] Shares Tennessee Commerce Bancorp, Inc. Common Stock FORM OF UNDERWRITING AGREEMENT
Exhibit 1.1
[ ] Shares
Tennessee Commerce Bancorp, Inc.
Common Stock
FORM OF UNDERWRITING AGREEMENT
August [ ], 2010
Macquarie Capital (USA) Inc.
As Representative of the several Underwriters named in Schedule I hereto
0 Xxxxx Xxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Tennessee Commerce Bancorp, Inc., a Tennessee corporation (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell to the several underwriters named in Schedule I hereto (the “Underwriters”), an aggregate of [ ] shares of its Common Stock (par value $0.50 per share) (the “Common Stock”). The aggregate of [ ] shares to be purchased from the Company are called the “Firm Shares”. In addition, the Company has agreed to sell to the Underwriters, upon the terms and conditions stated herein, up to an additional [ ] shares of Common Stock (the “Additional Shares”). The Firm Shares and the Additional Shares are collectively referred to in this underwriting agreement (this “Agreement”) as the “Shares”. Macquarie Capital (USA) Inc. is acting as the representative of the several Underwriters and in such capacity is referred to in this Agreement as the “Representative”.
The Company also proposes, subject to the terms of this Agreement, the applicable rules, regulations and interpretations of the Financial Industry Regulatory Authority, Inc. (“FINRA”) and all other applicable laws, rules and regulations, that [ ] of the Firm Shares (the “Directed Shares”) shall be reserved for sale by the Underwriters to certain officers, directors and other persons designated by the Company (“Directed Share Purchasers”). To the extent that sales of Directed Shares are not orally confirmed for purchase by Directed Share Purchasers by 9:00 A.M. Eastern Time on the first trading day after the date of this Agreement, the Directed Shares will be offered to the public as part of the offering.
The Company wishes to confirm as follows its agreement with the Representative and the Underwriters, on whose behalf the Representative is acting, in connection with their respective several purchases of the Shares from the Company.
1. Registration Statement and Prospectus.
(a) The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Act”), a registration statement on Form S-1 (File No. 333-167114; Film No. 10860931), as amended by Pre-Effective Amendment No. 1 to Form S-1 (File No. 333-167114; Film No. 10928023), Pre-Effective Amendment No. 2 to Form S-1 (File No. 333-167114; Film No. 10965355), Pre-Effective Amendment No. 3 to Form S-1 (File No. 333-167114; Film No. [ ]) and Pre-Effective Amendment No. 4 to Form S-1 (File No. 333-167114; Film No. [ ]), including a prospectus subject to completion, relating to the Shares. Such registration statement, as amended, including the financial statements, exhibits and schedules thereto, in the form in which it was declared effective by the Commission under the Act (including the information deemed pursuant to Rule 430A under the Act to be part of the registration statement at the time of its effectiveness (the “Rule 430A Information”)), is referred to in this Agreement as the “Registration Statement”. The Registration Statement was declared effective by the Commission on August [ ], 2010. If the Company has filed an abbreviated registration statement pursuant to Rule 462(b) under the Act (the “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement.
(b) The term “Preliminary Prospectus” means each prospectus included in the Registration Statement (and any amendments thereto) before effectiveness, any prospectus filed with the Commission pursuant to Rule 424(a) under the Act or the prospectus included in the Registration Statement at the time of its effectiveness that omits Rule 430A Information. The term “Prospectus” means the prospectus in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Act) in connection with confirmation of sales of the Shares. For purposes of this Agreement, “free writing prospectus” has the meaning ascribed to it in Rule 405 under the Act, and “Issuer Free Writing Prospectus” shall mean each free writing prospectus prepared by or on behalf of the Company or used or referred to by the Company in connection with the offering of the Shares.
(c) “Time of Sale Information” shall mean the (a) Preliminary Prospectus, (b) information set forth in Schedule II hereto to be conveyed orally by the Underwriters to purchasers of the Shares at the Applicable Time and (c) information and free writing prospectuses (including any Issuer Free Writing Prospectuses), if any, identified in Schedule III hereto. All references in this Agreement to the Registration Statement, the Rule 462 Registration Statement, a Preliminary Prospectus, the Prospectus or the Time of Sale Information, or any amendments or supplements to any of the foregoing, shall be deemed to refer to and include any documents incorporated by reference therein, and shall include any copy thereof filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval (“XXXXX”).
(d) Any reference in this Agreement to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-1 under the Act, as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or
Prospectus, as the case may be. As used herein, the term “Incorporated Documents” means the documents that at the time of filing are incorporated by reference in the Registration Statement, any Preliminary Prospectus, the Prospectus or any amendment or supplement thereto. For purposes of this Agreement, “Applicable Time” means [ ] Eastern Time on the date of this Agreement.
2. Agreements to Sell and Purchase.
(a) The Company hereby agrees to issue and sell the Firm Shares to the Underwriters and, upon the basis of the representations, warranties and agreements of the Company herein contained and subject to all the terms and conditions set forth herein, each Underwriter agrees, severally and not jointly, to purchase from the Company at a purchase price of $[ ] per Share (the “purchase price per Share”), the number of Firm Shares set forth opposite the name of such Underwriter in Schedule I hereto.
(b) The Company hereby also agrees to sell to the Underwriters, and, upon the basis of the representations, warranties and agreements of the Company herein contained and subject to all the terms and conditions set forth herein, the Underwriters shall have the right for 30 days from the date of the Prospectus to purchase from the Company up to [ ] Additional Shares at the purchase price per Share for the Firm Shares. If any Additional Shares are to be purchased, each Underwriter, severally and not jointly, agrees to purchase the number of Additional Shares (subject to such adjustments as the Representative may determine to avoid fractional shares) that bears the same proportion to the total number of Additional Shares to be purchased by the Underwriters as the number of Shares set forth opposite the name of such Underwriter in Schedule I hereto bears to the total number of Shares. The option to purchase Additional Shares may be exercised at any time within 30 days after the date of the Prospectus pursuant to the terms of this Agreement.
3. Terms of Public Offering.
(a) The Company has been advised by the Representative that the Underwriters propose to make a public offering of their respective portions of the Shares upon the terms set forth in the Prospectus.
(b) Not later than 12:00 P.M. Eastern Time on the second business day following the date the Shares are released by the Underwriters for sale to the public, the Company shall deliver or cause to be delivered copies of the Prospectus in such quantities and at such places as the Representative shall reasonably request.
4. Delivery of the Shares and Payment Therefor.
(a) Delivery to the Underwriters of the Firm Shares and payment therefor shall be made at the offices of Macquarie Capital (USA) Inc., 0 Xxxxx Xxxxxx Xxxxx, 0xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 at 10:00 A.M. Eastern Time on [ ], 2010, or such other place, time and date not later than 1:30 P.M. Eastern Time on [ ], 2010 as the Representative shall designate by notice to the Company (the time and date of such closing are
called the “Closing Date”). The place of closing for the Firm Shares and the Closing Date may be varied by agreement between the Representative and the Company. The Company hereby acknowledges that circumstances under which the Representative may provide notice to postpone the Closing Date as originally scheduled include any determination by the Company or the Representative to recirculate to the public copies of an amended or supplemented Prospectus or a delay as contemplated by the provisions of Section 10 hereof.
(b) Delivery to the Underwriters of and payment for any Additional Shares to be purchased by the Underwriters shall be made at the offices of Macquarie Capital (USA) Inc., 0 Xxxxx Xxxxxx Xxxxx, 0xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 at 10:00 A.M. Eastern Time on such date or dates (the “Additional Closing Date”) (which may be the same as the Closing Date) as shall be specified in a written notice, from the Representative on behalf of the Underwriters to the Company, of the Underwriters’ determination to purchase a number, specified in such notice, of Additional Shares. Such notice may be given at any time within 30 days after the date of the Prospectus and must set forth (i) the aggregate number of Additional Shares as to which the Underwriters are exercising the option and (ii) the names and denominations in which the Additional Shares are to be registered. The place of closing for the Additional Shares and the Additional Closing Date may be varied by agreement between the Representative and the Company.
(c) Delivery of the Firm Shares and any Additional Shares hereunder shall be made through the facilities of the Depository Trust Company (“DTC”) to the account(s) specified in writing by the Representative, not later than the close of business on the business day next preceding the Closing Date or the Additional Closing Date, as the case may be, against payment of the purchase price therefore by wire transfer of immediately available funds to an account specified in writing, not later than the close of business on the business day next preceding the Closing Date or the Additional Closing Date, as the case may be, by the Company. Payment for the Shares sold by the Company hereunder shall be delivered by the Representative to the Company.
(d) It is understood that the Representative has been authorized, for its own account and the accounts of the several Underwriters, to accept delivery of and receipt for, and make payment of the purchase price per Share for the Firm Shares and the Additional Shares, if any, that the Underwriters have agreed to purchase. Macquarie Capital (USA) Inc., individually and not as Representative of the Underwriters, may, but shall not be obligated to, make payment for any Shares to be purchased by any Underwriter whose funds shall not have been received by the Representative by the Closing Date or the Additional Closing Date, as the case may be, for the account of such Underwriter, but any such payment shall not relieve such Underwriter from any of its obligations under this Agreement.
5. Covenants and Agreements. The Company covenants and agrees with the several Underwriters as follows:
(a) The Company, subject to Section 5(b), will comply with the requirements of Rule 430A under the Act, and will promptly notify the Representative, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectus or any amended prospectus shall have been filed, and will promptly furnish the Representative with copies thereof, and will file promptly all material required to be filed by the Company with the Commission pursuant to Rule 433(d) under the Act, (ii) of the receipt of any comments from the Commission with respect to the Registration Statement and any post-effective amendment to the Registration Statement, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus, or of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or of the initiation or threat of any proceedings for any such purpose. The Company will file the Prospectus with the Commission in accordance with Rule 424(b) under the Act before the close of business on the first business day immediately following the date hereof and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company will make every reasonable effort to prevent the issuance of any stop order suspending the effectiveness of the Registration Statement and, if any such stop order is issued, to obtain the lifting thereof at the earliest possible moment.
(b) The Company will give the Representative notice of its intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b) under the Act), or any amendment, supplement or revision to either any Preliminary Prospectus (including the prospectus included in the Registration Statement at the time it became effective) or to the Prospectus, whether pursuant to the Act, the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Exchange Act”) or otherwise, will furnish the Underwriters with copies of any such documents a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file or use any such document to which the Representative or counsel for the Underwriters shall reasonably object.
(c) The Company will use its best efforts to qualify the Shares for offering and sale under the securities laws of such jurisdictions as the Representative may reasonably request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Shares; provided, however, that nothing in this Section 5(c) shall require the Company to qualify as a foreign corporation in any jurisdiction in which it is not already so qualified, or to file a general consent to service of process in any jurisdiction. In each jurisdiction in which the Shares have been so qualified, the Company will file such statements and reports as may be required by the laws of such jurisdiction to continue such qualification in effect for a period of not less than one year from the effective date of the Registration Statement and any Rule 462(b) Registration Statement. The Company will also supply the Underwriters with such information as is necessary for the determination of the legality of the Shares for investment under the laws of such jurisdiction as the Representative may request.
(d) The Company has furnished or, upon the request of the Representative will furnish to the Representative, without charge, two signed copies of the Registration Statement as originally filed, any Rule 462(b) Registration Statement and each amendment to each (including exhibits filed therewith or incorporated by reference therein), including signed copies of all consents and certificates of experts, and will also, upon the request of the Representative, deliver to the Representative, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for each of the Underwriters. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(e) The Company will cooperate with the Representative and counsel for the Underwriters in connection with the registration (or exemption therefrom) or qualification of the Shares for offering and sale by the several Underwriters and by dealers under the securities or Blue Sky laws of such jurisdictions as the Representative may reasonably designate and will file such consents to service of process or other documents as may be reasonably necessary in order to effect and maintain such registration or qualification for so long as required to complete the distribution of the Shares; provided, however, that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to general service of process in suits, other than those arising out of the offering or sale of the Shares, as contemplated by this Agreement and the Prospectus, in any jurisdiction where it is not now so subject. In the event that the qualification of the Shares in any jurisdiction is suspended, the Company shall so advise the Representative promptly in writing.
(f) The Company will comply with the Act and the Exchange Act so as to permit the completion of the distribution of the Shares as contemplated in this Agreement and in the Prospectus. If at any time when a prospectus is required by the Act to be delivered in connection with the offering or sale of the Shares (or, in lieu thereof, the notice referred to in Rule 173(a) under the Act), any event shall have occurred or condition shall exist as a result of which it is necessary to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it (or, in lieu thereof, the notice refereed to in Rule 173(a) under the Act) is delivered to a purchaser, or if for any other reason it shall be necessary at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the Act or any request by the Commission, the Company will promptly notify the Underwriters of such event or condition and promptly prepare and file with the Commission, subject to Section 5(b), such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements or requests, and the Company will furnish, without charge, to the Underwriters and to any dealer in securities as many copies of such amendment or supplement as the Underwriters may from time to time reasonably request. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus materially conflicted or would materially conflict with the information contained in
the Registration Statement or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, the Company has promptly notified or will promptly notify the Underwriters and has promptly amended or will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
(g) The Company will make generally available to its security holders a consolidated earnings statement (in a form complying with the provisions of Rule 158 under the Act), which need not be audited, covering a twelve-month period commencing after the effective date of the Registration Statement and the Rule 462 Registration Statement, if any, and ending not later than 15 months thereafter, as soon as practicable after the end of such period, which consolidated earnings statement shall satisfy the provisions of Section 11(a) of the Act.
(h) During the period ending five years from the date hereof, the Company will furnish to the Representative, as soon as available, such other information concerning the Company as the Representative may reasonably request from time to time.
(i) If this Agreement shall terminate or shall be terminated after execution pursuant to any provision hereof (except pursuant to a termination under Section 11 hereof, other than clauses (iv) or (v)) or if this Agreement shall be terminated by the Underwriters because of any inability, failure or refusal on the part of the Company to perform in all material respects any agreement herein or to comply in all material respects with any of the terms or provisions hereof or to fulfill in all material respects any of the conditions of this Agreement and such inability, failure or refusal to comply shall, in the sole judgment of the Representative, have a material adverse effect on the Underwriters’ ability to consummate the transactions contemplated hereby, the Company agrees to reimburse the Representative and the other Underwriters for all reasonable accountable out-of-pocket expenses (including travel expenses and reasonable fees and expenses of counsel for the Underwriters, but excluding wages and salaries paid by the Representative) reasonably incurred by the Representative and the other Underwriters in connection herewith.
(j) The Company will apply the net proceeds from the sale of the Shares to be sold by it hereunder in accordance in all material respects with the statements under the caption “Use of Proceeds” in the Prospectus.
(k) During the period commencing on the date hereof and ending on the 90th day after the date of the Prospectus (as the same may be extended as described below, the “Lock-Up Period”), the Company will not, directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than shares of Common Stock issued pursuant to employee benefit plans, qualified stock option plans or other director or employee compensation plans existing on the date hereof, including without limitation the Tennessee Commerce Bancorp, Inc. 2007 Equity Plan (collectively, the “Plans”), or pursuant to currently outstanding options, warrants or rights), or sell or grant options, rights or
warrants with respect to any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than the grant of options pursuant to the Plans), (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of ownership of such shares of Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise, (3) file or cause to be filed a registration statement, including any amendments, with respect to the registration of any shares of Common Stock or securities convertible, exercisable or exchangeable into Common Stock or any other securities of the Company (other than any registration statements on Form S-8 with respect to any Plan) or (4) publicly disclose the intention to do any of the foregoing, in each case without the prior written consent of the Representative on behalf of the Underwriters (which consent may be withheld at the sole discretion of the Representative). In addition, the Company shall cause each person set forth on Exhibit A attached hereto to furnish to the Representative, on or prior to August [ ], 2010, a letter or letters, substantially in the form of Exhibit B attached hereto (the “Lock-Up Agreements”). Notwithstanding the foregoing, if (x) during the last 17 days of the Lock-Up Period, the Company issues an earnings release or announces material news or a material event relating to the Company occurs or (y) prior to the expiration of the Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period, then the restrictions imposed in this Section 5(k) shall continue to apply until the expiration of the 18-day period beginning on the date of issuance of the earnings release or the announcement of the material news or the occurrence of the material event, unless the Representative, on behalf of the Underwriters, waives such extension in writing.
(l) During the period commencing on the date hereof and ending on the date on which the Prospectus is no longer required to be delivered in connection with the sale of the Shares under the Act or the Exchange Act (or, in lieu thereof, the notice referred to in Rule 173(a) under the Act), the Company will file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act.
(m) Prior to the Closing Date or the Additional Closing Date, as the case may be, the Company will furnish to the Representative, as promptly as possible, copies of any quarterly unaudited interim consolidated financial statements of the Company and its subsidiaries for any period subsequent to the periods covered by the financial statements appearing in the Prospectus.
(n) The Company will comply with all provisions of any undertakings contained in the Registration Statement.
(o) The Company will not at any time, directly or indirectly, take any action designed, or which might reasonably be expected to cause or result in, or which will constitute, stabilization or manipulation of the price of the shares of Common Stock and will not take any action prohibited by Regulation M under the Exchange Act in connection with the distribution of the Shares.
(p) The Company will timely file with the Nasdaq Global Market (“Nasdaq”) all documents and notices required by Nasdaq of companies that have or will issue securities that are listed on Nasdaq. The Company will comply in all material respects with all requirements of Nasdaq with respect to the issuance of the Shares and take all action necessary or appropriate to permit the listing of the Shares on Nasdaq.
(q) The Company has maintained and will maintain, at its expense, a transfer agent for the Common Stock and, if necessary under the jurisdiction of its incorporation or the rules of any national securities exchange on which the Common Stock is listed, a registrar (which, if permitted by applicable laws and rules may be the same entity as the transfer agent) for the Common Stock.
(r) The Company represents and agrees that, unless it obtains the prior written consent of the Representative, and each Underwriter represents and agrees that, unless it obtains the prior written consent of the Company and the Representative, it has not made and will not make any offer relating to the Shares that would constitute a free writing prospectus required to be filed with the Commission other than the Issuer Free Writing Prospectuses included in the Time of Sale Information. Each such Issuer Free Writing Prospectus and free writing prospectuses consented to by the Company and the Representative is referred to herein as a “Permitted Free Writing Prospectus”. The Company has treated and agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus”, as defined in Rule 433 under the Act, and has complied and will comply with the requirements of Rule 433 under the Act applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where required, legending and record keeping. Notwithstanding the foregoing, the Company consents to the use by any Underwriter of a free writing prospectus that contains only (i)(A) information describing the preliminary terms of the Shares or their offering, (B) information meeting the requirements of Rule 134 under the Act or (C) information that describes the final terms of the Shares or their offering or (ii) other customary information that is neither “issuer information”, as defined in Rule 433 under the Act, nor otherwise an Issuer Free Writing Prospectus.
(s) Until all amounts outstanding under the Loan Agreement, dated as of February 4, 2010, by and between the Company and Xxxxxx X. Xxxxxx (as it may be amended, restated and supplemented from time to time, the “Xxxxxx Loan Agreement”) remain outstanding, the Company will comply with Section 4.7 of the Xxxxxx Loan Agreement, including but not limited to the obligation of the Company to provide prompt notice of any event that could have a Material Adverse Effect (as defined in the Xxxxxx Loan Agreement).
6. Company Representations and Warranties. The Company and Tennessee Commerce Bank, its wholly owned banking subsidiary (the “Bank”), hereby jointly and severally represent and warrant to each Underwriter on the date hereof, and shall be deemed to represent and warrant to each Underwriter on the Closing Date and the Additional Closing Date, as the case may be, that:
(a) The Company satisfies all requirements to incorporate information by reference in Form S-1 under the Act set forth in General Instruction VII to such form. The
Company is not, and at the time of filing of the Registration Statement was not, an “ineligible issuer” as defined in Rule 405 under the Act. Each of the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendment thereto has become effective under the Act and no stop order suspending the effectiveness of the Registration Statement, any Rule 462(b) Registration Statement or any post-effective amendment thereto has been issued under the Act, no order preventing or suspending the use of any Preliminary Prospectus, the Prospectus or any Issuer Free Writing Prospectus has been issued by the Commission and no proceedings for any such purpose have been instituted or are pending or, to the knowledge of the Company, are threatened by the Commission, and any request on the part of the Commission for additional information has been complied with.
(b) At the respective times the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto became effective and at the Closing Date and the Additional Closing Date, as the case may be, the Registration Statement, the Rule 462(b) Registration Statement and any amendments and supplements thereto complied and will comply in all material respects with the requirements of the Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that the representations and warranties in this Section 6(b) shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by the Representative expressly for use in the Registration Statement, it being understood and agreed that the only such information provided by the Representative is that described as such in Section 12 hereof.
(c) The most recent Preliminary Prospectus, when it was filed with the Commission pursuant to Rule 424(b), conformed, and the Prospectus, when it is filed with the Commission pursuant to Rule 424(b), will conform, in all material respects to the requirements of the Act. Neither the Prospectus nor any amendments or supplements thereto (including any prospectus wrapper), at the time the Prospectus or any such amendment or supplement was issued or filed with the Commission and at the Closing Date and the Additional Closing Date, as the case may be, included or will include an untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this Section 6(c) shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by the Representative expressly for use in the Prospectus, it being understood and agreed that the only such information provided by the Representative is that described as such in Section 12 hereof. There are no contracts or other documents required to be described in the Prospectus or to be filed as exhibits to the Registration Statement which have not been described or filed as required.
(d) At the Applicable Time, the Time of Sale Information did not include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances in which they were made, not misleading. Each Issuer Free Writing Prospectus (including, without limitation, any road show that is a free writing prospectus under Rule 433), as supplemented by and taken together with the Time of
Sale Information as of the Applicable Time, did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances in which they were made, not misleading; provided, however, that the representations and warranties in this Section 6(d) shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by the Representative expressly for use in an Issuer Free Writing Prospectus.
(e) The Incorporated Documents when they were filed (or, if any amendment with respect to any such document was filed, when such amendment was filed), complied in all material respects with the requirements of the Exchange Act. No such Incorporated Document, at the time it was filed with the Commission, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading. The Incorporated Documents constitute all the documents required to be incorporated by Form S-1 and the Act.
(f) Each Issuer Free Writing Prospectus conformed or will conform in all material respects to the requirements of the Act on the date of first use, and the Company has complied with all prospectus delivery and any filing requirements applicable to such Issuer Free Writing Prospectus pursuant to the Act. The Company has not made any offer relating to its Common Stock that would constitute an Issuer Free Writing Prospectus with respect to the offer and sale of the Shares contemplated hereby without the prior written consent of the Representative. The Company has retained, in accordance with the Act, all Issuer Free Writing Prospectuses that were not required to be filed pursuant to the Act. The Company has taken all actions necessary so that any “road show” (as defined in Rule 433) in connection with the offering of the Stock will not be required to be filed pursuant to the Act or has been so filed as an Issuer Free Writing Prospectus or as an exhibit to a Current Report on Form 8-K. Each such Issuer Free Writing Prospectus, and any “road show”, as of its issue date and at all subsequent times through the completion of the public offer and sale of the Shares did not, does not and will not include any information that materially conflicted, materially conflicts with or will materially conflict with the information contained in the Registration Statement, the Time of Sale Information or the Prospectus, including any Incorporated Document.
(g) The statistical information and data required by Commission Industry Guide 3 included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus present fairly in all material respects the information set forth therein, is in compliance in all material respects with the Act and Commission Industry Guide 3, and is consistent with the Company’s financial statements included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus, except as noted therein. Nothing has come to the attention of the Company that has caused the Company to believe that the other statistical and market related data included or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus is not based on or derived from sources that are reliable and accurate.
(h) The capitalization of the Company will be as set forth in the Prospectus as of the date set forth therein. All the outstanding shares of Common Stock and preferred stock of the Company have been, and as of the Closing Date and the Additional Closing Date, as the case
may be, will be, duly authorized and validly issued, are fully paid and nonassessable and are free of any preemptive or similar rights; except as set forth in the Time of Sale Information and the Prospectus, the Company is not a party to or bound by any outstanding options, warrants or similar rights to subscribe for, or contractual obligations to issue, sell, transfer or acquire, any of its capital stock or any securities convertible into or exchangeable for any of such capital stock; the Shares to be issued and sold to the Underwriters by the Company hereunder have been duly authorized and, when issued and delivered to the Underwriters against full payment therefor in accordance with the terms hereof will be validly issued, fully paid and nonassessable and free of any preemptive or similar rights; the capital stock of the Company conforms to the description thereof in the Registration Statement, the Time of Sale Information and the Prospectus (or any amendment or supplement thereto); and the delivery of the Shares being sold by the Company against payment therefor pursuant to the terms of this Agreement will pass valid title to the Shares being sold by the Company, free and clear of any claim, encumbrance or defect in title, to the several Underwriters purchasing such Shares in good faith and without notice of any lien, claim or encumbrance.
(i) Each of the Company and its subsidiaries is a corporation or other entity duly organized and validly existing as a corporation or entity in good standing under the laws of the state of its incorporation with full corporate power and authority to own, lease and operate its properties and to conduct its business as presently conducted and as described in the Registration Statement, the Time of Sale Information and the Prospectus (and any amendment or supplement thereto) and is duly registered and qualified to conduct its business and is in good standing in each jurisdiction or place where the nature of its properties or the conduct of its business requires such registration or qualification, except where the failure to so register or qualify has not had or would not have a material adverse effect on the condition (financial or other), business, properties, net worth or results of operations of the Company and its subsidiaries, taken as a whole (a “Material Adverse Effect”).
(j) The issued shares of capital stock or other equity interests of each of the Company’s subsidiaries have been duly authorized and validly issued, are fully paid and nonassessable and, except as described in the Registration Statement, the Time of Sale Information and the Prospectus, are owned by the Company or a subsidiary of the Company free and clear of any security interests, liens, encumbrances, equities or claims. The Company does not have any subsidiaries and does not own a material interest in or control, directly or indirectly, any other corporation, partnership, joint venture, association, trust or other business organization, except as set forth in Exhibit 21 to the Company’s Annual Report on Form 10-K for its fiscal year ended December 31, 2009, which is incorporated by reference into the Registration Statement. As used in this Agreement, subsidiaries shall mean and include all direct and indirect subsidiaries of the Company.
(k) There are no legal, governmental or regulatory proceedings pending or, to the knowledge of the Company, threatened, against the Company or its subsidiaries or to which the Company or its subsidiaries or any of their properties are subject, that are required to be described in the Registration Statement, the Time of Sale Information or the Prospectus (or any amendment or supplement thereto) but are not described as required. Except as described in the Registration Statement, the Time of Sale Information and Prospectus, there is no action, suit,
inquiry, proceeding or investigation by or before any court, governmental, regulatory or administrative agency or commission pending or, to the knowledge of the Company, threatened, against or involving the Company or its subsidiaries, which would, individually or in the aggregate, prevent or adversely affect the transactions contemplated by this Agreement or result in a Material Adverse Effect, nor to the Company’s knowledge, is there any basis for any such action, suit, inquiry, proceeding or investigation. There are no agreements, contracts, indentures, leases or other instruments that are required to be described in the Registration Statement, the Time of Sale Information or the Prospectus (or any amendment or supplement thereto) or to be filed as an exhibit to the Registration Statement (“Material Contracts”) that are not described, filed or incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus as required by the Act. All Material Contracts to which the Company or any of its subsidiaries is a party have been duly authorized, executed and delivered by the Company or the applicable subsidiary, constitute valid and binding agreements of the Company or the applicable subsidiary and are enforceable against the Company or the applicable subsidiary in accordance with the terms thereof, except as enforceability thereof may be limited by (i) the application of bankruptcy, reorganization, insolvency and other laws affecting creditors’ rights generally and (ii) equitable principles being applied at the discretion of a court before which any proceeding may be brought. Neither the Company nor the applicable subsidiary has received notice or been made aware that any other party is in breach of or default to the Company under any Material Contract.
(l) Neither the Company nor any of its subsidiaries is (i) in violation of (A) its articles of incorporation, charter or bylaws, or other organizational documents, (B) any law, ordinance, administrative, governmental or regulatory rule or regulation applicable to the Company or any of its subsidiaries, the violation of which would have a Material Adverse Effect or (C) any judgment, injunction, order, decree, directive, memorandum of understanding of or with or board resolutions adopted at the request of any court, governmental or regulatory agency or body having jurisdiction over the Company or any of its subsidiaries or, (ii) except as described in the Registration Statement, the Time of Sale Information or the Prospectus, in default or noncompliance in any material respect in the performance of any obligation, agreement or condition contained in (A) any bond, debenture, note or any other evidence of indebtedness or under any financial or other covenant in any debt obligation of the Company, the Bank or any of their subsidiaries or (B) any agreement, indenture, lease or other instrument (each of (A) and (B), an “Existing Instrument”) to which the Company or any of its subsidiaries is a party or by which any of their properties may be bound, which default would have a Material Adverse Effect or which would prevent or limit the payment of dividends or distributions on any of the Company’s securities; and there does not exist any state of facts that constitutes such an event of default on the part of the Company or any of its subsidiaries as defined in such documents or that, with notice or lapse of time or both, would constitute such an event of default.
(m) The Company’s and the Bank’s execution and delivery of this Agreement and the performance by the Company and the Bank of their obligations under this Agreement have been duly and validly authorized by the Company and the Bank and this Agreement has been duly executed and delivered by the Company and the Bank, and constitutes a valid and legally binding agreement of the Company and the Bank, enforceable against the Company and the Bank in accordance with its terms, except to the extent enforceability may be limited by
(i) the application of bankruptcy, reorganization, insolvency and other laws affecting creditors’ rights generally and (ii) equitable principles being applied at the discretion of a court before which any proceeding may be brought, except as rights to indemnity and contribution hereunder may be limited by federal or state securities laws.
(n) None of the issuance and sale of the Shares by the Company, the execution, delivery or performance of this Agreement by the Company and the Bank nor the consummation by the Company of the transactions contemplated hereby (i) requires any consent, approval, authorization or other order of or registration or filing with, any court, regulatory body, administrative agency or other governmental body, agency or official (except such as may be required for the registration of the Shares under the Act, the listing of the Shares on Nasdaq and compliance with the securities or Blue Sky laws of any applicable jurisdiction, all of which will be, or have been, effected in accordance with this Agreement as required by applicable securities or Blue Sky laws or regulations), (ii) conflicts with or will conflict with or constitutes or will constitute a breach of, or a default under, the Company’s charter or the Company’s bylaws or any agreement, indenture, lease or other instrument to which the Company or any of its subsidiaries is a party or by which any of its properties may be bound, (iii) violates any law, ordinance, administrative, governmental or regulatory rule or regulation, ruling, filing, judgment, injunction, order, decree, directive or memorandum of understanding applicable to the Company or any of its subsidiaries or any of their properties, except for such violations that would not, individually or in the aggregate, result in a Material Adverse Effect, or (iv) results in a breach of, or default or Debt Repayment Triggering Event (as defined below) or warrant adjustment under, or results in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, or requires the consent of any other party to, any Existing Instrument, except for such conflicts, breaches or defaults under any agreement, indenture, lease or other instrument to which the Company or any of its subsidiaries is a party or by which any of its properties may be bound, liens, charges or encumbrances that would not, individually or in the aggregate, result in a Material Adverse Effect. As used herein, a “Debt Repayment Triggering Event” means any event or condition that gives, or with the giving of notice or lapse of time would give, the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries.
(o) Except as described in the Registration Statement, the Time of Sale Information and the Prospectus, and except for options to purchase capital stock issued pursuant to the Plans and for warrants exercisable for shares of Common Stock issued to the U.S. Department of the Treasury on December 19, 2008, neither the Company nor any of its subsidiaries has outstanding and at the Closing Date and the Additional Closing Date, as the case may be, will have outstanding any options to purchase, or any warrants to subscribe for, or any securities or obligations convertible into, or any contracts or commitments to issue or sell, any shares of Common Stock or any such warrants or convertible securities or obligations. No person has the right to require the Company or any of its subsidiaries to register any securities for sale under the Act as a result of or in connection with the filing of the Registration Statement or the consummation of the transactions contemplated hereby that have not been satisfied or heretofore waived in writing.
(p) KraftCPAs PLLC, the certified public accountants who have certified certain financial statements of the Company and its subsidiaries incorporated by reference into the Registration Statement, the Time of Sale Information and the Prospectus, and have audited the Company’s consolidated financial statements and the related financial statement schedules as of and for the years ended December 31, 2009, incorporated by reference in the Registration Statement, the Time of Sale Information and the Prospectus, is an independent registered public accounting firm as required by the Act and the rules and regulations of the Commission thereunder and do not provide to the Company or its subsidiaries any non-audit services prohibited by Section 10A(g) of the Exchange Act or which have not been pre-approved in accordance with Section 10A(h) of the Exchange Act.
(q) The deposit accounts of the Company’s banking subsidiaries are insured up to the maximum amount provided for by the Federal Deposit Insurance Corporation (“FDIC”) and its noninterest bearing transaction deposit accounts are guaranteed by the FDIC under its Temporary Liquidity Guarantee Program (“TLGP”) and the Company and its subsidiaries have no debt guaranteed by the TLGP. No proceedings for the modification, termination or revocation of any such FDIC insurance or guarantees are pending or, to the knowledge of the Company, threatened against the Company. The Bank has paid all premiums, assessments and TLG fees required by the FDIC and no proceeding for the termination or revocation of such insurance or the TLGP guarantee is pending or threatened. The Bank is a member in good standing of the Federal Home Loan Bank of Cincinnati.
(r) The financial statements, together with related schedules and notes, included in the Registration Statement, the Time of Sale Information and the Prospectus (and any amendment or supplement thereto), present fairly in all material respects the financial condition, results of operations, cash flows and changes in financial position of the Company on the basis stated in the Registration Statement at the respective dates or for the respective periods to which they apply; such statements and related schedules and notes comply as to form in all material respects with the requirements of Regulation S-X under the Act and have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) consistently applied throughout the periods involved, except as disclosed therein; and the other financial and statistical information included in the Registration Statement, the Time of Sale Information and Prospectus (and any amendment or supplement thereto) is accurately presented and prepared on a basis consistent with such financial statements and the books and records of the Company. No other financial statements, data or schedules are required to be included in the Registration Statement that are not included or incorporated by reference therein. The financial data set forth in the Registration Statement, any Preliminary Prospectus and the Prospectus under the caption “Summary Selected Consolidated Financial Information” fairly present the information therein on a basis consistent with the audited and unaudited financial statements of the Company, as the case may be, incorporated by reference in the Registration Statement, any such Preliminary Prospectus and the Prospectus. All disclosures contained in the Registration Statement, any Preliminary Prospectus, the Prospectus and any Issuer Free Writing Prospectus regarding “non-GAAP financial measures” comply with Commission Regulation G and Item 10 of Regulation S-K under the Act. The statistical and market related data contained or incorporated by reference in the Registration Statement, any Preliminary Prospectus, the
Prospectus and any Issuer Free Writing Prospectus are based on or derived from sources which the Company reasonably believes are reliable and accurate.
(s) The Company and each of its subsidiaries 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 GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; 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. The Company is not aware of (A) any significant deficiency in the design or operation of internal control over financial reporting which could adversely affect the Company’s ability to record, process, summarize and report financial data or any material weaknesses in internal control over financial reporting or (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls. Since the end of the Company’s most recent audited fiscal year, there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
(t) The Company and its subsidiaries maintain effective disclosure controls and procedures (as such term is defined in Rule 13a-15 under the Exchange Act), which (i) are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms and that material information relating to the Company and its subsidiaries is made known to the Company’s principal executive officer and principal financial officer by others within the Company and its subsidiaries to allow timely decisions regarding disclosure, and (ii) are effective in all material respects to perform the functions for which they were established.
(u) Since January 1, 2008 and except as set forth in the Registration Statement, the Time of Sale Information and the Prospectus, there is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with (i) any provision of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications, and (ii) the corporate governance requirements set forth in the Nasdaq Marketplace Rules.
(v) Except as disclosed in the Registration Statement, the Time of Sale Information and the Prospectus (or any amendment or supplement thereto), since the date of the last audited financial statements included therein, (i) neither the Company nor any of its subsidiaries has incurred any material liabilities or obligations, indirect, direct or contingent, or entered into any transaction that is not in the ordinary course of business, (ii) neither the Company nor any of its subsidiaries has sustained any material loss or interference with its business or properties from fire, flood, windstorm, accident or other calamity, whether or not covered by insurance, (iii) neither the Company nor any of its subsidiaries has failed to pay, or
has deferred, any dividends or other distributions with respect to any classes or series of its capital stock or securities and the Company is not in default or deferral under the terms of any class of capital stock of the Company or, except as described in the Registration Statement, the Time of Sale Information and the Prospectus, any outstanding debt obligations, (iv) there has not been any change in the authorized or outstanding capital stock or securities of the Company or any material change in the indebtedness of the Company (other than in the ordinary course of business) and (v) there has not been any Material Adverse Change (as defined below), or any development involving or that may reasonably be expected to result in a Material Adverse Effect.
(w) All offers and sales of the Company’s capital stock and other debt or other securities prior to the date hereof were made in compliance with or were the subject of an available exemption from the Act and all other applicable state and federal laws or regulations, or any actions under the Act or any state or federal laws or regulations in respect of any such offers or sales are effectively barred by effective waivers or statutes of limitation.
(x) The Common Stock (including the Shares) is registered pursuant to Section 12(b) of the Exchange Act and is listed on Nasdaq, and the Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock from Nasdaq, nor has the Company received any notification that the Commission or Nasdaq is contemplating terminating such registration or listing. The Company has applied to list the Shares on Nasdaq and the Shares will be so listed on or before the Closing Date. The transactions contemplated by this Agreement will not contravene the rules and regulations of Nasdaq.
(y) The Company has not taken and will not take, directly or indirectly, any action that constituted, or any action designed to, or that might reasonably be expected to cause or result in or constitute, under the Act or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares or for any other purpose.
(z) None of the Company or any of its subsidiaries or any agent thereof acting on behalf of them has taken, and none of them will take, any action that could cause this Agreement or the issuance or sale of the Shares or the application of the proceeds thereof to violate Regulation T, Regulation U or Regulation X of the Board of Governors of the Federal Reserve System (the “Federal Reserve”).
(aa) The statements in the Registration Statement, any Preliminary Prospectus and the Prospectus under the caption “Certain U.S. Federal Income Tax Consequences to Non-U.S. Holders of Our Common Stock”, insofar as such statements constitute a summary of the United States federal tax laws referred to therein, are accurate and fairly summarize in all material respects the United States federal tax laws referred to therein.
(bb) All United States federal income tax returns of the Company and each of its subsidiaries required by law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been
provided in the Company’s financial statements included in or incorporated by reference into the Registration Statement. The Company and each of its subsidiaries have filed all other tax returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law, except insofar as the failure to file such returns would not, individually or in the aggregate, have a Material Adverse Effect, and have paid all taxes due pursuant to such returns or pursuant to any assessment received by the Company or any subsidiary except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been provided in the Company’s financial statements included in or incorporated by reference into the Registration Statement. The charges, accruals and reserves on the books of the Company and the subsidiaries in respect of any tax liability for any years not finally determined by audit are adequate to meet any assessments or re-assessments for additional income tax for any years not finally determined. There are no outstanding agreements or waivers extending the statutory period of limitations applicable to any federal, state, local or foreign tax return for any period. On the Closing Date and the Additional Closing Date, as the case may be, all stock transfer and other taxes that are required to be paid in connection with the sale of the Shares to be sold by the Company to the Underwriters will have been fully paid by the Company and all laws imposing such taxes will have been complied with.
(cc) Except as set forth in the Time of Sale Information and the Prospectus, there are no transactions with “affiliates” (as defined in Rule 405 promulgated under the Act) or any officer, director or security holder of the Company (whether or not an affiliate) that are required by the Act to be disclosed in the Registration Statement, the Time of Sale Information and the Prospectus or that would violate Regulation W of the Federal Reserve. Additionally, no relationship, direct or indirect, exists between the Company or any of its subsidiaries on the one hand, and the directors, officers, shareholders, customers or suppliers of the Company or any subsidiary on the other hand that is required by the Act to be disclosed in the Registration Statement, the Time of Sale Information and the Prospectus that is not so disclosed.
(dd) The Company is not an “investment company” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an investment company within the meaning of the Investment Company Act of 1940, as amended.
(ee) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, each of the Company and its subsidiaries has good and valid title to all property (real and personal) described in the Registration Statement, the Time of Sale Information and the Prospectus as being owned by it, free and clear of all liens, claims, security interests or other encumbrances except such as are not materially burdensome and do not and would not have a Material Adverse Effect. All property (real and personal) held under lease by the Company and its subsidiaries is held by it under valid, subsisting and enforceable leases with only such exceptions as in the aggregate do not have or would not result in a Material Adverse Effect.
(ff) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, each of the Company and its subsidiaries has all permits, licenses, franchises, approvals, consents and authorizations of all governmental and regulatory authorities (hereinafter “permit” or “permits”) that are necessary to own its properties and to
conduct its business as conducted at the Applicable Time and in the manner described in the Registration Statement, the Time of Sale Information and the Prospectus, except where the failure to have obtained any such permit has not had and would not have a Material Adverse Effect; each of the Company and its subsidiaries has operated and is operating its business in material compliance with and not in material violation of all of its obligations with respect to each such permit and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination of any such permit or result in any other material impairment of the rights of any such permit, subject in each case to such qualification as may be set forth in the Registration Statement, the Time of Sale Information and the Prospectus; and, except as described in the Registration Statement, the Time of Sale Information and the Prospectus, such permits contain no restrictions that are materially burdensome to the Company or any of its subsidiaries.
(gg) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, the Company and its subsidiaries are (i) in compliance with any and all applicable federal, state, local and foreign laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or other approvals would not, individually or in the aggregate, have a Material Adverse Effect. Except as set forth in the Registration Statement, the Time of Sale Information and the Prospectus, neither the Company nor any of its subsidiaries has been named as a “potentially responsible party” under the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended. Except as set forth in the Registration Statement, the Time of Sale Information and the Prospectus, neither the Company nor any of its subsidiaries owns, leases, occupies or operates any property that appears on any list of hazardous sites compiled by any state or local governmental agency.
(hh) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, each of the Company and its subsidiaries owns and has full right, title and interest in and to, or has valid licenses to use, each material trade name, trademark, service xxxx, patent, copyright, approval, trade secret and other similar rights (collectively “Intellectual Property”) under which the Company and its subsidiaries conduct all or any material part of its business, and the Company has not created any lien or encumbrance on, or granted any right or license with respect to, any such Intellectual Property except where the failure to own or obtain a license or right to use any such Intellectual Property has not had and would not have a Material Adverse Effect; there is no claim pending against the Company or its subsidiaries with respect to any such Intellectual Property and the Company and its subsidiaries have not received notice or otherwise become aware that any such Intellectual Property infringes upon or conflicts with the rights of any third party. Neither the Company nor any of its subsidiaries has become aware that any material Intellectual Property that it uses or has used in the conduct of its business infringes upon or conflicts with the rights of any third party.
(ii) The Company has procured Lock-Up Agreements, in the form of Exhibit B attached hereto, from each person listed in Exhibit A attached hereto.
(jj) There are no affiliations or associations between any member of FINRA and any of the Company’s officers, directors or beneficial owners of 5% or more of the Company’s outstanding Common Stock, except as set forth in the Registration Statement, the Time of Sale Information and the Prospectus.
(kk) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, the Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which it is engaged; and neither the Company nor any of its subsidiaries has reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a comparable cost.
(ll) In the ordinary course of its business, the Company conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and its subsidiaries, in the course of which it identifies and evaluates associated costs and liabilities (including any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties). On the basis of such review and amount of its established reserves, the Company has reasonably concluded that any such associated costs and liabilities would not, individually or in the aggregate, result in a Material Adverse Effect.
(mm) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, the Company and its subsidiaries and any “employee benefit plan” (as defined in the Employee Retirement Income Security Act of 1974, as amended, and the regulations and published interpretations thereunder (collectively, “ERISA”)) established or maintained by the Company, its subsidiaries or their “ERISA Affiliates” (as defined below) are in compliance in all material respects with ERISA and all other applicable state and federal laws. “ERISA Affiliate” means, with respect to the Company or a subsidiary, any member of any group or organization described in Sections 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended, and the regulations and published interpretations thereunder (the “Code”) of which the Company or such subsidiary is a member. No “reportable event” (as defined in ERISA) has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined in ERISA). Neither the Company, its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably expects to incur any liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates that is intended to be qualified under Section 401(a)
of the Code is so qualified and nothing has occurred, whether by action or failure to act, that would cause the loss of such qualification.
(nn) The Company is a registered bank holding company under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and the Bank is the only FDIC-insured depository institution controlled by the Company for purposes of the BHC Act and the Savings and Loan Holding Company Act. Each of the Company and the Bank is in compliance in all material respects with all applicable laws administered by and regulations of the U.S. Department of the Treasury (including, without limitation, laws and regulations in respect of the TARP Capital Purchase Program), the Federal Reserve, the FDIC, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, the Tennessee Department of Financial Institutions and any other federal or state bank regulatory authority (collectively, the “Bank Regulatory Authorities”) with jurisdiction over the Company or the Bank. Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, neither the Company nor the Bank is a party to any written agreement, cease and desist or consent order, or memorandum of understanding with, or a party to, any commitment letter or similar undertaking to, or is subject to any order or directive by, or is a recipient of an extraordinary supervisory letter, formal of informal action (collectively, “Banking Enforcement Action”) that has resulted or would result in sanctions, limitations or restrictions against the Company or the Bank from, or has adopted any board resolutions at the request of, any Bank Regulatory Authority which restricts materially the conduct of its business, or in any manner relates to its capital adequacy, its credit policies or its management except, in each case, as individually or in the aggregate would not reasonably expected to have a Material Adverse Effect, nor have any of them been advised by any Bank Regulatory Authority that it is contemplating issuing or requesting (or is considering the appropriateness of issuing or requesting) any such Banking Enforcement Action. The most recent regulatory rating given to the Bank as to compliance with the Community Reinvestment Act of 1977, as amended (the “Community Reinvestment Act”) is “satisfactory”. To the knowledge of the Company, since the Bank’s last Community Reinvestment Act compliance examination, the Bank has not received any complaints as to Community Reinvestment Act compliance.
(oo) Except as disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, no labor disturbance by or dispute with employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is contemplated or threatened and the Company is not aware of any existing or imminent labor disturbance by, or dispute with, the employees of any of its or its subsidiaries’ principal suppliers, contractors or customers, except, in any case, as would not have a Material Adverse Effect. Except as disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, the Company and its subsidiaries have complied and will comply in all material respects with wage and hour determinations issued by the U.S. Department of Labor under the Service Contract Act of 1965 and the Fair Labor Standards Act in paying its employees’ salaries, fringe benefits and other compensation for the performance of work or other duties in connection with contracts with the U.S. government, and have complied and will comply in all material respects with the requirements of the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Civil Rights Act of 1964 (Title VII), the National Labor Relations Act, the Vietnam Era Veteran’s Readjustment Act, the Age Discrimination in Employment Act, as amended by the
Older Workers’ Benefit Protection Act, and federal, state and local and foreign labor laws, each as amended, except where the failure to comply with any such requirements has not and would not have a Material Adverse Effect.
(pp) Neither the Company nor any of its subsidiaries has participated in any reportable transaction, as defined in Treasury Regulation Section 1.6011-4(b)(1).
(qq) Except as described in the Registration Statement, the Time of Sale Information and the Prospectus, each of the Company and its subsidiaries has good and marketable title to all securities held by it (except securities held in any fiduciary or agency capacity) free and clear of any lien, claim, charge, option, encumbrance, mortgage, pledge or security interest or other restriction of any kind, except to the extent such securities are pledged in the ordinary course of business consistent with prudent business practices to secure obligations of the Company or any of its subsidiaries and except for such defects in title or liens, claims, charges, options, encumbrances, mortgages, pledges or security interests or other restrictions of any kind that would not be material to the Company and its subsidiaries taken as a whole. Such securities are valued on the books of the Company and its subsidiaries in accordance with GAAP.
(rr) Except for the underwriting discounts and commissions payable to the Underwriters as described in the Time of Sale Information and the Prospectus, there is no broker, finder or other party that is entitled to receive from the Company any brokerage or finder’s fee or other fee, payment or commission as a result of any transactions contemplated by this Agreement.
(ss) All swaps, caps, floors, futures, forward contracts, option agreements (other than employee stock options) and other derivative financial instruments, contracts or arrangements, whether entered into for the account of the Company or one of its subsidiaries or for the account of a customer of the Company or one of its subsidiaries, were entered into in the ordinary course of business and in accordance with prudent business practice and applicable laws, rules, regulations and policies of all applicable regulatory agencies and with counterparties believed to be financially responsible at the time. The Company and each of its subsidiaries have duly performed in all material respects all of their obligations thereunder, and, to the Company’s knowledge, the counterparties thereto have performed all their respective obligations thereunder, and there are no breaches, violations or defaults or allegations or assertions of such by the Company or its subsidiaries or any counterparty to any such instruments, contract or arrangements.
(tt) The minute books of each of the Company and its subsidiaries have been made available to the Underwriters and contain a complete summary of all meetings and other actions of the directors and shareholders of each such entity in all material respects and reflect all transactions referred to in such minutes accurately in all material respects.
(uu) No forward-looking statement (within the meaning of Section 27A of the Act and Section 21E of the Exchange Act) contained in the Registration Statement, the Time of
Sale Information or the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(vv) Except as otherwise disclosed in the Registration Statement, the Time of Sale Information and the Prospectus, (i) none of the Company nor any subsidiary of the Company is prohibited or restricted, directly or indirectly, from paying dividends, or from making any other distribution with respect to their respective equity, debt or hybrid securities; and (ii) no subsidiary is restricted, except by banking laws of general applicability, from repaying to the Company or any other subsidiary of the Company any amounts that may from time to time become due under any loans or advances to such subsidiary from the Company or from transferring any property or assets to the Company or to any other subsidiary.
(ww) Neither the Company, nor any of its subsidiaries, since each has been a subsidiary of the Company, nor, to the Company’s knowledge, any director, officer, agent, employee or other person acting on behalf of the Company or any of its subsidiaries has, directly or indirectly in the course of its actions for, or on behalf of, the Company (i) used any corporate funds for any unlawful contribution gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any federal, state, local or foreign governmental 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 domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign jurisdictions or domestic government official or employee.
(xx) The operations of the Company and its subsidiaries are, and have been conducted at all times, in compliance, in all material respects, with applicable financial recordkeeping and reporting requirements of the Bank Secrecy Act, the Currency and Foreign Transactions Reporting Act of 1970, as amended, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental or regulatory authority (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court, governmental or regulatory authority or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(yy) None of the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee, affiliate or person acting on behalf of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”); and the Company will not directly or indirectly use the proceeds of this offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.
(zz) Except as disclosed in the Registration Statement, the Time of Sale Information or the Prospectus, the Company (i) does not have any material lending or other relationship with any bank of lending affiliate of any Underwriter and (ii) does not intend to use any of the proceeds from the sale of the Shares hereunder to repay any outstanding debt owed to any affiliate of the Underwriter.
7. Expenses. Whether or not the transactions contemplated hereby are consummated or this Agreement becomes effective or is terminated, the Company agrees to pay or cause to be paid the following: (i) the fees, disbursements and expenses of the Company’s counsel and accountants in connection with the registration of the Shares under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the printing and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement, any Preliminary Prospectus, the Time of Sale Information, the Prospectus, the Blue Sky memoranda, the Agreement Among Underwriters, this Agreement and all amendments or supplements to any of them as may be reasonably requested for use in connection with the offering and sale of the Shares; (iii) consistent with the provisions of Section 5(e) hereof, the expenses in connection with the qualification of the Shares for offering and sale under state securities laws or Blue Sky laws, including reasonable attorneys’ fees and out-of-pocket expenses of the counsel for the Underwriters in connection therewith; (iv) the filing fees incident to securing any required review by FINRA of the fairness of the terms of the sale of the Shares; (v) the fees and charges associated with listing the Shares on Nasdaq; (vi) the cost of preparing stock certificates, if any, evidencing the Shares; (vii) the costs and charges of any transfer agent or registrar relating to the issuance and delivery of the Shares; (viii) the cost of the tax stamps, if any, in connection with the issuance and delivery of the Shares to the respective Underwriters; (ix) all other fees, costs and expenses referred to in Item 13 of the Registration Statement; (x) the reasonable transportation, lodging, graphics and other expenses incidental to the Company’s preparation for and participation in the “roadshow”, if any, for the offering contemplated hereby; (xi) all fees and disbursements of the Company’s outside loan reviewers and consultants; and (xii) the costs and expenses (including, without limitation, any damages or other amounts payable in connection with legal or contractual liability) associated with the reforming of any contracts for sale of the Shares made by the Underwriters caused by a breach of any of the representations contained in Sections 6(b)-(d) hereof. Except as provided in this Section 7 and in Section 8 hereof, the Underwriters shall pay their own expenses, including the fees and disbursements of their counsel. In addition, in the event that the proposed offering is terminated for the reasons set forth in Section 5(i) hereof, the Company agrees to reimburse the Underwriters as provided in Section 5(i).
8. Indemnification and Contribution.
Subject to the limitations in this paragraph below, the Company and the Bank, jointly and severally, agree to indemnify and hold harmless the Representative and each other Underwriter, the directors, officers, employees and agents of each Underwriter, and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages, liabilities and expenses, including reasonable costs of investigation and attorneys’ fees and expenses (collectively, “Damages”) arising out of or based upon (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, any Preliminary Prospectus, the Time of Sale Information, any Issuer Free Writing Prospectus or the Prospectus or in any amendment or supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in the light of the circumstances under which they were made) not misleading, except to the extent that any such Damages arise out of or are based upon an untrue statement or omission or alleged untrue statement or omission that has been made therein or omitted therefrom in reliance upon and in conformity with the information furnished in writing to the Company by or on behalf of any Underwriter through the Representative, expressly for use in connection therewith (as provided below in this Section 8) or (ii) any inaccuracy in or breach of the representations and warranties of the Company contained herein or any failure of the Company to perform its obligations hereunder or under law. This indemnification shall be in addition to any liability that the Company and Bank may otherwise have.
In addition to its other obligations under this Section 8, the Company and the Bank jointly and severally agree that, as an interim measure during the pendency of any claim, action, suit, investigation, inquiry or other proceeding (individually and collectively, a “Proceeding”) arising out of or based upon any such statement or omission, or any alleged statement or omission, or any inaccuracy, or alleged inaccuracy, in the representations and warranties of the Company herein or failure to perform its obligations hereunder, all as set forth in this Section 8, the party against whom indemnification is being sought will reimburse each applicable Underwriter on a monthly basis for all reasonable legal or other out-of-pocket expenses incurred in connection with investigating, defending or settling any such Proceeding (to the extent documented by reasonably itemized invoices therefor), notwithstanding the absence of a judicial determination as to the propriety and enforceability of the obligation of the Company and the Bank to reimburse each such Underwriter for such expenses and the possibility that such payments might later be held to have been improper by a court of competent jurisdiction. To the extent that any such interim reimbursement payment is so held to have been improper, each Underwriter shall promptly return it to the person(s) from whom it was received. Any such interim reimbursement payments that are not made to the Underwriters within 30 days of a request for reimbursement shall bear interest compounded daily at a rate determined on the basis of the base lending rate announced from time to time by The Wall Street Journal from the date of such request.
If any action, claim, inquiry, suit or proceeding shall be brought against any Underwriter or any person controlling any Underwriter in respect of which indemnity may be sought against the Company or the Bank, such Underwriter or such controlling person shall promptly notify in writing the party against whom indemnification is being sought (the “indemnifying party”), and such indemnifying party shall assume the defense thereof, including the employment of counsel reasonably acceptable to such Underwriter or such controlling person and the payment of all reasonable fees of and expenses incurred by such counsel. Such Underwriter or any such controlling person shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Underwriter or such controlling person, unless (i) the indemnifying party has agreed in writing to pay such fees and expenses, (ii) the indemnifying party has failed to timely assume the defense and employ counsel reasonably acceptable to the Underwriter or such controlling person or (iii) the named parties to any such action (including any impleaded parties) include both such Underwriter or such controlling person and the indemnifying party, and such Underwriter or such controlling person shall have been advised by its counsel that one or more legal defenses may be available to the Underwriter that may not be available to the Company or the Bank, as the case may be, or that representation of such indemnified party and any indemnifying party by the same counsel would be inappropriate under applicable standards of professional conduct (whether or not such representation by the same counsel has been proposed) due to actual or potential differing interests between them (in which case the indemnifying party shall not have the right to assume the defense of such action on behalf of such Underwriter or such controlling person (but the Company and the Bank shall not be liable for the fees and expenses of more than one counsel for the Underwriters and such controlling persons)). The indemnifying party shall not be liable for any settlement of any such action effected without its written consent, but if settled with such written consent, or if there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any Underwriter and any such controlling person from and against any loss, claim, damage, liability or expense by reason of such settlement or judgment, but in the case of a judgment only to the extent stated in the first and second paragraphs of this Section 8.
Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and any person who controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as the foregoing indemnity from the Company to each Underwriter, but only with respect to information furnished in writing by or on behalf of such Underwriter through the Representative expressly for use in the Registration Statement, any Preliminary Prospectus, the Time of Sale Information, any Issuer Free Writing Prospectus or the Prospectus, or any amendment or supplement thereto. If any action or claim shall be brought or asserted against the Company, any of its directors, any of its officers or any such controlling person based on the Registration Statement, any Preliminary Prospectus, the Time of Sale Information or the Prospectus, or any amendment or supplement thereto, and in respect of which indemnity may be sought against any Underwriter pursuant to this paragraph, such Underwriter shall have the rights and duties given to the Company by the immediately preceding paragraph (except that if the Company shall have assumed the defense thereof such Underwriter shall not be required to do so, but may employ separate counsel therein and participate in the defense thereof, but the fees and expenses of such counsel shall be at such Underwriter’s expense), and the Company, its directors, any such officers and any such controlling persons, shall have the rights and duties given to the Underwriters by the immediately preceding paragraph. The only information furnished to the Company through the Representative by or on behalf of any Underwriter is described in Section 12 herein.
In any event, the Company will not, without the prior written consent of the Representative, settle or compromise or consent to the entry of any judgment in any Proceeding or threatened Proceeding in respect of which the indemnification may be sought hereunder (whether or not the Representative or any person who controls the Representative within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act is a party to such Proceeding) unless such settlement, compromise or consent includes an unconditional release of all Underwriters and such controlling persons from all liability arising out of such Proceeding.
If the indemnification provided for in this Section 8 is unavailable or insufficient for any reason whatsoever to an indemnified party in respect of any Damages referred to herein, then an indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such Damages (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Bank on the one hand, and the Underwriters on the other hand, from the offering and sale of the Shares or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative and several fault of the Company and the Bank on the one hand, and the Underwriters on the other hand, in connection with the statements or omissions that resulted in such Damages as well as any other relevant equitable considerations. The relative and several benefits received by the Company and the Bank on the one hand, and the Underwriters on the other hand, shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company and the Bank bear to the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover page of the Prospectus; provided, however, that in the event that the Underwriters shall have purchased any Additional Shares hereunder, any determination of the relative benefits received by the Company and the Bank or the Underwriters from the offering of the Shares shall include the net proceeds (before deducting expenses) received by the Company and the Bank and the underwriting discounts and commissions received by the Underwriters, from the sale of such Additional Shares, in each case computed on the basis of the respective amounts set forth in the notes to the table on the cover page of the Prospectus. The relative fault of the Company and the Bank on the one hand, and the Underwriters 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 by the Underwriters on the other hand and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Company, the Bank and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 8 was determined by a pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the Damages referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating, defending or settling any such action or claim. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount of the underwriting commissions received by such Underwriter in connection with the Shares underwritten by it and distributed to the public. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section 8 are several in proportion to the respective numbers of Firm Shares set forth opposite their names in Schedule I hereto (or such numbers of Firm Shares increased as set forth in Section 10 hereof) and not joint.
Notwithstanding the second paragraph of this Section 8, any Damages for which an indemnified party is entitled to indemnification or contribution under this Section 8 shall be paid by the indemnifying party to the indemnified party as Damages are incurred after receipt of reasonably itemized invoices therefor. The indemnity, contribution and reimbursement agreements contained in this Section 8 and the representations and warranties of the Company set forth in this Agreement shall remain operative and in full force and effect, regardless of (i) any investigation made by or on behalf of any Underwriter or any person controlling any Underwriter, the Company, its directors or officers or any person controlling the Company, (ii) acceptance of any Shares and payment therefor hereunder and (iii) any termination of this Agreement. A successor to any Underwriter or any person controlling any Underwriter, or to the Company, its directors or officers or any person controlling the Company, shall be entitled to the benefits of the indemnity, contribution and reimbursement agreements contained in this Section 8.
It is agreed that any controversy arising out of the operation of the interim reimbursement arrangements set forth in the this Section 8, including the amounts of any requested reimbursement payments and the method of determining such amounts, shall be settled by arbitration conducted pursuant to the Code of Arbitration Procedure of FINRA. Any such arbitration must be commenced by service of a written demand for arbitration or written notice of intention to arbitrate, therein electing the arbitration tribunal. In the event the party demanding arbitration does not make such designation of an arbitration tribunal in such demand or notice, then the party responding to said demand or notice is authorized to do so. Such arbitration would be limited to the operation of the interim reimbursement provisions contained in this Section 8, and would not resolve the ultimate propriety or enforceability of the obligation to reimburse expenses that is created by the provisions of this Section 8.
9. Conditions of Underwriters’ Obligations. The several obligations of the Underwriters to purchase the Firm Shares and Additional Shares, as the case may be, hereunder are subject to the following conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to Rule 424(b) under the Act within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof (or a post-effective amendment shall have been filed and declared effective in accordance with the requirements of Rule 430A), and if the Company has elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall have become effective by 10:00 P.M. Eastern Time on the date of this Agreement.
(b) The Representative shall be reasonably satisfied that since the respective dates as of which information is given in the Registration Statement, the Time of Sale Information and Prospectus, (i) there shall not have been any change in the capital stock of the
Company or any material change in the indebtedness (other than in the ordinary course of business or as described in the Registration Statement, the Time of Sale Information and the Prospectus) of the Company, (ii) except as set forth or contemplated by the Registration Statement, the Time of Sale Information or the Prospectus, no material oral or written agreement or other transaction shall have been entered into by the Company that is not in the ordinary course of business or that could reasonably be expected to result in a material reduction in the future earnings of the Company, (iii) no loss or damage (whether or not insured) to the property of the Company shall have been sustained that had or could reasonably be expected to have a Material Adverse Effect, (iv) no legal or governmental action, suit or proceeding affecting the Company or any of its properties that is material to the Company or that affects or could reasonably be expected to affect the transactions contemplated by this Agreement shall have been instituted or threatened and (v) there shall not have been any material change in the condition (financial or otherwise), business, management or results of operations of the Company or its subsidiaries that makes it impractical or inadvisable in the Representative’s judgment to proceed with the public offering or purchase of the Shares as contemplated hereby (a “Material Adverse Change”).
(c) The Representative shall have received on the Closing Date (and the Additional Closing Date, if any) an opinion of Xxxxxx Xxxxxxx Xxxxxx & Xxxxx, LLP, counsel to the Company, substantially in the form of Exhibit C attached hereto.
(d) The Representative shall have received on the Closing Date or Additional Closing Date, as the case may be, an opinion of Xxxxx Day, as counsel for the Underwriters, dated the Closing Date or Additional Closing Date, as the case may be, with respect to the issuance and sale of the Shares, the Registration Statement and other related matters as the Representative may reasonably request, and the Company and its counsel shall have furnished to counsel to the Underwriters such documents as they may reasonably request for the purpose of enabling them to pass upon such matters.
(e) The Representative shall have received letters addressed to the Representative and dated the date hereof and the Closing Date or the Additional Closing Date, as the case may be, from the firm of Kraft CPAs PLLC, independent registered public accounting firm, in the forms heretofore approved by the Representative.
(f) (i) No stop order suspending the effectiveness of the Registration Statement shall have been issued by the Commission and no proceedings for that purpose shall be pending or, to the knowledge of the Company, shall be threatened or contemplated by the Commission at or prior to the Closing Date or the Additional Closing Date, as the case may be; (ii) no order suspending the effectiveness of the Registration Statement or the qualification or registration of the Shares under the securities or Blue Sky laws of any jurisdiction shall be in effect and no proceeding for such purpose shall be pending or, to the knowledge of the Company, threatened or contemplated by the authorities of any jurisdiction; (iii) any request for additional information on the part of the staff of the Commission or any such authorities shall have been complied with to the satisfaction of the staff of the Commission or such authorities, and FINRA shall have raised no objection to the fairness and reasonableness of the underwriting terms and arrangements; (iv) after the date hereof, no amendment or supplement to the
Registration Statement or the Prospectus shall have been filed unless a copy thereof was first submitted to the Representative and the Representative did not object thereto in good faith; and (v) all of the representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects (except for such representations and warranties qualified by materiality, which representations and warranties shall be true and correct in all respects) on and as of the date hereof and on and as of the Closing Date and the Additional Closing Date, if any, as if made on and as of the Closing Date or Additional Closing Date, as the case may be. In addition, the Representative shall have received a certificate, dated the Closing Date and signed by the chief executive officer and the chief financial officer of the Company (or such other officers as are acceptable to the Representative) to the effect set forth in this Section 9(f) and in Sections 9(b), 9(g), and 9(j) hereof.
(g) The Company shall not have failed in any material respect at or prior to the Closing Date or the Additional Closing Date, as the case may be, to have performed or complied with any of its agreements herein contained and required to be performed or complied with by it hereunder at or prior to the Closing Date or Additional Closing Date, as the case may be.
(h) The Company shall have furnished or caused to have been furnished to the Representative such further certificates and documents as the Representative shall have reasonably requested.
(i) At or prior to the date of this Agreement, the Representative shall have received the Lock-Up Agreements.
(j) For the period from and after the date of this Agreement and through and including the Closing Date and, with respect to the Additional Shares, the Additional Closing Date, there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any securities of the Company or any of its subsidiaries by any “nationally recognized statistical rating organization” as such term is defined for purposes of Rule 436(g)(2) under the Act.
(k) All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof only if they are reasonably satisfactory in form and substance to the Representative and counsel to the Underwriters.
(l) The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the satisfaction on and as of the Additional Closing Date of the conditions set forth in this Section 9, except that, if the Additional Closing Date is other than the Closing Date, the certificates, opinions and letters referred to in this Section 9 shall be dated as of the Additional Closing Date and the opinions and letters called for by Sections 9(c) and 9(d) shall be revised to reflect the sale of Additional Shares.
(m) At the Closing Date or the Additional Closing Date, as the case may be, the Shares shall have been approved for listing on Nasdaq, subject only to official notice of issuance.
If any of the conditions hereinabove provided for in this Section 9 shall not have been satisfied when and as required by this Agreement, this Agreement may be terminated by the Representative by notifying the Company of such termination by electronic mail transmission, facsimile or telephone at or prior to such Closing Date, but the Representative shall be entitled to waive any of such conditions.
10. Defaulting Underwriter. If any one or more of the Underwriters shall fail or refuse to purchase Firm Shares that it or they have agreed to purchase hereunder, and the aggregate number of Firm Shares that such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Firm Shares, each non-defaulting Underwriter shall be obligated, severally, in the proportion in which the number of Firm Shares set forth opposite its name in Schedule I hereto bears to the aggregate number of Firm Shares set forth opposite the names of all non-defaulting Underwriters or in such other proportion as the Representative may specify in the Agreement Among Underwriters, to purchase the Firm Shares that such defaulting Underwriter or Underwriters agreed, but failed or refused to purchase. If any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares and arrangements satisfactory to the Representative and the Company for the purchase of such Firm Shares are not made within 48 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter or the Company. In any such case that does not result in termination of this Agreement, either the Representative or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven (7) days, in order that the required changes, if any, in the Registration Statement and the Prospectus or any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any such default of any such Underwriter under this Agreement.
11. Termination of Agreement. This Agreement shall be subject to termination in the Representative’s absolute discretion, without liability on the part of any Underwriter to the Company by notice to the Company, if prior to the Closing Date or the Additional Closing Date (if different from the Closing Date and then only as to the Additional Shares), as the case may be, in the Representative’s sole judgment, (i) trading in the Company’s Common Stock shall have been suspended by the Commission or Nasdaq, (ii) trading in securities generally on the New York Stock Exchange or Nasdaq shall have been suspended or materially limited, or minimum or maximum prices shall have been generally established on such exchange, or additional material governmental restrictions, not in force on the date of this Agreement, shall have been imposed upon trading in securities generally by any such exchange or by order of the Commission or any court or other governmental authority, (iii) a general moratorium on commercial banking activities shall have been declared by either federal or New York State authorities, (iv) any downgrading shall have occurred in the rating accorded the Company’s securities by any “nationally recognized statistical rating organization”, as that term is defined by
the Commission for purposes of Rule 436(g)(2) under the Act, (v) any such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company’s securities, (vi) in the judgment of the Representative there shall have occurred any Material Adverse Change or (vii) there shall have occurred any outbreak or escalation of hostilities or other international or domestic calamity, crisis, acts of terrorism or change in political, financial or economic conditions or other material event the effect of which on the financial markets of the United States is such as to make it, in the Representative’s judgment, impracticable or inadvisable to market the Shares or to enforce contracts for the sale of the Shares. Notice of such cancellation shall be promptly given to the Company and its counsel by electronic mail transmission, facsimile or telephone and shall be subsequently confirmed by letter. If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party to any other party except as provided in any engagement letter executed by the parties, Section 5(i) hereof, and provided further that Section 7 shall survive such termination and remain in full force and effect.
12. Information Furnished by the Underwriters. The Company acknowledges that the only information furnished by or on behalf of the Underwriters through the Representative or on the Representative’s behalf is the concession and reallowance figures and the information contained in the [ ], [ ], [ ] and [ ] paragraphs under “Underwriting” in the Prospectus.
13. No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (a) the purchase and sale of the Shares pursuant to this Agreement, including the determination of the public offering price of the Shares and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand, (b) in connection with the offering contemplated hereby and the process leading to such transaction each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, or its shareholders, creditors, employees or any other person or entity, (c) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising the Company on other matters) and no Underwriter has any obligation to the Company with respect to the offering contemplated hereby except the obligations expressly set forth in this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (e) the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate. The Company waives, to the fullest extent permitted by law, any claims it may have against any of the Underwriters for breach of fiduciary duty or alleged breach of fiduciary duty and agrees that none of the Underwriters shall have any liability (whether direct or indirect, in contract, tort or otherwise) to it in respect of such a fiduciary claim or to any person asserting a fiduciary duty claim on its behalf or in right of it or the Company, including shareholders, employees or creditors of the Company.
14. Integration. This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and the Underwriters, or any of them with respect to the subject matter hereof, other than any placement agreement or any terms of any engagement with respect to a placement of shares of Company capital stock outside of the public offering contemplated hereby.
15. Parties. This Agreement shall inure to the benefit of and be binding upon each of the Underwriters and the Company and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters and the Company and their respective successors and their respective controlling persons, directors, officers, employees and agents and their respective heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters and the Company and their respective successors, and said controlling persons, directors, officers, employees and agents and their heirs and legal representatives, and for the benefit of no other person or entity. No purchaser of Shares from the Underwriters shall be deemed to be a successor by reason merely of such purchase.
16. Miscellaneous. Except as otherwise provided in Sections 5 and 11 hereof, notice given pursuant to any of the provisions of this Agreement shall be in writing and shall be delivered:
(i) to the Company:
Tennessee Commerce Bancorp, Inc.
000 Xxxxxxx Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxx
with a copy to
Xxxxxx Xxxxxxx Xxxxxx &
Xxxxx, LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: E. Xxxxxx Xxxxxxxx
(ii) to the Representative:
Macquarie Capital (USA) Inc.
0 Xxxxx Xxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
with a copy to
Xxxxx Day
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxx X. XxxXxxxxx, III
This Agreement has been and is made solely for the benefit of the several Underwriters, the Company and its directors and officers.
17. Applicable Law; Counterparts.
(a) This Agreement shall be governed by and construed in accordance with the laws of the State of New York without reference to choice of law principles thereunder.
(b) This Agreement may be signed in various counterparts, which together shall constitute one and the same instrument.
(c) This Agreement shall be effective when, but only when, at least one counterpart hereof shall have been executed on behalf of each party hereto.
(d) The Company and the Underwriters each hereby irrevocably waive any right they may have to a trial by jury in respect to any claim based upon or arising out of this Agreement or the transactions contemplated hereby.
(Signature Page Follows)
Please confirm that the foregoing correctly sets forth the agreement among the Company and the several Underwriters.
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Very truly yours, |
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TENNESSEE COMMERCE BANK |
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CONFIRMED as of the date first above mentioned, on behalf of the Representative and the other several Underwriters named in Schedule I hereto |
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MACQUARIE CAPITAL (USA) INC. |
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[Signature Page to Underwriting Agreement]
