3,525,000 SHARES
STANDARD COMMERCIAL CORPORATION
COMMON STOCK
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UNDERWRITING AGREEMENT
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WHEAT, FIRST SECURITIES, INC.
BT SECURITIES CORPORATION
As Representatives of the Several
Underwriters Named in Schedule I hereto
c/o Wheat, First Securities, Inc.
Riverfront Plaza
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000 May [ ], 1997
Ladies and Gentlemen:
Standard Commercial Corporation, a North Carolina corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of 3,500,000 shares of common stock, $0.20 par
value, of the Company (the "Common Stock"), and at the election of the
Underwriters, an aggregate of 528,750 additional shares, and the selling
shareholder named in Schedule II hereto (the "Selling Shareholder"), proposes,
subject to the terms and conditions stated herein, to sell to the Underwriters
an aggregate of 25,000 shares of Common Stock . The aggregate of 3,525,000
shares to be sold by the Company and the Selling Shareholders are herein called
the "Firm Securities," and the aggregate of 528,750 additional shares to be sold
by the Company are herein called the "Optional Securities." The Firm Securities
and the Optional Securities that the Underwriters elect to purchase pursuant to
Section 2 hereof are collectively called the "Securities."
1. Representations and Warranties.
(a) The Company represents and warrants to, and agrees with, the
Underwriters that:
(i) A registration statement in respect of the Securities on Form S-3
(File No. 333-23835) under the Securities Act of 1933, as amended (the
"Act"), and as a part thereof a preliminary prospectus, in respect of
the Securities has been filed with the Securities and Exchange
Commission (the "Commission") in the form heretofore delivered to you,
and, excluding exhibits thereto, for each of the other Underwriters;
such registration statement, as amended, has been declared effective by
the Commission; no other document with respect to such registration
statement (other than those documents incorporated into such
registration statement by reference) has heretofore been filed with the
Commission other than in accordance with Section 5(a) of this
Agreement; and no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that
purpose has been instituted or, to the knowledge of the Company,
threatened by the Commission (any preliminary prospectus included in
such registration statement or filed with the Commission pursuant to
Rule 424 of the rules and regulations of the Commission under the Act
being hereinafter called a "Preliminary Prospectus", the various parts
of such registration statement, including all exhibits thereto, and
including the information contained in the form of final prospectus
filed with the Commission pursuant to Rule 424(b) under the Act in
accordance with Section 5(a) of this Agreement and deemed by virtue of
Rule 430A under the Act to be part of the registration statement at the
time it was declared effective, together with any related registration
statement filed with the Commission for registration of a portion of
the Securities, which registration statement became effective pursuant
to Rule 462(b) under the Act, and the documents incorporated by
reference in the registration statement at the time it was declared
effective, each as amended at the time such part became effective,
being herein called collectively the "Registration Statement," and the
final prospectus, in the form first filed pursuant to Rule 424(b),
being hereinafter called the "Prospectus," provided, that if the
Company elects to rely on Rule 434 under the Act, all references to the
Prospectus shall be deemed to include, without limitation, the form of
prospectus and the abbreviated term sheet, taken together, provided to
the Underwriters by the Company in reliance on Rule 434); any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein
pursuant to Form S-3 under the Act; and the terms "supplement" and
"amendment" or "amend" as used in this Agreement shall include all
documents subsequently filed by the Company with the Commission
pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that are deemed to be incorporated by reference in the
Prospectus;
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations
of the Commission thereunder, and did not contain any untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty 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
Underwriters through you expressly for use therein (which information
consists only of the information set forth in the last sentence of
Section 8(c) hereof);
(iii) Each document incorporated by reference in the Prospectus when
filed, or to be filed, with the Commission, conformed in all material
respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder, and, as of its filing date,
no such document contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(iv) The Registration Statement conforms, and the Prospectus and any
amendments or supplements thereto will conform, in all material
respects to the requirements of the Act and the rules and regulations
of the Commission thereunder and do not and will not as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein (in
the case of any Prospectus, in light of the circumstances under which
they were made) not misleading; provided, however, that this
representation and warranty 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 Underwriters through you
expressly for use therein (which information consists only of the
information set forth in the last sentence of Section 8(c) hereof);
(v) Neither the Company nor any of its subsidiaries, a complete and
correct list of which is attached as Schedule III (the "Subsidiaries"),
has sustained since the date of the latest audited financial statements
included in the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, which loss has had, or is
reasonably expected to have a material adverse effect on the Company
and the Subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any material change in the outstanding
capital stock or long-term debt of the Company (other than payments in
the ordinary course) or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, shareholders' equity
or results of operations of the Company and the Subsidiaries, taken as
a whole, otherwise than as set forth or contemplated in the Prospectus;
(vi) The Company and each of the Subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title
to all material items of personal property owned by them, free and
clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the
value of such property, as reflected in the financial statements
included in the Prospectus, and do not interfere with the use made of
such property by the Company and the Subsidiaries; and any real
property and buildings held under lease by the Company or any of the
Subsidiaries are held by it under valid, subsisting and enforceable
leases with such exceptions as are not material to the Company and the
Subsidiaries taken as a whole, and do not interfere with the use made
of such property and buildings by the Company or such Subsidiaries;
(vii) The Company and each of the Subsidiaries have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation, with
power and authority (corporate and other) to own or lease their
respective properties and conduct their respective businesses as
described in the Prospectus, and each has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to require such
qualification, except where the failure to so qualify would not result
in a material adverse effect on the consolidated financial position,
shareholders' equity or results of operations of the Company and the
Subsidiaries taken as a whole;
(viii) The Company has an authorized capitalization as set forth in
the Prospectus under the caption "Capitalization"; all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued, are fully paid and nonassessable and conform to
the description of the capital stock of the Company contained in the
Prospectus; except as described in the Prospectus, there are no
preemptive or other similar rights to subscribe for or to purchase any
securities of the Company; except as described in the Prospectus, there
are no warrants, options or other similar rights to purchase any
securities of the Company; neither the filing of the Registration
Statement nor the offering or sale of the Securities as contemplated by
this Agreement gives rise to any rights for or relating to the
registration of any securities of the Company with respect to such
filing, offering or sale, other than rights which have been waived or
satisfied);
(ix) The issued and outstanding shares of capital stock of each of the
Subsidiaries owned by the Company have been duly and validly authorized
and issued and are fully paid and nonassessable; and except as
otherwise set forth in the Prospectus, all outstanding shares of
capital stock of each of the Subsidiaries owned by the Company are
directly or indirectly owned by the Company free and clear of any
perfected security interest and any other security interests, claims,
liens or encumbrances in the percentage of each such Subsidiary's total
capital stock set forth on Schedule III;
(x) The Securities to be sold by the Company pursuant to this
Agreement have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and nonassessable and will conform to the
description of the Securities contained in the Prospectus as amended or
supplemented;
(xi) The issue and sale of the Securities by the Company and the
performance by the Company of this Agreement and the consummation by
the Company of the other transactions herein contemplated will not
conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement, guarantee or other agreement or
instrument to which the Company or any of the Subsidiaries is a party
or by which the Company or any of the Subsidiaries is bound or to which
any of the property or assets of the Company or any of the Subsidiaries
is bound or to which any of the property or assets of the Company or
any of the Subsidiaries is subject, except where such conflict, breach,
violation or default will not have a material adverse effect on the
Company and the Subsidiaries, taken as a whole, nor will such action
result in any violation of the provisions of the Articles of
Incorporation or Bylaws or the articles of incorporation or bylaws or
other organizational documents (each as amended as of the date hereof,
the "Charter" and "Bylaws", respectively) of any of the Subsidiaries,
except where such conflict, breach, violation or default will not have
a material adverse effect on the Company and the Subsidiaries, taken as
a whole, nor will such action result in any violation of the provisions
of the Charter and Bylaws of the Company or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries or any of
their properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities or
the consummation by the Company of the transactions contemplated by
this Agreement, except such as may be required under the Act and such
as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Securities by the
Underwriters and the clearance of such offering with the National
Association of Securities Dealers, Inc. (the "NASD");
(xii) There are no legal or governmental proceedings pending to which
the Company or any of its Subsidiaries is a party or of which any
property of the Company or any of its Subsidiaries is the subject other
than as set forth or contemplated in the Prospectus, that, if
determined adversely to the Company or any of its Subsidiaries, would
individually or in the aggregate have a material adverse effect on the
financial position, shareholders' equity or results of operations of
the Company or of the Company and the Subsidiaries taken as a whole
and, to the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or by others;
(xiii) Deloitte & Touche, LLP, who have certified certain financial
statements of the Company and the Subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(xiv) All employee benefit plans (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"))
established, maintained or contributed to by the Company comply in all
material respects with the requirements of ERISA and no employee
pension benefit plan (as defined in Section 3(2) of ERISA) has incurred
or assumed an "accumulated funding deficiency" within the meaning of
Section 302 of ERISA or has incurred or assumed any material liability
(other than for the payment of premiums) to the Pension Benefit
Guaranty Corporation, except where such non-compliance, deficiency or
liability will not have a material adverse effect on the Company and
the Subsidiaries taken as a whole;
(xv) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes, as set forth in the
Registration Statement present fairly the financial position and the
results of operations of the Company and the Subsidiaries, taken as a
whole, at the indicated dates and for the indicated periods; such
financial statements have been prepared in accordance with generally
accepted accounting principles ("GAAP"), consistently applied
throughout the periods presented except as noted in the notes thereto,
and all adjustments necessary for a fair presentation of results for
such periods have been made; and the summary and selected financial
information included in the Prospectus presents fairly the information
shown therein and has been compiled on a basis consistent with the
financial statements presented therein;
(xvi) The Company and each of the Subsidiaries have filed all federal,
state and foreign income, franchise and excise tax returns which have
been required to be filed (or has received an extension with respect
thereto), and have paid, or made adequate reserves for, all taxes
indicated by said returns and all assessments received by them to the
extent that such taxes have become due (other than my taxes for which
appropriate reserves as determined by GAAP have been established and
are being contested in good faith); to the knowledge of the Company
there is no tax deficiency that has been or might be asserted against
the Company that could have a material adverse effect on the business,
properties, business prospects, condition (financial or otherwise),
earnings or results of operations of the Company and the Subsidiaries,
taken as a whole;
(xvii) Neither the Company nor any of the Subsidiaries is in violation
of any federal, state or foreign law, regulation, or treaty relating to
the storage, handling, transportation, treatment or disposal of
hazardous substances (as defined in 42 U.S.C. Section 9601) or
hazardous materials (as defined by any federal or state or foreign law
or regulation) or other waste products, which violation is reasonably
likely to result in a material adverse effect on the financial
condition or business operations or properties of the Company and the
Subsidiaries taken as a whole, and the Company and each of the
Subsidiaries have received all permits, licenses or other approvals as
may be required of them under applicable federal, state and foreign
environmental laws and regulations to conduct their business as
described in the Prospectus, except where failure to receive such
permits, licenses or approvals would not be reasonably expected to have
or result in a material adverse effect on the Company and the
Subsidiaries, taken as a whole; and the Company and each of the
Subsidiaries are in compliance in all material respects with the terms
and conditions of any such permit, license or approval; neither the
Company nor any of the Subsidiaries has received any notices or claims
that it is a responsible party or a potentially responsible party in
connection with any claim or notice asserted pursuant to 42 U.S.C.
Section 9601 et seq. or any state superfund law or any similar foreign
law; and the disposal by the Company or any Subsidiary of any of the
Company's and each Subsidiary's hazardous substances, hazardous
materials and other waste products has been lawful in all material
respects;
(xviii) No relationship, direct or indirect, exists between or among
the Company or any of the Subsidiaries, on the one hand, and the
directors, officers, shareholders, customers or suppliers of the
Company or any of the Subsidiaries on the other hand, that is required
by the Act or the Exchange Act, or by the rules and regulations under
either of such Acts to be described in the Registration Statement and
the Prospectus or documents incorporated by reference therein that is
not so described;
(xix) To the knowledge of the Company, none of the Company's officers,
directors or 5% or greater securityholders has any association or
affiliation with any member of the NASD;
(xx) Neither the Company nor any of the Subsidiaries has taken and
none of such entities will take, directly or indirectly, any action
that is designed to or that has constituted or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale
of the Securities in violation of the Act or the Exchange Act;
(xxi) Each of the Company and the Subsidiaries owns or possesses, or
can acquire on reasonable terms, adequate licenses, copyrights,
trademarks, service marks and trade names (collectively, "intellectual
property") necessary to carry on its business as presently operated by
it, except where the failure to own or possess or have the ability to
acquire any such intellectual property would not, individually or in
the aggregate, have a material adverse effect on the Company and the
Subsidiaries taken as a whole, and neither the Company nor any of the
Subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect
to any intellectual property or of any facts which would render any
intellectual property invalid or inadequate to protect the interest of
the Company or any of the Subsidiaries therein and which infringement
or conflict could have a material adverse effect on the Company and the
Subsidiaries taken as a whole;
(xxii) Except as described in the Prospectus, the Company and the
Subsidiaries maintain insurance of the types and in the amounts that
are customary or required for the business operated by them, all of
which insurance is in full force and effect, except where failure to
maintain such insurance would not be reasonably expected to have or
result in a material adverse effect on the Company and the
Subsidiaries, taken as a whole;
(xxiii) The Company and each of the Subsidiaries holds and are
operating in compliance, in all material respects, with all franchises,
grants, authorizations, licenses, permits, easements, consents,
certificates and orders of any governmental or self-regulatory body
required for the conduct of their respective businesses as presently
being conducted ("licenses") and all licenses are valid and in full
force and effect, except where the invalidity of such licenses would
not be reasonably expected to have or result in a material adverse
effect on the Company and the Subsidiaries, taken as a whole, and the
Company, and each of the Subsidiaries are in compliance, in all
material respects, with all laws, regulations, orders and decrees
applicable to them;
(xxiv) This Agreement has been duly authorized, executed and delivered
by the Company and constitutes a valid and binding obligation of the
Company;
(xxv) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that transactions are
executed in accordance with management's general or specific
authorization; (i) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (ii) access to assets is permitted
only in accordance with management's general or specific authorization;
and (iii) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences;
(xxvi) There is no document or contract of a character required to be
described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement which is not
described or filed as required. All such contracts to which the Company
or a Subsidiary is a party constitute valid and binding agreements of
the Company or such Subsidiary; and
(xxvii) The conditions for use of registration statements on Form S-3
set forth in the General Instructions on Form S-3 have been satisfied
and the Company is entitled to use such form for the transaction
contemplated herein.
(b) The Selling Shareholder represents and warrants to, and agrees
with, the Underwriters and the Company, solely with respect to the Selling
Shareholder, that:
(i) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the
transactions contemplated by this Agreement in connection with the
execution and delivery by the Selling Shareholder of this Agreement and
for the sale and delivery of the Securities to be sold by the Selling
Shareholder hereunder, except such as may be required under the Act or
state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriters and the clearance of
such offering with the NASD; and the Selling Shareholder has full
right, power and authority to enter into this Agreement and to sell,
assign, transfer and deliver the Securities to be sold by the Selling
Shareholder hereunder;
(ii) The execution and delivery of this Agreement and the sale of the
Securities to be sold by the Selling Shareholder hereunder and the
performance of this Agreement and the consummation by the Selling
Shareholder of the transactions herein contemplated will not conflict
with or result in a breach or violation of any terms or provisions of,
or constitute a default under, any statute, indenture, mortgage, deed
of trust, loan agreement, guarantee or other agreement or instrument to
which the Selling Shareholder is a party or by which the Selling
Shareholder is subject, or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Selling
Shareholder or the Securities of the Selling Shareholder;
(iii) The Selling Shareholder has and at such Delivery Date (as
hereinafter defined) will have good and valid title to the Securities
to be sold by the Selling Shareholder hereunder, free and clear of all
liens, encumbrances, equities or claims (other than those imposed under
this Agreement); and, upon delivery of such Securities and payment
therefor pursuant hereto, good and valid title to all of such
Securities, free and clear of all liens, encumbrances, equities or
claims, will be transferred to the Underwriters;
(iv) The Selling Shareholder has not taken and will not take, directly
or indirectly, any action which is designed to or which has constituted
or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities in violation
of the Act or the Exchange Act;
(v) The Selling Shareholder is familiar with the Registration
Statement and the Prospectus and verifies that the information set
forth therein under the caption "Principal and Selling Shareholders"
respecting him is true and complete;
(vi) The Selling Shareholder specifically agrees that the Securities
are subject to the interests of the Underwriters hereunder. The Selling
Shareholder agrees that its obligations hereunder shall not be
terminated by operation of law, whether by death or incapacity, or by
the occurrence of any other event that is not by the terms of this
Agreement a condition to the Selling Shareholder's obligations
hereunder;
(vii) This Agreement has been duly executed and delivered by or on
behalf of the Selling Shareholder and constitutes the valid and binding
agreement of the Selling Shareholder; and
(viii) To the knowledge of the Selling Shareholder, the
representations and warranties of the Company contained in Section 1(a)
hereof are true and correct in all material respects.
2. Purchase and Sale.
Subject to the terms and conditions herein set forth, (a) the Company
and the Selling Shareholder, severally and not jointly, agree to sell to the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to
purchase from the Company and the Selling Shareholder, at a purchase price per
share of $[ ], the number of Firm Securities to be purchased by such Underwriter
as set forth opposite the name of such Underwriter in Schedule I hereto and (b)
in the event and to the extent that the Underwriters shall exercise the option
to purchase Optional Securities as provided below, the Company agrees to sell to
each of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price set forth in clause
(a) of this Section 2, that portion of the number of Optional Securities as to
which such election shall have been exercised (to be adjusted by you so as to
eliminate fractional securities) determined by multiplying such number of
Optional Securities by a fraction, the numerator of which is the maximum number
of Optional Securities that such Underwriter is entitled to purchase as set
forth opposite the name of such Underwriter in Schedule I hereto, and the
denominator of which is the maximum number of the Optional Securities that all
of the Underwriters are entitled to purchase.
The Company hereby grants to the Underwriters an option to purchase
at their election up to 528,750 Optional Securities at the purchase price per
share set forth in the paragraph above, for the sole purpose of covering
over-allotments in the sale of the Firm Securities. Any such election to
purchase Optional Securities may be exercised no more than once by written
notice from you to the Company, given within a period of 30 days after the date
of this Agreement, setting forth the aggregate amount of Optional Securities to
be purchased and the date on which such Optional Securities are to be delivered
and payment therefor is to be made, as determined by you but in no event earlier
than the First Delivery Date (as defined in Section 4 hereof) or, unless you
otherwise agree in writing, earlier than two or later than 10 business days
after the date of such notice; provided that if such notice is delivered after
noon, Richmond, Virginia time, the date for delivery of the Optional Securities
and payment therefor shall be no earlier than three business days after the date
of such notice.
3. Offering by the Underwriters.
Upon the authorization by you of the release of the Firm Securities,
the several Underwriters propose to offer the Firm Securities for sale upon the
terms and conditions set forth in the Prospectus.
4. Delivery and Payment.
Certificates in definitive form for the Securities to be purchased by
each Underwriter hereunder, and in such denominations and registered in such
names as Wheat, First Securities, Inc. may request upon at least two business
days' prior notice to the Company or the Selling Shareholder, as applicable,
shall be delivered by or on behalf of the Company or the Selling Shareholder, as
applicable, to Wheat, First Securities, Inc., for the account of each
Underwriter, against payment by such Underwriter or on its behalf of the
purchase price therefor. Payment of the purchase price for the Securities shall
be made by certified or official bank check in immediately available funds or,
at the option of Wheat, First Securities, Inc., by wire transfer of immediately
available funds all at the offices of [Wheat, First Securities, Inc., Riverfront
Plaza, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx]. The time and date of such
delivery and payment shall be, with respect to the Firm Securities, 10:00 a.m.,
Richmond, Virginia time, on May [ ], 1997 or at such other time and date as you
and the Company may agree upon in writing, and, with respect to the Optional
Securities, 10:00 a.m., Richmond, Virginia time, on the date specified by you in
the written notice given by you (consistent with Section 2 hereof) of the
Underwriters' election to purchase such Optional Securities, or at such other
time and date as you and the Company may agree upon in writing. Such time and
date for delivery of the Firm Securities is herein called the "First Delivery
Date," such time and date for delivery of the Optional Securities, if not the
First Delivery Date, is herein called the "Second Delivery Date," and each such
time and date for delivery is herein called a "Delivery Date." Such certificates
will be made available for checking and packaging at least 24 hours prior to
each Delivery Date at the offices of Wheat, First Securities, Inc. at the
address set forth above or such other location designated by the Underwriters to
the Company and the Selling Shareholder.
5. Agreements of the Company and the Selling Shareholder.
(a) The Company agrees with the Underwriters:
(i) To prepare the Prospectus in a form reasonably approved by you and
to file such Prospectus (or a term sheet as permitted by Rule 434(c))
pursuant to Rule 424(b) under the Act as soon as practicable after the
execution of this agreement, but in no event later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement or, if applicable, such
earlier time as may be required by Rule 430A(a)(3) under the Act; to
make no amendment or supplement to the Registration Statement or
Prospectus prior to any Delivery Date which shall be reasonably
disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus
has been filed and to furnish you with copies thereof; to file promptly
all reports and any definitive proxy or information statements required
to be filed by the Company with the Commission subsequent to the date
of the Prospectus and for so long as the delivery of a Prospectus is
required in connection with the offering or sale of the Securities; to
advise you, promptly after it receives notice thereof, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus, of
the suspension of the qualification of the Securities for offering or
sale in any jurisdiction, of the initiation or threatening in writing
of any proceeding for any such purpose, of any request by the
Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information and, in the event
of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus or
suspending any such qualification, to use promptly its reasonable best
efforts to obtain its withdrawal;
(ii) Promptly from time to time to take such actions as you may
reasonably request to qualify the Securities for offering and sale
under the securities laws of such jurisdictions as you may 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 Securities, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(iii) To furnish the Underwriters with copies of the Registration
Statement and the Prospectus in such quantities as you may from time to
time reasonably request during such period following the date hereof
that a prospectus is required to be delivered in connection with offers
or sales of Securities, and, if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would 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 under which they
were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such period to amend or
supplement the Prospectus to comply with the Act, to notify you and
upon your request to prepare and file such document and furnish without
charge to you and to any dealer in securities as many copies as you may
from time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or
omission or effect such compliance;
(iv) As soon as practicable, to make generally available to its
shareholders (within the meaning of Rule 158 under the Act) and to
deliver to you, an earnings statement of the Company, conforming with
the requirements of Section 11(a) of the Act and Rule 158 under the
Act, covering a period of at least 12 months beginning after the
effective date of the Registration Statement; provided that, so long as
the Company continues to be subject to the reporting requirements under
Section 13 or 15(d) of the Exchange Act, the Company shall not be
required to make available any such earnings statement other than as
included in periodic reports filed with the Commission as required by
such provisions of the Exchange Act;
(v) For a period of 180 days from the date of the Prospectus, not to
offer, sell, contract to sell or otherwise dispose of any securities of
the Company (other than the Securities to be sold by the Company
hereunder or stock dividends issued in the ordinary course of business
or pursuant to employee stock option plans or pursuant to options,
warrants or rights outstanding on the date of this Agreement) without
your prior written consent;
(vi) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or
other communications (financial or other) distributed to shareholders
generally, and deliver to you (i) as soon as they are available, copies
of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of
securities of the Company is listed, and (ii) such additional
information concerning the business and financial condition of the
Company as you may from time to time reasonably request; and
(vii) To apply the net proceeds from the sale of the Securities for
the purposes set forth in the Prospectus.
(b) The Selling Shareholder agrees with the Underwriters:
(i) No offering, sale or other disposition of any Securities (or any
securities convertible into or exercisable for such Securities) will be
made within 180 days after the date of the Prospectus, directly or
indirectly, by the Selling Shareholder, otherwise than hereunder or
with your written consent; and
(ii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982, as amended, with respect to the
transactions herein contemplated, the Selling Shareholder agrees to
deliver to you prior to or at the First Delivery Date (as hereinafter
defined) a properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement specified by
Treasury Department regulations in lieu thereof).
6. Payment of Expenses.
The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's and the Selling Shareholder's
counsel and accountants in connection with the registration of the Securities
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 cost of
reproducing any Agreement Among Underwriters, this Agreement, the Blue Sky
Survey and any other documents in connection with the offering, purchase, sale
and delivery of the Securities; (iii) all expenses in connection with the
qualification of the Securities for offering and sale under state securities
laws as provided in Section 5(a)(ii) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky Survey; (iv) the filing fees
incident to securing any required review by the NASD of the terms of the sale of
the Securities; (v) the cost of preparing stock certificates; (vi) the costs or
expenses of any transfer agent or registrar; and (vii) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section. It is understood, however,
that except as provided in this Section 6, Section 8 and Section 11 hereof, the
Underwriters will pay all their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the Securities by them
and any advertising expenses connected with any offers they may make.
7. Conditions to Obligations of Underwriters.
The obligations of the Underwriters hereunder, as to the Securities
to be delivered at each Delivery Date, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and the Selling Shareholder herein are, at and as of such Delivery
Date, true and correct in all material respects, the condition that the Company
and the Selling Shareholder shall have performed all of their respective
obligations hereunder theretofore to be performed, and the following additional
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)(i) of this Agreement; no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceeding for that
purpose shall have been initiated or, to the knowledge of the Company,
threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Underwriters, shall have
furnished to you such opinion or opinions, dated such Delivery Date, with
respect to the Registration Statement, the Prospectus, and other related matters
as you may reasonably request, and such counsel shall have received such papers
and information as they may reasonably request to enable them to pass upon such
matters;
(c) Wyrick, Robbins, Xxxxx & Xxxxxx L.L.P., counsel for the Company,
shall have furnished to you their written opinion, dated such Delivery Date, in
form reasonably satisfactory to you, to the effect set forth in Exhibit A
attached hereto.
Such opinion may be furnished subject to such stated assumptions,
limitations and qualifications as shall be reasonably acceptable to Xxxxxx
Xxxxxx & Xxxxxxx, counsel for the Underwriters and may state that in giving such
opinions Wyrick, Robbins, Xxxxx & Xxxxxx L.L.P. have relied upon certain
opinions of foreign counsel to the Company reasonably acceptable to Xxxxxx
Xxxxxx & Xxxxxxx, counsel to the Underwriters, provided that such foreign
counsel opinions shall also be addressed and delivered to the Underwriters.
(d) Wyrick, Robbins, Xxxxx & Xxxxxx L.L.P., counsel for the Selling
Shareholders, shall have furnished to you its written opinion, dated such
Delivery Date, in form and substance reasonably satisfactory to you, to the
effect set forth in Exhibit B.
Such opinion may be furnished subject to such stated assumptions,
limitations and qualifications as shall be reasonably acceptable to Xxxxxx
Xxxxxx & Xxxxxxx, counsel for the Underwriters.
(e) At 10:00 a.m., Richmond, Virginia, time, on the date of this
Agreement and the effective date of the most recently filed post-effective
amendment to the Registration Statement and also at each Delivery Date, Deloitte
& Touche, LLP shall have furnished to you a letter or letters, dated the
respective date of delivery thereof, in form and substance reasonably
satisfactory to you, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information relating
to the Company and its Subsidiaries contained in the Registration Statement and
the Prospectus;
(f) (i) Neither the Company nor any of the Subsidiaries shall have
sustained, since the date of the latest audited financial statements included in
the Prospectus, any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus, and (ii) since the respective dates as
of which information is given in the Prospectus there shall not have been any
change in the outstanding capital stock or long-term debt of the Company or any
of the Subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company or any of the
Subsidiaries otherwise than as set forth or contemplated in the Prospectus, the
effect of which, in any such case described in clause (i) or (ii) is in your
reasonable judgment so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities being delivered at such Delivery Date on the terms and in the manner
contemplated by the Prospectus;
(g) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading of any of the
securities of the Company on the New York Stock Exchange; (ii) any United States
federal or state statute, regulation, rule or order of any court, legislative
body, agency or other governmental authority shall have been enacted, published,
decreed or promulgated or any proceeding or investigation shall have been
commenced which, in your reasonable judgment, materially and adversely affects
the business or operations of the Company; (iii) a suspension or material
limitation in trading in securities generally on the New York Stock Exchange;
(iv) a general moratorium on commercial banking activities in New York, Virginia
or North Carolina declared by either federal or New York, Virginia or North
Carolina authorities; (v) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war, if any such event specified in this clause (v) would have such
a materially adverse effect, in your reasonable judgment, as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Securities being delivered at such Delivery Date on the terms and in the
manner contemplated in the Prospectus; or (vi) such a material adverse change in
general economic, political, financial or international conditions affecting
financial markets in the United States having a material adverse impact on
trading prices of securities in general, as, in your reasonable judgment, makes
it inadvisable to proceed with the payment for and delivery of the Securities;
(h) The Company shall have furnished to you copies of agreements of the
directors and executive officers of the Company (other than the Selling
Shareholder), in form and content reasonably satisfactory to you, pursuant to
which such persons agree not to offer, sell, or contract to sell, or otherwise
dispose of, any shares of Common Stock beneficially owned by them or any
securities convertible into, or exchangeable for, Common Stock (other than
pursuant to bona fide gifts to persons who agree in writing with the donor to be
bound by this restriction), on or before the 180th day after the date of this
Agreement without your prior written consent; and
(i) The Company and the Selling Shareholder shall have furnished or
caused to be furnished to you at such Delivery Date certificates of officers of
the Company and the Selling Shareholder reasonably satisfactory to you as to the
accuracy of the respective representations and warranties of the Company and the
Selling Shareholder herein at and as of such Delivery Date, as to the
performance by the Company and the Selling Shareholder of all of their
obligations hereunder to be performed at or prior to such Delivery Date, as to
the matters set forth in subsections (a) and (f) of this Section and as to such
other matters as you may reasonably request.
8. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made), not misleading, and will promptly
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating, preparing to defend or
defending, or appearing as a third-party witness in connection with, any such
action or claim; provided, however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by the Underwriters through you expressly for use therein; provided,
further, that the foregoing indemnity agreement with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Securities, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Securities to such
person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such losses, claims, damages or liabilities.
(b) Subject to subsection (f) of this Section 8, the Selling
Shareholder will indemnify and hold harmless each Underwriter against any
losses, claims, damages or liabilities, joint or several, to which the
Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made), not misleading, and will promptly
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating, preparing to defend or
defending, or appearing as a third-party witness in connection with, any such
action or claim; provided, however, that the Selling Shareholder shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by the Underwriters through you expressly for use therein; provided,
further, that the foregoing indemnity agreement with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Securities, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Securities to such
person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such losses, claims, damages or liabilities.
(c) Each Underwriter will indemnify and hold harmless the Company and
the Selling Shareholder against any losses, claims, damages or liabilities,
joint or several, to which the Company or the Selling Shareholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein (in the case of
the Prospectus, in light of the circumstances under which they were made), not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through you expressly
for use therein; and will promptly reimburse the Company and the Selling
Shareholder for any legal or other expenses reasonably incurred by the Company
and the Selling Shareholder in connection with investigating, preparing to
defend or defending, or appearing as a third-party witness in connection with,
any such action or claim. The Company and the Selling Shareholder acknowledge
that the statements set forth in the last paragraph immediately preceding your
names on the cover page, the last paragraph on the inside front cover page and
the first, third, seventh and eighth paragraphs under the heading "Underwriting"
in the Preliminary Prospectus and the Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in the Preliminary Prospectus or the Prospectus.
(d) Promptly after receipt by an indemnified party under subsection
(a), (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party;
provided, however, that if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have been advised in writing by counsel that representation of such indemnified
party and the indemnifying party may be inappropriate under applicable standards
of professional conduct due to actual or potential differing interests between
them, the indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties. It
is understood that the indemnifying party shall, in connection with any such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys together with appropriate local counsel at any time for all
indemnified parties unless such firm of attorneys shall have reasonably
concluded that one or more indemnified parties has actual differing interests
with other indemnified parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to appoint counsel to defend
such action and approval by the indemnified party of such counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence, (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii). The indemnifying party shall not be liable for any settlement entered
into without its written consent (which consent will not be unreasonably
withheld).
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Selling Shareholder on the one hand and the Underwriters on the other from the
offering of the Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (d) above,
then each indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company and the
Selling Shareholder on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Shareholder on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (after deducting the total underwriting
discount, but before deducting expenses) received by the Company and the Selling
Shareholder 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. The relative fault 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 or the Selling Shareholder on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company, the Selling Shareholder and the Underwriters agree that
it would not be just and equitable if contributions pursuant to this subsection
(e) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take into account the equitable considerations referred to above
in this subsection (e). Except in the event that the indemnified party failed to
give the notice required under subsection (d) above, the amount paid or payable
by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to above in
this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of damages which such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations under this subsection (e) are several in proportion to
their respective underwriting obligations and not joint.
(f) The liability of the Selling Shareholder under this Section 8 shall
be limited to an amount equal to (x) the purchase price per share set forth in
clause (a) of Section 2 hereof multiplied by the number of Securities sold by
the Selling Shareholder to the Underwriters pursuant to this Agreement.
(g) The obligations of the Company and the Selling Shareholder under
this Section 8 shall be in addition to any liability which the Company and the
Selling Shareholder may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section 8
shall be in addition to any liability which the Underwriters may otherwise have
and shall extend, upon the same terms and conditions, to each officer and
director of the Company and to each person, if any, who controls the Company
within the meaning of the Act.
9. Default of Underwriters.
(a) If any Underwriter shall default in its obligation to purchase the
Securities that it has agreed to purchase hereunder at a Delivery Date, you may
in your discretion arrange for you or another party or other parties to purchase
such Securities on the terms contained herein. If within 36 hours after such
default by any Underwriter you do not arrange for the purchase of such
Securities, then the Company and the Selling Shareholder shall be entitled to a
further period of 36 hours within which to procure another party or other
parties satisfactory to you to purchase such Securities on such terms. In the
event that, within the respective prescribed periods, you notify the Company and
the Selling Shareholder that you have so arranged for the purchase of such
Securities, or the Company and the Selling Shareholder notify you that they have
so arranged for the purchase of such Securities, you or the Company and the
Selling Shareholder shall have the right to postpone such Delivery Date for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or in
any other documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your
opinion, exercised in consultation with Xxxxxx Xxxxxx & Xxxxxxx, may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by you and the Company
and the Selling Shareholder as provided in subsection (a) above, the aggregate
number of such Securities that remains unpurchased does not exceed one-tenth of
the aggregate number of all the Securities to be purchased at such Delivery
Date, then the Company and the Selling Shareholder shall have the right to
require each non-defaulting Underwriter to purchase the number of Securities
that such Underwriter agreed to purchase hereunder at such Delivery Date and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Securities that such Underwriter agreed to
purchase hereunder at such Delivery Date) of the share of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Underwriter or Underwriters by you and the Company
and the Selling Shareholder as provided in subsection (a) above, the aggregate
number of such Securities that remains unpurchased exceeds one-tenth of the
aggregate number of all the Securities to be purchased at such Delivery Date, or
if the Company and the Selling Shareholder shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Securities of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Delivery Date, the obligation of the
Underwriters to purchase and of the Company to sell the Optional Securities)
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriters or the Company and the Selling Shareholder, except for the expenses
to be borne by the Company and the Underwriters as provided in Section 6 hereof
and the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
10. Representations and Indemnities to Survive.
The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Shareholder and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation (or any statement as to the results thereof) made by or on behalf
of the Underwriters or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company or the
Selling Shareholder, and shall survive delivery of and payment for the
Securities.
11. Termination and Payment of Expenses.
If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Shareholder shall then be under any
liability to any Underwriter except as provided in Section 6 and Section 8
hereof; but if for any other reason any Securities are not delivered by or on
behalf of the Company or the Selling Shareholder as provided herein, the Company
will reimburse the Underwriters through you for all reasonable documented
out-of-pocket expenses, including fees and disbursements of counsel, incurred by
the Underwriters in making preparations for the purchase, sale and delivery of
the Securities not so delivered, but neither the Company nor the Selling
Shareholder shall then be under further liability to any Underwriter except as
provided in Section 6 and Section 8 hereof.
12. Notices.
In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you.
All statements, requests, notices and agreements hereunder shall be
in writing or by telegram if promptly confirmed in writing, and if to the
Underwriters shall be sufficient in all respects if delivered or sent by
reliable courier, first-class mail, telex or facsimile transmission to Wheat,
First Securities, Inc., at Riverfront Plaza, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxx 00000, Attention: Corporate Finance Department (telecopier number (804)
782-3440); if to the Selling Shareholder or the Company shall be sufficient in
all respects if delivered or sent by reliable courier, first-class mail, telex,
or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Xxxxxx X. Xxxxxxxx (telecopier number (919)
237-1109, with a copy (which shall not constitute notice) to Wyrick, Robbins,
Xxxxx & Xxxxxx L.L.P., 0000 Xxxx Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx Xxxxxxxx
00000, Attention: Xxxxx X. Xxxxxxx (telecopier number (000) 000-0000); provided,
however, that any notice to any Underwriter pursuant to Section 8 hereof shall
be delivered or sent by reliable courier, first-class mail, telex or facsimile
transmission to such Underwriter at its address set forth in the Underwriters'
Questionnaire, which address will be supplied to the Company or the Selling
Shareholder by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. Successors.
This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Selling Shareholder and the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers and directors of the Company
and the Selling Shareholder and each person who controls the Company or any
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the Securities from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time of the Essence.
Time shall be of the essence in this Agreement.
15. Business Day.
As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
16. Applicable Law.
This Agreement shall be construed in accordance with the laws of the
State of New York.
17. Captions.
The captions included in this Agreement are included solely for
convenience of reference and shall not be deemed to be a part of this Agreement.
18. Counterparts.
This Agreement may be executed by any one or more of the parties in
any number of counterparts, each of which shall be deemed to be an original, but
all such counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please
sign and return to us four counterparts hereof, and upon the acceptance hereof
by you, this Agreement and such acceptance hereof shall constitute a binding
agreement among each of the Underwriters, the Selling Shareholder and the
Company. It is understood that your acceptance of this Agreement on behalf of
each of the Underwriters is pursuant to the authority set forth in a form of
Agreement Among Underwriters, the form of which will be submitted to the Company
and the Selling Shareholder for examination, upon request, but without warranty
on your part as to the authority of the signers thereof.
Very truly yours,
STANDARD COMMERCIAL CORPORATION
By: __________________________________
Xxxxxx X. Xxxxxxxx
Chief Executive Officer,
Chief Financial Officer and President
Xxxxxx X. Xxxxxxx
By: ___________________________________
Name:
Title: Attorney In-Fact
Accepted as of the date hereof at Richmond, Virginia:
WHEAT, FIRST SECURITIES, INC.
BT SECURITIES CORPORATION
As Representatives of the Several
Underwriters Named in Schedule I hereto
By: WHEAT, FIRST SECURITIES, INC.
By: _______________________________
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
EXHIBIT A
Opinion of Counsel to the Company
1. The Company and each of the subsidiaries set forth on an exhibit to
such opinion have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation or organization, with corporate or other
legal power and authority to own or lease their respective properties
and conduct their respective businesses as described in the Prospectus;
2. The Company and each of the Subsidiaries have been duly qualified as
foreign corporations for the transaction of business and are in good
standing under the laws of every other jurisdiction in the United
States in which they own or lease properties, or conduct any business,
so as to require such qualification, except where the failure to so
qualify will not result in a material adverse effect on the
consolidated financial position, shareholders' equity or results of
operations of the Company and the Subsidiaries taken as a whole (such
opinion may be based solely upon certificates of authority or
qualification issued in such jurisdictions to such effect);
3. The Company has the authorized, issued and outstanding capital stock
set forth in the Prospectus under the subheading "Actual" under the
caption "Capitalization," and all of the outstanding shares of capital
stock of the Company have been duly authorized, validly issued, and are
fully paid and nonassessable and conform to the description of the
capital stock in the Prospectus incorporated by reference from the
Company's Registration Statement on Form [ ]; except as
described in the Prospectus, there are no preemptive or other similar
rights to subscribe for or to purchase any securities of the Company
arising under the Charter and Bylaws of the Company or under any
applicable North Carolina law or, to our knowledge, under any contract
or agreement of the Company; to such counsel's knowledge, except as
described in the Prospectus, there are no warrants, options or similar
rights to purchase any securities of the Company; to such counsel's
knowledge, neither the filing of the Registration Statement nor the
offering or sale of the Securities as contemplated by this Agreement
gives rise to any rights for or relating to the registration of any
securities of the Company with respect to such filing, offering or
sale, other than rights which have been waived or satisfied; and the
form of the certificates evidencing the Securities complies with all
formal requirements of North Carolina law, the Charter and Bylaws of
the Company and the New York Stock Exchange for companies listed and
traded on such stock exchange;
4. All outstanding shares of capital stock of the subsidiaries set forth
on an exhibit to such opinion owned by the Company are directly or
indirectly owned by the Company in the percentage of each such
subsidiary's total capital stock set forth on such schedule, in each
case, free and clear of any perfected security interests and any other
security interests, claims, liens or encumbrances;
5. The Securities have been duly authorized, and the Securities being
issued as of such Delivery Date, when issued and delivered against
payment therefor in accordance with the Underwriting Agreement, will be
duly authorized, validly issued, and fully paid and nonassessable and
will conform to the description of the Securities contained in the
Prospectus as amended or supplemented as of such Delivery Date;
6. The Underwriting Agreement has been duly authorized executed and
delivered by the Company;
7. To such counsel's knowledge, there are no legal or governmental
proceedings pending to which the Company or any of the Subsidiaries is
a party or of which any property of the Company or any of the
Subsidiaries is the subject, other than as set forth or contemplated in
the Prospectus, that, if determined adversely to the Company or any of
its Subsidiaries, would individually or in the aggregate have a
material adverse effect on the financial position, shareholders' equity
or results of operations of the Company and the Subsidiaries taken as a
whole, and no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
8. Neither the Company nor any of its subsidiaries is, or with the giving
of notice or lapse of time or both would be, in violation or default
under, its Charter or Bylaws or other organizational document, as the
case may be, or any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument filed by the Company with the
Securities and Exchange Commission or known to such counsel to which
the Company or any of its subsidiaries is a party or by which it or any
of them or any of their respective properties is bound, except for
violations and defaults which individually and in the aggregate would
not reasonably be expected to have or result in a material adverse
effect on the Company and its subsidiaries taken as a whole;
9. The issue and sale of the Securities being issued at such Delivery Date
by the Company and the performance of the Underwriting Agreement by the
Company and the consummation by the Company of the other transactions
herein contemplated will not conflict with or result in a breach or
violation of any terms or provisions of, or constitute a default under,
any provision of the Charter or Bylaws of the Company or any material
provision of any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument filed by the Company with the Securities
and Exchange Commission or known to such counsel nor will such action
result in any material violation of the provisions of the Charter or
Bylaws, articles of incorporation or other organizational document or
instrument of any of the Subsidiaries or of any statute or any order,
rule or regulation known to such counsel of any court or governmental
agency or body having jurisdiction over the Company or any of the
Subsidiaries or any of their properties; provided, however, that such
opinion need not address state securities or Blue Sky laws or, to the
extent of matters discussed separately in paragraph (11) below, the
federal securities laws;
10. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Securities by the Company or the
consummation by the Company of the other transactions contemplated by
the Underwriting Agreement, except such as have been obtained under the
Act and such as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Securities by
the Underwriters and the clearance of such offering with the National
Association of Securities Dealers, Inc.;
11. The Registration Statement, including any 462(b) Registration Statement
has been declared effective under the Securities Act of 1933, as
amended (the "Act"); any required filing of the Prospectus pursuant to
Rule 424(b) has been made in the manner and within the time required by
Rule 424(b); and to such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the Act and no proceedings
for that purpose have been instituted or are pending or threatened by
the Commission and the effectiveness of the Registration Statement is
in full force and effect as of such Delivery Date;
12. The documents incorporated by reference in the Prospectus or any
further amendment or supplement thereto made by the Company prior to
the Delivery Date (other than the financial statements and notes
thereto, related schedules and other financial information contained or
incorporated by reference therein, as to which such counsel need
express no opinion), when they were filed with the Commission, complied
as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission
thereunder; and they have no reason to believe that any of such
documents, when such documents were so filed, contained an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading;
13. The Registration Statement, as of its effective date, and the
Prospectus and any further amendments or supplements thereto made by
the Company prior to such Delivery Date, as of the date thereof (other
than the financial statements and notes thereto, related schedules and
other financial information contained or incorporated by reference
therein, as to which such counsel need not express any opinion), and
each document incorporated by reference in the Prospectus (other than
the financial statements and notes thereto, related Schedules and other
financial information contained therein, as to which such counsel need
not express any opinion) comply as to form in all material respects
with the requirements of the Act and, to the extent applicable, the
Securities Exchange Act of 1934, as amended, in each case, including
the rules and regulations of the Commission thereunder. In addition,
while such counsel need not check the accuracy and completeness of, or
otherwise verify or pass upon the accuracy or completeness of, the
statements contained in the Registration Statement, the Prospectus or
any amendment or supplement thereto, such counsel shall state that (a)
in the course of its review and discussion of the contents of the
Registration Statement and the Prospectus with certain directors,
officers and employees of the Company, representatives of the
independent public accountants for the Company, representatives of the
Underwriters and representatives of counsel for the Underwriters,
nothing has come to its attention that has caused it to believe (i)
that the Registration Statement, as of its effective date, any further
amendment to the Registration Statement made by the Company prior to
such Delivery Date, as of the date thereof, the Prospectus, as of the
date thereof, and any further amendment or supplement to the Prospectus
made by the Company prior to such Delivery date, as of the date thereof
(in each case, (x) including each document incorporated therein by
reference and (y) excluding the financial statements and notes thereto,
related schedules and other financial information contained or
incorporated by reference therein, as to which such counsel need not
express any opinion), contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the
Prospectus, in light of the circumstances under which they were made)
not misleading and (ii) that the Registration Statement and the
Prospectus, as amended and supplemented prior to such Delivery Date, as
of such Delivery Date (in each case, (x) including each document
incorporated therein by reference and (y) excluding the financial
statements and notes thereto, related schedules and other financial
information contained or incorporated by reference therein, as to which
such counsel need not express any opinion), contains an untrue
statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which
they were made) not misleading, and (b) such counsel does not know of
any contracts or other documents of a character required to be filed as
an exhibit to the Registration Statement or otherwise required to be
filed with the Securities and Exchange Commission or any statutes,
regulations, contracts or other documents required to be described in
the Registration Statement or the Prospectus that are not filed or
described as required;
14. The descriptions in the Registration Statement and Prospectus under the
captions "Selling Shareholders," "Business - Tobacco - Properties,"
"Business - Wool -Properties," "Business - Legal Proceedings,"
"Underwriting" and "Item 15. Indemnification of Directors and Officers"
of statutes and contracts and other documents and legal matters or
proceedings have been reviewed by such Counsel and are accurate and
fairly present the information required to be shown;
15. To such counsel's knowledge, there are no statutes or regulations that
are required to be described in the Prospectus that are not described
as required;
16. The Company is not and, after giving effect to the offering and sale of
the Securities, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the Investment Company Act;
17. There are no taxes, duties, imports, levies or other governmental
charges of any kind payable in connection with (i) the authorization,
execution and delivery of the Underwriting Agreement by the parties
thereto, (ii) the authorization, issuance and delivery of the
Securities sold to the Underwriters by the Company pursuant to the
Underwriting Agreement or (iii) the delivery and sale of the Securities
sold to the Underwriters by the Selling Shareholder pursuant to the
Underwriting Agreement, in each case, arising under any statute, rule,
regulation or other applicable authority in the State of North
Carolina.
EXHIBIT B
Opinion of Counsel to the Selling Shareholder
1. This Agreement has been duly executed and delivered by or on behalf of
the Selling Shareholder;
2. Each of the Power of Attorney and Custody Agreement has been duly
executed and delivered by the Selling Shareholder;
3. The sale of the Securities to be sold by the Selling Shareholder
hereunder and the performance of this Agreement, the Power of Attorney
and Custody Agreement and the consummation of the transactions herein
contemplated will not conflict with or result in a breach or violation
of any terms or provisions of, or constitute a default under, any
statute or agreement to which such Selling Shareholder is a party or by
which the Selling Shareholder is bound, or any statute, order, rule or
regulation known to such counsel of any court or governmental agency or
body having jurisdiction over the Selling Shareholder or the Selling
Shareholder's property; provided, however, that such opinion need not
address state securities or Blue Sky laws or, to the extent of matters
discussed separately, in paragraph 11 of Exhibit A above, the federal
securities laws;
4. No consent, approval, authorization or order of any court or
governmental agency or body is required for the sale of securities by
the Selling Shareholder and the consummation by the Selling Shareholder
of the transactions contemplated by this Agreement, except such as have
been obtained under the Act and such as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of such Securities by the Underwriters and the clearance
of such offering with the National Association of Securities Dealers,
Inc.;
5. Upon delivery of and payment for the Securities to be sold by the
Selling Shareholder as contemplated by the Agreement, each of the
Underwriters that has acquired any of such Securities from the Selling
Shareholder in good faith and without notice of any adverse claim
within the meaning of the North Carolina Uniform Commercial Code will
acquire such Securities on such Delivery Date free of any adverse
claim.
SCHEDULE I
Optional Securities
to be Purchased if
Firm Securities Maximum Option
Underwriter to be Purchased Exercised
----------- --------------- --------------------
Wheat, First Securities, Inc.
BT Securities Corporation
TOTAL 3,525,000 528,750
========= =======
SCHEDULE II
Number of Optional
Total Number of Securities to be Sold
Firm Securities if Maximum Option
to be Sold Exercised
--------------- ---------------------
The Company 3,525,000 528,750
The Selling Shareholder:
Xxxxxx X. Xxxxxxx 25,000 -
TOTAL 3,525,000 528,750
========= =======
SCHEDULE III
SUBSIDIARIES OF STANDARD COMMERCIAL CORPORATION.
Jurisdiction Percentage of Subsidiary's Capital Stock
Name of Subsidiary of Incorporation owned By the Company
------------------ ---------------- -----------------------------------------
