
Company's knowledge, instituted proceedings for that purpose. The
Registration Statement, the Prospectus and any Preliminary Prospectus and
any amendments or supplements thereto at the time they became or become
effective or were filed or are filed with the Commission contained or will
contain all statements which are required to be stated therein by, and in
all material respects conformed or will conform to the requirements of, the
Act and the Rules. Neither the Registration Statement nor any Preliminary
Prospectus nor any amendment thereto, and neither the Prospectus nor any
supplement thereto, as of its date and while effective, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
provided, however, that the Company does not make any representations or
warranties as to information contained in or omitted from the Registration
Statement or any Preliminary Prospectus or the Prospectus, or any such
amendment or supplement, in reliance upon, and in conformity with, written
information furnished to the Company by
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or on behalf of any Underwriter through the Representative, expressly for
use in the preparation thereof as hereinafter set forth in Section 15.
(vi) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules as set forth in the
Registration Statement, present fairly the consolidated financial condition
and the results of operations of the Company and the Subsidiaries, at the
indicated dates and for the indicated periods. Such financial statements
have been prepared in accordance with generally accepted accounting
principles ("GAAP"), consistently applied throughout the periods involved,
and all adjustments necessary for a fair presentation of results for such
periods have been made. The summary financial information and the selected
financial data included in the Prospectus present fairly in accordance with
GAAP (other than the "__________" information) the information shown
therein and have been compiled on a basis consistent with that of the
audited and unaudited financial statements from which they were derived.
(vii) Except as is disclosed in the Prospectus, there is no action or
proceeding pending or, to the knowledge of the Company, threatened against
the Company, any of its Subsidiaries or any of their respective officers or
any of their properties, assets or rights before any court or
administrative or governmental agency or other body which reasonably would
be expected to (A) result in any material adverse change in the financial
condition, or in the earnings, business, affairs, properties, business
prospects or results of operations of the Company and its Subsidiaries
taken as a whole ("Material Adverse Change" or "Material Adverse Effect,"
as the case may be), whether or not arising in the ordinary course of
business, (B) adversely affect the performance of this Agreement or the
consummation of the transactions herein contemplated, except as disclosed
in the Prospectus and for which the Company maintains a reserve in an
amount which it believes is adequate to cover potential liabilities, or (C)
be required to be disclosed in the Registration Statement.
(viii) The Company and each of its Subsidiaries are not in violation
of any law, ordinance, governmental rule or regulation or court decree to
which they may be subject which violation reasonably would be expected to
have a Material Adverse Effect.
(ix) The Company and its Subsidiaries have (A) to the best of our
knowledge, good and marketable title to all of the real properties and (B)
valid title to all other assets reflected in the consolidated financial
statements hereinabove described or as described in the Prospectus as being
owned by them, subject to no lien, mortgage, pledge, charge or encumbrance
of any kind except those securing indebtedness described in such financial
statements or as described in the Prospectus or which do not materially
affect the present or proposed use of such properties or assets or would
not cause a Material Adverse Effect. The Company and its Subsidiaries
occupy their leased properties under valid, subsisting and binding leases
with only such exceptions as in the aggregate are not material and do not
interfere with the conduct of the business of the Company and its
Subsidiaries. There exists no default under the provisions of any lease,
contract or other obligation to which the Company is a party which may
result in a Material Adverse Change.
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(x) The Company and its Subsidiaries have filed all federal, state and
other tax returns and reports which have been required to be filed and have
paid all taxes indicated by said returns and all assessments received by
them to the extent that such taxes have become due and there is no tax
deficiency that has been or, to the Company's knowledge, might be asserted
against the Company or any of its Subsidiaries that might have a Material
Adverse Effect. All material tax liabilities are adequately provided for on
the books of the Company and its Subsidiaries.
(xi) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, as they may be amended or
supplemented, and except as set forth in the Registration Statement, (A)
there has not been any Material Adverse Change nor, to the knowledge of the
Company, is any such change threatened, (B) there has not been any
transaction entered into by the Company or its Subsidiaries that is
material to the earnings, business, affairs, properties, business prospects
or operations of the Company and its Subsidiaries taken as a whole, other
than transactions in the ordinary course of business and changes and
transactions contemplated by the Registration Statement and the Prospectus,
as they may be amended or supplemented, (C) other than changes in the
amounts outstanding under the Company's and its Subsidiaries' revolving
credit facilities, there has not been any material change in the capital
stock, long term debt or material liabilities of the Company or its
Subsidiaries, and (D) there has not been any dividend or distribution of
any kind declared, paid or made on the capital stock of the Company or any
of its Subsidiaries. Neither the Company nor any Subsidiary has any
contingent obligations or liabilities which are required to be but are not
disclosed in the Registration Statement and the Prospectus.
(xii) The filing of the Registration Statement and related Prospectus
and the execution and delivery of this Agreement have been duly authorized
by the Board of Directors of the Company; this Agreement constitutes a
valid and legally binding obligation of the Company enforceable in
accordance with its terms except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other laws affecting creditors' rights generally and by general
principles of equity and federal and state securities laws. The Company is
not in breach or violation of or default under any indenture, mortgage,
deed of trust, lease, contract, note or other agreement or instrument to
which it is a party or by which it or any of its properties is bound and
which breach, violation or default would reasonably be expected to have a
Material Adverse Effect. The consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will not result in a
breach or violation of any of the material terms and provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, lease,
contract, note or other agreement or instrument to which the Company or any
Subsidiary is a party, or of the Company's or any Subsidiary's Certificate
of Incorporation or bylaws or any law, decree, order, rule, writ,
injunction or regulation applicable to the Company or any Subsidiary of a
court or of any regulatory body or administrative agency or other
governmental body having jurisdiction over the Company and its Subsidiaries
except for such breaches, violations or defaults as would not reasonably be
expected to have a Material Adverse Effect.
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(xiii) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery
by the Company of this Agreement and performance of its obligations
hereunder (except such additional steps as may be necessary to qualify the
Shares for public offering by the Underwriters under state securities or
Blue Sky laws, and filing the Prospectus under Rule 424(b)) has been
obtained or made and is in full force and effect.
(xiv) The Company and each Subsidiary hold all material licenses,
authorizations, charters, certificates and permits from governmental
authorities which are necessary to the conduct of their businesses and
neither the Company nor any Subsidiary has received notice of any
proceeding relating to the revocation or modification of any of such
licenses, authorizations, charters, certificates or permits. The Company
and its Subsidiaries own or otherwise possess rights to the patents, patent
rights, licenses, inventions, copyrights, trademarks, service marks and
trade names presently employed by them in connection with the businesses
now operated by them as described in the Prospectus, and neither the
Company nor any of its Subsidiaries has infringed or received any notice of
infringements of or conflict with asserted rights of others with respect to
any of the foregoing, except where such infringement or conflict would not
reasonably be expected to result in a Material Adverse Effect.
(xv) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, independent auditors, who have certified certain
of the financial statements filed with the Commission and included as part
of the Registration Statement and Prospectus, are independent public
accountants within the meaning of the Act, the Rules and Regulation S-X of
the Commission and Rule 101 of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
(xvi) There are no agreements, contracts or other documents of a
character required to be described in the Registration Statement or the
Prospectus or required by Form SB-2 to be filed as exhibits to the
Registration Statement or incorporated by reference in the Registration
Statement which are not described, filed or incorporated as required.
(xvii) No labor dispute is pending or, to the knowledge of the
Company, threatened by the Company's or any Subsidiary's employees which
could result in a Material Adverse Effect. No collective bargaining
agreement exists with any of the Company's employees and, to the Company's
knowledge, no agreement is imminent.
(xviii) Except as contemplated by Section 2 hereof and as disclosed in
the Prospectus and permitted by the Rules, the Company has not (itself or
through any person) taken and will not take, directly or indirectly, any
action designed to or which might reasonably be expected to, cause or
result in a violation of Section 5 of the Act or Regulation M under the Act
or in stabilization or manipulation of the price of the Company's common
stock.
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(xix) Without limiting the generality of any of the foregoing
representations and warranties and except to the extent no Material Adverse
Effect would reasonably be expected to occur, (a) none of the operations of
the Company or its Subsidiaries is in violation of any material
environmental law, regulation or any permit; (b) neither the Company nor
any of its Subsidiaries has been notified that it is under investigation or
under review by any governmental agency with respect to compliance
therewith or with respect to the generation, use, treatment, storage or
release of hazardous material; (c) neither the Company nor any of its
Subsidiaries have any material liability in connection with the past
generation, use, treatment, storage, disposal or release of any hazardous
material; (d) there is no hazardous material that may reasonably be
expected to pose any material risk to safety, health, or the environment,
on, under or about any property owned, leased or operated by the Company or
any of its Subsidiaries or, to the knowledge of the Company, any property
adjacent to any such property; and (e) there has heretofore been no release
of any hazardous material on, under or about such property, or, to the
knowledge of the Company, any such adjacent property. None of the present
or, to the knowledge of the Company, past property of the Company or any of
its Subsidiaries is listed or proposed for listing on the National
Priorities List pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"), or on the
Comprehensive Environmental Response Compensation Liability Information
System List ("CERCLIS") or any similar state list of sites requiring
remedial action. Neither the Company nor any of its Subsidiaries is subject
to any state Environmental Property Transfer Act, or to the extent that any
such statute is applicable to any property, the Company and its
Subsidiaries have fully complied with their obligations under such
statute(s), and neither has any outstanding obligations or liabilities
under any state Environmental Property Transfer Act.
(xx) The Company and its Subsidiaries maintain insurance of the types
and in the amounts customary for their businesses, including, but not
limited to, insurance covering liability and real and personal property
owned or leased by the Company against theft, damage, destruction, acts of
vandalism and all other risks customarily insured against, all of which
insurance is in full force and effect.
(xxi) Neither the Company nor any Subsidiary has at any time during
the last five years (a) made any unlawful contribution to any candidate for
foreign office, or failed to disclose fully any contribution in violation
of law, or (b) made any payment to any federal or state governmental
officer or official, or other person charged with similar public or
quasi-public duties, other than payments required or permitted by the laws
of the United States or any jurisdiction thereof.
(xxii) Each executive officer, director and substantially all of the
stockholders of the Company has executed a lock-up agreement, a form of
which is attached hereto as Exhibit "A" (the "Lock-Up Agreement").
(b) Any certificate signed by any officer of the Company and delivered to
you or counsel for the Underwriters shall be deemed a representation and
warranty by the Company to the Underwriters as to the matters covered thereby.
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2. PURCHASE, SALE AND DELIVERY OF THE UNDERWRITTEN SHARES. On the basis of
the representations, warranties and covenants herein contained, and subject to
the terms and conditions herein set forth, the Company agrees to sell each
Underwriter, severally and not jointly, and each Underwriter agrees, severally
and not jointly, to purchase, at a price of $________ per share, the number of
the Underwritten Shares set forth on Schedule I attached hereto, subject to
adjustment in accordance with Section 12 hereof.
Payment for the Underwritten Shares shall be made by wire transfer of
immediately available U.S. Funds to a designated account of the Company, to the
order of the Company, against delivery of certificates for the Shares to the
Representative for the accounts of the several Underwriters. Delivery of
certificates shall be to the Representative c/o First Colonial Securities Group,
Inc. ("First Colonial"), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address as First Colonial may designate in
writing. Payment will be made at the offices of First Colonial, or at such other
place as shall be agreed upon by First Colonial and the Company, at
approximately 9:00 a.m., eastern time, on __________, 199__, such time and date
being herein referred to as the "Closing Date." The certificates for the
Underwritten Shares will be delivered in such denominations and in such
registrations as First Colonial reasonably requests in writing and will be made
available for inspection at such locations as First Colonial may reasonably
request at least one full business day prior to the Closing Date.
In addition, on the basis of the representations, warranties, agreements
and covenants herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants the Option to the several Underwriters to
purchase the Option Shares at the price per share as set forth in the first
paragraph of this Section 2. The Option may be exercised in whole or in part on
one occasion upon written notice (or oral notice, subsequently confirmed in
writing) given not more than forty five (45) days following the date of this
Agreement, by First Colonial, on behalf of the Representative of the several
Underwriters, to the Company setting forth the number of Option Shares as to
which the several Underwriters are exercising the Option and the names and
denominations in which the Option Shares are to be registered. Closing on the
purchase of the Option Shares (the "Option Closing Date"), if any, shall occur
no later than three (3) business days following the date upon which notice of
exercise of the Option is given to the Company, and shall take place at the
offices of First Colonial, or at such other place as shall be agreed upon by
First Colonial and the Company. Subject to Section 12, the number of Option
Shares to be purchased by each Underwriter shall be in the same proportion to
the total number of shares of the common stock being purchased by such
Underwriter bears to 1,100,000 shares, adjusted by you in such manner as to
avoid fractional shares. The Option may be exercised only to cover
over-allotments in the sale of the Underwritten Shares by the Underwriters.
First Colonial, on behalf of the Representative of the several Underwriters, may
cancel such option at any time prior to its expiration by giving written notice
(or oral notice, subsequently confirmed in writing) of such cancellation to the
Company. To the extent, if any, that the Option is exercised, payment for the
Option Shares shall be made by wire transfer of immediately available U.S. Funds
to a designated account of the Company, to the order of the Company.
Certificates for the Option Shares shall be delivered in the same manner and
upon the same terms as the Underwritten Shares.
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3. OFFERING BY THE UNDERWRITERS. It is understood that the Public Offering
of the Underwritten Shares is to be made as soon as the Representative deems it
advisable to do so after the Registration Statement has become effective. The
Underwritten Shares are to be initially offered to the public at the public
offering price set forth in the Prospectus. The Representative may from time to
time thereafter change the public offering price and other selling terms. To the
extent, if at all, that any Option Shares are purchased pursuant to Section 2
hereof, the Underwriters will offer them to the public on the foregoing terms.
It is further understood that you will act as the Representative for the
Underwriters in the offering and sale of the Shares, in accordance with an
Agreement Among Underwriters which has been entered into by you and the several
other Underwriters.
4. COVENANTS OF THE COMPANY. The Company covenants and agrees with each of
the several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement to become effective and will not, either before or after
effectiveness, file any amendment thereto or supplement to the Prospectus
(including a prospectus filed pursuant to Rule 424(b) which differs from the
Prospectus on file at the time the Registration Statement becomes effective) or
file any documents under the Exchange Act before the earlier to occur of (A) the
35th day following the Effective Date or (B) the closing date of the
Underwriters' purchase of the Option Shares if such document would be deemed to
be incorporated by reference into the Registration Statement, the Preliminary
Prospectus or the Prospectus of which the Representative shall not previously
have been advised and furnished with a copy or to which the Representative shall
have reasonably objected in writing or which is not in compliance with the Act
or Rules.
(b) The Company will advise the Representative promptly of any request of
the Commission or other securities regulatory agency ("Other Securities
Regulator") for amendment of the Registration Statement or for supplement to the
Prospectus or for any additional information, or of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the use of the Prospectus or of the institution of any proceedings
for that purpose, or comparable action taken or initiated by any Other
Securities Regulator, and the Company will use its reasonable efforts to prevent
the issuance of any such stop order preventing or suspending the use of the
Prospectus and to obtain as soon as possible the lifting thereof, if issued.
(c) The Company will use its reasonable efforts with the Representative in
endeavoring to qualify the Shares for sale under the securities laws of such
jurisdictions (including foreign jurisdictions) as the Representative may
reasonably designate, and will make such applications, file such documents, and
furnish such information as may be reasonably required for that purpose;
provided, however, the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction where it is not so qualified or required to file such a consent.
The Company will, from time to time, prepare and file such statements, reports,
and other documents, as are or may be required to continue such qualifications
in effect for so long a period as the Representative may reasonably request for
distribution of the Shares.
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(d) The Company will deliver to, or upon the order of, the Representative,
from time to time, as many copies of any Preliminary Prospectus or the
Prospectus as the Representative may reasonably request. The Company will
deliver to, or upon the order of, the Representative, on the Trade Date and
thereafter from time to time during the period necessary to effect the
distribution of the Shares as many copies of the Prospectus in final form, or as
thereafter amended or supplemented, as the Representative may reasonably
request. The Company will deliver to the Representative at or before the Closing
Date, one (1) manually signed copy of the Registration Statement and all
amendments thereto including all exhibits filed therewith (including any
document filed under the Exchange Act and deemed to be incorporated by reference
into the Registration Statement, the Preliminary Prospectus or the Prospectus)
and will deliver to the Representative such number of copies of the Registration
Statement, but without exhibits, and of all amendments thereto, as the
Representative may reasonably request.
(e) During the time necessary to effect the distribution of the Shares, the
Company shall comply with all requirements imposed upon it by the Act, as now
and hereafter amended, and by the Rules, as from time to time in force, so far
as is necessary to permit the continuance of sales of or dealings in the Shares
as contemplated by the provisions hereof and the Prospectus. If, during the
period necessary to effect the distribution of the Shares, any event shall occur
as a result of which, in the judgment of the Company or in the opinion of
counsel for the Underwriters, it becomes necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances existing at the time the Prospectus is delivered to a purchaser,
not misleading, or, if it is necessary at any time to amend or supplement the
Prospectus to comply with any law or to file under the Exchange Act any document
which would be deemed to be incorporated by reference in the Prospectus in order
to comply with the Act or the Exchange Act, the Company promptly will notify the
Representative and, subject to the Representative's prior review, prepare and
file with the Commission and any appropriate Other Securities Regulator an
appropriate amendment or supplement to the Prospectus (at the expense of the
Company) so that the Prospectus as so amended or supplemented will not, in light
of the circumstances when it is so delivered, be misleading, or so that the
Prospectus will comply with the law.
(f) The Company will make generally available to its security holders in
the manner contemplated by Rule 158(b) under the Act, as soon as it is
practicable to do so, but in any event not later than the 90th day after the end
of the fiscal quarter first occurring one year after the Effective Date, an
earnings statement in reasonable detail, covering a period of at least twelve
consecutive months beginning after the Effective Date, which earnings statement
shall satisfy the requirements of Section 11(a) of the Act and will advise you
in writing when such statement has been so made available.
(g) For a period of three years from the date of this Agreement, the
Company will furnish to the Representative (a) concurrently with furnishing of
such reports to its stockholders, statements of income of the Company for each
quarter in the form furnished to the Company's stockholders and certified by the
Company's principal financial or accounting officer; (b) concurrently with
furnishing to its stockholders, a balance sheet of the Company as at the end of
such fiscal year, together with statements of earnings, stockholders' equity and
cash flow of the Company for such fiscal year, all in reasonable detail and
accompanied by a copy of the
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certificate or report thereon of independent public accountants; (c) as soon as
they are available, copies of all reports (financial or other) mailed to
stockholders; (d) as soon as they are available, copies of all reports and
financial statements furnished to or filed with the Commission; (e) every press
release which was released or prepared by the Company; and (f) any additional
information of a public nature concerning the Company or its business which you
may reasonably request. During such period, if the Company shall have active
subsidiaries the foregoing financial statements shall be on a consolidated basis
to the extent that the accounts of the Company and its subsidiaries are
consolidated, and shall be accompanied by similar financial statements for any
significant subsidiary (as defined by the Act) which is not so consolidated.
(h) Promptly after the Company is advised thereof, it will advise the
Representative, and confirm in writing, that the Registration Statement and any
amendments shall have become effective.
(i) The Company will use the net proceeds from the sale of the Shares
substantially in the manner set forth in the Prospectus under the caption "Use
of Proceeds."
(j) Other than as permitted by the Act and the Rules, the Company will not
distribute any prospectus or offering materials in connection with the offering
and sale of the Shares and prior to the Closing Date or the Option Closing Date
will not issue any press releases or other communications directly or indirectly
and will hold no press conferences with respect to the Company, the financial
condition, results of operations, business, properties, assets or liabilities of
the Company, or the offering of the Shares, without the prior written consent of
First Colonial.
(k) The Company will maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for its common stock
and will use its best efforts to maintain the listing of the Shares on The
Nasdaq National Market.
(l) Except as contemplated hereby or by the Prospectus, the Company will
not, for a period of one hundred eighty (180) days after the Effective Date of
the Registration Statement, offer to sell, contract to sell, sell or otherwise
dispose of any shares of the Company's common stock or securities convertible
into shares of the Company's common stock without the prior written consent of
First Colonial, which consent will not be unreasonably withheld.
(m) The foregoing covenants and agreements shall apply to any successor of
the Company, including without limitation, any entity into which the Company
might consolidate or merge.
5. COSTS AND EXPENSES. Whether or not the Registration Statement becomes
effective, the Company will pay all costs, expenses and fees incident to the
performance of the obligations of the Company under this Agreement, including,
without limiting the generality of the foregoing, the following: accounting fees
of the Company; the fees and disbursements of counsel for the Company; the cost
of printing and delivering to Underwriters copies of the Registration Statement,
any Preliminary Prospectus, the Prospectus, this Agreement, the Agreement Among
Underwriters, the Selling Agreement, Underwriters' Questionnaire and Power of
Attorney, and the Blue Sky Survey and any supplements thereto; the filing fees
of the
11
Commission; the filing fees incident to securing any required review by the NASD
of the terms of the sale of the Shares on behalf of, and any disbursements made
by, the Representative, the cost of printing certificates representing the
Shares; and the cost and charges of any transfer agent or registrar. Any
transfer taxes imposed on the sale of the Shares to the Underwriters will be
paid by the Company. The Company will pay all costs expenses and fees, including
attorney fees and out-of-pocket expenses, reasonably incurred in connection with
serving as the Representative and performing the obligations hereunder. The
Company shall not, however, be required to pay for any of the Underwriters'
expenses (other than those related to qualification under State securities or
Blue Sky laws) except that, if the Public Offering shall not be consummated
because the conditions in Section 8 hereof are not satisfied, or because this
Agreement is terminated by the Representative pursuant to Section 7 hereof, or
by reason of any failure, refusal or inability on the part of the Company to
perform any undertaking or satisfy any condition of this Agreement or to comply
with any of the terms hereof on their part to be performed, unless such failure
to satisfy said condition or to comply with said terms is due to the default or
omission of any Underwriter, then the Company shall reimburse the several
Underwriters for all costs and expenses, including attorney fees and
out-of-pocket expenses, reasonably incurred in connection with investigating,
marketing and proposing to market the Shares or in contemplation of performing
their obligations hereunder, but the Company shall not in any event be liable to
any of the several Underwriters for damages on account of loss of anticipated
profits from the sale by them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The obligations of the
several Underwriters to purchase and pay for the Shares as provided herein, are
subject to the accuracy, as of the Closing Date and as of the Option Closing
Date, of the representations and warranties and agreements of the Company
contained herein, to the performance by the Company of its obligations hereunder
and to the following additional conditions:
(a) The Registration Statement shall have become effective not later than
10:00 a.m., eastern time, on the date of this Agreement, unless a later time and
date is agreed to by the Representative, and no stop order or other order
suspending the effectiveness thereof or the qualification of the Shares under
the State securities or Blue Sky laws of any jurisdiction shall have been issued
and no proceeding for that purpose shall have been taken or, to the knowledge of
the Company, shall be contemplated or threatened by the Commission or any Other
Securities Regulator. If the Company has elected to rely upon Rule 430A of the
Rules, the price of the Shares and any price-related information previously
omitted from the effective Registration Statement pursuant to such Rule 430A
shall have been transmitted to the Commission for filing pursuant to Rule 424(b)
of the Act within the prescribed time period, and prior to the Closing Date the
Company shall have provided evidence satisfactory to the Representative of such
timely filing, or a post-effective amendment providing such information shall
have been promptly filed and declared effective in accordance with the
requirements of Rule 430A under the Act. All requests for additional information
on the part of the Commission or any other government or regulatory authority
with jurisdiction (to be included in the Registration Statement or Prospectus or
otherwise) shall be complied with to the satisfaction of the Commission or such
authorities.
(b) The Representative shall have received on the Closing Date and on the
Option Closing Date the opinion of Jamieson, Moore, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel for
the Company, with
12
respect to the Company, with respect to matters set forth below in subparagraphs
(i) through (ix) dated the Closing Date and the Option Closing Date, addressed
to the Underwriters in form and substance satisfactory to ▇▇▇▇▇▇▇▇▇ Traurig,
P.A., counsel to the Underwriters, to the effect that:
(i) The Company and the Subsidiaries have been duly organized and are
validly existing in good standing under the laws of the state(s) or similar
foreign jurisdictions (with respect to the Subsidiaries) of their
organization with corporate power to own their properties and conduct their
business as described in the Registration Statement and Prospectus; the
Company and the Subsidiaries are duly qualified to transact business in
those jurisdictions listed in such counsel's opinion (which list shall
include, with respect to the Company, each state in which the Company or
each foreign jurisdiction in which the Subsidiaries own properties as shown
in the Prospectus); and all of the outstanding shares of capital stock of
the Company have been duly authorized and, upon payment for and delivery of
the Shares and the countersigning of the certificates representing the
Shares by a duly authorized signatory, the Shares will be duly issued,
fully paid and non-assessable, and except as set forth in the Prospectus
and the Registration Statement, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligations into any shares of capital stock of the Company are
outstanding.
(ii) The Company has authorized and, to the knowledge of such counsel,
outstanding the capital stock set forth under the caption "Description of
Capital Stock" in the Registration Statement and Prospectus, except for
issuances subsequent to the date of the Prospectus, if any, pursuant to
reservations, commitments, employee benefit plans, the recapitalization
contemplated by the Registration Statement or other existing agreements;
all of the Shares conform to the description thereof contained in the
Prospectus; the Underwritten Shares to be sold pursuant to this Agreement
have been duly authorized and, upon payment for and delivery of the Shares
and the countersigning of the certificates representing the Shares by a
duly authorized signatory, the Shares will be validly issued, fully paid
and non-assessable when issued and paid for as contemplated by this
Agreement; there are no preemptive or other restrictive rights to subscribe
for or to purchase or any restriction upon the voting or transfer of the
Shares pursuant to the Company's Certificate of Incorporation, bylaws,
other governing documents or, to such counsel's knowledge, any material
agreement or other instrument to which the Company is a party or by which
it is bound; and, to such counsel's knowledge, neither the filing of the
Registration Statement nor the offering or sale of the Shares as
contemplated by this Agreement gives rise to any rights, other than those
which have been waived or satisfied, for or relating to the registration of
any class of the Company's capital stock.
(iii) The Registration Statement has been declared effective under the
Act and to the knowledge of such counsel no stop order proceedings with
respect thereto have been instituted by the Commission or threatened and
all filings required by Rule 424 and Rule 430A of the Rules have been made.
(iv) The Registration Statement, all Preliminary Prospectuses, the
Prospectus and each amendment or supplement thereto, as of their respective
dates they were filed,
13
appeared on their face to comply as to form in all material respects with
the requirements of the Act and the Rules, except that such counsel need
express no opinion as to the information supplied by the Underwriters or
the financial statements, schedules and other financial or statistical
information included therein.
(v) Except as set forth in the Registration Statement and the
Prospectus, to the best of our knowledge, there are no contracts,
agreements or understandings known to such counsel between the Company and
any person granting such person the right to require the Company to file a
Registration Statement under the Act with respect to any securities of the
Company owned or to be owned by such person or to require the Company to
include such securities in the securities being registered pursuant to a
Registration Statement filed by the Company under the Act, except for any
rights under employee stock compensation plans, which registration rights
are not exercisable with respect to the transactions contemplated by this
Agreement, and except as set forth in the Prospectus.
(vi) To the knowledge of such counsel, the Company's execution and
delivery of, and performance of its obligations under, this Agreement do
not (A) violate the Company's and its Subsidiaries' respective charter or
bylaws, (B) breach or otherwise violate any existing obligation of or
restriction on the Company or its Subsidiaries under any order, judgment or
decree of any federal or Delaware court or government authority binding on
the Company or its Subsidiaries that we have, in the exercise of customary
professional diligence, recognized as applicable to the Company or its
Subsidiaries or to transactions of the type contemplated by this Agreement,
except that we do not express an opinion regarding any federal securities
laws or Blue Sky or state securities laws. The execution and delivery by
the Company of, and performance of its obligations under, the Agreement, do
not violate any Delaware or federal statute or regulation that we have, in
the exercise of customary professional diligence, recognized as applicable
to the Company or its Subsidiaries or to transactions of the type
contemplated by the Agreement, except that we do not express an opinion
regarding any federal securities laws or Blue Sky or state securities laws.
(vii) This Agreement has been duly authorized, executed and delivered
by the Company and is a valid and binding obligation of the Company.
(viii) No approval, consent, order or permit of Delaware or any U.S.
Federal governmental authority is required on the part of the Company for
the execution and delivery of this Agreement or for the issuance and sale
of the Shares by the Company herein contemplated (other than required by
NASD regulation or state securities and Blue Sky laws, as to which such
counsel need express no opinion) except such as have been obtained or made,
specifying the same.
In addition to the matters set forth above, such counsel shall also include
a statement to the effect that such counsel has participated in the
preparation of the Registration Statement and the Prospectus and, based on
such participation, no facts have come to the attention of such counsel
which appeared on their face to cause such counsel to believe
14
that any part of the Registration Statement or any amendment thereto (other
than the financial statements and other financial and statistical data
contained therein, as to which such counsel may express no belief), as of
its effective date, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (other than the financial
statements and other financial data contained therein, as to which such
counsel may express no belief), contains any untrue statement of a material
fact or omitted to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading. Such counsel does not know of any legal or
governmental proceedings required to be described in the Registration
Statement or the Prospectus which are not described as required or of any
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 which are not described and filed as required; it
being understood that such counsel need express no opinion as to the
financial statements or other financial data contained in the Registration
Statement or the Prospectus. Such counsel may state that its opinion is
limited to the applicable law of the United States of America, the State of
Delaware General Corporation Law and the general corporate law of
jurisdictions under which the Subsidiaries are organized, and that such
counsel renders no opinion with respect to the law of any other
jurisdiction. Such opinion may state further that whenever such opinion is
based on factual matters to such counsel's knowledge or known to such
counsel, such counsel has relied exclusively on certificates of officers
(after discussion of the contents thereof with such officers) of the
Company or certificates of others as to the existence or nonexistence of
factual matters on which such opinion is predicated but has no reason to
believe that any such certificate is untrue or inaccurate in any material
respect.
Such opinion shall contain only those qualifications as ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, P.A., counsel to the Underwriters, may reasonably request or
allow.
(c) The Representative shall have received from ▇▇▇▇▇▇▇▇▇ Traurig, P.A.,
counsel to the Underwriters, an opinion dated the Closing Date, substantially to
the effects specified in subparagraph (iii) and (iv) of paragraph (b) of this
Section 7, and that the Company is a validly organized and existing corporation
under the laws of the State of Delaware. In rendering such opinion, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, P.A., may rely as to all matters governed other than by Federal law on
the opinions of counsel referred to in paragraph (b) of this Section 7. In
addition to the matters set forth above, such opinion shall also include a
statement to the effect that nothing has come to the attention of such counsel
which leads them to believe that the Registration Statement or any amendment
thereto at the time the Registration Statement or amendment became effective or
the Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto as of their respective dates 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 (except that such counsel need
express no view as to financial statements, schedules and other financial or
statistical information included therein).
15
(d) The Representative shall have received at or prior to the Closing Date
from ▇▇▇▇▇▇▇▇▇ Traurig, P.A., a memorandum or summary, in form and substance
satisfactory to the Representative, with respect to the qualification or
exemption therefrom for offering and sale by the Underwriters of the Shares
under the State securities or Blue Sky laws of such jurisdictions as the
Representative may reasonably have designated.
(e) The Representative shall have received on the Closing Date and on the
Option Closing Date, as the case may be, signed letters from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
addressed to the Underwriters dated as of the Effective Date and again dated as
of the Closing Date and as of the Option Closing Date, as the case may be, with
respect to the financial statements and certain financial and statistical
information contained in the Registration Statement and the Prospectus. All such
letters shall be in form and substance satisfactory to the Representative and
▇▇▇▇▇▇▇▇▇ Traurig, P.A., counsel to the Underwriters.
(f) The Representative shall have received on the Closing Date and on the
Option Closing Date, as the case may be, a certificate or certificates of the
President & Chief Executive Officer and Vice President and Chief Financial
Officer of the Company to the effect that, on and as of the Closing Date and on
and as of the Option Closing Date, as the case may be, each of them severally
represents as follows:
(i) The Registration Statement has become effective under the
Securities Act and no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings for such purpose
have been taken or are, to his knowledge, contemplated by the Commission.
(ii) He does not know of any litigation instituted or threatened
against the Company or any of its Subsidiaries of a character required to
be disclosed in the Registration Statement which is not so disclosed; he
does not know of any material contract required to be filed as an exhibit
to the Registration Statement which is not so filed; and the
representations and warranties of the Company contained in Section 1 hereof
are true and correct in all material respects as of the Closing Date.
(iii) He has examined the Registration Statement and the Prospectus
and, in his opinion, as of the effective date of the Registration
Statement, the statements contained in the Registration Statement and the
Prospectus were true and correct in all material respects, and such
Registration Statement and Prospectus did not omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of he circumstances in which they were made, not
misleading and, in his opinion, since the effective date of the
Registration Statement, no event has occurred which should have been set
forth in a supplement to or an amendment of the Prospectus which has not
been so set forth in such supplement or amendment.
(g) The Company shall have furnished to the Representative such additional
information and further certificates and documents confirming the
representations and warranties contained herein and related matters as the
Representative may reasonably have requested.
16
(h) Since the respective dates as of which information is given in the
Prospectus, there shall not have been any Material Adverse Change.
(i) The Shares shall have been approved for listing on The Nasdaq National
Market, subject to official notice of issuance.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Representative and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, P.A., counsel
for the Underwriters.
If any of the conditions hereinabove provided for in this Section 7 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Representative by notifying the Company of such termination in writing or by
confirmed telefax at or prior to the Closing Date. In such event, the Company
and the Underwriters shall not be under any obligation to each other (except to
the extent provided in Sections 6, 9 and 10 hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations of the
Company to sell and deliver the Shares are subject to the conditions that (a) at
or before 10:00 a.m., eastern time, on the date of this Agreement, or such later
time and date as the Company and the Representative may from time to time
consent to in writing or by confirmed telefax, the Registration Statement shall
have become effective, and (b) at the Closing Date no stop order suspending the
effectiveness of the Registration Statement shall have been issued or
proceedings therefor initiated or threatened. If either of the conditions
hereinabove provided for in this Section 8 shall not have been fulfilled when
and as required by this Agreement to be fulfilled, this Agreement may be
terminated by the Company by notifying the Representative of such termination in
writing or by confirmed telefax at or prior to the Closing Date.
8. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of the Act,
the Rules and the Exchange Act from and against any and all losses, claims,
damages, liabilities, joint or several, to which such Underwriter or such
controlling person may become subject under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon any breach of any
representation, warranty, agreement, or covenant of the Company, or any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading; and the
Company will reimburse each Underwriter and each such controlling person for
legal and other expenses reasonably incurred in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement made in, or omission or
alleged omission from, the Registration
17
Statement, any Preliminary Prospectus, the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by or through the Representative specifically for use
in the preparation thereof, it being understood and agreed that the only such
information furnished by any Underwriter consists of the information described
as such in Section 15 below; and provided further, that with respect to any
untrue statement or alleged untrue statement in or omission or alleged omission
from any Preliminary Prospectus, the indemnity agreement contained in this
Section 9(a) shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased the
Shares concerned, to the extent that a prospectus relating to such Shares was
required to be delivered by such Underwriter under the Act in connection with
such purchase and any such loss, claim, damage or liability of such Underwriter,
results from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Shares to such person, a
copy of the Prospectus as then amended or supplemented (excluding any documents
incorporated by reference therein) if the Company had previously furnished
copies thereof to such Underwriter. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) Each Underwriter severally, but not jointly, will indemnify and hold
harmless the Company, each of its directors, each of its officers who have
signed the Registration Statement, and each person, if any, who controls the
Company, within the meaning of the Act, the Rules and the Exchange Act from and
against any losses, claims, damages or liabilities to which the Company, or any
such director, officer, or controlling person may become subject, under the Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances under which they were made; and will reimburse any legal or
other expenses reasonably incurred by the Company, or any such director,
officer, or controlling person in connection with investigating or defending any
such loss, claim, damage, liability, action or proceeding; provided, however,
that each Underwriter will be liable in such case only to the extent that such
untrue statement, or alleged untrue statement or omission or alleged omission
has been made in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or such amendment or supplement, in reliance upon and in conformity
with information furnished to the Company by or through the Representative
expressly for use in the preparation thereof, which information is described in
Section 15. This indemnity agreement will be in addition to any liability which
such Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section 9 of
notice of the commencement of any action or proceeding, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 9, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 9, except to the extent that the indemnifying party is
substantially prejudiced by the omission of such notification. In case any such
action or proceeding is brought against any party,
18
and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and, to the extent
that it may wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section 9 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding. Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment of such counsel has been specifically authorized in
writing by the indemnifying party, (ii) the indemnifying party has failed to
assume the defense and employ counsel, or (iii) the named parties to any such
action (including any impleaded parties) include such indemnified party and the
indemnifying party, as the case may be, and such indemnified party shall have
been advised in writing by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party, in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of such
indemnified party, it being understood, however, that (A) the indemnifying party
shall not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all such indemnified parties, which firm shall be designated in writing by the
indemnified parties, and that (B) all such fees and expenses shall be reimbursed
as they are incurred. Subject to the foregoing provisions of this Section 9(c),
the indemnifying party shall not be liable for the costs and expenses of any
settlement of any action without the consent of the indemnifying party.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 9 is for
any reason held to be unavailable to an indemnified party under subsection (a)
or (b) above in respect to any losses, claims, damages, liabilities or expenses
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities and expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the parties in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand shall be deemed to be in the same proportion as
the total
19
proceeds from the offering (net of underwriting discounts and commissions but
before deducting expenses) received by the Company bears to the underwriting
discounts and commissions received by the Underwriters. The relative fault of a
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by each party
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid or
payable by a party as a result of the losses, claims, damages, liabilities and
expenses referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any such action or claim.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriters
have otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute shall be several in proportion to their respective underwriting
obligations and not joint.
(e) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 9 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join him or it as
an additional defendant in any such proceeding in which such other contributing
party is a party.
9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties and agreements of the Company, and the officers of
the Company herein or in certificates delivered pursuant hereto, and the
indemnity and contribution agreements contained in Sections 9 and 10 hereof,
shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriters or any controlling
person, or by or on behalf of the Company or any of its officers, directors or
controlling persons, and shall survive delivery of the Underwritten Shares and,
if appropriate, the Option Shares to the Representative or termination of this
Agreement.
10. DEFAULT BY UNDERWRITERS. If any Underwriter shall fail to purchase and
pay for the Shares which such Underwriter has agreed to purchase and pay for
hereunder (otherwise than by reason of any default on the part of the Company),
you, as the Representative of the Underwriters, shall use your best efforts to
procure within twenty-four hours thereafter one or
20
more of the other Underwriters, or any others, to purchase from the Company such
amounts as may be agreed upon and upon the terms set forth herein, the Shares
which the defaulting Underwriter or Underwriters failed to purchase. If during
such twenty-four hours you, as such Representative, shall not have procured such
other Underwriters, or any others, to purchase the Shares agreed to be purchased
by the defaulting Underwriter or Underwriters, then (a) if the aggregate number
of Shares with respect to which such default shall occur does not exceed 10% of
the Shares which the Underwriters are obligated to purchase hereby, the other
Underwriters shall be obligated, severally, in proportion to the respective
number of Shares which they are obligated to purchase hereunder, to purchase the
Shares which such defaulting Underwriter or Underwriters failed to purchase, or
(b) if the aggregate number of Shares with respect to which such default shall
occur exceeds 10% of the Company's common stock covered hereby, the Company or
you, as the Representative of the Underwriters will have the right, by written
notice given within the next twenty-four hour period to the parties to this
Agreement, to terminate this Agreement without liability on the part of the
non-defaulting Underwriters or the Company except to the extent provided in
Section 9 hereof. In the event of a default by any Underwriter or Underwriters,
as set forth in this Section 12, the time of closing may be postponed for such
period, not to exceed seven days, as you, as the Representative, may determine
in order that the required changes in the Registration Statement, the Prospectus
or in any other documents or arrangements may be effected. The term
"Underwriters" includes any person substituted for a defaulting Underwriter. Any
action taken under Section 12 shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
11. NOTICES. All communications hereunder shall be in writing and, except
as otherwise provided in, will be mailed, delivered or telefaxed and confirmed
as follows: if to the Underwriters, c/o the Representative as follows: to First
Colonial, Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Director of Investment Banking; with a
copy to ▇▇▇▇▇▇▇▇▇ Traurig, P.A., Attention ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇; if to the Company, to
Admiralty Bancorp, Inc., Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, President; ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ with a copy to Jamieson, Moore, ▇▇▇▇▇▇ & ▇▇▇▇▇▇,
Attention ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇.
12. TERMINATION. This Agreement may be terminated by notice to the Company
as follows:
(a) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any Material Adverse Change which
would, in your reasonable judgment, materially make it impracticable to market
the Shares in the manner contemplated by the Prospectus, (ii) any outbreak of
hostilities or other national or international calamity or crisis or change in
economic or political conditions if the effect of such outbreak, calamity,
crisis or change on the financial markets of the United States would, in your
reasonable judgment, make the offering or delivery of the Shares impracticable,
(iii) suspension of trading or general trading halts in securities on the New
York Stock Exchange, the American Stock Exchange, The Nasdaq National Market or
the over-the-counter market or limitation on prices (other than limitations on
hours or numbers of days or trading) for securities on either such Exchange, The
Nasdaq National Market or the over-the-counter market, (iv) the enactment,
publication, decree or other
21
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in your reasonable opinion
materially and adversely affects or will materially or adversely affect the
business or operations of the Company, (v) declaration of a banking moratorium
by either federal or state authorities, or (vi) the taking of any action by any
federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your reasonable opinion has a material adverse effect on
the securities markets in the United States; or
(b) as provided in Sections 7 and 12 of this Agreement.
13. INFORMATION FURNISHED BY UNDERWRITERS. The information set forth in the
Prospectus: (a) in the last paragraph on the cover page, (b) on the inside front
cover regarding stabilization, and (c) (i) in the table under the caption
"Underwriting" on page 50, listing the Underwriters and the number of shares
each has agreed to purchase, and (ii) in the second paragraph below said table
on page 50, relating to the concession to dealers and the reallowance to certain
other dealers under the caption "Underwriting" in the Prospectus, constitute the
written information furnished by or on behalf of any Underwriters referred to in
paragraph (a) (v) of Section 1 hereof and in paragraphs (a) and (b) of Section 9
hereof.
14. SUCCESSORS. This Agreement has been and is made solely for the benefit
of the Underwriters, the Company and their respective successors, executors,
administrators, heirs, and assigns, and the officers, directors and controlling
persons referred to herein, and no other person will have any right or
obligation hereunder. The term "successors" shall not include any purchaser of
the Shares merely because of such purchase.
15. MISCELLANEOUS. The Representative will act for the several Underwriters
in connection with this offering, and any action under this Agreement taken by
the Representative will be binding upon all of the Underwriters.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Florida, without giving effect to the choice of law or
conflict of law principles thereof.
22
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement among the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
ADMIRALTY BANCORP, INC.
By:
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇, President and
Chief Executive Officer
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
FIRST COLONIAL SECURITIES
GROUP, INC.
By:
-------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Director of Investment Banking
As Representative of the several Underwriters named in Schedule I hereto
23
SCHEDULE I
Name No. of Underwritten Shares
---- --------------------------
Total [FIRM SHARES]
EXHIBIT "A"
August 25, 1998
First Colonial Securities Group, Inc.
As Representative of the several
Underwriters named in Schedule I hereto.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: AGREEMENT NOT TO SELL ADMIRALTY BANCORP, INC. STOCK
Ladies and Gentlemen:
This letter is provided, at the request of Admiralty Bancorp, Inc. (the
"Company"), for the benefit of the Company and the Underwriters in connection
with the proposed public offering of 1,100,000 shares of the Company's Common
Stock (plus an additional 165,000 shares if the Underwriters choose to exercise
their over-allotment option) pursuant to a Registration Statement on Form SB-2
(File No. 333-60307). As an inducement to the Underwriters to (a) enter into an
Underwriting Agreement with the Company and (b) consummate the transactions
contemplated in such Underwriting Agreement, the undersigned hereby represents
and agrees as follows:
1. Upon the closing of the Company's initial public offering, the
undersigned will beneficially own the number of shares of the Company's Common
Stock set forth below opposite the signature of the undersigned (the "Shares"),
and no others.
2. The undersigned agrees that, for a period of 180 days from the effective
date of the Registration Statement, except for bona fide gifts to persons who
agree with you in writing to be bound by this letter, the undersigned will not
offer, sell or otherwise dispose of any of the Shares, directly or indirectly,
without written consent of First Colonial Securities Group, Inc., as
Representative of the Underwriters, which consent will not be unreasonably
withheld; except that (a) such Shares may be pledged as collateral against loans
of the undersigned without such written consent, and (b) if loans secured by
Shares are called, the undersigned and any applicable pledgee will have the
right to sell the shares pledged on such loans to the extent necessary to
satisfy such loans.
Shares of Common Stock Very truly yours,
_______________________
