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Exhibit h.3
January __, 1997
2,900,000 Shares
Sirrom Capital Corporation
Shares of Common Stock, No Par Value
AGREEMENT BETWEEN U.S. AND INTERNATIONAL UNDERWRITERS
January __, 1997
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January __, 1997(1)
To each of the Underwriters named in
Schedules II and III to the Underwriting
Agreement referred to below.
Dear Sirs:
We understand that Sirrom Capital Corporation (the "Company")
and certain shareholders of the Company (the "Selling Shareholders") named in
Schedule I to the Underwriting Agreement (as defined below) have entered into an
underwriting agreement (the "Underwriting Agreement") with Xxxxxx Xxxxxxx & Co.
Incorporated, The Xxxxxxxx-Xxxxxxxx Company, Inc., X.X. Xxxxxxxx & Co. and
Equitable Securities Corporation acting as representatives (the "U.S.
Representatives") of the U.S. underwriters (the "U.S. Underwriters") and Xxxxxx
Xxxxxxx & Co. International Limited as representative (the "International
Representative") of the international underwriters named in Schedule III thereto
(the "International Underwriters" and, together with the U.S. Underwriters, the
"Underwriters"), pursuant to which the several Underwriters have agreed to
purchase from the Company and the Selling Shareholders an aggregate of 2,900,000
shares of Common Stock, no par value of the Company ("Common Stock"). In
addition, the Company has granted the U.S. Underwriters the option to purchase
up to 435,000 additional shares of Common Stock (the "Additional Shares"). All
shares of Common Stock to be purchased by the U.S. Underwriters and the
International Underwriters under the Underwriting Agreement, including any
Additional Shares, are herein called the "U.S. Shares" and the "International
Shares," respectively. The U.S. Shares and the International Shares are
collectively referred to herein as the "Shares."
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(1) Insert date of Underwriting Agreement.
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I.
The U.S. Underwriters acting through the U.S. Representatives,
and the International Underwriters, acting through the International
Representative, agree that, in order to provide an orderly marketing effort for
the offering, they will consult with each other as to the availability of the
Shares for sale to the public, from time to time until the earlier of (a)
notice from the U.S. Representatives to the U.S. Underwriters of the completion
of the distribution of the U.S. Shares and (b) notice from the International
Representative to the International Underwriters of the completion of the
distribution of the International Shares. From time to time as mutually agreed
among the U.S. Underwriters and the International Underwriters, acting through
Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxx Xxxxxxx & Co. International
Limited, respectively, the Underwriters may purchase and sell among each other
such number of Shares to be purchased pursuant to the Underwriting Agreement as
may be so mutually agreed.
The price and currency of settlement of any Shares so
purchased or sold shall be the public offering price, in United States dollars,
less an amount not greater than the selling concession. Settlement with respect
to any Shares transferred hereunder prior to the Closing Date (as defined in
the Underwriting Agreement) shall be made on the Closing Date, and in the case
of purchases and sales made thereafter, as promptly as practicable but in no
event later than three business days after the transfer date. Certificates
representing the Shares so purchased shall be delivered on the respective
settlement dates. The liability of the Underwriters under the Underwriting
Agreement for payment of the purchase price of the Shares purchased thereunder
shall not be affected by the provisions of this Agreement.
The obligations of each U.S. Underwriter in respect of any
purchase or sale of Shares under this Article I by the U.S. Underwriters shall
be pro rata in accordance with the proportion of the total number of U.S. Shares
that such U.S. Underwriter is obligated to purchase under the Underwriting
Agreement. The obligations of each International Underwriter in respect of any
purchase or sale of Shares under this Article I by the International
Underwriters shall be pro rata in accordance with the proportion of the total
number of International Shares that such International Underwriter is obligated
to purchase under the Underwriting Agreement.
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II.
Each of the Underwriters represents that it is a member in
good standing of the U.S. National Association of Securities Dealers, Inc. (the
"NASD") or that it is a foreign bank or dealer not eligible for membership in
the NASD. In making sales of Shares, if it is such a member, such Underwriter
agrees to comply with all applicable rules of the NASD, including, without
limitation, the NASD's Interpretation with Respect to Free-Riding and Witholding
(IM-2110-1) and Rule 2740 of Article III of the NASD Conduct Rules, or, if it is
such a foreign bank or dealer, such Underwriter agrees to comply with such
Interpretation and 2730, 2740 and 2750 of the NASD Conduct Rules as though it
were such a member and Rule 2420 of the NASD Conduct Rules as it applies to a
nonmember broker or dealer in a foreign country.
III.
Each U.S. Underwriter represents and agrees that, except for
(x) sales between the U.S. Underwriters and the International Underwriters
pursuant to Article I of this Agreement and (y) stabilization transactions,
contemplated in Article IV of this Agreement, conducted through the U.S.
Representatives as part of the distribution of the Shares, (a) it is not
purchasing any of the U.S. Shares for the account of anyone other than a United
States or Canadian Person and (b) it has not offered or sold, and will not offer
or sell, directly or indirectly, any of the U.S. Shares or distribute any
prospectus relating to the U.S. Shares outside the United States or Canada or to
anyone other than a United States or Canadian Person, and any dealer to whom it
may sell any of the U.S. Shares will represent that it is not purchasing any of
the U.S. Shares for the account of anyone other than a United States or Canadian
Person and will agree that it will not offer or resell such U.S. Shares directly
or indirectly outside the United States or Canada or to anyone other than a
United States or Canadian Person or to any other dealer who does not so
represent and agree.
Each International Underwriter represents and agrees that,
except for (x) sales between the U.S. Underwriters and the International
Underwriters pursuant to Article I of this Agreement and (y) stabilization
transactions, contemplated in Article IV of this Agreement, conducted through
the U.S. Representatives as part of the distribution of the Shares, (a) it is
not purchasing any of the Interna-
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tional Shares for the account of any United States or Canadian Person and (b)
it has not offered or sold, and will not offer or sell, directly or indirectly,
any of the International Shares or distribute any prospectus relating to the
International Shares in the United States or Canada or to any United States or
Canadian Person, and any dealer to whom it may sell any of the International
Shares will represent that it is not purchasing any of the International Shares
for the account of any United States or Canadian Person and will agree that it
will not offer or resell such International Shares directly or indirectly in
the United States or Canada or to any United States or Canadian Person or to
any other dealer who does not so represent and agree.
With respect to any Underwriter that is a U.S. Underwriter and
an International Underwriter, the foregoing representations and agreements (i)
made by it in its capacity as a U.S. Underwriter shall apply only to it in its
capacity as a U.S. Underwriter and (ii) made by it in its capacity as an
International Underwriter shall apply only to it in its capacity as an
International Underwriter. In addition, notwithstanding the foregoing
representations and agreements, if an Underwriter (including its affiliates) is
both a U.S. Underwriter and an International Underwriter, then the U.S.
Underwriter and its corresponding International Underwriter may, with the
consent of Xxxxxx Xxxxxxx & Co. Incorporated, transfer between themselves at
cost any Shares allocated to them for direct sale by the U.S. Representatives
or the International Representative so long as any Shares so transferred are
treated as U.S. Shares while held by the U.S. Underwriter and International
Shares while held by the International Underwriter for purposes of the foregoing
representations and agreements.
"United States or Canadian Person" shall mean any national or
resident of the United States or Canada, or any corporation, pension,
profit-sharing or other trust or other entity organized under the laws of the
United States or Canada or of any political subdivision thereof (other than a
branch located outside of the United States and Canada of any United States or
Canadian Person), and shall include any United States or Canadian branch of a
person who is otherwise not a United States or Canadian Person. "United States"
shall mean the United States of America, its territories, its possessions and
all areas subject to its jurisdiction.
The agreements of the Underwriters set forth in the first and
second paragraphs of this Article III shall terminate upon the earlier of (a)
the mutual agreement of the U.S. Representatives and the International
Representative and (b) 30 days after the date hereof, unless the U.S.
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Representatives or the International Representative shall have given notice to
the other to the effect that the distribution of the Shares by the U.S.
Underwriters or the International Underwriters, as the case may be, has not yet
been completed. If such notice is given, the agreements set forth in such
preceding paragraphs shall survive until the earlier of (x) the mutual
agreement referred to in the preceding sentence and (y) 30 days after the date
of any such notice.
Each U.S. Underwriter represents that it has not offered or
sold, and agrees not to offer or sell, any Shares, directly or indirectly, in
any province or territory of Canada or to, or for the benefit of, any resident
of any province or territory of Canada in contravention of the securities laws
thereof and, without limiting the generality of the foregoing, represents that
any offer of Shares in Canada will be made only pursuant to an exemption from
the requirement to file a prospectus in the province or territory of Canada in
which such offer is made. Each U.S. Underwriter further agrees to send to any
dealer who purchases from it any of the Shares a notice stating in substance
that, by purchasing such Shares, such dealer represents and agrees that it has
not offered or sold, and will not offer or sell, directly or indirectly, any of
such Shares in any province or territory of Canada or to, or for the benefit
of, any resident of any province or territory of Canada in contravention of the
securities laws thereof and that any offer of Shares in Canada will be made
only pursuant to an exemption from the requirement to file a prospectus in the
province or territory of Canada in which such offer is made, and that such
dealer will deliver to any other dealer to whom it sells any of such Shares a
notice containing substantially the same statement as is contained in this
sentence.
The Underwriters understand that no action has been or will be
taken in any jurisdiction by the Underwriters or the Company that would permit a
public offering of the Shares, or possession or distribution of the Prospectus
(as defined in the Underwriting Agreement), in preliminary or final form, in any
jurisdiction where, or in any circumstances in which, action for that purpose is
required, other than the United States.
Each International Underwriter agrees that it will comply with
all applicable laws and regulations, and make or obtain all necessary filings,
consents or approvals, in each jurisdiction in which it purchases, offers, sells
or delivers Shares (including, without limitation, any applicable requirements
relating to the delivery of the international prospectus, in preliminary or
final form), in each case at
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its own expense. In connection with sales of and offers to sell Shares made by
it, each International Underwriter will either furnish to each person to whom
any such sale or offer is made a copy of the then current international
prospectus (in preliminary or final form and as then amended or supplemented if
the Company shall have furnished any amendments or supplements thereto), or
inform such person that such international prospectus, in preliminary or final
form, will be made available upon request, and will keep an accurate record of
the names and addresses of all persons to whom it gives copies of the
registration statement relating to the offering of the Shares, the international
prospectus, in preliminary or final form, or any amendment or supplement
thereto, and, when furnished with any subsequent amendment to such registration
statement, any subsequent prospectus or any medium outlining changes in the
registration statement or any prospectus, will upon request of the International
Representative, promptly forward copies thereof to such person or inform such
person that such amendment, subsequent prospectus or other medium will be made
available upon request.
Each International Underwriter further represents that it has
not offered or sold, and agrees not to offer or sell, directly or indirectly,
in Japan or to or for the account of any resident thereof, any of the Shares
acquired in connection with the distribution contemplated hereby, except for
offers or sales to Japanese International Underwriters or dealers and except
pursuant to any exemption from the registration requirements of the Securities
and Exchange Law and other relevant laws and regulations of Japan. Each
International Underwriter further agrees to send to any dealer who purchases
from it any of the Shares a notice stating in substance that, by purchasing
such Shares, such dealer represents and agrees that it has not offered or sold,
and will not offer or sell, any of such Shares, directly or indirectly, in
Japan or to or for the account of any resident thereof except for offers or
sales to Japanese International Underwriters or dealers and except pursuant to
any exemption from the registration requirements of the Securities and Exchange
Law and other relevant laws and regulations of Japan, and that such dealer will
send to any other dealer to whom it sells any of such Shares a notice
containing substantially the same statement as is contained in this sentence.
Each International Underwriter further represents and agrees
that (i) it has not offered or sold and will not offer or sell, any Shares to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or
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otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995 (the "Regulations"); (ii) it has complied
and will comply with all applicable provisions of the Financial Services Act
1986 and the Regulations with respect to anything done by it in relation to the
Shares in, from or otherwise involving the United Kingdom; and (iii) it has
only issued or passed on and will only issue or pass on to any person in the
United Kingdom any document received by it in connection with the issue of the
Shares if that person is of a kind described in Article 11(3) of the Financial
Services Act 1986 (Investment Advertisements) (Exemptions) Order 1995 or is a
person to whom such document may otherwise lawfully be issued or passed on.
Each International Underwriter agrees to indemnify and hold
harmless each Underwriter and each person controlling any Underwriter from and
against any and all losses, claims, damages and liabilities (including fees and
disbursements of counsel) arising from any breach by it of any of the
provisions of paragraphs eight, nine and ten of this Article III.
IV.
The overall direction and planning of the stabilization
transactions contemplated herein shall be the responsibility of the U.S.
Representatives and the International Representative, which will consult with
one another on a continuous basis so that such stabilization transactions shall
be conducted in accordance with such direction and planning as is mutually
agreed upon.
All stabilization transactions shall be conducted only by
Xxxxxx Xxxxxxx & Co. Incorporated and shall be conducted in compliance with any
applicable laws and regulations. Xxxxxx Xxxxxxx & Co. Incorporated agrees to
notify the International Representative of the date of termination of
stabilization.
The International Primary Market Association (IPMA) limits
will not be complied with in connection with stabilization losses and expenses.
All stabilization transactions shall be for the respective accounts of the
several Underwriters and shall be allocated between the U.S. Underwriters and
the International Underwriters in the respective proportions that the number of
U.S. Shares and International Shares purchased pursuant to the Underwriting
Agreement bears to the total number of Shares purchased. In no event
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shall the net commitment of any Underwriter, for either long or short account,
resulting from such stabilization transactions and from the over-allotments
referred to in Article V, exceed 15% of the total number of Shares that such
Underwriter is obligated to purchase under the Underwriting Agreement; provided
that the net commitment of any Underwriter for short account shall be
calculated (x) in the case of any U.S. Underwriter, after giving effect to the
purchase of (i) any Shares that the U.S. Representatives have agreed to
purchase for the account of such U.S. Underwriter pursuant to Article I of
this Agreement and (ii) the maximum number of Additional Shares that such U.S.
Underwriter is entitled to purchase under the Underwriting Agreement and (y) in
the case of any International Underwriter, after giving effect to the purchase
of any Shares that the International Representative has agreed to purchase for
the account of such International Underwriter pursuant to Article I of this
Agreement.
Each U.S. Underwriter represents that it has not offered or
sold, and agrees that it will not offer or sell, directly or indirectly, Shares
to any person at less than the public offering price, other than to (i) the
International Underwriters pursuant to Article I hereof or (ii) other U.S.
Underwriters or to dealers who have entered into the Master Dealer Agreement
with Xxxxxx Xxxxxxx & Co. Incorporated and who have received a pricing wire
from the U.S. Representatives with respect to this offering that, among other
things, sets forth such dealer's agreement that it is not purchasing Shares for
the account of any persons other than United States or Canadian Persons and
that it will not offer or resell Shares outside the United States and Canada.
Such sales to U.S. dealers and other U.S. Underwriters shall be made in
confirmity with the provisions of Article II and at a price that is not below
the public offering price less the maximum permissible reallowance to be
specified in the Prospectus. Each U.S. Underwriter agrees that prior to
offering Shares to any dealer at the public offering price less the
reallowance, it will either ascertain that such dealer has entered into such
Master Dealer Agreement and received such a pricing wire or make arrangements
to ensure that such dealer will enter into such Master Dealer Agreement and
receive such a pricing wire.
Each International Underwriter represents that it has not
offered or sold and agrees that it will not offer or sell, directly or
indirectly, Shares to any person at less than the offering price, other than to
(i) U.S. Underwriters pursuant to Article I hereof or (ii) other International
Underwriters or to dealers who have entered into International Dealer Agreements
(the "International Dealers") with the International Representative in the form
of Exhibit C to
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the Agreement Among International Underwriters. Such sales to International
Dealers and other International Underwriters shall be made in conformity with
the provisions of Article II and at a price that is not below the public
offering price less the maximum permissible reallowance to be specified in the
Prospectus. Each International Underwriter agrees that prior to offering Shares
to any dealer at the public offering price less the reallowance, it will either
ascertain that such dealer has entered into such an International Dealer
Agreement or make arrangements to assure that such dealer will enter into an
International Dealer Agreement.
The agreements of the Underwriters set forth in the foregoing
two paragraphs shall terminate upon the earlier of (a) the mutual agreement of
the U.S. Representatives and the International Representative and (b) 30 days
after the date hereof, unless the U.S. Representatives or the International
Representative shall have given notice to the other to the effect that the
distribution of the Shares by the U.S. Underwriters or the International
Underwriters, as the case may be, has not yet been completed. If such notice is
given, the agreements set forth in such preceding paragraphs shall survive
until the earlier of (x) the mutual agreement referred to in the preceding
sentence and (y) 30 days after the date of any such notice.
Each Underwriter agrees that it will not, without the advance
approval of the U.S. Representatives and the International Representative,
respectively, (i) offer, bid for, buy, sell, contract to buy or sell, sell any
option or contract to purchase or sell, purchase any option or contract to sell
or buy or otherwise acquire, transfer or dispose of, directly or indirectly,
any shares of Common Stock or any security convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other arrangement
that involves the transfer to another, in whole or in part, of any of the
economic consequences of ownership of the Common Stock (whether any such
transaction described in clause (i) or (ii) above is for the account of such
Underwriter or a customer or whether any such transaction is to be settled by
delivery of Common Stock or other such securities, in cash or otherwise),
except (a) as provided in the Agreement Among International Underwriters, the
Master Agreement Among Underwriters, this Agreement or the Underwriting
Agreement, (b) that it may convert any security of the Company convertible into
Common Stock owned by it and sell the Common Stock acquired upon such
conversion and that it may deliver Common Stock owned by it upon the exercise
of any option written by it as permitted by the provisions set forth herein,
(c) in brokerage transactions on unsolicited orders which have not resulted
from activities on its part
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in connection with the solicitation of purchases and which are executed by it
in the ordinary course of its brokerage business and (d) that on or after the
date of the initial public offering of the Shares, it may execute covered
writing transactions in options to acquire Common Stock, when such transactions
are covered by Shares, for the accounts of customers.
An opening uncovered writing transaction in options to acquire
Common Stock for an Underwriter's account or for the account of a customer
shall be deemed, for purposes of this Article IV, to be a sale of Common Stock
which is not unsolicited. The term "opening uncovered writing transaction in
options to acquire" as used above means a transaction in which the seller
intends to become a writer of an option to purchase Common Stock which he does
not own. An opening uncovered purchase transaction in options to sell Common
Stock for an Underwriter's account or for the account of a customer shall be
deemed, for purposes of this paragraph, to be a sale of Common Stock which is
not unsolicited. The term "opening uncovered purchase transaction in options to
sell" as used above means a transaction where the purchaser intends to become
an owner of an option to sell Common Stock which he does not own.
Each Underwriter represents that it has not participated,
since it was invited to participate in the offering of the Shares, in any
transaction prohibited by this Article IV and that it has at all times complied
and agrees that it will at all times comply with the provisions of Rule 10b-6
of the U.S. Securities Exchange Act of 1934, as amended, applicable to this
offering.
V.
The overall direction and planning of any over-allotments to be
made by the Underwriters in arranging for sales of Shares, and the related
transactions required to cover such over-allotments, shall be the responsibility
of the U.S. Representatives. All profits and losses arising from such
over-allotments (excluding the excess, if any, of (i) the public selling price
of any Additional Shares and any Shares purchased pursuant to Article I of this
Agreement over (ii) the cost of such Additional Shares and such other Shares to
the Underwriters making such sales) shall be for the respective accounts of the
several Underwriters and shall be allocated between the U.S. Underwriters and
the International Underwriters in the respective proportions that the number of
U.S. Shares and International Shares purchased pursuant to the Underwriting
Agreement bears to the total number of Shares purchased.
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VI.
Each of the Underwriters agrees that the expenses incurred in
connection with or attributable to the purchase, carrying or sale of the
Shares, including the fees and disbursements of Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP (U.S. counsel to the Underwriters), shall be for the respective
accounts of the several Underwriters and shall be allocated between the U.S.
Underwriters and the International Underwriters in the respective proportions
that the number of U.S. Shares and International Shares purchased pursuant to
the Underwriting Agreement bears to the total number of Shares purchased.
VII.
Changes in the offering price and in the concessions and
reallowances to dealers will be made only upon the mutual agreement of the
Underwriters during the period referred to in the first sentence of Article I
hereof.
VIII.
The Representatives will keep one another fully informed of
the progress of the offering of the Shares.
The agreements of the Underwriters contained in Article II,
the sixth through eleventh paragraphs of Article III, the last paragraph of
Article IV, Article V and Article VI shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
termination of the Underwriting Agreement, (iii) any investigation made by or
on behalf of any Underwriter or any person controlling any Underwriter or by or
on behalf of the Company, its shareholders, officers or directors or any other
person controlling the Company and (iv) acceptance of and payment for any
Shares.
IX.
This Agreement may be signed in counterparts, which together
shall constitute one and the same instrument.
This Agreement shall be governed and construed in all respects
in accordance with the laws of the State of New York and United States federal
law.
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IN WITNESS WHEREOF, this Agreement has been executed as of the
date and year first above written by the undersigned for themselves and for the
Underwriters as set forth above.
XXXXXX XXXXXXX & CO. INCORPORATED
THE XXXXXXXX-XXXXXXXX COMPANY, INC.
X.X. XXXXXXXX & CO.
EQUITABLE SECURITIES CORPORATION
Acting severally on behalf of
themselves and the several U.S.
Underwriters named in Schedule II
to the Underwriting Agreement
referred to herein.
By XXXXXX XXXXXXX & CO.
INCORPORATED
By
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XXXXXX XXXXXXX & CO. INTERNATIONAL
LIMITED
Acting severally on behalf of
itself and the several
International Underwriters
named in Schedule III to the
Underwriting Agreement
referred to herein.
By XXXXXX XXXXXXX & CO. INTERNATIONAL
LIMITED
By
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