Exhibit 1.1
Form of Underwriting Agreement
[ ] Shares
(plus [ ] Shares to cover over-allotments, if any)
SUN BANCSHARES, INC.
COMMON STOCK, PAR VALUE $1.00 PER SHARE
UNDERWRITING AGREEMENT
October ___, 1997
ADVEST, INC.
As Representative (the "Representative")
of the Several Underwriters
Named in Schedule I hereto
c/o Advest, Inc.
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Sun Bancorp, Inc., a New Jersey corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to sell to the
several Underwriters named in Schedule I hereto (the "Underwriters"), an
aggregate of [ ] shares (the "Firm Shares") of the Company's common stock, par
value $1.00 per share (the "Common Stock").
In addition, in order to cover over-allotments in the sale of
the Firm Shares, the Underwriters may, at the Underwriters' election and subject
to the terms and conditions stated herein, purchase ratably in proportion to the
amounts set forth opposite their respective names in Schedule I hereto, up to [
] additional shares of Common Stock from the Company (such additional shares of
Common Stock, the "Optional Shares"). The Firm Shares and the Optional Shares
are referred to collectively as the "Shares."
As part of the offering of [ ] Firm Shares contemplated by
this Agreement, Advest, Inc. ("Advest") has agreed to reserve out of the Firm
Shares set forth opposite its name on Schedule I hereto, up to [ ] Shares, for
sale to the Company's employees, officers and directors (collectively, the
"Participants"), as set forth in the Prospectus in the section entitled
"Underwriting" (the "Directed Share Program"). The Shares to be sold by Advest
pursuant to the Directed Share Program (the "Directed Shares") will be sold by
Advest pursuant to this Agreement [at the public offering price] [at the price
specified in the Prospectus]. [Any Directed Shares not orally confirmed for
purchase by any Participants by the end of the first business day
after the date on which this Agreement is executed will be offered to the public
by Advest as set forth in the Prospectus.]
The Company, intending to be legally bound, hereby confirms
its agreement with the Underwriters as follows:
1. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each of the Underwriters that:
(a) A registration statement on Form S-1 (File
No. 333-________) with respect to the Shares, including a prospectus subject to
completion, has been filed by the Company with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Act"), and one or more amendments to such registration statement may have been
so filed. After the execution of this Agreement, the Company will file with the
Commission either (i) if such registration statement, as it may have been
amended, has become effective under the Act and information has been omitted
therefrom in accordance with Rule 430A under the Act, a prospectus in the form
most recently included in an amendment to such registration statement (or, if no
such amendment shall have been filed, in such registration statement) with such
changes or insertions as are required by Rule 430A or permitted by Rule 424(b)
under the Act and as have been provided to and approved by the Representative,
or (ii) if such registration statement, as it may have been amended, has not
become effective under the Act, an amendment to such registration statement,
including a form of prospectus, a copy of which amendment has been provided to
and approved by the Representative prior to the execution of this Agreement. As
used in this Agreement, the term "Registration Statement" means such
registration statement, as amended at the time when it was or is declared
effective, including (A) all financial statements, schedules and exhibits
thereto, (B) all documents (or portions thereof) incorporated by reference
therein, and (C) any information omitted therefrom pursuant to Rule 430A under
the Act and included in the Prospectus (as hereinafter defined); the term
"Preliminary Prospectus" means each prospectus subject to completion included in
such registration statement or any amendment or post-effective amendment thereto
(including the prospectus subject to completion, if any, included in the
Registration Statement at the time it was or is declared effective), including
all documents (or portions thereof) incorporated by reference therein; and the
term "Prospectus" means the prospectus first filed with the Commission pursuant
to Rule 424(b) under the Act or, if no prospectus is required to be so filed,
such term means the prospectus included in the Registration Statement, in either
case, including all documents (or portions thereof) incorporated by reference
therein. As used herein, any reference to any statement or information as being
"made," "included," "contained," "disclosed" or "set forth" in any
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Preliminary Prospectus, a Prospectus or any amendment or supplement thereto, or
the Registration Statement or any amendment thereto (or other similar
references) shall refer both to information and statements actually appearing in
such document as well as information and statements incorporated by reference
therein.
(b) No order preventing or suspending the use of
any Preliminary Prospectus has been issued and no proceeding for that purpose
has been instituted or threatened by the Commission or the securities authority
of any state or other jurisdiction. If the Registration Statement has become
effective under the Act, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no proceeding for
that purpose has been instituted or threatened or, to the knowledge of the
Company, contemplated by the Commission or the securities authority of any state
or other jurisdiction.
(c) When any Preliminary Prospectus was filed
with the Commission it contained all statements required to be stated therein in
accordance with, and complied in all material respects with the requirements of,
the Act and the rules and regulations of the Commission thereunder. When the
Registration Statement or any amendment thereto was or is declared effective,
and at each Time of Delivery (as hereinafter defined), it (i) contained and will
contain all statements required to be stated therein in accordance with, and
complied or will comply in all material respects with the requirements of, the
Act and the rules and regulations of the Commission thereunder and (ii) did not
and will not include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein not misleading. When
the Prospectus or any amendment or supplement thereto is filed with the
Commission pursuant to Rule 424(b) (or, if the Prospectus or such amendment or
supplement is not required to be so filed, when the Registration Statement or
the amendment thereto containing such amendment or supplement to the Prospectus
was or is declared effective) and at each Time of Delivery, the Prospectus, as
amended or supplemented at any such time, (i) contained and will contain all
statements required to be stated therein in accordance with, and complied or
will comply in all material respects with the requirements of, the Act and the
rules and regulations of the Commission thereunder and (ii) did not and will 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 under which they were made, not misleading. The foregoing
provisions of this paragraph (c) do not apply to statements or omissions made in
the Registration Statement or any amendment thereto or the Prospectus or any
amendment or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through you specifically
for use therein. It is understood that the statements set forth in the
Registration
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Statement or any amendment thereto or the Prospectus or any amendment or
supplement thereto (W) in the last paragraph of the cover page of the
Prospectus, (X) on the inside cover page with respect to stabilization and
passive market making, and (Y) in the [ ]1, [ ]2 and [ ]3 paragraphs and the
list of Underwriters under the section entitled "Underwriting," constitute the
only written information furnished to the Company by or on behalf of any
Underwriter through you specifically for use in the Registration Statement or
any amendment thereto or the Prospectus and any amendment or supplement thereto,
as the case may be.
(d) There are no legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the Company or any
subsidiary is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any statutes,
regulations, contracts or other documents that are required to be described in
the Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(e) Each of the Company and its subsidiaries has
been duly incorporated, is validly existing as a corporation or banking
association in good standing under the laws of its jurisdiction of incorporation
and has full power and authority (corporate and other) to own or lease its
properties and conduct its business as described in the Prospectus. The Company
is duly registered under the Bank Holding Company Act of 1956, as amended. The
Company has full power and authority (corporate and other) to enter into this
Agreement and to perform its obligations hereunder. Each of the Company and its
subsidiaries is duly qualified to transact business as a foreign corporation 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 have a material
adverse effect on the financial position, results of operations or business of
the Company and its subsidiaries taken as a whole.
--------
1 Insert number of paragraph included in the section of the Prospectus
entitled "Underwriting" regarding selling concessions.
2 Insert number of paragraph included in the section of the Prospectus
entitled "Underwriting" regarding sales to discretionary accounts.
3 Insert number of paragraph included in the section of the Prospectus
entitled "Underwriting" regarding stabilization.
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(f) The Company's authorized, issued and
outstanding capital stock is as disclosed in the Prospectus. All of the issued
shares of capital stock of the Company, have been duly authorized and validly
issued, are fully paid and nonassessable and conform to the descriptions of the
Common Stock contained in the Prospectus. None of the issued shares of capital
stock of the Company or any of its subsidiaries has been issued or is owned or
held in violation of any statutory (or to the knowledge of the Company, any
other) preemptive rights of shareholders, and no person or entity (including any
holder of outstanding shares of capital stock of the Company or its
subsidiaries) has any statutory (or to the knowledge of the Company, any other)
preemptive or other rights to subscribe for any of the Shares. None of the
capital stock of the Company has been issued in violation of applicable federal
or state securities laws.
(g) All of the issued shares of capital stock of
each subsidiary have been duly authorized and validly issued, are fully paid and
nonassessable and are owned beneficially by the Company or one of its
subsidiaries, free and clear of all liens, security interests, pledges, charges,
encumbrances, defects, shareholders' agreements, voting agreements, proxies,
voting trusts, equities or claims of any nature whatsoever. Other than the
outstanding capital stock of Sun National Bank and the equity securities held in
the investment portfolios of the Company and such subsidiaries (the composition
of which is not materially different than the disclosures in the Prospectus as
of specific dates), the Company does not own, directly or indirectly, any
capital stock or other equity securities of any other corporation or any
ownership interest in any partnership, joint venture or other association.
(h) Except as disclosed in the Prospectus, there
are no outstanding (i) securities or obligations of the Company or any of its
subsidiaries convertible into or exchangeable for any capital stock of the
Company or any of its subsidiaries, (ii) warrants, rights or options to
subscribe for or purchase from the Company or any of its subsidiaries any such
capital stock or any such convertible or exchangeable securities or obligations
or (iii) obligations of the Company or any of its subsidiaries to issue any
shares of capital stock, any such convertible or exchangeable securities or
obligations, or any such warrants, rights or options.
(i) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, (i)
neither the Company nor any of its subsidiaries has incurred any liabilities or
obligations, direct or contingent, or entered into any transactions, not in the
ordinary course of business, that are material to the Company and its
subsidiaries, (ii) the Company has not purchased any of its outstanding capital
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stock or declared, paid or otherwise made any dividend or distribution of any
kind on its capital stock, (iii) there has not been any change in the capital
stock, long-term debt or short-term debt of the Company or any of its
subsidiaries, and (iv) there has not been any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
financial position, results of operations or business of the Company and its
subsidiaries, in each case other than as disclosed in or contemplated by the
Prospectus.
(j) There are no contracts, agreements or
understandings between the Company and any person granting such person the right
to require the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such person or,
requiring the Company to include such securities in the securities registered
pursuant to the Registration Statement (or any such right has been effectively
waived) or requiring the registration of any securities pursuant to any other
registration statement filed by the Company under the Act. Neither the filing of
the Registration Statement nor the offering or sale of Shares as contemplated by
this Agreement gives any security holder of the Company any rights for or
relating to the registration of any shares of Common Stock or any other capital
stock of the Company, except such as have been satisfied or waived.
(k) Neither the Company nor any of its
subsidiaries is, or with the giving of notice or passage of time or both would
be, in violation of its Articles of Incorporation or Bylaws or in default under
any indenture, mortgage, deed of trust, loan agreement, lease or other agreement
or instrument to which the Company or any of its subsidiaries is a party or to
which any of their respective properties or assets are subject.
(l) The Company and its subsidiaries have good
and marketable title in fee simple to all real property, if any, and good title
to all personal property owned by them, in each case free and clear of all
liens, security interests, pledges, charges, encumbrances, mortgages and
defects, except such as are disclosed in the Prospectus or such as would not
have a material adverse effect on the financial position, results of operations
or business of the Company and its subsidiaries taken as a whole and do not
interfere with the use made or proposed to be made of such property by the
Company and its subsidiaries; and any real property and buildings held under
lease by the Company or any of its subsidiaries are held under valid, subsisting
and enforceable leases, with such exceptions as are disclosed in the Prospectus
or are not material and do not interfere with the use made or proposed to be
made of such property and buildings by the Company or any subsidiary.
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(m) The Company does not require any consent,
approval, authorization, order or declaration of or from, or registration,
qualification or filing with, any court or governmental agency or body in
connection with the sale of the Shares or the consummation of the transactions
contemplated by this Agreement, except the registration of the Shares under the
Act (which, if the Registration Statement is not effective as of the time of
execution hereof, shall be obtained as provided in this Agreement) and such as
may be required by the National Association of Securities Dealers, Inc. (the
"NASD") or under state securities or blue sky laws in connection with the offer,
sale and distribution of the Shares by the Underwriters.
(n) Other than as disclosed in the Prospectus,
there is no litigation, arbitration, claim, proceeding (formal or informal) or
investigation (including without limitation, any bank regulatory proceeding)
pending or, to the Company's knowledge, threatened in which the Company or any
of its subsidiaries is a party or of which any of their respective properties or
assets are the subject which, if determined adversely to the Company or any
subsidiary, would individually or in the aggregate have a material adverse
effect on the financial position, results of operations or business of the
Company and its subsidiaries taken as a whole. Neither the Company nor any
subsidiary is in violation of, or in default with respect to, any law, statute,
rule, regulation, order, judgment or decree, except as described in the
Prospectus or such as do not and will not individually or in the aggregate have
a material adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole, and neither the
Company nor any subsidiary is required to take any action in order to avoid any
such violation or default.
(o) Deloitte & Touche LLP, which has certified
certain financial statements of the Company and its consolidated subsidiaries
included in the Registration Statement and the Prospectus, are independent
public accountants as required by the Act, the Exchange Act and the respective
rules and regulations of the Commission thereunder.
(p) The consolidated financial statements and
schedules (including the related notes) of the Company and its consolidated
subsidiaries included or incorporated by reference in the Registration
Statement, the Prospectus and/or any Preliminary Prospectus were prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved and fairly present the financial position and
results of operations of the Company and its subsidiaries, on a consolidated
basis, at the dates and for the periods presented. The selected financial data
and operating and statistical information set forth under the captions
"Summary," "Selected Consolidated Financial Data," "Use of Proceeds,"
"Capitalization," "Business of the
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Company," "Management" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the Prospectus fairly present, on the
basis stated in the Prospectus, the information included therein, and have been
compiled on a basis consistent with that of the audited financial statements
included in the Registration Statement. The supporting notes and schedules
included in the Registration Statement, the Prospectus and/or any Preliminary
Prospectus fairly state in all material respects the information required to be
stated therein in relation to the financial statements taken as a whole. The
unaudited interim consolidated financial statements included or incorporated by
reference in the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of Rule 10-01 of Regulation
S-X under the Act.
(q) This Agreement has been duly authorized,
executed and delivered by the Company and, assuming due execution by the
Representative of the Underwriters, constitutes the valid and binding agreement
of the Company enforceable against the Company in accordance with its terms,
subject, as to enforcement, to applicable bankruptcy, insolvency, reorganization
and moratorium laws and other laws relating to or affecting the enforcement of
creditors' rights generally and to general equitable principles and except as
the enforceability of rights to indemnity and contribution under this Agreement
may be limited under applicable securities laws or the public policy underlying
such laws.
(r) The sale of the Shares and the performance of
this Agreement and the consummation of the transactions herein contemplated will
not (with or without the giving of notice or the passage of time or both) (i)
conflict with or violate any term or provision of the articles of incorporation
or bylaws or other organizational documents of the Company or any subsidiary,
(ii) result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which the Company or any
subsidiary is a party or to which any of their respective properties or assets
is subject, (iii) conflict with or violate any law, statute, rule or regulation
or any order, judgment or decree of any court or governmental agency or body
having jurisdiction over the Company or any subsidiary or any of their
respective properties or assets or (iv) result in a breach, termination or lapse
of the corporate power and authority of the Company or any subsidiary to own or
lease and operate their respective assets and properties and conduct their
respective business as described in the Prospectus.
(s) When the Shares to be sold by the Company
hereunder have been duly delivered against payment therefor as contemplated by
this Agreement, the Shares will be validly issued, fully paid and nonassessable,
and the holders thereof will not be
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subject to personal liability solely by reason of being such holders. The
certificates representing the Shares are in proper legal form under, and conform
in all respects to the requirements of, the New Jersey Business Corporation Act
and the requirements of the NASD.
(t) The Company has not distributed and will not
distribute any offering material in connection with the offering and sale of the
Shares other than the Registration Statement, a Preliminary Prospectus, the
Prospectus and other material, if any, permitted by the Act.
(u) Neither the Company nor any of its officers,
directors or affiliates has (i) taken, directly or indirectly, any action
designed to cause or result in, or that has constituted or might reasonably be
expected to constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares or (ii)
since the filing of the Registration Statement (A) sold, bid for, purchased or
paid anyone any compensation for soliciting purchases of, the Shares or (B) paid
or agreed to pay to any person any compensation for soliciting another to
purchase any other securities of the Company.
(v) The operations of the Company and its
subsidiaries with respect to any real property currently leased or owned or by
any means controlled by the Company or any subsidiary (the "Real Property") are
in compliance in all material respects with all federal, state, and local laws,
ordinances, rules, and regulations relating to occupational health and safety
and the environment (collectively, "Laws"), and the Company and its subsidiaries
have not violated any Laws in a way which would have a material adverse effect
on the financial position, results of operations or business of the Company and
its subsidiaries taken as a whole. Except as disclosed in the Prospectus, there
is no pending or, to the Company's knowledge, threatened claim, litigation or
any administrative agency proceeding, nor has the Company or any subsidiary
received any written or oral notice from any governmental entity or third party,
that: (i) alleges a violation of any Laws by the Company or any subsidiary or
(ii) alleges the Company or any subsidiary is a liable party under the
Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
ss. 9601 et seq. or any state superfund law.
(w) Neither the Company nor any subsidiary owns
or has the right to use patents, patent applications, trademarks, trademark
applications, trade names, service marks, copyrights, franchises, trade secrets,
proprietary or other confidential information and intangible properties and
assets (collectively, "Intangibles"), the loss of any of which would have a
material adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole;
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and, to the best knowledge of the Company, neither the Company nor any
subsidiary has infringed or is infringing, and neither the Company nor any
subsidiary has received notice of infringement with respect to, asserted
Intangibles of others.
(x) Each of the Company and its subsidiaries
makes and keeps accurate books and records reflecting its assets and maintains
internal accounting controls which provide reasonable assurance that (i)
transactions are executed in accordance with management's authorization, (ii)
transactions are recorded as necessary to permit preparation of the Company's
consolidated financial statements in accordance with generally accepted
accounting principles and to maintain accountability for the assets of the
Company, (iii) access to the assets of the Company and each of its subsidiaries
is permitted only in accordance with management's authorization, and (iv) the
recorded accountability for assets of the Company and each of its subsidiaries
is compared with existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(y) The Company and its subsidiaries have filed
all foreign, federal, state and local tax returns that are required to be filed
by them and have paid all taxes shown as due on such returns as well as all
other taxes, assessments and governmental charges that are due and payable; and
no material deficiency with respect to any such return has been assessed or
proposed.
(z) Except for such plans that are expressly
disclosed in the Prospectus, the Company and its subsidiaries do not maintain,
contribute to or have any material liability with respect to any employee
benefit plan, profit sharing plan, employee pension benefit plan, employee
welfare benefit plan, equity-based plan or deferred compensation plan or
arrangement ("Plans") that are subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended, or the rules and regulations
thereunder ("ERISA"). All Plans are in compliance in all material respects with
all applicable laws, including but not limited to ERISA and the Internal Revenue
Code of 1986, as amended (the "Code"), and have been operated and administered
in all material respects in accordance with their terms. No Plan is a defined
benefit plan or multi employer plan. The Company does not provide retiree life
and/or retiree health benefits or coverage for any employee or any beneficiary
of any employee after such employee's termination of employment, except as
required by Section 4980B of the Code or under a Plan which is intended to be
"qualified" under Section 401(a) of the Code. No material liability has been, or
could reasonably be expected to be, incurred under Title IV of ERISA or Section
412 of the Code by any entity required to be aggregated with the Company or any
of the Subsidiaries pursuant to Section 4001(b) of ERISA and/or Section
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414(b) or (c) of the Code (and the regulations promulgated thereunder) with
respect to any "employee pension benefit plan" which is not a Plan. As used in
this subsection, the terms "defined benefit plan," "employee benefit plan,"
"employee pension benefit plan," "employee welfare benefit plan" and
"multiemployer plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
(aa) No material labor dispute exists with the
Company's or any subsidiary's employees, and no such labor dispute is
threatened. The Company has no knowledge of any existing or threatened labor
disturbance by the employees of any of its principal agents, suppliers,
contractors or customers that would have a material adverse effect on the
financial position, results of operations or business of the Company and its
subsidiaries taken as a whole.
(bb) The Company and its subsidiaries have
received all permits, licenses, franchises, authorizations, registrations,
qualifications and approvals (collectively, "Permits") of governmental or
regulatory authorities (including, without limitation, state or federal bank
regulatory authorities) as may be required of them to own their properties and
conduct their businesses in the manner described in the Prospectus, subject to
such qualifications as may be set forth in the Prospectus; and the Company and
its subsidiaries have fulfilled and performed all of their material obligations
with respect to such Permits, and no event has occurred which allows or, after
notice or lapse of time or both, would allow revocation or termination thereof
or result in any other material impairment of the rights of the holder of any
such Permit, subject in each case to such qualification as may be set forth in
the Prospectus; and, except as described in the Prospectus, such Permits contain
no restrictions that materially affect the ability of the Company and its
subsidiaries to conduct their businesses and no state or federal bank regulatory
agency or body has issued any order or decree impairing, restricting or
prohibiting the payment of dividends by any of its subsidiaries to the Company.
(cc) The Company and each of its subsidiaries has
filed, or has had filed on its behalf, on a timely basis, all materials,
reports, documents and information, including but not limited to annual reports,
call reports and reports of examination with each applicable bank regulatory
authority, board or agency, which are required to be filed by it, except where
the failure to have timely filed such materials, reports, documents and
information would not have a material adverse effect on the financial position,
results of operations or business of the Company and its subsidiaries taken as a
whole.
(dd) Neither the Company, nor any subsidiary is an
"investment company" or a company "controlled" by an investment
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company as such terms are defined in Sections 3(a) and 2(a)(9), respectively, of
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
and, if the Company or any subsidiary conducts its business as set forth in the
Registration Statement and the Prospectus, will not become an "investment
company" and will not be required to register under the Investment Company Act.
(ee) The Company has not offered, or caused the Underwriters
Underwriters to offer, Shares to any person pursuant to the Directed Share
Program with the specific intent to unlawfully influence (i) a customer or
supplier of the Company to alter the customer's or supplier's level or type of
business with the Company, or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products.
(ff) Sun National Bank is a member in good
standing of the Federal Reserve System and its deposits are insured by the
Federal Deposit Insurance Corporation up to the legal limits.
(gg) The Company and each Subsidiary have in place
and effective such policies of insurance, with limits of liability in such
amounts, as are normal and prudent in the ordinary scope of business similar to
that of the Company and such subsidiary in the respective jurisdiction in which
they conduct business.
2. Purchase and Sale of Shares.
(a) Subject to the terms and conditions herein
set forth, 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 a purchase price of [ ] Dollars and [ ] cents ($[ ]) per share (the
"Per Share Price"), the number of Firm Shares (to be adjusted by you so as to
eliminate fractional shares) determined by multiplying the aggregate number of
Firm Shares to be sold by the Company as set forth in the first paragraph of
this Agreement by a fraction, the numerator of which is the aggregate number of
Firm Shares to be purchased by such Underwriter as set forth opposite the name
of such Underwriter in Schedule I hereto, and the denominator of which is the
aggregate number of Firm Shares to be purchased by the several Underwriters
hereunder.
(b) The Company hereby grants to the Underwriters
the right to purchase at their election in whole or in part from time to time up
to [ ] Optional Shares, at the Per Share Price, for the sole purpose of covering
over-allotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised by written notice from the Representative to
the Company, given at any time and from time to time within a period of 30
calendar days after the date of this Agreement and
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setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as hereinafter defined) or,
unless the Representative otherwise agrees in writing, earlier than two or later
than ten business days after the date of such notice. In the event the
Underwriters elect to purchase all or a portion of the Optional Shares, the
Company agrees to furnish or cause to be furnished to the Representative the
certificates, letters and opinions, and to satisfy all conditions, set forth in
Section 7 hereof at each Subsequent Time of Delivery (as hereinafter defined).
(c) In making this Agreement, each Underwriter is
contracting severally, and not jointly, and except as provided in Sections 2(b)
and 9 hereof, the agreement of each Underwriter is to purchase only that number
of shares specified with respect to that Underwriter in Schedule I hereto. No
Underwriter shall be under any obligation to purchase any Optional Shares prior
to an exercise of the option with respect to such Shares granted pursuant to
Section 2(b) hereof.
3. Offering by the Underwriters. Upon the authorization by the
Representative of the release of the Shares, the several Underwriters propose to
offer the Shares for sale upon the terms and conditions disclosed in the
Prospectus.
4. Delivery of Shares; Closing. Certificates in definitive
form for the Shares to be purchased by each Underwriter hereunder, and in such
denominations and registered in such names as the Representative may request
upon at least 48 hours' prior notice to the Company, shall be delivered by or on
behalf of the Company to the Representative for the account of such Underwriter,
against payment by such Underwriter on its behalf of the purchase price therefor
by wire transfer of immediately available funds to such accounts as the Company
shall designate in writing. The closing of the sale and purchase of the Shares
shall be held at the offices of Xxxxxx & Xxxxxx, 000 00xx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000, except that physical delivery of such certificates shall
be made at the office of The Depository Trust Company, 00 Xxxxx Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000. The time and date of such delivery and payment shall
be, with respect to the Firm Shares, at 10:00 a.m., New York, New York time, on
the third (3rd) full business day after this Agreement is executed or at such
other time and date as the Representative and the Company may agree upon in
writing, and, with respect to the Optional Shares, at 10:00 a.m., New York, New
York time, on the date specified by the Representative in the written notice
given by the Representative of the Underwriters' election to purchase all or
part of such Optional Shares, or at such other time and date as the
Representative and the Company may agree upon in writing. Such time and date for
delivery of the Firm Shares is herein
- 13 -
called the "First Time of Delivery," such time and date for delivery of any
Optional Shares, if not the First Time of Delivery, is herein called a
"Subsequent Time of Delivery," and each such time and date for delivery is
herein called a "Time of Delivery." The Company will make such certificates
available for checking and packaging at least 24 hours prior to each Time of
Delivery at the office of The Depository Trust Company, 00 Xxxxx Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 or at such other location specified by you in writing
at least 48 hours prior to such Time of Delivery.
5. Covenants of the Company. The Company covenants and agrees
with each of the Underwriters that:
(a) The Company will use its best efforts to
cause the Registration Statement, if not effective prior to the execution and
delivery of this Agreement, to become effective. If the Registration Statement
has been declared effective prior to the execution and delivery of this
Agreement, the Company will file the Prospectus with the Commission pursuant to
and in accordance with subparagraph (1) (or, if applicable and if consented to
by you, subparagraph (4)) of Rule 424(b) within the time period required under
Rule 424(b) under the Act. The Company will advise you promptly of any such
filing pursuant to Rule 424(b). The Company will file timely all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act.
(b) The Company will not file with the Commission
the Prospectus or the amendment referred to in Section 1(a) hereof, any
amendment or supplement to the Prospectus or any amendment to the Registration
Statement unless you have received a reasonable period of time to review any
such proposed amendment or supplement and consented to the filing thereof and
will use its best efforts to cause any such amendment to the Registration
Statement to be declared effective as promptly as possible. Upon the request of
the Representative or counsel for the Underwriters, the Company will promptly
prepare and file with the Commission, in accordance with the rules and
regulations of the Commission, any amendments to the Registration Statement or
amendments or supplements to the Prospectus that may be necessary or advisable
in connection with the distribution of the Shares by the several Underwriters
and will use its best efforts to cause any such amendment to the Registration
Statement to be declared effective as promptly as possible. If required, the
Company will file any amendment or supplement to the Prospectus with the
Commission in the manner and within the time period required by Rule 424(b)
under the Act. The Company will advise the Representative, promptly after
receiving notice thereof, of the time when the Registration Statement or any
amendment thereto has been filed or declared effective or the Prospectus or any
amendment or
- 14 -
supplement thereto has been filed and will provide evidence to the
Representative of each such filing or effectiveness.
(c) The Company will advise the Representative
promptly after receiving notice or obtaining knowledge of (i) when any
post-effective amendment to the Registration Statement is filed with the
Commission, (ii) the receipt of any comments from the Commission concerning the
Registration Statement, (iii) when any post-effective amendment to the
Registration Statement becomes effective, or when any supplement to the
Prospectus or any amended Prospectus has been filed, (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or any part thereof or any order preventing or suspending the use of
any Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto, (v) the suspension of the qualification of the Shares for offer or sale
in any jurisdiction or of the initiation or threatening of any proceeding for
any such purpose, or (vi) any request made by the Commission or any securities
authority of any other jurisdiction for amending the Registration Statement, for
amending or supplementing the Prospectus or for additional information. The
Company will use its best efforts to prevent the issuance of any such stop order
or suspension and, if any such stop order or suspension is issued, to obtain the
withdrawal thereof as promptly as possible.
(d) If the delivery of a prospectus relating to
the Shares is required under the Act at any time prior to the expiration of nine
months after the date of the Prospectus and if at such time any events 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, not misleading, or if for any
reason it is necessary during such same period to amend or supplement the
Prospectus, the Company will promptly notify the Representative and upon its
request (but at the Company's expense) prepare and file with the Commission an
amendment or supplement to the Prospectus that corrects such statement or
omission or effects such compliance and will furnish without charge to each
Underwriter and to any dealer in securities as many copies of such amended or
supplemented Prospectus as the Representative may from time to time reasonably
request.
(e) The Company promptly from time to time will
take such action as the Representative may reasonably request to qualify the
Shares for offering and sale under the securities or blue sky laws of such
jurisdictions as the Representative may request and will continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Shares, 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. The
- 15 -
Company will file such statements and reports as may be required by the laws of
each jurisdiction in which the Shares have been qualified as above provided.
(f) The Company will promptly provide the
Representative, without charge, (i) two manually executed copies of the
Registration Statement as originally filed with the Commission and of each
amendment thereto, including all exhibits and all documents or information
incorporated by reference therein, (ii) for each other Underwriter, a conformed
copy of the Registration Statement as originally filed and of each amendment
thereto, without exhibits but including all documents or information
incorporated by reference therein and (iii) so long as a prospectus relating to
the Shares is required to be delivered under the Act, as many copies of each
Preliminary Prospectus or the Prospectus or any amendment or supplement thereto
as the Representative may reasonably request.
(g) As soon as practicable, but not later than
the Availability Date (as defined below), the Company will make generally
available to its security holders an earnings statement of the Company and its
subsidiaries, if any, covering a period of at least 12 months beginning after
the effective date of the Registration Statement (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations
thereunder. "Availability Date" means the forty-fifth (45th) day after the end
of the fourth fiscal quarter following the fiscal quarter in which the
Registration Statement went effective, except that if such fourth fiscal quarter
is the last quarter of the Company's fiscal year, "Availability Date" means the
ninetieth (90th) day after the end of such fourth fiscal quarter.
(h) During the period beginning from the date
hereof and continuing to and including the date 180 days after the date of the
Prospectus, the Company will not, and will cause its officers and directors not
to, without the prior written consent of the Representative, directly or
indirectly (i) offer, sell, contract to sell or otherwise dispose of, any shares
of Common Stock or securities convertible into or exercisable or exchangeable
for shares of Common Stock or (ii) enter into any swap or other agreement or any
transaction that transfers, in whole or in part, the economic consequences of
ownership of shares of Common Stock whether any such swap or other agreement is
to be settled by delivery of shares of Common Stock, other securities, cash or
otherwise; except for the sale of the Shares hereunder and except for the
issuance of Common Stock upon the exercise of stock options or warrants or the
conversion of convertible securities outstanding on the date of this Agreement
to the extent that such stock options, warrants and convertible securities are
disclosed in the Prospectus or except for the grant to employees of stock
options to purchase Common Stock which are not exercisable within such 180 days.
- 16 -
(i) During the period of three years after the
effective date of the Registration Statement, the Company will furnish to the
Representative and, upon request, to each of the other Underwriters, without
charge, (i) copies of all reports or other communications (financial or other)
furnished to shareholders and (ii) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the Commission, the
NASD or any national securities exchange.
(j) Prior to the termination of the underwriting
syndicate contemplated by this Agreement, neither the Company nor any of its
officers, directors or affiliates will (i) take, directly or indirectly, any
action designed to cause or to result in, or that might reasonably be expected
to cause or result in, the stabilization or manipulation of the price of any
security of the Company or (ii) sell, bid for, purchase or pay anyone any
compensation for soliciting purchases of, the Shares.
(k) In case of any event, at any time within the
period during which a prospectus is required to be delivered under the Act, as a
result of which any Preliminary Prospectus or the Prospectus, as then amended or
supplemented, would contain an untrue statement of a material fact, or omit to
state any material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, or, if it
is necessary at any time to amend any Preliminary Prospectus or the Prospectus
to comply with the Act or any applicable securities or blue sky laws, the
Company promptly will prepare and file with the Commission, and any applicable
state securities commission, an amendment, supplement or document that will
correct such statement or omission or effect such compliance and will furnish to
the several Underwriters such number of copies of such amendment(s),
supplement(s) or document(s) as the Representative may reasonably request. For
purposes of this subsection (k), the Company will provide such information to
the Representative, the Underwriters' counsel and counsel to the Company as
shall be necessary to enable such persons to consult with the Company with
respect to the need to amend or supplement the Registration Statement, any
Preliminary Prospectus or the Prospectus or file any document, and shall furnish
to the Representative and the Underwriters' counsel such further information as
each may from time to time reasonably request.
(l) The Company will use its best efforts to
obtain, and thereafter maintain, the qualification or listing of the shares of
Common Stock (including, without limitation, the Shares) on the Nasdaq National
Market System.
6. Expenses and Fees.
(a) The Company will pay all costs and expenses
incident to the performance of the obligations of the Company
- 17 -
under this Agreement, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated pursuant to Section 10 hereof,
including, without limitation, all costs and expenses incident to (i) the
printing of and mailing expenses associated with the Registration Statement, the
Preliminary Prospectus and the Prospectus and any amendments or supplements
thereto, this Agreement, the Agreement among Underwriters, the Underwriters'
Questionnaire submitted to each of the Underwriters by the Representative in
connection herewith, the power of attorney executed by each of the Underwriters
in favor of Advest, Inc. in connection herewith, the Dealer Agreement and
related documents (collectively, the "Underwriting Documents") and the
preliminary Blue Sky memorandum relating to the offering prepared by Xxxxxx &
Xxxxxx, counsel to the Underwriters (collectively with any supplement thereto,
the "Preliminary Blue Sky Memorandum"); (ii) 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 and, if applicable, filing of the Registration Statement
(including all amendments thereto), any Preliminary Prospectus, the Prospectus
and any amendments and supplements thereto, the Underwriting Documents and the
Preliminary Blue Sky Memorandum; (iii) the delivery of copies of the foregoing
documents to the Underwriters; (iv) the filing fees of the Commission and the
NASD relating to the Shares; (v) the preparation, issuance and delivery to the
Underwriters of any certificates evidencing the Shares, including transfer
agent's and registrar's fees; (vi) the qualification of the Shares for offering
and sale under state securities and blue sky laws, including filing fees and
fees and disbursements of counsel for the Underwriters (and local counsel
therefor) relating thereto; (vii) any listing of the Shares on the Nasdaq
National Market System; (viii) any expenses for travel, lodging and meals
incurred by the Company and any of its officers, directors and employees in
connection with any meetings with prospective investors in the Shares; (ix) the
costs of advertising the offering, including, without limitation, with respect
to the placement of "tombstone" advertisements in publications selected by the
Representative; and (x) all other costs and expenses reasonably incident to the
performance of the Company's obligations hereunder that are not otherwise
specifically provided for in this Section 6.
(b) The Representative and the Underwriters will
pay their own expenses, including the fees of their counsel (except as provided
in Section 6(a)(vi) hereof), public advertisement of the offering, and their own
marketing and due diligence expenses.
(c) At the First Time of Delivery, the Company
shall pay to the Representative the sum of One Hundred Thousand Dollars
($100,000) as a financial advisory fee.
- 18 -
7. Conditions of the Underwriters' Obligations. The
-------------------------------------------
obligations of the Underwriters hereunder to purchase and pay for the Shares to
be delivered at each Time of Delivery shall be subject, in their discretion, to
the accuracy of the representations and warranties of the Company contained
herein as of the date hereof and as of such Time of Delivery, to the accuracy of
the statements of the Company's officers made pursuant to the provisions hereof,
to the performance by the Company of its covenants and agreements hereunder, and
to the following additional conditions precedent:
(a) If the registration statement as amended to
date has not become effective prior to the execution of this Agreement, such
registration statement shall have been declared effective not later than 11:00
a.m., New York City time, on the date of this Agreement or such later date
and/or time as shall have been consented to by you in writing. If required, the
Prospectus and any amendment or supplement thereto shall have been filed with
the Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing and in accordance with Section 5(a) of this
Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceedings for that
purpose shall have been instituted, threatened or, to the knowledge of the
Company and the Representative, contemplated 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) The Representative shall have received a copy
of an executed lock-up agreement from the Company and each of the Company's
officers and directors and certain shareholders of Common Stock, in the form
attached hereto as Exhibit A.
(c) You shall have received an opinion, dated
such Time of Delivery, of Xxxxxxx, Spidi, Sloane & Xxxxx, P.C., counsel for the
Company, in form and substance satisfactory to you and your counsel, to the
effect that:
(i) The Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of the
State of New Jersey and has the corporate power and authority to own or lease
its properties and conduct its business as described in the Registration
Statement and the Prospectus and to enter into this Agreement and perform its
obligations hereunder. The Company is duly qualified to transact business as a
foreign corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases property, or conducts any business, so
as to require such qualification, except where the failure to so qualify would
not have a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries taken as a whole.
- 19 -
The Company is a registered bank holding company under the Bank Holding Company
Act of 1956, as amended.
(ii) Each of the Company's subsidiaries is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has the corporate power and authority to own
or lease its properties and conduct its business as described in the
Registration Statement and the Prospectus. Each subsidiary is duly qualified to
transact business as a foreign corporation and is in good standing under the
laws of each other jurisdiction in which it owns or leases property, or conducts
any business, so as to require such qualification, except where the failure to
so qualify would not have a material adverse effect on the financial position,
results of operations or business of the Company and its subsidiaries taken as a
whole.
(iii) The Company's authorized, issued and outstanding capital
stock is as disclosed in the Prospectus. All of the issued shares of capital
stock of the Company have been duly authorized and validly issued, are fully
paid and nonassessable and conform to the description of the Common Stock
contained in the Prospectus. None of the issued shares of Common Stock of the
Company or capital stock of any of its subsidiaries has been issued or is owned
or held in violation of any statutory (or, to the knowledge of such counsel, any
other) preemptive rights of shareholders, and no person or entity (including any
holder of outstanding shares of Common Stock of the Company or capital stock of
its subsidiaries) has any statutory (or, to the knowledge of such counsel, any
other) preemptive or other rights to subscribe for any of the Shares.
(iv) All of the issued shares of capital
stock of each of the Company's subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable, and, to such counsel's
knowledge, are owned beneficially by the Company or its subsidiaries, free and
clear of all liens, security interests, pledges, charges, encumbrances,
shareholders' agreements, voting agreements, proxies, voting trusts, defects,
equities or claims of any nature whatsoever (collectively, "Encumbrances"),
including, without limitation, any Encumbrance arising or resulting from any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement of
or entered into by the Company or its subsidiaries. To such counsel's knowledge,
other than the outstanding capital stock of Sun National Bank and the equity
securities held in the investment portfolios of the Company and such
subsidiaries, the Company does not own, directly or indirectly, any capital
stock or other equity securities of any other corporation or any ownership
interest in any partnership, joint venture or other association.
- 20 -
(v) Except as disclosed in the Prospectus,
there are, to such counsel's knowledge, no outstanding (A) securities or
obligations of the Company or any of its subsidiaries convertible into or
exchangeable for any capital stock of the Company or any subsidiary, (B)
warrants, rights or options to subscribe for or purchase from the Company or any
of its subsidiaries any such capital stock or any such convertible or
exchangeable securities or obligations or (C) obligations of the Company or any
of its subsidiaries to issue any shares of capital stock, any such convertible
or exchangeable securities or obligations, or any such warrants, rights or
options.
(vi) When the Shares to be sold by the Company
have been duly delivered against payment therefor as contemplated by this
Agreement, the Shares will be duly authorized, validly issued and fully paid and
nonassessable, the holders thereof will not be subject to personal liability
solely by reason of being such holders and the Shares will conform to the
description of the Common Stock contained in the Prospectus; the certificates
evidencing the Shares will comply with all applicable requirements of New Jersey
law.
(vii) There are no contracts, agreements or
understandings known to such counsel between the Company and any person granting
such person the right to require the Company to file a registration statement
under the Act with respect to any securities of the Company owned or to be owned
by such person or, requiring the Company to include such securities in the
securities registered pursuant to the Registration Statement (or any such right
has been effectively waived) or requiring the registration of any securities
pursuant to any other registration statement filed by the Company under the Act.
(viii) To such counsel's knowledge, neither the
Company nor any of its subsidiaries is, or with the giving of notice or passage
of time or both, would be, in violation of its articles of incorporation or
bylaws, in each case as amended to date, or, in default in any material respect
under any indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument known to such counsel to which the Company or any of its
subsidiaries is a party or to which any of their respective properties or assets
is subject.
(ix) The sale of the Shares being sold at such
Time of Delivery and the performance of this Agreement and the consummation of
the transactions herein contemplated will not conflict with or violate any
provision of the articles of incorporation or bylaws of the Company or any of
its subsidiaries, in each case as amended to date, or to such counsel's
knowledge, any existing law, statute, rule or regulation, or in any material
respect, conflict with, or (with or without the giving of notice or the passage
of time or both)
- 21 -
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument known to such counsel to which
the Company or any of its subsidiaries is a party or to which any of their
respective properties or assets is subject, or, conflict with or violate any
order, judgment or decree known to such counsel, of any court or governmental
agency or body having jurisdiction over the Company or any of its subsidiaries
or any of their respective properties or assets.
(x) To such counsel's knowledge, no consent,
approval, authorization, order or declaration of or from, or registration,
qualification or filing with, any court or governmental agency or body is
required for the sale of the Shares or the consummation of the transactions
contemplated by this Agreement, except such as have been or will have been
obtained and are or will be in effect, and except the registration of the Shares
under the Act, and such as may be required by the NASD or under state securities
or blue sky laws in connection with the offer, sale and distribution of the
Shares by the Underwriters.
(xi) To such counsel's knowledge and other than
as disclosed in or contemplated by the Prospectus, there is no litigation,
arbitration, claim, proceeding (formal or informal) or investigation pending or
threatened, in which the Company or any of its subsidiaries is a party or of
which any of their respective properties or assets is the subject which, 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, results of operations or business of the Company and its subsidiaries
taken as a whole; and, to such counsel's knowledge, neither the Company nor any
of its subsidiaries is in violation of, or in default with respect to, any law,
statute, rule, regulation, order, judgment or decree, except as described in the
Prospectus or such as do not and will not individually or in the aggregate have
a material adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole, nor is the
Company or any of its subsidiaries required to take any action in order to avoid
any such violation or default.
(xii) The statements in the Prospectus under
"Summary," "Price Range of the Common Shares; Dividends," "Business of the
Company," "Supervision and Regulation," "Description of the Capital Stock," and
"Shares Eligible for Future Sale" have been reviewed by such counsel, and
insofar as they refer to statements of law, descriptions of statutes, licenses,
rules or regulations, or legal conclusions, are correct in all material
respects.
- 22 -
(xiii) This Agreement has been duly authorized,
executed and delivered by the Company and, assuming due execution by the
Representative of the Underwriters, constitutes the valid and binding agreement
of the Company, enforceable against the Company, in accordance with its terms,
subject, as to enforcement, to applicable bankruptcy, insolvency, reorganization
and moratorium laws and other laws relating to or affecting the enforcement of
creditors' rights generally and to general equitable principles and except as
the enforceability of rights to indemnity and contribution under this Agreement
may be limited under applicable securities laws or the public policy underlying
such laws.
(xiv) Neither the Company nor any of its subsidiaries is an
"investment company" or a company "controlled" by an investment company as such
terms are defined in Sections 3(a) and 2(a)(9), respectively, of the Investment
Company Act.
(xv) To such counsel's knowledge, the Company
and its subsidiaries have received all permits, licenses, franchises,
authorizations, registrations, qualifications and approvals (collectively,
"permits") of governmental or regulatory authorities (including, without
limitation, state and/or other insurance regulatory authorities) as may be
required of them to own their properties and to conduct their businesses in the
manner described in the Prospectus, subject to such qualification as may be set
forth in the Prospectus; to such counsel's knowledge, the Company and its
subsidiaries have fulfilled and performed all of their material obligations with
respect to such permits and no event has occurred which allows, or after notice
or lapse of time or both would allow, revocation or termination thereof or
result in any other material impairment of the rights of the holder of any such
permits, subject in each case to such qualifications as may be set forth in the
Prospectus; and other than as described in the Prospectus, such permits contain
no restrictions that materially affect the ability of the Company and its
subsidiaries to conduct their businesses.
(xvi) The Registration Statement and the Prospectus and each
amendment or supplement thereto (other than the financial statements, the notes
and schedules thereto and other financial data included therein, to which such
counsel need express no opinion), as of their respective effective or issue
dates, complied as to form in all material respects with the requirements of the
Act and the respective rules and regulations thereunder. The descriptions in the
Registration Statement and the Prospectus of contracts and other documents are
accurate and fairly present the information required to be shown; and such
counsel do not know of any contracts or documents of a character required to be
described in the Registration Statement or Prospectus or to be filed as exhibits
to the Registration Statement which are not described and filed as required.
- 23 -
(xvii) The Registration Statement was declared
effective under the Act as of the date and time specified in such opinion and,
to such counsel's knowledge and information, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Act and no
proceedings therefor have been initiated or threatened by the Commission.
Such counsel shall also state that they have participated in
the preparation of the Registration Statement and the Prospectus and in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company, and
representatives of and counsel to the Underwriters at which the contents of the
Registration Statement, the Prospectus and related matters were discussed and,
although such counsel has not passed upon or assumed any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, and although such counsel has not
undertaken to verify independently the accuracy or completeness of the
statements in the Registration Statement or the Prospectus, nothing has come to
such counsel's attention to lead them to believe that the Registration
Statement, or any further amendment thereto made prior to such Time of Delivery,
on its effective date and as of such Time of Delivery, contained or contains any
untrue statement of a material fact or omitted or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
not misleading, or that the Prospectus, or any amendment or supplement thereto
made prior to such Time of Delivery, as of its issue date and as of such Time of
Delivery, contained or contains any untrue statement of a material fact or
omitted or omits 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 that such counsel need express no belief
regarding the financial statements, the notes and schedules thereto and other
financial data contained in the Registration Statement, any amendment thereto,
or the Prospectus, or any amendment or supplement thereto).
In rendering any such opinion, such counsel may rely, as to
matters of fact, to the extent such counsel deem proper, on certificates of
officers of the Company, public officials and letters from officials of the NASD
[and such counsel may rely as to matters governed by the laws of the State of
New Jersey on the opinion of _________________, special New Jersey counsel to
the Company, provided that such Company counsel shall state in their opinion
that they believe that both they and the Underwriters are justified in relying
upon the opinion of such special New Jersey counsel]. Copies of such
certificates of officers of the Company and other opinions shall be addressed
and furnished to the Underwriters and furnished to counsel for the Underwriters.
- 24 -
(d) Xxxxxx & Xxxxxx, counsel for the Underwriters,
shall have furnished to you such opinion or opinions, dated such Time of
Delivery, with respect to such matters as you may reasonably request, and the
Company shall have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(e) The Representative shall have received from
Deloitte & Touche LLP, independent public accountants, in form and substance
satisfactory to the Representative, letters dated as of the date hereof, the
date of delivery of the Firm Securities and the date(s) of delivery of any
Option Securities, 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 contained in the
Registration Statement and Prospectus; provided that the letter dated as of the
date of delivery of the Firm Securities shall use a "cut-off date" not earlier
than the date hereof.
(f) Since the date of the latest audited
financial statements included in the Prospectus, neither the Company nor any of
the Subsidiaries shall have sustained any change, or any development involving a
prospective change (including, without limitation, a change in management or
control of the Company), in or affecting the position (financial or otherwise),
results of operations, net worth or business prospects of the Company and its
subsidiaries, otherwise than as disclosed in or contemplated by the Prospectus,
the effect of which, in either such case, in your sole judgment makes it
impracticable or inadvisable to proceed with the purchase, sale and delivery of
the Shares being delivered at such Time of Delivery as contemplated by the
Registration Statement, as amended as of the date hereof.
(g) Subsequent to the date hereof, there shall
not have occurred any of the following: (i) any suspension or limitation in
trading in securities generally on the New York Stock Exchange, and/or the
American Stock Exchange or any setting of minimum prices for trading on such
exchange, or in the Common Stock of the Company by the Commission or the NASD;
(ii) a moratorium on commercial banking activities in New York, New Jersey or
Connecticut declared by either federal or state authorities; or (iii) any
outbreak or escalation of hostilities involving the United States, declaration
by the United States of a national emergency or war or any other national or
international calamity or emergency if the effect of any such event specified in
this clause (iii) in your sole judgment makes it impracticable or inadvisable to
proceed with the purchase, sale and delivery of the Shares being delivered at
such Time of Delivery as contemplated by the Registration Statement, as amended
as of the date hereof.
(h) The Company shall have furnished to you at
such Time of Delivery certificates of the chief executive and
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chief financial officers of the Company satisfactory to you, as to the accuracy
of the representations and warranties of the Company herein at and as of such
Time of Delivery with the same effect as if made at such Time of Delivery, as to
the performance by the Company of all of its respective obligations hereunder to
be performed at or prior to such Time of Delivery, and as to such other matters
as you may reasonably request, and the Company shall have furnished or caused to
be furnished certificates of such officers as to such matters as you may
reasonably request.
[the following was included in the officers' closing certificate:]
(i) The representations and warranties of
the Company in this Agreement and in the certificates delivered by the Company
pursuant to this Agreement shall be true and correct in all material respects
when made and on and as of each Time of Delivery as if made at such time, and
the Company shall have performed all covenants and agreements and satisfied all
conditions contained in this Agreement required to be performed or satisfied by
the Company at or before such Time of Delivery.
(j) The Shares shall have been approved for
quotation in the Nasdaq National Market System.
(k) Each person purchasing Shares pursuant to the
Directed Share Program shall have executed and delivered to the Representative a
subscription agreement in form and substance acceptable to the Representative.
8. Indemnification and Contribution.
(a) The Company agrees to 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 in
respect thereof) arise out of or are based upon: (i) any untrue statement or
alleged untrue statement made by the Company in Section 1 of this Agreement;
(ii) any untrue statement or alleged untrue statement of any material fact
contained in (A) the Registration Statement or any amendment thereto, any
Preliminary Prospectus or the Prospectus or any amendment or supplement thereto,
or (B) any application or other document, or amendment or supplement thereto,
executed by the Company or based upon written information furnished by or on
behalf of the Company filed in any jurisdiction in order to qualify the Shares
under the securities or blue sky laws thereof or filed with the Commission or
any securities association or securities exchange (each an "Application"); or
(iii) the omission of or alleged omission to state in the Registration Statement
or any amendment thereto, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or any Application of a material fact required
to be stated
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therein or necessary to make the statements therein not misleading; and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto or any Application in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through you expressly for use therein (which information is solely
as set forth in Section 1(c) hereof). The Company will not, without the prior
written consent of the Representative of the Underwriters, settle or compromise
or consent to the entry of any judgment in any pending or threatened claim,
action, suit or proceeding (or related cause of action or portion thereof) in
respect of which indemnification may be sought hereunder (whether or not any
Underwriter is a party to such claim, action, suit or proceeding), unless such
settlement, compromise or consent includes an unconditional release of each
Underwriter from all liability arising out of such claim, action, suit or
proceeding (or related cause of action or portion thereof).
(b) The Company agrees to indemnify and hold
harmless Advest and each person, if any, who controls Advest within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act
("Advest Entities"), against any and all losses, claims, damages or liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim): (i)
caused by the failure of any Participant to pay for and accept delivery of the
Shares which, immediately following the effectiveness of the Registration
Statement, were subject to a properly confirmed agreement to purchase; or (ii)
related to, arising out of, or in connection with the Directed Share Program,
provided that the Company shall not be responsible under this subsection 8(b)
for any losses, claims, damages or liabilities (or expenses relating thereto)
that are finally judicially determined to have resulted from the bad faith or
gross negligence of Advest Entities.
(c) Each Underwriter, severally but not jointly,
agrees to indemnify and hold harmless the Company against any losses, claims,
damages or liabilities to which the Company may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
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Registration Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, or any Application or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in 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 reliance upon and in conformity with written information
furnished to the Company by such Underwriter through you expressly for use
therein (which information is solely as set forth in Section 1(c) hereof); and
will reimburse the Company for any legal or other expenses reasonably incurred
by the Company in connection with investigating or defending any such loss,
claim, damage, liability or action.
(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 the indemnifying party from
any liability which it may have to any indemnified party otherwise than under
such subsection (a), (b) or (c). 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 satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying 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 reasonably concluded that there may be one or more legal defenses available
to it or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnifying party shall not have
the right to assume the defense of such action on behalf of such indemnified
party and such indemnified party shall have the right to select separate counsel
to defend such action on behalf of such indemnified party. After such notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof and approval by such indemnified party of counsel
appointed to defend such action, the indemnifying party will not be liable to
such indemnified party under this Section 8 for any legal or other expenses,
other than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof. Nothing in this
Section 8(d) shall preclude an indemnified party from participating at its own
expense in the defense of any such action so assumed by the indemnifying party.
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Notwithstanding anything contained herein to the contrary, if indemnity may be
sought pursuant to section 8(b) hereof in respect of such action or proceeding,
then in addition to such separate firm for the indemnified parties, the
indemnifying party shall be liable for the reasonable fees and expenses of
counsel for Advest for the defense of any losses, claims, damages and
liabilities arising out of the Directed Share Program, and all persons, if any,
who control Advest within the meaning of either Section 15 of the Act or Section
20 of the Exchange Act.
(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 (c) above in respect of any losses, claims,
damages or liabilities (or actions 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 in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares. 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 on the one hand and the Underwriters on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other hand shall be deemed
to be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriters. 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 on the one hand
or 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 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 account of the equitable considerations referred to above in this
subsection (e). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (e) shall be deemed
- 29 -
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 Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any 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 in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company under this
Section 8 shall be in addition to any liability which the Company may otherwise
have and shall extend, upon the same terms and conditions, to each officer,
director and employee of the Underwriters and to each person, if any, who
controls any Underwriter within the meaning of the Act or the Exchange Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer, trustee and
director of the Company and to each person, if any, who controls the Company
within the meaning of the Act or the Exchange Act.
9. Default of Underwriters.
(a) If any Underwriter defaults in its obligation
to purchase Shares at a Time of Delivery, you may in your discretion arrange for
you or another party or other parties to purchase such Shares on the terms
contained herein within thirty-six (36) hours after such default by any
Underwriter. In the event that, within the respective prescribed period, you
notify the Company that you have so arranged for the purchase of such Shares,
you shall have the right to postpone a Time of Delivery for a period of not more
than seven (7) 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 that in your opinion
may thereby be made necessary. The cost of preparing, printing and filing any
such amendments shall be paid for by the Underwriters. 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 Shares.
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(b) If, after giving effect to any arrangements
for the purchase of the Shares of a defaulting Underwriter or Underwriters by
you as provided in subsection (a) above, if any, the aggregate number of such
Shares which remains unpurchased does not exceed one-eleventh (1/11) of the
aggregate number of Shares to be purchased at such Time of Delivery, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the number of Shares which such Underwriter agreed to purchase
hereunder at such Time of Delivery and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the number
of Shares which such Underwriter agreed to purchase hereunder) of the Shares of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made.
10. Termination.
(a) This Agreement may be terminated in the sole
discretion of the Representative by notice to the Company given prior to the
First Time of Delivery or any Subsequent Time of Delivery, respectively, in the
event that (i) any condition to the obligations of the Underwriters set forth in
Section 7 hereof has not been satisfied, or (ii) the Company shall have failed,
refused or been unable to deliver Certificates in definitive form for the Shares
or the Company shall have failed, refused or been unable to perform all
obligations and satisfy all conditions on their respective parts to be performed
or satisfied hereunder at or prior to such Time of Delivery, in either case
other than by reason of a default by any of the Underwriters. If this Agreement
is terminated pursuant to this Section 10(a), the Company will reimburse the
Underwriters severally upon demand for all reasonable out-of-pocket expenses
(including counsel fees and disbursements) that shall have been incurred by them
in connection with the proposed purchase and sale of the Shares. Any termination
pursuant to this Section 10(a) shall be without liability on the part of any
Underwriter to the Company or on the part of the Company to any Underwriter
(except for expenses to be paid by the Company pursuant to Section 6 hereof or
reimbursed by the Company pursuant to this Section 10(a) and except as to
indemnification and contribution to the extent provided in Section 8 hereof).
(b) If, after giving effect to any arrangements
for the purchase of the Shares of a defaulting Underwriter or Underwriters by
you as provided in Section 9(a), the aggregate number of such Shares which
remains unpurchased exceeds one- eleventh (1/11) of the aggregate number of
Shares to be purchased at such Time of Delivery, then this Agreement (or, with
respect to a Subsequent Time of Delivery, the obligations of the Underwriters to
purchase and of the Company to sell the Optional Shares) shall thereupon
terminate, without liability on the part of any non-defaulting Underwriter or
the Company, except for the expenses to
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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.
11. Survival. The respective indemnities, agreements,
representations, warranties and other statements of the Company, its officers
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 investigation (or any statement as to the
results thereof) made by or on behalf of any Underwriter or any controlling
person referred to in Section 8(f) or the Company, or any officer, trustee or
director or controlling person of the Company referred to in Section 8(f), and
shall survive delivery of and payment for the Shares. The respective agreements,
covenants, indemnities and other statements set forth in Sections 6 and 8 hereof
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement.
12. Notices. All communications hereunder shall be in writing
and, if sent to any of the Underwriters, shall be mailed, delivered or
telegraphed and confirmed in writing to you in care of Advest, Inc., Xxx
Xxxxxxxxxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx X.
Xxxxx (with a copy to Xxxxxx & Xxxxxx, 000 00xx Xxxxxx, X.X., Xxxxxxxxxx, X.X.
00000, Attention: Xxxxxx Xxxxxx); if to the Company shall be sufficient in all
respects if mailed, delivered or telegraphed and confirmed in writing to Sun
Bancorp, Inc., 000 Xxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxxxx 00000, Attention: Xxxxxx
X. Xxxxxx, III (with a copy to Xxxxxxx, Spidi, Sloane & Xxxxx, P.C., One
Franklin Square, 0000 X Xxxxxx, X.X., Xxxxx 000 Xxxx, Xxxxxxxxxx, X.X. 00000,
Attention: Xxxx X. Spidi).
13. Binding Effect. This Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers, trustees, directors and
employees and controlling persons referred to therein 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 Shares from any Underwriter shall be deemed a successor
or assign by reason merely of such purchase.
14. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to any provisions regarding conflicts of laws.
15. Counterparts. This Agreement may be executed by any one or
more of the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but
- 32 -
all such counterparts shall together constitute one and the same
instrument.
- 33 -
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us one of the counterparts hereof, and
upon the acceptance hereof by Advest, Inc., on behalf of each of the
Underwriters, this letter will constitute a binding agreement among the
Underwriters and the Company. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in the Agreement among Underwriters, a copy of which shall be submitted to
the Company for examination, upon request, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
SUN BANCORP, INC.
By:
---------------------------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
written above at New York, New York.
ADVEST, INC.
By: ADVEST, INC.
By:
----------------------------------
Name:
Title:
On behalf of each of the Underwriters
SCHEDULE I
Number of Optional
Total Number Shares to be Purchased
of Firm Shares if Maximum
Underwriter to be Purchased Option Exercised
----------- --------------- ----------------
Advest, Inc.
EXHIBIT A
FORM OF LOCK-UP AGREEMENT
SUN BANCORP, INC.
LOCK-UP AGREEMENT
__________ __, 1997
Advest, Inc.
As Representative of the Several Underwriters
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The undersigned understands that you, as Representative of the several
underwriters (the "Underwriters"), propose to enter into an underwriting
agreement (the "Underwriting Agreement") with Sun Bancorp, Inc. (the "Company")
providing for the public offering (the "Public Offering") by the Underwriters,
including yourself, of common stock of the Company (the "Common Stock") pursuant
to the Company's Registration Statement on Form S-1 (the "Registration
Statement").
In consideration of the Underwriters' agreement to purchase and make
the Public Offering of the Common Stock, and for other good and valuable
consideration, receipt of which is hereby acknowledged, the undersigned hereby
agrees, for a period of 180 days after the effective date of the Registration
Statement (the "Lock-Up Period"), not to sell, offer to sell, solicit an offer
to buy, contract to sell, encumber, distribute, pledge, grant any option for the
sale of, or otherwise transfer or dispose of, directly or indirectly, in one or
a series of transactions (collectively, a "Disposition"), any shares of Common
Stock or any securities convertible or exercisable into or exchangeable for
shares of Common Stock (collectively, "Securities"), now owned or hereafter
acquired by the undersigned or with respect to which the undersigned has
acquired or hereafter acquires the power of disposition, without the prior
written consent of Advest, Inc. Prior to the expiration of the Lock-Up Period,
the undersigned agrees that it will not announce or disclose any intention to do
anything after the expiration of such period which the undersigned is
prohibited, as provided in the preceding sentence, from doing during the Lock-Up
Period. In addition, for the benefit of the Company and the Underwriters, the
undersigned hereby (i) waives any right it may have to cause the Company to
register pursuant to the Securities Act of 1933, as amended, shares of Common
Stock now owned or hereafter acquired or received by the undersigned as a result
of the Public Offering and (ii) during the Lock-Up Period, agrees not to
exercise any such registration rights and further agrees that the Company shall
not be obligated to register any shares in violation of the Underwriting
Agreement.
The undersigned acknowledges and agrees that the restrictions above are
expressly agreed to preclude the holder of the Securities from engaging in any
hedging or other transaction which is designed to or reasonably expected to lead
to or result in a Disposition of Securities (or the economic equivalent thereof)
during the Lock-Up Period even if such Securities would be disposed of by
someone other than the undersigned. Such prohibited hedging or other
transactions would include, without limitation, any short sale (whether or not
against the box) or any purchase, sale or grant of any right (including, without
limitation, any put or call option) with respect to any Securities or with
respect to any security (other than a broad-based marked basket or index) that
includes, relates to or derives any significant part of its value from the
Securities.
The undersigned hereby also agrees and consents to the entry of stop
transfer instructions with the Company's transfer agent against the transfer of
the Securities held by the undersigned except in compliance with the Lock-Up
Agreement.
It is understood that, if the Underwriting Agreement is not executed,
or if the Underwriting Agreement shall terminate or be terminated prior to
payment for and delivery of the Common Stock the subject thereof, this Lock-Up
Agreement shall automatically terminate and be of no further force or effect.
This Lock-Up Agreement shall be governed by and construed in accordance
with the laws of the State of New York (without giving effect to its conflict of
laws provisions).
Very truly yours,
-----------------------------
Name:
