EXHIBIT 1.1
1,150,000
MARINE BANCSHARES, INC.
COMMON SHARES
(PAR VALUE $0.01 PER SHARE)
UNDERWRITING AGREEMENT
----------------------
December ___, 1998
XXXXXX XXXXX & CO.
000 Xxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Gentlemen:
Marine Bancshares, Inc., a Florida corporation (the "Company"), hereby
confirms its agreement with Xxxxxx Xxxxx & Co., as the underwriter (the
"Underwriter"), as follows:
SECTION 1. INTRODUCTION. Subject to the terms and conditions set forth
in this Underwriting Agreement (this "Agreement"), the Company proposes to issue
and sell to the Underwriter an aggregate of 1,150,000 common shares ("Firm
Shares"), $0.01 per value (the "Common Shares"), of the Company. In addition,
the Company proposes to grant to the Underwriter an option to purchase up to
172,500 additional Common Shares (the "Option Shares") as provided in Section 4
hereof. The Firm Shares and the Option Shares are hereinafter referred to
collectively as the "Shares."
As part of the offering of the Firm Shares contemplated by this
Agreement, the Underwriter has agreed to reserve out of the Firm Shares, 500,000
Shares for sale to the Company's employees, officers, and directors and other
parties associated with the Company (collectively, the "Participants,") as set
forth in the Prospectus (as defined below) in the section entitled
"Underwriting" (the "Directed Share Program"). The Shares to be sold by the
Underwriter pursuant to the Directed Share Program (the "Directed Shares') will
be sold by the Underwriter pursuant to this Agreement at the public offering
price as set forth on the cover page of the Prospectus.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, the Underwriter as follows:
(a) (i) A registration statement on Form SB-2 (File No.
333-39203) with respect to the Shares, including a related preliminary
prospectus, has been carefully prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
and the rules and regulations of the Securities and Exchange Commission
("Commission") promulgated thereunder, and has been filed with the Commission.
The Company has prepared and filed such amendments thereto, if any, and such
amended preliminary prospectuses, if any, as may have been required to the date
hereof, and will file such additional amendments thereto and such amended
preliminary prospectuses as may hereafter be required.
(ii) For purposes of this Agreement, the term "Registration
Statement" means the registration statement referred to in Section 2(a)(i) of
this Agreement as amended at the time when it was declared effective by the
Commission (including the related prospectus, Part II, any documents or a
portion thereof incorporated by reference therein, all financial schedules and
exhibits thereto, and all information
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deemed to be part of the registration statement at the time it became effective
pursuant to Rule 430A(b) under the Securities Act), except that if the Company
files a post-effective amendment to such registration statement which is
declared effective prior to the Closing Date (as defined in Section 4 hereof),
"Registration Statement" shall refer to such registration statement as so
amended. The date on which the Registration Statement is declared effective by
the Commission shall be referred to as the "Effective Date." If the Company has
filed an abbreviated registration statement to register additional Shares
pursuant to Rule 462(b) under the Securities Act (including the exhibits
thereto, the "Rule 462 Registration Statement"), then any reference herein to
the Registration Statement also shall be deemed to include the Rule 462
Registration Statement. "Preliminary Prospectus" shall mean: (A) any prospectus
included in the registration statement, or amendments thereto, before it was
declared effective under the Securities Act, (B) any prospectus filed with the
Commission by the Company with the consent of the Underwriter pursuant to Rule
424(a) under the Securities Act (including documents incorporated by reference
therein), and (C) any prospectus included in the Registration Statement at the
Effective Date that omits the Rule 430A Information (as defined below). The term
"Prospectus" means the final prospectus documents as first filed with the
Commission pursuant to paragraph (1) or (4) of Rule 424(b) under the Securities
Act or, if no filing pursuant to Rule 424(b) is required, shall mean the form of
final prospectus relating to the Shares included in the Registration Statement
at the Effective Date, in either case, including all documents (or portions
thereof) incorporated by reference therein. "Rules and Regulations" means the
rules and regulations adopted by the Commission under either the Securities Act
or the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
applicable. "Rule 430A Information" means information with respect to the Shares
and the offering thereof which, pursuant to Rule 430A promulgated under the
Securities Act, is permitted to be omitted from the Registration Statement and
the related prospectus at the time the Registration Statement is declared
effective by the Commission.
(b) The Commission has not issued any order preventing or suspending
the use of any Preliminary Prospectus, and each Preliminary Prospectus complies
in all material respects with the requirements of, and contains all statements
which are required to be stated therein in accordance with, the Securities Act
and the Rules and Regulations, and does not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading; PROVIDED, HOWEVER, that no representation
or warranty is made as to information contained in or omitted from the
Registration Statement, the Prospectus, or any amendment or supplement thereto
in reliance upon and in conformity with written information furnished to the
Company by or on behalf of the Underwriter specifically for use therein..
(c) The Registration Statement has been declared effective and no stop
order suspending the effectiveness of the Registration Statement or any part
thereof has been issued or is in effect and no proceedings for that purpose have
been initiated, are pending, or, to the Company's knowledge, have been
threatened by the Commission or the securities authority of any state or other
jurisdiction. The Registration Statement and the Prospectus comply and, as
amended or supplemented, will comply, in all material respects with the
requirements of, and contain and, as amended or supplemented, if applicable,
will contain, all statements that are required to be stated therein by, the
Securities Act and the Rules and Regulations. The Registration Statement, at the
Effective Date, did not contain and the Prospectus does not contain and, as
amended or supplemented, if applicable, will not contain, and at all times
subsequent thereto up to each Closing Date will not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances in which they were made, not misleading; PROVIDED, HOWEVER, that
no representation or warranty is made as to information contained in or omitted
from the Registration Statement, the Prospectus, or any amendment or supplement
thereto in reliance upon and in conformity with written information furnished to
the Company by or on behalf of the Underwriter specifically for use therein.
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(d) The Company has been duly incorporated and is validly existing as a
corporation with active status under the laws of the State of Florida and,
subject to Section 2(i) of this Agreement and commencement of the business of
the Marine National Bank, a national bank (in organization) to be located in
Naples, Florida (the "Bank"), is duly registered and in good standing under the
Bank Holding Company Act of 1956, as amended (the "BHCA"), with the full power
and authority (corporate and other) to own, lease, and operate its properties
and conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement thereto); the Company is duly
registered or qualified to do business as a foreign corporation under the
corporation and banking laws of, and is in good standing as such in, each
jurisdiction in which the conduct of its business or where the nature of its
properties requires such registration or qualification, except to the extent
that the failure to be so registered or qualified would not have a material
adverse effect on the condition (financial or other), business, properties, net
worth, or results of operations of the Company or any of its Subsidiaries (as
defined below) ("Material Adverse Effect"); and no proceeding has been
instituted in any jurisdiction revoking, limiting, or curtailing, or seeking to
revoke, limit, or curtail, such power and authority or qualification.
(e) The Company has the requisite power and authority (corporate and
other) to execute and deliver this Agreement and to perform its obligations
under this Agreement. The execution and delivery of this Agreement, and the
performance by the Company of its obligations hereunder and consummation of the
transactions described herein, have been duly and validly authorized by the
Company. This Agreement has been duly executed and delivered by the Company and
constitutes a legal, valid, and binding obligation of the Company, enforceable
against the Company in accordance with its terms (except in all cases (i) to the
extent that such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, moratorium, or similar laws affecting
the enforcement of creditor rights and remedies generally, (ii) that the
availability of the equitable remedy of specific performance and injunctive
relief is subject to the discretion of the court before which the proceeding may
be brought, and (iii) that the enforceability of the indemnification and
contribution provisions hereof may be limited under applicable federal or state
or other securities laws or the public policy underlying such laws.)
(f) Neither the execution and delivery by the Company of this
Agreement, nor the performance by the Company of its obligations hereunder or
the consummation of the transactions contemplated hereby (including the offer,
sale, or delivery of the Shares) and compliance by the Company with any of the
provisions hereof will (i) conflict with, violate, or contravene any provision
of the articles of incorporation, bylaws, or other corporate governance
documents of the Company or any Subsidiary, (ii) violate, conflict with, or
result in a breach of any term, condition, or provision of, or constitute a
default (with or without notice or the lapse of time, or both) under, or give
rise to any right of termination, cancellation, or acceleration of any
obligation or loss of benefit under, or result in the creation of any claim,
lien, pledge, security, interest, charge, or other encumbrance of any kind
whatsoever (a "Lien") upon any assets or properties of the Company or any
Subsidiary pursuant to the terms, provisions, or conditions of any loan
agreement, indenture, note, bond, or other evidence of indebtedness, or of any
agreement, lease, deed of trust, mortgage, contract, or other material agreement
or instrument to which the Company or any Subsidiary is a party or by which any
of them or any of their assets or properties are bound or affected, except where
such a violation, conflict, breach, or default would not have a Material Adverse
Effect, or (iii) conflict with or violate any statute, law, ordinance, rule, or
regulation applicable to the Company, any Subsidiary, or any of their respective
assets or properties, or any order, judgment, writ, injunction, or decree of any
court, or any governmental, regulatory, or administrative agency, commission,
authority, or other body, domestic or foreign, having jurisdiction over the
Company, any Subsidiary, or any of their respective assets or properties. No
consent, approval, filing, authorization, registration, qualification, or order,
including with or by any bank regulatory agency, is required for the execution,
delivery, and performance of this Agreement or the consummation of the
transactions contemplated by this Agreement, other than such that have been
obtained or made, except as such may be required for compliance
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with the Securities Act, the Exchange Act, and the Blue Sky Laws applicable to
the public offering of the Shares by the Underwriter, and the clearance of such
offering and the underwriting arrangements evidenced hereby with the National
Association of Securities Dealers, Inc. ("NASD").
(g) The Company had the outstanding capitalization as set forth under
"Capitalization" in the Registration Statement and the Prospectus as of the date
indicated therein and there has been no change therein since such date. The
Common Shares issued and outstanding prior to the issuance of the Shares to be
sold by the Company hereunder have been duly authorized and validly issued, are
fully paid and nonassessable; the Shares to be sold by the Company hereunder
have been duly authorized and, when issued and paid for against delivery thereof
as contemplated by this Agreement, will be validly issued, fully paid and
nonassessable; and, the securities of the Company conform to the descriptions
thereof contained in the Registration Statement and Prospectus, and the
certificates representing the Shares are in due and proper legal form under, and
conform in all respects to the requirements of, the laws of the State of
Florida. There are no preemptive, preferential, or other rights (including
rights of first refusal) to subscribe for or to purchase any of the Common
Shares (including the Shares) and no Common Shares have been issued in violation
of any such rights, nor are there any restrictions upon the voting or transfer
of any Common Shares (including the Shares) pursuant to the Company's articles
of incorporation, bylaws, and other governing documents, or any agreement or
other instrument to which the Company or any Subsidiary is a party or by which
any of them may be bound. All of the securities previously issued by the Company
and each of its Subsidiaries, including the Common Shares and any warrants and
stock options to purchase Common Shares, were duly offered, sold, issued, or
granted in compliance with, and were registered under or exempt from the
registration requirements of, the Securities Act, and were duly registered or
qualified under, or the subject of an available exemption from, the registration
provisions of all applicable state securities laws ("Blue Sky Laws").
(h) Except as set forth in the Prospectus, the Company does not have
any outstanding options to purchase, or warrants to subscribe for, or any
securities or obligations convertible into or exchangeable for, or any contracts
or commitments to issue or sell, any Common Shares or any such options,
warrants, convertible securities, or obligations, or other rights of any
description, contractual or otherwise, entitling any person to receive any class
of security from the Company. No holder of the Common Shares or other securities
of the Company or any other person has the right, contractual or otherwise, to
cause the Company to register any securities of the Company under the Securities
Act or any Blue Sky Laws.
(i) The Company has prepared and filed with the Board of Governors of
the Federal Reserve System (the "FRB") in accordance with Section 3(a)(1) of the
BHCA and Section 225.15 of Regulation Y promulgated thereunder, an application
to become a bank holding company (together with all exhibits, schedules,
amendments, and supplements thereto, the "BHC Application"). On _____, 1998, the
FRB approved the Company's application to become a bank holding company through
the acquisition of all of the outstanding voting securities of the Bank,
effective upon the Company's compliance with commitments and representations
made in connection with the BHC Application (the "FRB Approval"). The FRB
Approval provides that the acquisition by the Company of the Bank must be made
within the period commencing thirty days after ____, 1998, and ending three
months after such date, unless extended by the FRB. The FRB Approval also
requires the Company to provide the FRB with certain further information set
forth therein within thirty days following the Company's acquisition of the
Bank's voting stock.
(j) The incorporators of the Bank have prepared and filed with the
United States Office of the Comptroller of the Currency ("OCC") in accordance
with the National Bank Act (the "NBA") an Application to Organize a National
Bank (together with all exhibits, schedules, amendments, and supplements
thereto, the "Charter Application"). On ______, 1998, the OCC approved the
Charter Application for authority to organize the Bank, subject to certain terms
and conditions specified in such approval (the "Charter Approval"). The
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Charter Approval remains in full force and effect on the date hereof and on each
of the Closing Dates. The incorporators of the Bank have prepared and filed with
the Federal Deposit Insurance Corporation ("FDIC") in accordance with Section
5(a)(1) of the Federal Deposit Insurance Act, as amended (the "FDIA"), an
Application for Federal Deposit Insurance (together with all exhibits,
schedules, amendments, and supplements thereto, the "Deposit Insurance
Application"). On ______, 1998, the FDIC approved the Deposit Insurance
Application, subject to certain terms and conditions specified in such approval
(the "Deposit Insurance Approval").
(k) The Company has provided the Underwriter with true and complete
copies of the BHC Application, the Charter Application, and the Deposit
Insurance Application, as each has been amended or supplemented from time to
time (the "Applications"), and the FRB Approval, the Charter Approval, and the
Deposit Insurance Approval (the "Regulatory Approvals"). When the Applications
were filed with the respective bank regulatory authorities, and upon the filing
with the Commission or the first delivery to the Underwriter of the Prospectus,
and as of the date of this Agreement and each of the Closing Dates: (i) each
such Application conformed with and will conform with the respective
requirements of the BHCA, the NBA, and the FDIA and the rules and regulations
promulgated thereunder, and (ii) none of the Applications contained or will
contain any untrue statement of a material fact or omitted or will omit to state
any material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading. As of each of the Closing Dates, all Regulatory Approvals
are in full force and effect, and no actions or proceedings to suspend, revoke,
or terminate any of such Regulatory Approvals have been taken, or are pending,
or, to the knowledge of the Company, threatened or contemplated, and neither the
Company nor the Bank is in breach of or default under any condition or of any
commitment contained in any Regulatory Approval.
(l) The Company does not have any Subsidiaries and does not, directly
or indirectly, own any equity interest in, or control, any corporation, limited
liability company, association, partnership, joint venture, trust,
proprietorship, or other commercial or business entity or organization, except
that the Company has the sole right to acquire all of the outstanding capital
stock of the Bank, which stock will be acquired upon receipt of all necessary
regulatory approvals, including the Regulatory Approvals, and upon acquisition
of such stock the Bank will be the Company's only subsidiary ("Subsidiary"). On
the First Closing Date (as defined in Section 4 hereof), promptly following the
sale of the Firm Shares to the Underwriter pursuant to this Agreement, a minimum
of $9,000,000 of the net proceeds therefrom shall be contributed by the Company
to the Bank, and after receipt thereof the Bank shall issue shares of its common
stock to the Company, and following such issuance, and at all times subsequent
thereto up to and as of the Second Closing Date (as defined in Section 4
hereof), if any, all of the outstanding shares of capital stock of the Bank (i)
will have been issued to the Company, (ii) when issued to the Company, will have
been duly authorized and validly issued, and will be fully paid and
nonassessable, and (iii) will be owned beneficially and of record by the
Company, free and clear of any claim, lien, encumbrance, or security interest,
or restriction on transfer (except for restrictions under federal or state
banking laws). Subject to receipt by the Bank of such capital contribution from
the Company, and satisfaction of the conditions set forth in the Bank Approvals
(as defined in Section 7(g) hereof), the Bank will be duly organized and validly
existing as a nationally chartered banking association in good standing under
the laws of the United States of America and the State of Florida, with full
power and authority (corporate and other) to own, lease, and operate its
properties and conduct its business as described in the Registration Statement,
the Prospectus, the Applications, and the Regulatory Approvals; the Bank is not
and will not be required to be registered or qualified to do business as a
foreign corporation under the laws of any jurisdiction; and no proceeding has
been instituted in any jurisdiction revoking, limiting, or curtailing, or
seeking to revoke, limit, or curtail, such power and authority or qualification.
Except as described in the Prospectus, no options to purchase, or warrants to
subscribe for, or any securities or obligations convertible into or exchangeable
for, or any contracts or commitments to issue or sell, any capital stock or
ownership interests in the Bank or any such options, warrants, convertible or
exchangeable securities, or obligations or other rights of any description,
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contractual or otherwise, entitling any person to receive any class of security
from the Company, are currently outstanding or, as of each of the Closing Dates,
will be outstanding. The Bank is not and, as of each of the Closing Dates, will
not be subject to any current formal arrangement or memorandum of understanding
with, or cease and desist order by, any bank regulatory agency.
(m) Xxxx, Xxxxx & Xxxx, Inc., the certified public accountants which
have audited, reviewed, and expressed its opinion with respect to certain of the
financial statements and schedules filed with the Commission as a part of the
Registration Statement and included or to be included, as the case may be, in
the Registration Statement and in the Prospectus, and whose report is included
in the Registration Statement and in the Prospectus, were and are independent
accountants as required by, and within the meaning of, the Securities Act and
the Rules and Regulations.
(n) The financial statements and schedules and the related notes
thereto included or to be included, as the case may be, in the Registration
Statement, any Preliminary Prospectus, or the Prospectus present fairly the
financial position of the Company as of the respective dates of such financial
statements and schedules, and the results of operations and changes in equity
and in cash flows of the entities purported to be shown thereby for the
respective periods covered thereby, all prepared in conformity with generally
accepted accounting principles consistently applied throughout the periods
involved, except as may be disclosed in the Registration Statement and the
Prospectus. All adjustments necessary for a fair presentation of the results of
such periods have been made. The financial, operating, and statistical
information relating to the Company and any Subsidiary are accurately and fairly
presented and prepared on a basis consistent with the audited financial
statements and the books and records of the Company.
(o) The Company and each Subsidiary maintains a system of internal
accounting controls sufficient to provide reasonable assurance that: (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
material assets is permitted only in accordance with management's general or
specific authorizations, and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(p) Neither the Company nor any Subsidiary is presently, nor with the
giving of notice or the lapse of time, or both, would be (i) in conflict with or
in violation of its articles of incorporation, bylaws, or other corporate
governance documents, (ii) in violation or breach of, or in default in the
performance of any obligation, agreement, or condition contained in any
provision of any loan agreement, indenture, note, bond, or other evidence of
indebtedness, or of any agreement, lease, deed of trust, mortgage, contract, or
other material agreement or instrument to which the Company, or any Subsidiary
is a party or by which any of them or any of their assets or properties are
bound or affected, or (iii) in conflict with or in violation of any law,
ordinance, rule, or regulation applicable to the Company, any Subsidiary, or any
of their respective assets or properties, or any order, judgment, writ,
injunction, or decree of any court, or any governmental, regulatory, or
administrative agency, commission, authority, or other body, domestic or
foreign, having jurisdiction over the Company, any Subsidiary, or any of their
respective assets or properties.
(q) The Company and each Subsidiary have and hold, and at each of the
Closing Dates will have and hold, and are operating in compliance with, and have
fulfilled and performed all of their material obligations with respect to all
permits, certificates, franchises, grants, easements, consents, licenses,
approvals, charters, registrations, authorizations, and orders ("Permits")
required under all laws, rules, and regulations and as are necessary to own
their respective properties and to conduct their respective businesses in the
manner described in the Registration Statement and Prospectus, and all of such
Permits are valid and in full force and effect; and
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there is no pending proceeding, and neither the Company nor any Subsidiary has
received notice of any threatened proceeding, relating to the revocation or
modification of any such Permit. Neither the Company nor any Subsidiary is or
has been (by virtue of any action, omission to act, contract to which it is a
party or by which it is bound, or any occurrence or state of facts whatsoever)
in violation of any law, rule, regulation, or any order, writ, injunction, or
decree to which the Company or any of its Subsidiaries may be subject (including
those relating to any aspect of banking, bank holding companies, environmental
protection, occupational safety and health, and equal employment practices)
heretofore or currently in effect, except any such violation that has been fully
cured or satisfied without recourse or that is not reasonably likely to have a
Material Adverse Effect.
(r) Except as described in or contemplated by the Registration
Statement and the Prospectus, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus and prior
to each of the Closing Dates: (i) neither the Company nor any of its
Subsidiaries has or will have incurred any material liability or obligation,
direct or contingent, and neither of them has or will have nor entered into any
material transaction not in the ordinary course of business; (ii) neither the
Company nor any Subsidiary has or will have purchased any of its outstanding
capital stock, nor declared, paid, or otherwise made any dividend or other
distribution of any kind with respect to its capital stock, and neither the
Company nor any Subsidiary has or will be delinquent in the payment of principal
or interest on any outstanding debt obligations; and (iii) there has not been
and will not be any change in the capital stock, or any material change in the
indebtedness of the Company or any Subsidiary, or any change or development
involving, or that could be expected to involve, a Material Adverse Effect.
(s) There are no contracts or other documents, transactions,
relationships, statutes, regulations, or rules required to be described in the
Registration Statement or the Prospectus, or to be filed as an exhibit to the
Registration Statement, by the Securities Act or by the Rules and Regulations
that has not been so described or filed as required.
(t) Either the Company or a Subsidiary, as the case may be, has good
and marketable title in fee simple to all items of real property and good and
marketable title to all the personal property and assets reflected as owned by
the Company or any Subsidiary in the financial statements described above (or
elsewhere in the Registration Statement and the Prospectus), in each case free
and clear of all Liens, defects, or adverse intent of any nature except those,
if any, reflected in such financial statements (or elsewhere in the Registration
Statement and the Prospectus) or such as are not material to the Company or any
Subsidiary and do not interfere with the use of the property or the conduct of
the business of the Company or any Subsidiary; and all real property and
buildings held or used by the Company or any Subsidiary under leases, licenses,
franchises, or other agreements are held by them under valid, existing, binding,
and enforceable leases, licenses, franchises, or other agreements with respect
to which it is not in material default with such exceptions as are not material
and do not interfere with the use made and proposed to be made of such property
and buildings or the conduct of the business of the Company or any Subsidiary.
(u) There is no litigation or governmental proceeding, action, or
investigation pending or, to the knowledge of the Company, threatened, to which
the Company or any Subsidiary is a party, or to which property owned or leased
by the Company or any Subsidiary is subject, or related to environmental or
discrimination matters, which is required to be disclosed in the Registration
Statement or the Prospectus by the Securities Act or the Rules and Regulations
and is not so disclosed, or which questions the validity of this Agreement or
any action taken or to be taken pursuant hereto nor, to the Company's knowledge,
is there a basis for any such litigation, proceeding, action, or investigation.
(v) Neither the Company nor any Subsidiary has distributed or will
distribute prior to any Closing Date any offering material in connection with
the offering of the Shares other than the Preliminary Prospectus,
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the Registration Statement, the Prospectus or other materials permitted by the
Securities Act and which distribution was previously approved in writing by the
Underwriter. The Company has not given any information or made any
representation in connection with the offering of the Shares, written or oral,
other than as contained in the Prospectus or the Preliminary Prospectus. Neither
the Company nor any person that controls, is controlled by (including any
Subsidiary), or is under the common control of the Company has taken or will
take, directly or indirectly, any action designed to cause or result in, or
which constitutes or which might reasonably be expected to constitute, under the
Exchange Act or otherwise, stabilization or manipulation of the price of the
Common Shares to facilitate the sale or resale of the Shares.
(w) Neither the Company nor any person that controls, is controlled by
(including any Subsidiary), or is under the common control of the Company has,
directly or indirectly, at any time: (i) made any unlawful contribution to any
candidate for political office, or failed to disclose fully any contribution in
violation of law; or (ii) made any payment to any federal, state, local, or
foreign government 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 or applicable foreign
jurisdictions.
(x) The Company and each Subsidiary has filed all required federal,
state, local, and foreign income and franchise tax returns; all such tax
returns, as filed, are accurate in all material respects and has paid all taxes
shown as due thereon to the extent such taxes have become due; and no tax
deficiency has been asserted or threatened against the Company or any Subsidiary
that would have a Material Adverse Effect, except as described in the
Registration Statement and the Prospectus.
(y) The Company or a Subsidiary owns or possesses adequate right, title
and interest in and to, or have the right to use all patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights, licenses, and other rights, know-how,
and technology (including trade secrets and other unpatented and/or proprietary
or confidential information, systems or procedures) (collectively "Intellectual
Property Rights") necessary for the conduct of the business of the Company or
any of its Subsidiaries or ownership of their respective properties, and neither
the Company nor any Subsidiary has received notice of conflict with the asserted
rights of others in respect thereof which has not been resolved.
(z) In addition to federal deposit insurance of the Bank, the Company
and each Subsidiary have in place and effective such policies of insurance, with
limits of liability in such amounts, as are normal and prudent in the ordinary
course of business similar to that of the Company and each Subsidiary in the
respective jurisdictions in which they conduct business, and the Company has no
reason to believe that the Company and its Subsidiaries will not be able to
renew their existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue
their respective businesses at a cost that would not have a Material Adverse
Effect.
(aa) The provisions of any employee pension benefit plan ("Pension
Plan") as defined in Section 3(2) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), in which the Company and any Subsidiary is a
participating employer are in substantial compliance with ERISA, and the Company
and each Subsidiary are not in material violation of ERISA. The Company, each
Subsidiary, or the plan sponsor thereof, as the case may be, has duly and timely
filed the reports required to be filed by ERISA in connection with the
maintenance of any Pension Plans in which the Company or any Subsidiary is a
participating employer, and no facts, including any "reportable event" as
defined by ERISA and the regulations thereunder, exist in connection with any
Pension Plan in which the Company or any Subsidiary is a participating employer
which might constitute grounds for the termination of such plan by the Pension
Benefit Guaranty Corporation or for the appointment by the appropriate U.S.
District Court of a trustee to administer any such plan. The
8
provisions of any employee benefit welfare plan, as defined in Section 3(1) of
ERISA, in which the Company or any Subsidiary is a participating employer, are
in substantial compliance with ERISA and the Company, any Subsidiary, or the
plan sponsor thereof, as the case may be, has duly and timely filed the reports
required to be filed by ERISA in connection with the maintenance of any such
plans.
(ab) Except as set forth in the Registration Statement and the
Prospectus, to the knowledge of the Company, neither the Company nor any
Subsidiary has violated any environmental, safety, or similar law applicable to
their respective businesses, nor any federal or state law relating to
discrimination in the hiring, promotion or pay of employees nor any applicable
federal or state wages and hours laws, which in each case might have a Material
Adverse Effect. No labor dispute with or disturbance by the employees of the
Company or any Subsidiary exists or is imminent; and neither the Company nor any
Subsidiary is aware of any existing or imminent labor disturbances by its
employees that might reasonably be expected to have a Material Adverse Effect.
No collective bargaining agreement exists with any of the Company's or any
Subsidiary's employees and no such agreement is imminent. To the knowledge of
the Company, neither the employment by the Company or any Subsidiary of their
key personnel nor the activities of such individuals at the Company or any
Subsidiary conflicts with, constitutes a breach of, or otherwise violates any
employment, noncompetition, nondisclosure, or similar agreement or covenant by
which such individuals may be bound.
(ac) Neither the Company nor any Subsidiary is an "investment company"
or an "affiliated person" of, or a "promoter" or "principal underwriter" for an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended (the "Investment Company Act"), and none of them is subject to
regulation under the Investment Company Act.
(ad) The Company has complied with all provisions of Section 517.075,
Florida Statutes, relating to disclosures of doing business with the government
of Cuba or with any person or affiliate located in Cuba.
(ae) All Common Shares outstanding prior to the sale of the Shares to
the Underwriter, and all securities convertible into or exercisable or
exchangeable for Common Shares, are subject to valid, binding, and enforceable
agreements with the Underwriter (collectively, the "Lock-Up Agreements")
pursuant to which the holders thereof agree not to offer, sell, contract to
sell, distribute, grant any option, right, or warrant for the purchase of, or
pledge, hypothecate, make any short sale, or otherwise transfer or dispose of,
directly or indirectly, any of such Common Shares, or any securities convertible
into, or exercisable or exchangeable for, Common Shares, or any other Common
Shares acquired by them during the term of the Lock-Up Agreements (including
Shares purchased pursuant to the public offering thereof), for a period of 180
days after the date of the Prospectus without the prior written consent of the
Underwriter.
(af) The Company has not offered, or caused the Underwriter to offer,
Shares to any person pursuant to the Directed Share Program with the specific
intent to unlawfully influence: (i) a customer or supplier of the Company to
alter the customer's or supplier's level or type of business with the Company,
or (ii) a trade journalist or publication to write or publish favorable
information about the Company or its applications or services.
(ag) All documents delivered or to be delivered by the Company or any
of its representatives in connection with the issuance and sale of the Shares
were on the dates on which they were delivered, or will be on the dates on which
they are to be delivered, true, complete, and correct in all material respects.
Neither this Agreement nor any certificate, statement, or other document
delivered or to be delivered by the Company or any Subsidiary contains or will
contain any untrue statement of a material fact or omits or will omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading.
9
(ah) The Company has satisfied the conditions for the use of Form SB-2
with respect to the offering of the Shares for sale to the public.
Any certificate signed by any director or officer of the Company and
delivered to the Underwriter or to counsel for the Underwriter shall be deemed a
representation and warranty of the Company to the Underwriter as to the matters
covered thereby.
Any certificate delivered by the Company to its counsel for purposes of
enabling such counsel to render the opinion referred to in Section 7(d) will
also be furnished to the Underwriter and counsel for the Underwriter and shall
be deemed to be additional representations and warranties to the Underwriter by
the Company as to the matters covered thereby.
SECTION 3. TERMS OF PUBLIC OFFERING. The Company has been advised by
the Underwriter that the Underwriter proposes to make a public offering of the
Shares, on the terms and conditions set forth in the Registration Statement, as
soon after the Effective Date as the Underwriter deems it advisable to do so.
SECTION 4. PURCHASE, SALE AND DELIVERY OF SHARES.
(a) On the basis of the representations, warranties, and agreements
contained herein, but subject to the terms and conditions set forth herein, the
Company agrees to issue and sell to the Underwriter, and the Underwriter agrees
to purchase from the Company, the Firm Shares at the following purchase prices:
(i) $10.00 per share for each of the 500,000 Shares purchased and sold pursuant
to the Directed Share Program, (ii) $9.61 per share for 500,000 Shares, and
(iii) $9.15 per share for each remaining Share. The Underwriter agrees to offer
the Shares to the public as set forth in the Prospectus.
(b) At 10:00 a.m., Eastern Standard Time, on the fourth full business
day following the commencement of the initial public offering contemplated by
this Agreement, or at such other time not later than ten (10) full business days
following the date of this Agreement, as the Underwriter and the Company may
agree, the Company will deliver to the Underwriter at the offices of Carlton,
Fields, Xxxx, Xxxxxxxx, Xxxxx & Xxxxxx, P.A. ("Xxxxxxx Xxxxxx"), 000 Xxxxx
Xxxxxxx Xxxxxx Xxxxxxxxx, Xxxxx, Xxxxxxx 00000, or at such other location as is
specified by the Underwriter, certificates representing the Firm Shares to be
purchased by the Underwriter, against payment therefor by the Underwriter of the
purchase price therefor by wire transfer of same day funds payable to the order
of the Company for Firm Shares. Such time of delivery and payment is referred to
in this Agreement as the "First Closing Date."
(c) In addition, on the basis of the representations, warranties, and
agreements contained herein, but subject to the terms and conditions set forth
herein, the Company hereby grants to the Underwriter a one-time option (the
"Option") to purchase from the Company up to 172,500 Option Shares at a purchase
price of $9.15 per share, for use solely in covering any over-allotments made by
the Underwriter in the sale and distribution of the Firm Shares. The Option
granted hereunder may be exercised at any time (but not more than once) within
thirty (30) days after the date of this Agreement, upon notice by the
Underwriter to the Company which sets forth the aggregate number of Option
Shares to be purchased by the Underwriter, the names and denominations in which
the certificates for such shares are to be registered, and the time and place at
which such certificates will be delivered. Such time of delivery may not be
earlier than the First Closing Date and herein is called the "Second Closing
Date." The Second Closing Date shall be determined by the Underwriter and may be
the same as the First Closing Date, but if at any time other than the First
Closing Date, such Second Closing Date shall not be earlier than three nor later
than ten full business days after delivery of such notice to exercise.
10
(d) Certificates for the Firm Shares and the Option Shares shall be in
definitive form and shall be registered in such names and in such denominations
as the Underwriter shall request by written notice to the Company not later than
two business days prior to the First Closing Date or the Second Closing Date, as
the case may be. The Company agrees to make such certificates available for
inspection at least twenty-four (24) hours prior to the First Closing Date or
the Second Closing Date, as the case may be, at the offices of its designated
custodian, or at any other location designated by the Underwriter. The
certificates evidencing the Firm Shares and the Option Shares shall be delivered
to the Underwriter on the First Closing Date or the Second Closing Date, as the
case may be, for the account of the Underwriter, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriter duly paid,
against payment of the purchase price therefor.
The First Closing Date and the Second Closing Date are sometimes
referred to together in this Agreement as the "Closing Dates".
SECTION 5. COVENANTS OF THE COMPANY. In further consideration of the
agreements of the Underwriter herein contained, the Company covenants and agrees
with the Underwriter that:
(a) If any information shall have been omitted from the Registration
Statement in reliance upon Rule 430A under the Securities Act, the Company will
prepare and timely file with the Commission pursuant to Rule 424(b) under the
Securities Act a Prospectus in a form approved by the Underwriter containing the
Rule 430A Information.
(b) The Company will advise the Underwriter and counsel to the
Underwriter promptly, and, if requested by the Underwriter, will confirm such
advice in writing: (i) if information shall have been omitted from the
Registration Statement in reliance on Rule 430A under the Securities Act, (ii)
when the Prospectus or term sheet (as described in Rule 434(b) under the
Securities Act) has been timely filed pursuant to Rule 424(b) under the
Securities Act, (iii) when any post-effective amendment to the Registration
Statement or any Rule 462 Registration Statement is filed or becomes effective
under the Securities Act, (iv) of any request by the Commission for amendments
or supplements to the Registration Statement, any Preliminary Prospectus, or the
Prospectus, or for additional information, (v) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
of any notification of the suspension of qualification or registration of the
Shares for offer or sale in any jurisdiction or the initiation or threatening of
any proceedings for such purposes. If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration Statement or the
Prospectus, the Company will make every reasonable effort to obtain the
withdrawal of such order at the earliest possible time.
(c) The Company will not file any amendment to the Registration
Statement, file any Rule 462(b) Registration Statement, or make any amendment or
supplement to the Prospectus, or file any amendment or supplement to any of the
Applications if: (i) the Underwriter shall not have been previously advised of
such filing, been furnished with a copy thereof prior thereto, and given
reasonable opportunity to review such amendment or supplement, (ii) the
Underwriter shall reasonably object after having been so advised, or (iii) in
the case of a Registration Statement, Rule 462(b) Registration Statement, or
Prospectus, such amendment or supplement is not in compliance with the
Securities Act. The Company will prepare and file with the Commission any
amendments or supplements which, in the opinion of counsel for the Underwriter,
is necessary and advisable in connection with the distribution of the Shares by
the Underwriter.
(d) The Company will furnish to the Underwriter, without charge, eight
(8) signed copies of the Registration Statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits thereto, and such number of conformed copies of the Registration
Statement as originally filed and of each amendment thereto as the Underwriter
may reasonably request. The Company has
11
delivered to the Underwriter, without charge, in such quantities as the
Underwriter has requested, copies of each form of the Preliminary Prospectus.
The Company confirms its consent to the use, in accordance with the provisions
of the Securities Act and with the securities or Blue Sky Laws of the
jurisdictions in which the Shares are or have been offered by the Underwriter
and by dealers, prior to the date of the Prospectus, of each Preliminary
Prospectus so furnished by the Company.
(e) The Company will furnish to the Underwriter in Naples, Florida,
without charge, prior to 10:00 a.m., Eastern Standard Time on the business day
next succeeding the date of this Agreement and thereafter from time to time for
such period as in the opinion of counsel for the Underwriter a prospectus is
required by law to be delivered in connection with sales by the Underwriter or a
dealer, as many copies of the Prospectus and the Registration Statement, and of
any amendment or supplement thereto, as the Underwriter may reasonably request.
The Company shall comply with all requirements imposed on it by the Securities
Act, as now and hereafter amended, and by the Rules and Regulations, as from
time to time in force, so far as is necessary to permit the completion of the
distribution of the Shares as contemplated by this Agreement and the
Registration Statement and the Prospectus. If, during the period in which the
Prospectus is required by law to be delivered by the Underwriter or a dealer,
any event shall occur or condition exist as a result of which, in the judgment
of the Company or in the opinion of counsel for the Underwriter, it becomes
necessary to amend or supplement the Registration Statement or the Prospectus in
order to make the statements therein, in light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if, in the opinion of
counsel to the Underwriter, it is necessary to amend or supplement the
Prospectus to comply with the Securities Act or applicable law, the Company
promptly will prepare and file with the Commission an appropriate amendment or
supplement thereto, and will furnish to the Underwriter and to each dealer to
which Shares may have been sold by the Underwriter and to any other dealers upon
request, without charge, as many copies as the Underwriter may from time to time
reasonably request.
(f) The Company will make generally available to its security holders a
consolidated earnings statement, which need not be audited, as soon as it is
practicable to do so, but in any event not later than fifteen (15) months after
the effective date of the Registration Statement, covering a period of twelve
(12) consecutive calendar months beginning after the effective date of the
Registration Statement, which consolidated earnings statement will satisfy the
provisions of the last paragraph of Section 11(a) of the Securities Act and Rule
158 of the Rules and Regulations promulgated thereunder and will advise the
Underwriter in writing when such statement has been so made available.
(g) The Company shall take or cause to be taken in cooperation with the
Underwriter and counsel to the Underwriter all actions required to register or
qualify the Shares for offer and sale under the securities or Blue Sky Laws of
such jurisdictions as the Underwriter may reasonably designate and will make
such applications, file such documents, and furnish such information as may be
required for that purpose (provided, that the Company shall not be required to
qualify as a foreign corporation or to file a general consent to the service of
process in any jurisdiction where it is not now so qualified or required to file
a consent, except with respect to the offer and sale of the Shares), and will
continue such registrations or qualifications in effect so long as reasonably
requested by the Underwriter to effect the distribution of the Shares
(including, without limitation, the preparation and filing of such statements,
reports, or documents as may be so required and compliance with all undertakings
given pursuant to such registrations or qualifications). In the event that the
registration or qualification of the Shares in any jurisdiction is suspended,
the Company shall so advise the Underwriter in writing.
(h) During the period ending five years after the date of this
Agreement, the Company will furnish to the Underwriter: (i) as soon as
practicable after the end of each fiscal year, copies of the annual report
containing the consolidated audited financial statements of the Company, (ii) as
soon as available, a copy of each
12
report, document, and definitive proxy or information statement furnished to or
filed with any securities exchange or the NASD (including the Nasdaq Stock
Market, Inc., or any successor thereto) pursuant to the requirements of such
exchange or the NASD, or with the Commission under the Securities Act or the
Exchange Act, and (iii) copies of all other information or communications
(financial or other) furnished to shareholders of the Company.
(i) The Company shall apply the proceeds from the sale of the Shares to
be sold by it hereunder as set forth in the Prospectus under the heading "Use of
Proceeds" and shall file with the Commission, and will furnish or cause to be
furnished to the Underwriter and counsel to the Underwriter, such reports as may
be required in accordance with Rule 463 under the Securities Act.
(j) Except for the sale of Common Shares pursuant to this Agreement,
neither the Company nor any Subsidiary shall, directly or indirectly, offer,
sell, pledge, contract to sell, issue, distribute, grant or sell any option,
right, or warrant to purchase or otherwise dispose of any Common Shares or
securities convertible into, or exercisable, or exchangeable for, Common Shares
or a derivative of the Common Shares (or an agreement for such) in the open
market or otherwise, for a period of one-hundred eighty days (180) days after
the later of the Effective Date or the date of this Agreement, without the
express prior written consent of the Underwriter.
(k) The Company will not, directly or indirectly, take any action
designed, or which might reasonably be expected to cause or result in or
constitute, under the Securities Act or otherwise, stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Shares.
(l) The Company has (i) caused each director, officer, and current
shareholder of the Company to furnish to the Underwriter, on or before the date
of this Agreement, the Lock-Up Agreements, and (ii) issued stop-transfer
instructions to the transfer agent for the Common Shares with respect to the
Common Shares that are or will be subject to such Lock-Up Agreements, which
stop-transfer instructions shall restrict the transfer of such shares prior to
expiration of the 180-day period specified in the Lock-Up Agreements.
(m) During the period that a prospectus is required by law to be
delivered in connection with sales of the Shares by the Underwriter or a dealer,
the Company will not, directly or indirectly hold any press conference with
respect to the Company, or its financial condition, results of operations,
business, properties, assets, or prospects, or this offering, without the
express written consent of the Underwriter.
(n) The Company shall not invest or otherwise cause the use of proceeds
received by the Company from its sale of the Shares, or otherwise conduct its
business, in such a manner as would require the Company or any Subsidiary to
register as an investment company under the Investment Company Act of 1940, as
amended.
(o) The Company will not prior to the Second Closing Date, if any, (i)
except as specifically described in the Prospectus, acquire any of the Common
Shares, or declare or pay any dividend or make any other distribution upon its
Common Shares payable to shareholders of record on a date prior to the Second
Closing Date, or (ii) incur any material liability or obligation, direct or
contingent, or enter into any material transaction other than in the ordinary
course of business, or any transaction with a related party which is required to
be disclosed in the Prospectus pursuant to Item 404 of Regulation S-B under the
Securities Act.
(p) The Company will maintain a transfer agent and, if necessary under
the jurisdiction of incorporation of the Company, a registrar for the Common
Shares.
(q) In connection with the Directed Shares Program, the Company will
ensure that the Directed Shares will be restricted to the extent required by the
NASD or the NASD rules from sale, transfer, assignment,
13
pledge, or hypothecation for a period of three months following the Effective
Date. The Underwriter will notify the Company as to which Participants are
required to be restricted. The Company will direct the transfer agent to place
stop transfer restrictions upon such securities for such period of time.
(r) The Company shall comply in all respects with the provisions of all
undertakings contained in the Registration Statement and the undertakings given
by the Company in connection with the registration or qualification of the
Shares for offering and sale under the Blue Sky Laws.
(s) The Company will use its best efforts to satisfy or cause to be
satisfied the conditions to the obligations of the Underwriter in Section 7
hereof.
(t) The Company shall deliver the requisite notice of issuance to the
NASD and shall take all necessary and appropriate action to cause or permit the
quotation and listing of the Common Shares on the OTC Bulletin Board for a
period of at least 36 months, except to the extent during such period that the
Common Shares are listed on a national securities exchange or the Nasdaq Stock
Market.
(u) The Company will advise the Underwriter promptly of and, when
applicable, furnish copies of, any communications with the FRB, OCC, or FDIC
relating to the Applications or the Regulatory Approvals.
(v) During the period ending five years after the date of this
Agreement, the Company shall grant the Underwriter with a right of first refusal
to serve as the Company's underwriter in connection with the sale of any
securities by the Company or any of its Subsidiaries or affiliates, whether or
not currently existing, and to act as a financial advisor thereto in connection
with any of the following transactions involving the Company or any of its
Subsidiaries or affiliates: (i) a merger, consolidation, reorganization,
recapitalization, restructuring, business combination, or other similar
transaction, (ii) the acquisition of controlling interest of 20% or more of
another company, entity, or business thereof, (iii) the disposition of a
controlling interest of 20% or more of any of the Company or any of its
Subsidiaries or affiliates, whether or not currently existing, (iv) the purchase
or lease of all or substantially all of the assets of another company, entity,
or business thereof, (v) the sale or lease of all or substantially all of the
assets of the Company or any of its Subsidiaries or affiliates, or (vi) an
option to engage in any of the transactions set forth in Sections 5(v)(i)
through 5(v)(v).
(w) The Company shall supply the Underwriter and counsel to the
Underwriter, at the Company's cost, with a bound volume of the Underwriting
materials within a reasonable time after the last Closing Date.
SECTION 6. PAYMENT OF EXPENSES AND FEES.
(a) Whether or not the transactions contemplated hereunder are
consummated or this Agreement is terminated for any reason, the Company agrees
to pay or cause to be paid all costs, fees, and expenses incurred in connection
with, or incident to the performance of the Company's obligations under this
Agreement, including: (i) the fees, disbursements, and expenses of the Company's
accountants and counsel incurred in connection with the registration and
delivery of the Shares under the Securities Act, (ii) the fees, expenses, and
costs associated with the preparation, filing with the Commission, printing, and
distribution (including costs of mailing, packaging, and shipping copies thereof
to the Underwriter and dealers) of the Registration Statement, each Preliminary
Prospectus, and the Prospectus (including all exhibits and financial statements
thereto, and any amendments and supplements to any of the foregoing); (iii) the
cost of preparing, printing, and authenticating certificates representing the
Shares, and all costs and expenses related to the transfer and delivery of the
Shares to the Underwriter, including any stamp, transfer, or other taxes payable
thereon; (iv) all costs and expenses in connection with the registration and
qualification of the Shares for offer and sale under state securities and Blue
Sky Laws, including filing fees and legal fees and disbursements of counsel for
the Underwriter incurred in
14
connection with such registration and qualifications and in connection with the
preparation of the preliminary and supplemental Blue Sky memoranda (such legal
fees, exclusive of disbursements, not to exceed $15,000), (v) the costs of
printing (or reproducing) and delivery of this Agreement, the preliminary and
supplemental Blue Sky Memoranda, the Selected Dealer Agreements, and all other
agreements and documents printed (or reproduced) and delivered in connection
with the offering of the Shares; (vi) all filing fees, and legal fees and
disbursements of counsel to the Underwriter incurred in connection with the
review and qualification of the offering of the Shares by the NASD; (vii) to the
extent appropriate, the fees and expenses related to the approval and quotation
of the Shares on the OTC Bulletin Board; (viii) the costs and charges of any
transfer agent, registrar, or depositary; (ix) transportation, accommodations,
and other expenses incurred by or on behalf of the Underwriter in connection
with the presentations to prospective purchasers of the Shares; (x) conditioned
upon the occurrence of the First Closing, the preparation, printing, and
distribution of one bound volume of the closing documents for each of the
Underwriter and its counsel; and (xi) all other costs incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section 6. It is understood, however, that except as
provided in this Section 6(a), and in Sections 6(b) and 6(c), and in Section 9
entitled "Indemnification and Contribution", the Underwriter will pay all of its
costs and expenses, including fees and disbursements of its counsel, stock
transfer taxes payable on resale of any of the Shares by it, and any advertising
expenses connected with any offers the Underwriter may make.
(b) It is understood that, conditioned upon the occurrence of the First
Closing, the Company shall reimburse the Underwriter for its expenses on a
nonaccountable basis in an amount equal to $45,000 with respect to the sale of
the Firm Shares, which amount shall be paid to the Underwriter on the First
Closing Date, and, to the extent the Option is exercised, an additional amount
equal to 3% of the gross proceeds from the sale of the Option Shares, which
additional amount shall be paid to the Underwriter on the Second Closing Date.
(c) If this Agreement shall be terminated by the Underwriter because of
the conditions in Section 7 of this Agreement are not satisfied, or because this
Agreement is terminated by the Underwriter pursuant to Section 10 of this
Agreement, or by reason of the failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement,
then the Company will reimburse the Underwriter for out-of-pocket expenses
(including fees and disbursements of counsel for the Underwriter) reasonably
incurred by the Underwriter or counsel to the Underwriter in connection with
this Agreement or the offering contemplated hereunder; PROVIDED, HOWEVER, that
reimbursement pursuant to this Section 6(c) shall be limited to an aggregate of
$35,000.
SECTION 7. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITER. The
obligations of the Underwriter under this Agreement to purchase the Shares on
each Closing Date shall be subject to the accuracy of the representations and
warranties on the part of the Company set forth herein as of the date hereof, as
of the First Closing Date, and if applicable, as of the Second Closing Date, as
the case may be, to the accuracy of the statements of the Company's directors
and officers made pursuant to the provisions hereof, to the performance and
compliance by the Company of its agreements and obligations hereunder, and to
the following additional conditions, except to the extent expressly waived in
writing by the Underwriter:
(a) The Registration Statement and all post-effective amendments
thereto shall have been declared effective by the Commission not later than 5:30
p.m. Eastern Standard Time on the date of this Agreement, or such later time as
shall have been consented to by the Underwriter, and all filings required by
Rule 424(b) and Rule 430A under the Securities Act shall have been timely filed
with the Commission in compliance with the Rules and Regulations, and any
request of the Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been disclosed
to the Underwriter and complied with to the Underwriter's satisfaction. No stop
order suspending the effectiveness of the Registration Statement or any
amendment or supplement thereto shall have been issued and no proceeding for
that purpose
15
shall have been initiated or shall be pending, or, to the knowledge of the
Company, threatened or contemplated by the Commission, and no restraining order,
or order of any nature by a federal or state court of competent jurisdiction
shall have been issued which would or purports to prevent the issuance of the
Shares.
(b) Subsequent to the execution and delivery of this Agreement and
prior to each Closing Date, there shall not have occurred any change, or any
development involving, or which might reasonably be expected to involve, a
prospective change, in the ability of the Company or any Subsidiary to conduct
their respective businesses (whether by reason of any court, legislative, other
governmental action, order, decree, or otherwise), or in the general affairs,
condition (financial and otherwise), business, prospects, properties,
management, financial position or earnings, results of operations, or net worth
of the Company or any Subsidiary, whether or not arising from transactions in
the ordinary course of business that, in the Underwriter's judgment, is material
and adverse and makes it, in the Underwriter's judgment, impracticable to market
the Shares on the terms and in the manner contemplated by the Prospectus.
(c) The Underwriter shall have received on each Closing Date, a
certificate of the chief executive officer of the Company, dated as of the First
Closing Date or the Second Closing Date, as the case may be, to the effect that:
(i) The Registration Statement has been declared effective by
the Commission under the Securities Act and no stop order suspending the
effectiveness of the Registration Statement has been issued, and no proceeding
for such purpose is pending, or, to the knowledge of the respective signatories,
threatened or contemplated by the Commission.
(ii) The representations and warranties of the Company set
forth in this Agreement are true and correct as of the date of this Agreement
and as of the First Closing Date or the Second Closing Date, as the case may be,
and the Company has complied with all of the covenants and agreements and
satisfied in all respects all of the conditions to be performed or satisfied by
it on or prior to each such Closing Date.
(iii) Except as set forth in the Registration Statement or the
Prospectus, since the respective dates of the Registration Statement and
Prospectus, neither the Company nor any Subsidiary shall have incurred any
liability or obligation, direct or contingent, neither of them shall have
entered into any material transaction, there shall not have been any change in
the capital stock or other securities of the Company nor any material increase
in the short-term or long-term debt of the Company from that set forth or
contemplated in the Registration Statement or the Prospectus (or any amendment
or supplement thereto).
(iv) Each of the respective signatories of the certificate has
carefully examined the Registration Statement, the Prospectus, and any
amendments or supplements thereto, and such documents contain all statements and
information required to be made therein, and neither the Registration Statement,
the Prospectus, nor any amendment or supplement thereto includes any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and,
since the date on which the Registration Statement was initially filed, no event
has occurred that was required to be set forth in an amended or supplemented
prospectus or in an amendment to the Registration Statement that has not been so
set forth; provided, however, that no representation need be made as to
information contained in or omitted from the Registration Statement or any
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Underwriter.
(v) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been any
material adverse change in the conditions (financial or otherwise) of the
Company or any Subsidiary, or any development involving a prospective material
adverse
16
change in the condition (financial or other) of the Company or any Subsidiary or
affecting their businesses (resulting from litigation or otherwise), properties,
net worth, prospects, or results of operations of the Company or any Subsidiary,
whether or not arising from transactions in the ordinary course of business.
(d) The Underwriter shall have received on each Closing Date an opinion
of Xxxxx, Xxxxxxxx & Xxxxxxx, LLP, Atlanta, Georgia, counsel for the Company, in
form reasonably satisfactory to the Underwriter and counsel for the Underwriter,
addressed to the Underwriter and dated as of the First Closing Date or the
Second Closing Date, as the case may be, to the effect that:
(i) The Company has been duly incorporated, is validly
existing as a corporation with active status under the laws of the State of
Florida, and has full power and authority (corporate and other) to own, lease,
and operate its properties and to conduct its business as described in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto); based upon a review of standard compilations of state corporation and
bank regulatory laws and certificates of officials in such jurisdictions, the
Company is duly qualified to do business as foreign corporation under the
corporation and banking laws of, and is in good standing as such in, each
jurisdiction in which the conduct of its business or where the nature of its
properties requires such registration or qualification, except where the failure
to so register or qualify would not have a Material Adverse Effect; and the
Company is duly registered and in good standing under the BHCA and is a member
in good standing of the Federal Reserve System.
(ii) The Company, prior to the First Closing Date, does not
have any Subsidiaries and does not, directly or indirectly, own any equity
interest in, or control, any corporation, limited liability company,
association, partnership, joint venture, trust, proprietorship, or other
commercial or business entity or organization, except that the Company has the
sole right to acquire all of the outstanding capital stock of the Bank, and upon
acquisition of such stock the Bank will be the Company's only Subsidiary. Upon
contribution to the Bank of the net proceeds from the sale of the Firm Shares as
described in the Prospectus, and the issuance by the Bank of its capital stock
after receipt thereof, and at all times subsequent thereto and as of the Second
Closing Date, if any, all of the outstanding capital stock of the Bank (a) will
have been issued to the Company, (b) when issued to the Company, will have been
duly authorized, validly issued, fully paid and nonassessable, and (c) will be
owned beneficially and of record by the Company, free and clear of any claim,
lien, encumbrance, security interest, or restriction on transfer. Subject to the
receipt of such capital contribution by the Company to the Bank, and
satisfaction of the conditions set forth in the Bank Approvals, the Bank will be
or is duly organized and validly existing as a nationally chartered banking
association in good standing under the laws of the United States of America and
the State of Florida, with full power and authority (corporate and other) to
own, lease, and operate its properties and conduct its business as described in
the Registration Statement, the Prospectus, the Application, and the Regulatory
Approvals. The Bank is not, and will not be required to register or qualify to
do business as a foreign corporation under the laws of any jurisdiction, and is
not, and will not be, subject to any current formal arrangements or memorandum
of understanding with, or cease and desist order by, any bank regulatory agency.
(iii) As of the time each Application was filed with the
respective bank regulatory authorities (FRB, OCC, or FDR) and as of each Closing
Date: (A) to the knowledge of such counsel, each such Application conformed in
all material respects to the applicable respective requirements of the BHCA, the
NBA, and the FDIA and the rules and regulations promulgated thereunder, and (B)
to the knowledge of such counsel after due investigation, as of such times, none
of the Applications contained an untrue statement of a material fact or omitted
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances in which they were
made, not misleading.
17
(iv) The Company has received the FRB Approval and the Bank
has received the Bank Approvals and, to the knowledge of such counsel after due
investigation, as of the date hereof and as of each Closing Date: (A) all such
Regulatory Approvals are in full force and effect, and no actions to suspend,
revoke, or terminate any of such Regulatory Approvals has been taken, have been
initiated or are pending, threatened, or contemplated by any of the FRB, the
OCC, or the FDIC; (B) neither the Company nor the Bank is in breach or default
under any condition or of any commitment contained in any of such Regulatory
Approvals; and (C) each of the Company and the Bank has satisfied all conditions
precedent to such Regulatory Approvals which can be satisfied thereunder by them
as of such date.
(v) The authorized, issued, and outstanding capital stock of
the Company is as set forth under the caption "Capitalization" in the
Prospectus, and the Common Shares conform to the descriptions thereof contained
in the Registration Statement and Prospectus. The certificates for the Shares to
be delivered hereunder are in due and proper legal form and, when duly
countersigned by the Company's transfer agent and delivered to the Underwriter
or upon the order of the Underwriter in accordance with this Agreement, will
comply in all material respects with the requirements of the Florida Business
Corporation Act, and the Company's articles of incorporation and bylaws.
(vi) The Common Shares issued and outstanding prior to the
issuance of the Firm Shares or the Option Shares, as the case may be, to be sold
by the Company hereunder have been duly authorized and validly issued, are fully
paid and nonassessable. There are no preemptive, preferential, or other rights
(including rights of first refusal) to subscribe for or to purchase any of the
Common Shares and no Common Shares have been issued in violation of such rights,
nor are there any restrictions upon the voting or transfer of any Common Shares
pursuant to the Company's articles of incorporation, bylaws, other governing
documents, or any agreement or other instrument to which the Company or any
Subsidiary is a party or by which any of them is bound.
(vii) The Firm Shares or the Option Shares, as the case may
be, to be sold by the Company hereunder have been duly authorized and, when
issued and paid for against delivery thereof in accordance with the terms of
this Agreement, will be validly issued, fully paid and nonassessable, and the
issuance of the Shares will not be in violation of, or subject to, any statutory
preemptive, preferential, or, to the knowledge of such counsel, other rights
(including rights of first refusal) to subscribe for or to purchase such Shares,
nor are there any restrictions on the voting or transfer of such Shares under
the Company's articles of incorporation, bylaws, or other governing documents.
(viii) Except as set forth in the Prospectus, neither the
Company nor any Subsidiary has any outstanding options to purchase, or warrants
to subscribe for, or any securities or obligations convertible or exchangeable
into, or any contracts or commitments to issue or sell, any capital stock or any
such options, warrants, convertible or exchangeable securities, or obligations,
or rights of any description, contractual or otherwise, entitling any person to
receive any class of security of the Company or any Subsidiary. No holder of any
securities of the Company or any Subsidiary or any other person has the right,
contractual or otherwise, to cause the Company to have any such securities
included in the Registration Statement or to register any securities of the
Company or any Subsidiary under the Securities Act or applicable Blue Sky Laws.
(ix) The Registration Statement has been declared effective
under the Securities Act, and to the knowledge of such counsel after
investigation, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted, are pending, threatened, or contemplated. All filings required by
Rule 424 and Rule 430A under the Securities Act have been made in the manner and
within the time period required by such rules and, at the Effective Date and at
each Closing Date, the Registration Statement, the Prospectus, and each
amendment or supplement thereto comply or
18
will have complied as to form in all material respects with the requirements of
the Securities Act and the Rules and Regulations (except that counsel shall
express no opinion as to the financial statements and other statistical or
financial data derived therefrom), and no amendments to the Registration
Statement are required to be filed.
(x) Such counsel has participated in the preparation of the
Registration Statement and the Prospectus, including review of and discussion of
the contents thereof, and no facts have come to the attention of such counsel
which lead it to believe that either the Registration Statement, the Prospectus,
or any amendment or supplement thereto, as of their respective effective or
issue dates, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, as amended or
supplemented, if applicable, as of the First Closing Date or the Second Closing
Date, as the case may be, contains any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances under
which made (except, in each case, for the financial statements, notes and
related schedules, and other statistical or financial data included therein, as
to which such counsel need express no opinion).
(xi) The Company has requisite power and authority (corporate
and other) to execute, deliver, and perform this Agreement and to issue, sell,
and deliver the Shares to be sold by it to the Underwriter as provided herein.
The execution and delivery of this Agreement, and the performance by the Company
of its obligations hereunder and consummation of the transactions described
herein, have been duly and validly authorized by the Company, and this Agreement
has been duly executed and delivered by the Company, and constitutes a legal,
valid, and binding obligation of the Company and is enforceable against the
Company in accordance with its terms (except in all cases (i) to the extent that
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, moratorium, or similar laws affecting the
enforcement of creditor rights and remedies generally, (ii) that the
availability of the equitable remedy of specific performance and injunctive
relief is subject to the discretion of the court before which the proceeding may
be brought, and (iii) that the enforceability of the indemnification and
contribution provisions hereof may be limited under applicable federal or state
or other securities laws or the public policy underlying such laws.).
(xii) The execution and delivery by the Company of, and the
performance by the Company of its obligations hereunder (including the offer,
sale, or delivery of the Shares) and consummation of the transactions
contemplated by this Agreement will not (A) conflict with, violate, or
contravene any provision of the articles of incorporation, bylaws, or other
governing documents of the Company or any Subsidiary, (B) to the knowledge of
such counsel, violate, conflict with, constitute a breach of, or a default under
any provision of any agreement, contract, mortgage, deed of trust, lease, loan
agreement, indenture, note, bond or other evidence of indebtedness, or any other
material agreement or instrument to which the Company or any Subsidiary is a
party or by which any of them is bound, or to which any of their properties is
subject, or (C) result in a violation of any statute, law, ordinance, rule,
regulation, or any ruling, order, writ, injunction, judgment, or decree of any
court or any governmental, regulatory, or administrative agency, or commission,
authority, or other body, domestic or foreign, having jurisdiction over the
Company, any Subsidiary, or any of their respective properties, except those, if
any, described in the Registration Statement or the Prospectus.
(xiii) No consent, approval, filing, authorization,
registration, qualification, or order of or with any court or governmental
agency or body (including with or by any bank regulatory agency) is required for
the execution and delivery of this Agreement, and performance by the Company of
its obligations under this Agreement, including the issue and sale of the
Shares, or in connection with the consummation of the transactions contemplated
in this Agreement, except (A) as have been obtained under the Securities Act or
the Exchange Act, or (B) as may be required under state securities or Blue Sky
Laws governing the purchase and distribution of the Shares by the Underwriter
(as to which such counsel shall not express an opinion);
19
(xiv) The statements (A) in the Prospectus under "Risk
Factors- Need to Obtain Regulatory Approvals", "- Governmental Regulation and
Monetary Policy", "- Anti-Takeover Provisions", "Dividend Policy", "Management -
Employment Agreement", "- Stock Option Agreement", and "- Stock Option Plan",
"Supervision and Regulation", "Description of Capital Stock", and "Shares
Eligible for Future Sale", and (B) in the Registration Statement in Item 24, in
each case insofar as such statements constitute summaries of legal matters,
documents, or proceedings referred to therein, fairly present the information
called for with respect to such legal matters, documents, and proceedings and
fairly summarize the matters referred to therein;
(xv) To such counsel's knowledge after due investigation and
inquiry (A) there is no litigation or any legal, regulatory, or governmental
proceedings, actions, or investigations pending or threatened to which the
Company or any Subsidiary is or may be a party or to which any of their
properties is or may be subject, or any statutes, regulations, or rules, that
are required to be described or disclosed in the Registration Statement or the
Prospectus that are not so described or disclosed as required, and (B) there are
no agreements, contracts, indentures, leases or other documents or instruments
required to be described, summarized, or otherwise disclosed in the Registration
Statement or the Prospectus or to be filed as an exhibit to the Registration
Statement that has not been so described, summarized, disclosed, or filed.
(xvi) Neither the Company nor any Subsidiary is, nor with the
giving of notice or the lapse of time, or both, would be (A) in conflict with or
in violation of its articles of incorporation, bylaws, or other corporate
governance documents, or (B) in violation of breach of, or in default in the
performance of any obligation, agreement, or condition contained in any
provision of any loan agreement, indenture, note, bond, other evidence of
indebtedness, or of any agreement, lease, deed of trust, contract, or other
material agreement or instrument to which the Company or any Subsidiary is a
party or by which any of them or any of their assets or properties are bound or
affected.
(xvii) The Company and each Subsidiary have and hold, and are
in substantial compliance with, all Permits required under all laws, rules, and
regulations in connection with their respective businesses, and all of such
Permits are valid and in full force and effect; and there is no pending
proceeding, and neither the Company nor any Subsidiary has received notice of
any threatened proceeding, relating to the revocation or modification of any
such Permit. Neither the Company nor any Subsidiary is or has been (by virtue of
any action, omission to act, contract to which it is a party or by which it is
bound, or any occurrence or state of facts whatsoever) in violation of any law,
rule, regulation, or any order, writ, injunction, or decree to which the Company
or any of its Subsidiaries may be subject (including those relating to any
aspect of banking, bank holding companies, environmental protection,
occupational safety and health, and equal employment practices) heretofore or
currently in effect, except any such violation that has been fully cured or
satisfied without recourse or that is not reasonably likely to have a Material
Adverse Effect;
(xviii) The Company is not an "investment company" or a
company "controlled" by an "investment company," within the meaning of the
Investment Company Act and, upon its receipt of the net proceeds from the sale
of the Shares and the application thereof in accordance with the description
thereof set forth in the Prospectus, will not become or be deemed to be an
"investment company" thereunder; and
(xix) To the knowledge of such counsel, the conditions for use
of Form SB-2 have been satisfied with respect to the Registration Statement.
In rendering such opinion such counsel may rely as to factual
matters on certificates of officers of the Company and of state officials and,
as to legal matters in jurisdictions other than those in which it is domiciled,
on opinions of local counsel, in each case satisfactory to the Underwriter, in
which case their opinion
20
shall state that they are so doing and copies of such certificates or opinions
will be attached to their opinion unless such certificates or opinions or the
information therein has been furnished to the Underwriter in other form.
(e) The Underwriter shall have received an opinion of Xxxxxxx Xxxxxx,
counsel for the Underwriter, dated the First Closing Date or the Second Closing
Date, as the case may be, with respect to the issuance and sale of the Shares by
the Company, the Registration Statement, and other related matters as the
Underwriter may reasonably require, and the Company shall have furnished to such
counsel such documents and shall have exhibited to them such papers and records
as they reasonably request for the purpose of enabling them to pass upon such
matters.
(f) The Underwriter shall have received, on each of the date of this
Agreement, the First Closing Date, and the Second Closing Date, as the case may
be, a letter addressed to the Underwriter, from Xxxx Xxxxx & Xxxx, Inc., the
Company's independent accountants, the first letter to be dated the date of this
Agreement, the second letter to be dated the First Closing Date, and the third
letter (in the event of a Second Closing) to be dated the Second Closing Date,
which shall be in form and substance reasonably satisfactory to the Underwriter
and shall contain information of the type ordinarily included in accountants'
"comfort letters" with respect to the financial statements and certain financial
information contained in the Prospectus, which information shall be as of a date
within five days of the date of such letter; provided, however, that the letters
delivered on each Closing Date shall use a "cut-off date" not earlier than the
date of this Agreement. There shall not have been any change or decrease set
forth in any letter referred to in this Section 7(f) that makes it impracticable
or inadvisable in the judgment of the Underwriter to proceed with the public
offering or purchase of the Shares as contemplated hereby.
(g) As of the First Closing Date, the Bank will have received the
Charter Approval and Deposit Insurance Approval (together, the "Bank Approvals")
from the OCC and the FDIC, respectively, and the Company will have received the
FRB Approval from the FRB, and as of each Closing Date (i) the Regulatory
Approvals will be in full force and effect and no action to suspend, revoke, or
terminate any of the Regulatory Approvals will have been taken, or proceedings
for such purposes initiated or threatened, by the FRB, the OCC, or the FDIC,
(ii) neither the Bank nor the Company will be in breach or default under any
condition precedent of or commitment contained in any of the Regulatory
Approvals that can be satisfied as of such date, and (iii) the Bank and the
Company will have satisfied their respective conditions precedent to the
Regulatory Approvals that can be satisfied as of such date.
(h) The Company shall have furnished to the Underwriter such further
certificates and documents as the Underwriter may reasonably request (including
certificates of officers of the Company).
(i) The Shares shall have been qualified or registered for sale, or
subject to an available exemption from such qualification or registration, under
the Blue Sky Laws of such jurisdictions as shall have been reasonably specified
by the Underwriter and the offering shall have been cleared by the NASD.
(j) The Lock-Up Agreements shall have been delivered to the Underwriter
on or before the date of this Agreement and shall be in full force and effect on
each Closing Date.
All of the agreements, opinions, certificates, letters, and documents
mentioned above or elsewhere in this Agreement shall be deemed to be in
compliance with the provisions of this Agreement only if they are satisfactory
in form and substance to the Underwriter and to Xxxxxxx Xxxxxx, counsel for the
Underwriter. The Company shall furnish the Underwriter with such manually signed
or conformed copies of such opinions, certificates, letters, and other documents
as the Underwriter shall reasonably request. If any condition to the
21
Underwriter's obligations hereunder which are to be satisfied prior to or at
either Closing Date and is not so satisfied when and as required by this
Agreement, this Agreement at the election of the Underwriter will terminate upon
notification to the Company without liability on the part of the Underwriter,
except to the extent provided in Section 8 of this Agreement, and the Company
shall pay those expenses required under Section 6 hereof in connection with any
such termination.
SECTION 8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless the Underwriter and each person, if any, who
controls the Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages, expenses, liabilities, or actions in respect thereof
("Claims") to which such Underwriter or each such controlling person may become
subject under the Securities Act, the Exchange Act, the Rules and Regulations,
Blue Sky Laws, or other federal or state statutory laws or regulations, at
common law or otherwise (including payments made in settlement of any
litigation, if such settlement is effected with the written consent of the
Company, which consent shall not be unreasonably withheld), insofar as such
Claims arise out of or are based upon the inaccuracy or breach of any
representation, warranty, or covenant of the Company contained in this
Agreement, 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 in any application filed
under any Blue Sky Law or other document executed by the Company for that
purpose or based upon written information furnished by the Company and filed in
any state or other jurisdiction to qualify or register any or all of the Shares
under the securities laws thereof (any such document, application, or
information being hereinafter called a "Blue Sky Application"), or arise out of
or are based upon the omission or alleged omission to state in any of the
foregoing a material fact required to be stated therein or necessary to make the
statements therein not misleading. The Company agrees to reimburse the
Underwriter and each such controlling person for any legal fees or other
expenses incurred by the Underwriter or any such controlling person in
connection with investigating or defending any such Claim or appearing as a
third-party witness in connection with any such Claim; provided, however, that
the Company will not be liable in any such case to the extent that:
(i) Any such Claim arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto or in any Blue Sky Application in reliance upon
and in conformity with the written information furnished by or on behalf of the
Underwriter to the Company expressly for use therein pursuant to Section 13 of
this Agreement; or
(ii) Such statement or omission was contained or made in any
Preliminary Prospectus and corrected in the Prospectus and (1) any such Claim
suffered or incurred by the Underwriter (or any person who controls the
Underwriter) resulted from an action, claim, or suit by any person who purchased
Shares that are the subject thereof from such Underwriter in the offering, and
(2) such Underwriter failed to deliver a copy of the Prospectus (as then amended
if the Company shall have amended the Prospectus) to such person at or prior to
the confirmation of the sale of such Shares, in any case where such delivery is
required by the Securities Act, unless such failure was due to failure by the
Company to provide copies of the Prospectus (as so amended) to the Underwriter
as required by this Agreement.
(b) The Underwriter agrees to indemnify and hold harmless the Company,
each of its directors, each of its officers who signs the Registration
Statement, and each person who controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all Claims to which the Company, or any such director, officer,
or controlling person, may become subject under the Securities Act, the Exchange
Act, the Rules and Regulations, Blue Sky Laws, or other federal or state
statutory laws or regulations, at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Underwriter and such consent shall not be unreasonably
22
withheld), insofar as such Claim arises out of or is based upon any untrue 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 in any Blue Sky Application, or arises out of or is 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 each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, or in any Blue Sky Application, in reliance
upon and in conformity with the written information furnished by the Underwriter
to the Company pursuant to Section 13 of this Agreement. The Underwriter will
reimburse any legal fees or other expenses reasonably incurred by the Company,
or any such director, officer, or controlling person in connection with
investigating or defending any such claim, and from any and all Claims resulting
from failure of the Underwriter to deliver a copy of the Prospectus, if the
person asserting such Claim purchased Shares from the Underwriter and a copy of
the Prospectus (as then amended if the Company shall have amended the
Prospectus) was not sent or given by or on behalf of the Underwriter to such
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Shares to such person, and if the Prospectus (as
so amended) would have cured the defect giving rise to such Claim (unless such
failure was due to a failure by the Company to provide sufficient copies of the
Prospectuses (as so amended) to the Underwriter). The indemnification
obligations of the Underwriter as provided above are in addition to any
liabilities the Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under Section 8(a)
or 8(b) of this Agreement of notice of the commencement of any action in respect
of a Claim, such indemnified party will, if a Claim for indemnification under
this Section 8 in respect thereof is to be made against an indemnifying party
under such subsection, notify the indemnifying party in writing of the
commencement thereof. In case any such action is brought against any indemnified
party, and such indemnified party notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate in
and, to the extent that it may wish, jointly with all other indemnifying
parties, similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to the indemnified party and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defense and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties.
(d) Upon receipt of notice from the indemnifying party to such
indemnified party of the indemnifying party's election to assume the defense of
such action and upon approval by the indemnified party of counsel selected by
the indemnifying party, the indemnifying party will not be liable to such
indemnified party under Section 8(a) or 8(b) of this Agreement for any legal
fees or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless:
(i) the indemnified party shall have employed separate counsel
in connection with the assumption of legal defenses in accordance with the
proviso to the last sentence of Section 8(c) of this Agreement (it being
understood, however, that the indemnifying party shall not be liable for the
legal fees and expenses of more than one separate counsel, approved by the
Underwriter, if the Underwriter or its controlling persons are the indemnified
parties);
(ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after the indemnified party's notice to the
indemnifying party of commencement of the action; or
23
(iii) the indemnifying party has authorized the employment of
counsel at the expense of the indemnifying party.
(e) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding regarding any Claim in respect of which 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 action, suit or
proceeding.
(f) To the extent that the indemnification provided for in this Section
8 is unavailable to an indemnified party or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) of this Agreement in respect of any
Claim referred to therein, then each indemnifying party, in lieu of indemnifying
such indemnified party, shall, subject, to the limitations hereinafter set
forth, contribute to the amount paid or payable by such indemnified party as a
result of such Claim:
(i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party on the one hand and the
indemnified party on the other hand from the offering of the Shares; or
(ii) if the allocation provided by Section 8(f)(i) is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in Section 8 (f)(i), but also the
relative fault of the indemnifying party on the one hand and the indemnified
party on the other hand in connection with the statements or omissions that
resulted in such Claim, as well as any other relevant equitable considerations.
The respective relative benefits received by the Company on the one
hand and the Underwriter on the other hand in connection with the offering of
the Shares shall be deemed to be in such proportion so that the Underwriter is
responsible for that portion of a Claim represented by the percentage that the
amount of the underwriting discount per share as set forth in Section 4 hereof
bears to the initial public offering price per share appearing on the cover page
of the Prospectus, and the Company (including the Company's directors, officers,
and controlling persons) shall be responsible for the remaining portion of such
Claim.
The relative fault of the Company on the one hand and the Underwriter
on the other hand 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 the Company on the one hand or the Underwriter on the other hand and
the parties' relative intent, knowledge, access to information, and opportunity
to correct or prevent such untrue statement or omission. The amount for
indemnification paid or payable by a party as a result of the Claims referred to
above shall be deemed to include, subject to the limitations set forth in
Sections 8(c) and 8(d) of this Agreement, any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or defending
any action or claim.
(g) The Company and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 8 were determined by PRO RATA
or per capita allocation or by any other method or allocation that does not take
into account the equitable considerations referred to in Section 8(f) of this
Agreement. Notwithstanding the other provisions of this Section 8, the
Underwriter shall not 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 which the Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission
24
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(h) The obligations of the Company and the Underwriter under this
Section 8 shall be in addition to any liability that the Company or the
Underwriter may otherwise have.
SECTION 9. EFFECTIVE DATE. This Agreement shall become effective
immediately upon the execution and delivery hereof by the parties hereto. Such
execution and delivery shall include delivery of an executed copy of this
Agreement by telecopier, facsimile transmission, or other means of transmitting
written documents.
SECTION 10. TERMINATION. Without limiting the right to terminate this
Agreement pursuant to any other provision hereof, the Underwriter, in its
absolute discretion and without any liability on its part, may terminate this
Agreement prior to the First Closing Date, and may cancel the Option to the
Company referred to in Section 4 hereof at any time prior to the Second Closing
Date, if:
(a) The Company shall have failed, refused, or been unable, at or prior
to such Closing Date, to perform any agreement on its part to be performed
hereunder;
(b) Any condition to the obligations of the Underwriter hereunder is
not fulfilled or satisfied at or prior to the applicable Closing Date;
(c) Any event shall have occurred or shall exist that makes untrue or
incorrect in any material respect any statement or information contained in the
Registration Statement or that is not reflected in the Registration Statement
but should be reflected therein to make the statements or information contained
therein not misleading in any material respect; or
(d) There shall have occurred any of the following events: (i) trading
in securities generally on or by, as the case may be, any national stock
exchange, the Nasdaq Stock Market, the OTC Bulletin Board, or the
over-the-counter market, shall have been suspended or materially limited, (ii)
governmental restrictions shall have been imposed on trading in securities
generally or minimum or maximum prices shall have been established, (iii)
trading of any securities of the Company, including the Shares, on any national
stock exchange, the Nasdaq Stock Market, the OTC Bulletin Board, or the
over-the-counter market shall have been suspended or materially limited, whether
by reason of a stop order by the Commission or otherwise, (iv) a general banking
moratorium shall have been established by federal or state authorities, (v) an
outbreak or escalation of hostilities, declaration of war, national emergency,
or other national or international calamity or crisis, or any change in
political, financial, or economic conditions shall have occurred or shall have
accelerated to such extent, in the Underwriter's judgment, as to make it
impracticable or inadvisable to market the Shares or to enforce contracts for
the sale of Shares, or (vi) in the case of any of the events specified in
Section 10(d)(i) through Section 10(d)(v), such event, together with any other
event or events, makes it, in the Underwriter's judgment, impracticable to
market the Shares at the time and in the manner contemplated by the Prospectus.
SECTION 11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
expense reimbursement, indemnity, and contribution agreements contained in this
Agreement, and the representations, warranties, covenants, and other statements
of the Company set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of
the Underwriter, the Company, or any of its or their partners, officers,
directors, or any controlling person, as the case may be, and will survive
delivery of and payment for the Shares sold hereunder or any termination or
cancellation of this Agreement.
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SECTION 12. NOTICES. All communications hereunder will be in writing
and, if sent to the Underwriter, will be mailed, delivered, or telecopied (with
receipt confirmed) to Xxxxxx Xxxxx & Co., 000 Xxxxx Xxxxxx Xxxxx, Xxxxxx, XX
00000, Attention: W. Xxxxxxxx Xxxxx, President and Chief Executive Officer, (Fax
No. (000) 000-0000) with a copy to Xxxxxxx X. Xxxxxx, Esq., Carlton, Fields,
Xxxx, Xxxxxxxx, Xxxxx & Xxxxxx, P.A., 000 Xxxxx Xxxxxxx Xxxxxx Xxxxxxxxx, Xxxxx,
Xxxxxxx 00000 (Fax No. (000) 000-0000); and if sent to the Company will be
mailed, delivered, or telecopied (with receipt confirmed) to the Company at 000
Xxxxxxxxx Xxxx Xxxxx, Xxxxx X-00, Xxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X.
Xxxxx, President and Chief Executive Officer, (Fax No. (000) 000-0000) with a
copy to Xxxxxx X. Xxxxxxxx, Esquire, Xxxxx, Xxxxxxxx & Xxxxxxx LLP, Suite 3100,
Promenade II, 0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, (Fax No.
(000) 000-0000).
SECTION 13. REPRESENTATIONS AND WARRANTIES OF THE UNDERWRITER. The
Underwriter represents and warrants to the Company that the information set
forth (a) in the first paragraph on page 2 of the Prospectus relating to
stabilization, and (b) in the third and tenth paragraphs of the section in the
Prospectus entitled "Underwriting," constitutes the only written information
furnished to the Company by and on behalf of the Underwriter expressly for use
in connection with the preparation of the Registration Statement, and is correct
and complete in all material respects and does not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
SECTION 14. SUCCESSORS. This Agreement is made solely for the benefit
of the Underwriter, the Company, and their respective successors and assigns,
directors and officers (and their personal representatives), and controlling
persons referred to in Section 8, and no other person shall have any right or
obligation hereunder. The term "successors or assigns", as used in this
Agreement, shall not include any purchaser of the Shares from the Underwriter
merely by reason of such purchase.
SECTION 15. PARTIAL UNENFORCEABILITY. If any section, subsection,
clause, or provision of this Agreement is for any reason determined to be
invalid or unenforceable, such determination shall not affect the validity or
enforceability of any other section, subsection, clause, or provision hereof.
SECTION 16. MISCELLANEOUS AGREEMENT. Upon execution and delivery of
this Agreement by all parties hereto, the following agreements between the
parties shall be terminated without any further obligation or liability on the
part of either party, and such agreements shall henceforth be null and void in
all respects: (a) that certain document entitled Future Agreements, dated March
25, 1997, by and between the Company and the Underwriter, and (b) that certain
Restated Future Agreements, dated August 20, 1997, by and between the Company
and the Underwriter.
SECTION 17. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida without reference
to conflict of law principles thereunder.
SECTION 18. COUNTERPARTS. 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.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed counterparts hereof,
whereupon it will become a binding agreement among the Company, and the
Underwriter in accordance with its terms.
Very truly yours,
MARINE BANCSHARES, INC.
By: ____________________________
Title:__________________________
Accepted as of the date hereof:
XXXXXX XXXXX & CO.
By: __________________________________
Title:________________________________
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