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EXHIBIT 1
1,150,000 SHARES
MERCANTILE BANK CORPORATION
COMMON STOCK
UNDERWRITING AGREEMENT
_____________, 1998
Xxxxx Capital Markets, a division of
First Chicago Capital Markets, Inc.
Xxx Xxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Dear Sirs:
Mercantile Bank Corporation, a Michigan corporation (the "Company"),
proposes to issue and sell 1,000,000 shares (the "Firm Shares") of its
authorized but unissued Common Stock (the "Common Stock") to Xxxxx Capital
Markets, a division of First Chicago Capital Markets, Inc., a Delaware
corporation ("Xxxxx" or the "Underwriter"). In addition, the Company proposes to
grant to the Underwriter an option to purchase up to an additional 150,000
shares (the "Optional Shares") to cover over-allotments. The Firm Shares and the
Optional Shares are called, collectively, the "Shares."
1. SALE AND PURCHASE OF THE SHARES.
(a) On the basis of the representations, warranties and
agreements of the Company contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to issue and sell to
the Underwriter, and the Underwriter agrees to purchase, the Firm
Shares at a purchase price of $_____ per Share.
(b) On the basis of the representations, warranties and
agreements of the Company contained in, and subject to the terms and
conditions of, this Agreement, the Company grants to the Underwriter an
option to purchase all or any part of the Optional Shares at a price
per Share of $_______. The over-allotment option may be exercised only
to cover over-allotments in the sale of the Firm Shares by the
Underwriter and may be exercised in whole or in part at any time or
times on or before 12:00 noon, Detroit time, on the day before the Firm
Shares Closing Date (as defined in Section 2 below), and only once at
any time after that date and within 30 days after the Effective Date
(as defined in Section 4 below), in each case upon written or
transmitted facsimile notice, or verbal notice confirmed by transmitted
facsimile, written or telegraphic notice, by Xxxxx to the Company no
later than 12:00 noon, Detroit time, on the day before the Firm
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Shares Closing Date or at least three but not more than five full
business days before the Optional Shares Closing Date (as defined in
Section 2 below), as the case may be, setting forth the number of
Optional Shares to be purchased and the time and date (if other than
the Firm Shares Closing Date) of such purchase.
2. DELIVERY AND PAYMENT. Delivery by the Company of the Firm Shares to
Xxxxx, and payment of the purchase price by wire transfer to an account
specified in writing by the Company to Xxxxx at least 48 hours prior to the Firm
Shares Closing Date, shall take place at the offices of Xxxxxxxxx Xxxxxx PLLC,
000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, at 10:00 a.m., Detroit
time, at such time and date, not later than the third (or, if the Firm Shares
are priced, as contemplated by Rule 15c6-1(c) under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), after 4:30 p.m., Washington, D.C.
time, the fourth) full business day following the first date that any of the
Shares are released by the Underwriter for sale to the public, as Xxxxx shall
designate by at least 48 hours prior notice to the Company (the "Firm Shares
Closing Date"); provided, however, that if the Prospectus (as defined in Section
4 below) is at any time prior to the Firm Shares Closing Date recirculated to
the public, the Firm Shares Closing Date shall occur upon the later of the third
or fourth, as the case may be, full business day following the first date
that any of the Shares are released by the Underwriter for sale to the public or
the date that is 48 hours after the date that the Prospectus has been so
recirculated.
To the extent the option with respect to the Optional Shares
is exercised, delivery by the Company of the Optional Shares, and payment of the
purchase price by wire transfer to an account specified in writing by the
Company to Xxxxx at least 48 hours prior to the Optional Shares Closing Date (as
defined below) shall take place at the offices of Xxxxxxxxx Xxxxxx PLLC
specified above at the time and on the date (which may be the Firm Shares
Closing Date) specified in the notice referred to in Section 1(b) (such time and
date of delivery and payment are called the "Optional Shares Closing Date"). The
Firm Shares Closing Date and the Optional Shares Closing Date are called,
individually, a "Closing Date" and, collectively, the "Closing Dates."
Certificates representing the Firm Shares shall be registered
in such names and shall be in such denominations as Xxxxx shall request at least
two full business days before the Firm Shares Closing Date or, in the case of
the Optional Shares, on the day of notice of exercise of the option as described
in Section 1(b), and shall be made available to Xxxxx for checking and
packaging, at such place as is designated by Xxxxx, at least one full business
day before the Closing Date.
3. PUBLIC OFFERING. The Company understands that the Underwriter
proposes to make a public offering of the Shares, as set forth in and pursuant
to the Prospectus, as soon after the Effective Date as Xxxxx xxxxx advisable.
The Company hereby confirms that the Underwriter and dealers have been
authorized to distribute each preliminary prospectus and are authorized to
distribute the Prospectus (as from time to time amended or supplemented).
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4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to the Underwriter and
agrees with the Underwriter as follows:
(a) The Company has carefully prepared in conformity with the
requirements of the Securities Act of 1933, as amended (the "Securities
Act") and the rules and regulations adopted by the Securities and
Exchange Commission (the "Commission") thereunder (the "Rules"), a
registration statement on Form SB-2 (No. 333-_______), including a
preliminary prospectus, and has filed with the Commission the
registration statement and such amendments thereof as may have been
required to the date of this Agreement. Copies of such registration
statement (including all amendments thereof) and of the related
preliminary prospectus have heretofore been delivered by the Company to
you. The term "preliminary prospectus" means any preliminary prospectus
(as defined in Rule 430 of the Rules) included at any time as a part of
the registration statement. The registration statement as amended
(including any supplemental registration statement under Rule 462(b) or
any amendment under Rule 462(c) of the Rules) at the time and on the
date it becomes effective (the "Effective Date"), including the
prospectus, financial statements, schedules, exhibits, and all other
documents incorporated by reference therein or filed as a part thereof,
is called the "Registration Statement;" provided, however, that
"Registration Statement" shall also include all Rule 430A Information
(as defined below) deemed to be included in such Registration Statement
at the time such Registration Statement becomes effective as provided
by Rule 430A of the Rules. The term "Prospectus" means the Prospectus
as filed with the Commission pursuant to Rule 424(b) of the Rules or,
if no filing pursuant to Rule 424(b) of the Rules is required, means
the form of final prospectus included in the Registration Statement at
the time such Registration Statement becomes effective. The term "Rule
430A Information" means information with respect to the Shares and the
offering thereof permitted to be omitted from the Registration
Statement when it becomes effective pursuant to Rule 430A of the Rules.
Reference made herein to any preliminary prospectus or to the
Prospectus shall be deemed to refer to and include any document
attached as an exhibit thereto or incorporated by reference therein, as
of the date of such preliminary prospectus or the Prospectus, as the
case may be. The Company will not file any amendment of the
Registration Statement or supplement to the Prospectus to which Xxxxx
shall reasonably object in writing after being furnished with a copy
thereof.
(b) Each preliminary prospectus, at the time of filing
thereof, contained all material statements which were required to be
stated therein in accordance with the Securities Act and the Rules, and
conformed in all material respects with the requirements of the
Securities Act and the Rules, and did not include any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. The
Commission has not issued any order suspending or preventing the use of
any preliminary prospectus. When the
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Registration Statement shall become effective, when the Prospectus is
first filed pursuant to Rule 424(b) of the Rules, when any
post-effective amendment of the Registration Statement shall become
effective, when any supplement to or pre-effective amendment of the
Prospectus is filed with the Commission and at each Closing Date, the
Registration Statement and the Prospectus (and any amendment thereof or
supplement thereto) will comply with the applicable provisions of the
Securities Act and the Exchange Act and the respective rules and
regulations of the Commission thereunder, and neither the Registration
Statement nor the Prospectus, nor any amendment thereof or supplement
thereto, will contain any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided,
however, that the Company makes no representation or warranty as to the
information contained in the Registration Statement or the Prospectus
or any amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by the
Underwriter, specifically for use in connection with the preparation
thereof.
(c) All contracts and other documents required to be filed as
exhibits to the Registration Statement have been filed with the
Commission as exhibits to the Registration Statement.
(d) Xxxxx, Xxxxxx & Company, LLP, whose report is filed with
the Commission as part of the Registration Statement, are, and during
the periods covered by their report were, independent public
accountants as required by the Securities Act and the Rules.
(e) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Michigan. The Company's subsidiary, Mercantile Bank of West
Michigan, a Michigan banking corporation (the "Bank"), has been duly
chartered and is validly existing as a banking corporation in good
standing under the laws of the State of Michigan, including without
limitation, the Michigan Banking Code of 1969 (the "Banking Code").
Neither the Company nor the Bank has any properties or conducts any
business outside of the State of Michigan which would require either of
them to be qualified as a foreign corporation or bank, as the case may
be, in any jurisdiction outside of Michigan. Except for the Company's
ownership of the Bank, neither the Company nor the Bank has any
directly or indirectly held subsidiary. The Company has all power,
authority, authorizations, approvals, consents, orders, licenses,
certificates and permits needed to enter into, deliver and perform this
Agreement and to issue and sell the Shares.
(f) The application for permission to organize the Bank (the
"FIB Application") was approved by the Commissioner of the Financial
Institutions Bureau for the State of Michigan (the "Commissioner") on
August 29, 1997, pursuant to Order No. BT-0612-97-05, subject to
certain conditions specified in the Order and supplemental
correspondence from the Commissioner dated the
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same date. The Order and supplemental correspondence from the
Commissioner are collectively referred to in this Agreement as the "FIB
Order." All conditions contained in the FIB Order have been satisfied.
The application to the Federal Deposit Insurance Corporation (the
"FDIC") to become an insured depository institution under the
provisions of the Federal Deposit Insurance Act (the "FDIC
Application") was approved by order of the FDIC dated August 19, 1997
(the "FDIC Order"). All conditions contained in the FDIC Order have
been satisfied. The Company's application to the Federal Reserve Board
to become a bank holding company and acquire all issued capital stock
of the Bank (the "Bank Holding Company Application") under the Bank
Holding Company Act of 1956, as amended, was approved on October 15,
1997 (the "Federal Reserve Board Approval"). All conditions in the
Federal Reserve Board Approval have been satisfied. Each of the FIB
Application, FDIC Application, and Bank Holding Company Application, at
the time of their respective filings, contained all required
information and such information was complete and accurate in all
material respects and each of the approvals and/or orders from the FIB,
the FDIC and the Federal Reserve Board are still in full force and
effect and have not been rescinded or revoked. The Company and the Bank
are in full compliance with the applicable rules and regulations of
each of such agencies, except where a failure to comply is not material
to the conduct of their respective businesses or ownership of their
respective properties. No authorization, approval, consent, order,
license, certificate or permit of and from any federal, state, or local
governmental or regulatory official, body, or tribunal, is required for
the Company or the Bank to conduct their respective businesses and own
their respective properties as described in the Prospectus, except such
authorizations, approvals, consents, orders, licenses, certificates, or
permits as are not material to the commencement or conduct of their
respective businesses or to the ownership of their respective
properties.
(g) The financial statements of the Company and any related
notes thereto, included in the Registration Statement and the
Prospectus, present fairly the financial position of the Company as of
the date of such financial statements and for the period covered
thereby. Such statements and any related notes have been prepared in
accordance with generally accepted accounting principals applied on a
consistent basis and certified by the independent accountants named in
subsection 4(d) above. No other financial statements are required to be
included in the Prospectus or the Registration Statement.
(h) The Company owns adequate and enforceable rights to use
any patents, patent applications, trademarks, trademark applications,
service marks, copyrights, copyright applications and other similar
rights (collectively, "Intangibles") necessary for the conduct of the
material aspects of its business as described in the Prospectus and the
Company has not infringed, is infringing, or has received any notice of
infringement of, any Intangible of any other person.
(i) The Company has a valid and enforceable leasehold interest
in the real property located at 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx
Xxxxxx, Xxxxxxxx,
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which is as described in the Prospectus, and is free and clear of all
liens, encumbrances, claims, security interests and defects.
(j) There are no litigation or governmental or other
proceedings or investigations pending before any court or before or by
any public body or board or threatened against the Company or the Bank
and to the best of the Company's knowledge, there is no reasonable
basis for any such litigation, proceedings or investigations, which
would have a material adverse effect on commencement or conduct of the
respective businesses of the Company or the Bank or the ownership of
their respective properties.
(k) The Company and Bank have filed all federal, state and
local tax returns required to be filed by them and paid all taxes shown
due on such returns as well as all other material taxes, assessments
and governmental charges which have become due; no material deficiency
with respect to any such return has been assessed or proposed.
(l) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, there has
not been any material adverse change in the condition (financial or
other), business, properties or prospects of the Company.
(m) No default exists, and no event has occurred which with
notice or lapse of time, or both, would constitute a default, in the
due performance and observance of any material term, covenant or
condition, by the Company or the Bank of any lease, indenture,
mortgage, note or any other agreement or instrument to which the
Company or the Bank is a party or by which either of them or either
of their businesses may be bound or affected, except such defaults or
events as are not material to the conduct of their respective
businesses or ownership of their respective properties.
(n) Neither the Company nor the Bank is in violation of any
term or provision of the articles of incorporation or bylaws of the
Company or the Bank. Neither the Company nor the Bank is in violation
of, any franchise, license, permit, judgment, decree, order, statute,
rule or regulation.
(o) Neither the execution, delivery or performance of this
Agreement by the Company nor the consummation of the transactions
contemplated hereby (including, without limitation, the issuance and
sale by the Company of the Shares) will give rise to a right to
terminate or accelerate the due date of any payment due under, or
conflict with or result in the breach of any term or provision of, or
constitute a default (or an event which with notice or lapse of time,
or both, would constitute a default) under, or require any consent
under, or result in the execution or imposition of any lien, charge or
encumbrance upon any properties or assets of the Company or the Bank
pursuant to the terms of, any
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lease, indenture, mortgage, note or other agreement or instrument to
which the Company or the Bank is a party or by which either of them or
either of their businesses may be bound or affected, or any franchise,
license, permit, judgment, decree, order, statute, rule or regulation
or violate any provision of the articles of incorporation or bylaws of
the Company or the Bank, except those which are immaterial in amount or
effect.
(p) The Company has authorized capital stock as set forth in
the Prospectus. There are 1,495,000 shares of Common Stock of the
Company issued and outstanding. No shares of preferred stock are issued
and outstanding. The issuance, sale and delivery of the Shares have
been duly authorized by all necessary corporate action by the Company
and, when issued, sold and delivered against payment therefor pursuant
to this Agreement, will be duly and validly issued, fully paid and
nonassessable and none of them will have been issued in violation of
any preemptive or other right. Upon issuance, sale, and delivery
thereof against payment therefor, all of the capital stock of the Bank
will be duly authorized and validly issued, fully paid and
nonassessable and will be owned by the Company, free and clear of all
liens, encumbrances and security interests (subject to the provisions
of the Banking Code, including, without limitation, Sections 77 and 201
of the Banking Code). There is no outstanding option, warrant or other
right calling for the issuance of, and no binding commitment to issue,
any share of stock of the Company or the Bank or any security
convertible into or exchangeable for stock of the Company or the Bank,
except for stock options described in the Registration Statement (the
"Stock Options") under the 1997 Employee Stock Option Plan (the "Stock
Option Plan"). The Common Stock, the Shares and the Stock Options
conform to all statements in relation thereto contained in the
Registration Statement and the Prospectus.
(q) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, neither the
Company nor the Bank has (1) issued any securities or incurred any
material liability or obligation, direct or contingent, (2) entered
into any material transaction, or (3) declared or paid any dividend or
made any distribution on any of their stock, except liabilities,
obligations, and transactions reasonably expected based on the
disclosures in the Prospectus.
(r) This Agreement has been duly and validly authorized,
executed and delivered by the Company and is the legal, valid and
binding agreement and obligation of the Company.
(s) The Commission has not issued any order preventing or
suspending the use of any preliminary prospectus.
(t) Neither the Company, nor the Bank, nor, to the Company's
knowledge any director, officer, agent, employee or other person
associated with the Company or the Bank, acting on behalf of the
Company or the Bank, has used any corporate funds for any unlawful
contribution, gift, entertainment or other
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unlawful expense relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; violated or is in violation
of any provision of the Foreign Corrupt Practices Act of 1977; or made
any bribe, rebate, payoff, influence payment, kickback or other
unlawful payment.
(u) Neither the Company nor the Bank nor any affiliate of
either of them has taken, and they will not take, directly or
indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the shares of the Common
Stock in order to facilitate the sale or resale of any of the Shares.
(v) No transaction has occurred between or among the Company
or the Bank and any of their officers, directors, organizers or the
Company's shareholder or any affiliate or affiliates of any such
officer, director, organizer, or shareholder, that is required to be
described in and is not described in the Prospectus.
(w) The Company is not and will not after the offering be an
"investment company," or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as
amended.
(x) The Company has obtained from all of its executive
officers and directors their written agreement that for a period of 150
days from the date of the Effective Date, they will not offer to sell,
sell, transfer, contract to sell, or grant any option for the sale of
or otherwise dispose of, directly or indirectly, any shares of Common
Stock of the Company (or any securities convertible into or exercisable
for such shares of Common Stock), except for (1) the exercise of Stock
Options under the Stock Option Plan or (2) gifts of Common Stock (or
other securities) to a donee or donees who agree in writing to be bound
by this clause.
5. CONDITIONS OF THE UNDERWRITER'S OBLIGATIONS. The obligation of the
Underwriter to purchase the Shares shall be subject to the accuracy of the
representations and warranties of the Company in this Agreement as of the date
of this Agreement and as of the Firm Shares Closing Date or Optional Shares
Closing Date, as the case may be, to the accuracy of the statements of Company
officers made pursuant to the provisions of this Agreement, to the performance
by the Company of its obligations under this Agreement, and to the following
additional terms and conditions:
(a) The Registration Statement shall have become effective not
later than 5:00 P.M., Detroit time, on the date of this Agreement or on
such later date and time as shall be consented to in writing by Xxxxx;
if the filing of the Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b) of the Rules, the Prospectus shall have been
filed in the manner and within the time period required by Rule 424(b)
of the Rules; at each Closing Date, if any, no stop order shall have
been issued or proceedings therefor initiated or threatened by the
Commission; and any request of the Commission for inclusion of
additional
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information in the Registration Statement, or otherwise, shall have
been complied with to the reasonable satisfaction of Xxxxx.
(b) At each Closing Date, Xxxxx shall have received the
favorable opinion of Xxxxxxxxx Xxxxxx PLLC, counsel for the Company,
dated the Firm Shares Closing Date or the Optional Shares Closing Date,
as the case may be, addressed to the Underwriter and in form and scope
reasonably satisfactory to counsel for Xxxxx to the effect that:
(i) The Company and the Bank are each (A) a
corporation existing and in good standing under the laws of
the State of Michigan, and (B) not required to be qualified to
do business in any jurisdiction outside Michigan.
(ii) Each of the Company and the Bank has full
corporate power and authority and all material authorizations,
approvals, orders, licenses, certificates and permits of and
from all governmental bank regulatory officials and bodies
necessary to own its properties and to commence and conduct
its business as described in the Registration Statement and
Prospectus, including, without limitation, the FIB Order, the
FDIC Order and the Federal Reserve Board Approval, except for
such authorizations, approvals, orders, licenses, certificates
and permits as are not material to the ownership of their
properties or commencement or conduct of their businesses;
(iii) The Company has authorized capital stock as set
forth in the Prospectus and, prior to the Closing, had
1,495,000 shares of Common Stock issued and outstanding; the
Shares have been duly and validly authorized and issued and
upon receipt by the Company of payment therefor in accordance
with the terms of this Agreement will be fully paid and
nonassessable and are not and will not be subject to,
preemptive rights; the Shares and the other capital stock and
Stock Options of the Company conform in all material respects
to the descriptions thereof contained in the Registration
Statement and the Prospectus;
(iv) To such counsel's knowledge, after due inquiry,
the Company has no directly or indirectly held subsidiary
other than the Bank;
(v) the certificates evidencing the Shares are in the
form approved by the Board of Directors of the Company, comply
with the bylaws and the articles of incorporation of the
Company, comply as to form and in all other material respects
with applicable legal requirements;
(vi) this Agreement has been duly and validly
authorized, executed and delivered by the Company, and is the
legal, valid and binding agreement and obligation of the
Company enforceable in accordance with its terms, except (a)
as enforcement thereof may be limited by bankruptcy,
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insolvency, reorganization, moratorium or other laws relating
to or affecting enforcement of creditors' rights or by general
equity principles (including requirements of reasonableness
and good faith in the exercise of rights and remedies),
whether applied by a court of equity or a court of law in an
action at law or in equity, or by the discretionary nature of
specific performance, injunctive relief, and other equitable
remedies, including the appointment of a receiver, and (b),
with respect to provisions relating to indemnification and
contribution, to the extent they are held by a court of
competent jurisdiction to be void or unenforceable as against
public policy or limited by applicable laws or the policies
embodied in them;
(vii) the Company is conveying to the Underwriter
good and valid title to the Shares that are issued in its
name, free and clear of any adverse claims, except to the
extent the Underwriter has notice of any adverse claim;
(viii) to the best of such counsel's knowledge, after
due inquiry, there are (A) no contracts or other documents
which are required to be filed as exhibits to the Registration
Statement other than those filed as exhibits thereto, (B) no
legal or governmental proceedings pending or threatened
against the Company or the Bank, and (C) no statutes or
regulations applicable to the Company or the Bank, or
certificates, permits, grants or other consents, approvals,
orders, licenses or authorizations from regulatory officials
or bodies, which are required to be obtained or maintained by
the Company or the Bank and which are of a character required
to be disclosed in the Registration Statement and Prospectus
which have not been so disclosed;
(ix) the statements in the Registration Statement and
the Prospectus, insofar as they are descriptions of corporate
documents, stock option plans, contracts, or agreements or
descriptions of laws, regulations, or regulatory requirements,
or refer to compliance with law or to statements of law or
legal conclusions, are correct in all material respects;
(x) to the best of such counsel's knowledge, after
due inquiry, the execution, delivery and performance of this
Agreement, the consummation of the transactions herein
contemplated and the compliance with the terms and provisions
hereof by the Company will not give rise to a right to
terminate or accelerate the due date of any payment due under,
or conflict with or result in a breach of any of the terms or
provisions of, or constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a
default) under, or require any consent under, or result in the
execution or imposition of any lien, charge or encumbrance
upon any properties or assets of the Company or the Bank
pursuant to the terms of, any lease, indenture, mortgage, note
or other agreement or instrument to which the Company or the
Bank is a party or by which either
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of them or either of their properties or businesses is or may
be bound or affected, nor will such action result in any
violation of the provisions of the articles of incorporation
or bylaws of the Company or the Bank or any statute or any
order, rule, or regulation applicable to the Company or the
Bank of any court or any federal, state, local or other
regulatory authority or other governmental body, the effect of
which, in any such case, would be expected to be materially
adverse to the Company or the Bank;
(xi) to the best of such counsel's knowledge, after
due inquiry, no consent, approval, authorization or order of
any court or governmental agency or body, domestic or foreign,
is required to be obtained by the Company in connection with
the execution and delivery of this Agreement or the sale of
the Shares to the Underwriter as contemplated by this
Agreement, except those which have been obtained;
(xii) to the best of such counsel's knowledge, after
due inquiry, (A) neither the Company nor the Bank is in breach
of, or in default (and no event has occurred which, with
notice or lapse of time, or both, would constitute a default)
under, any lease, indenture, mortgage, note, or other
agreement or instrument to which the Company or the Bank, as
the case may be, is a party; (B) neither the Company nor the
Bank is in violation of any term or provision of either of
their articles of incorporation or bylaws, or of any
franchise, license, grant, permit, judgment, decree, order,
statute, rule or regulation; and (C) neither the Company nor
the Bank has received any notice of conflict with the asserted
rights of others in respect of Intangibles necessary for the
commencement or conduct of its business, the effect of which,
in any such case, would be expected to be materially adverse
to the Company or the Bank;
(xiii) the Registration Statement and the Prospectus
and any amendments or supplements thereto (other than the
financial statements as to which no opinion need be rendered)
comply as to form with the requirements of the Securities Act
and the Rules in all material respects; and
(xiv) the Registration Statement is effective under
the Securities Act, and, to the best of such counsel's
knowledge, after due inquiry, no proceedings for a stop order
are pending or threatened under the Securities Act.
In rendering the foregoing opinion, such counsel may rely upon
certificates of public officials (as to matters of fact and law) and
officers of the Company (as to matters of fact), and include
qualifications in its opinion as are reasonably acceptable to Xxxxx.
Copies of all such certificates shall be furnished to counsel to Xxxxx
on the Closing Date.
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In addition, such counsel shall state that they have
participated in conferences with officers of the Company and a
representative of the Underwriter at which the contents of the
Registration Statement and Prospectus and related matters were
discussed and although such counsel did not independently verify the
accuracy or completeness of the statements made in the Registration
Statement and Prospectus and does not assume any responsibility for the
accuracy or completeness of the statements in the Registration
Statement and Prospectus, on the basis of the foregoing, nothing has
come to the attention of such counsel that would lead them to believe
that the Registration Statement or Prospectus, as amended or
supplemented, if amended or supplemented, contains any untrue statement
of a material fact or omits a material fact required to be stated
therein or necessary to make the statements therein not misleading;
except that such statement may exclude financial statements, financial
data, and statistical information included in the Registration
Statement and Prospectus.
(c) At the time this Agreement is executed and at the Closing
Date, you shall have received a letter, addressed to you and in form
and substance satisfactory to you in all respects (including the
non-material nature of the changes or decreases, if any, referred to in
clause (iii) below), from Xxxxx, Xxxxxx & Company, LLP, dated as of the
date of this Agreement and as of the Closing Date:
(i) confirming that they are independent public
accountants with respect to the Company and its Subsidiary
within the meaning of the Act and the applicable published
Regulations and stating that the answer to Item 13 of the
Registration Statement is correct insofar as it relates to
them;
(ii) stating that, in their opinion, the consolidated
financial statements and schedules of the Company audited by
them and the selected financial data to the extent derived
from financial statements examined by them included in the
Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the
Act and the related published Regulations;
(iii) stating that, on the basis of procedures (but
not an examination made in accordance with generally accepted
auditing standards) which included a reading of the latest
available unaudited interim consolidated financial statements
of the Company and its Subsidiary (with an indication of the
date of the latest available unaudited interim consolidated
financial statements), a reading of the latest available
minutes of the meetings of the shareholders and boards of
directors of the Company and its Subsidiary and committees of
such boards and inquiries to certain officers and other
employees of the Company and its Subsidiary responsible for
financial and accounting matters and other specified
procedures and inquiries, nothing has come to their attention
that would cause them to believe that (A) the unaudited
consolidated financial statements of the Company and its
Subsidiary included in the Registration Statement and
Prospectus (i) do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the related published Regulations, or (ii) were not
fairly presented in
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conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the
audited consolidated financial statements included in the
Registration Statement and Prospectus, (B) at a specified date
not more than five business days prior to the date of such
letter, there was any change in the capital stock or long-term
debt of the Company or decrease in shareholders' equity of the
Company and its Subsidiary as compared with the amounts shown
on the consolidated balance sheet of the Company included in
the Registration Statement and Prospectus, other than as set
forth in or contemplated by the Registration Statement and
Prospectus or, if there was any change or decrease, setting
forth the amount of such change or decrease, and (C) during
the period from [JANUARY 1, 1998], to a specified date not
more than the five business days prior to the date of such
letter, there was any decrease in net interest income, net
income or income per share of the Company, as compared with
the corresponding period beginning [JANUARY 1, 1998], other
than as set forth in or contemplated by the Registration
Statement and Prospectus, or, if there was any such decrease,
setting forth the amount of such decrease; and
(iv) stating that they have compared specific dollar
amounts, numbers of shares, percentages of revenues and income
and other financial information pertaining to the Company set
forth in the Prospectus, which have been specified by you
prior to the date of this Agreement, to the extent that such
amounts, numbers, percentages and information may be derived
from the general accounting records of the Company and its
Subsidiary, and excluding any questions requiring an
interpretation by legal counsel, with the results obtained
from the application of specific readings, inquiries and other
appropriate procedures (which procedures do not constitute an
audit in accordance with generally accepted auditing
standards) set forth in the letter, and found them to be in
agreement.
(d) On or prior to each Closing Date, Xxxxx shall have been
furnished such documents, certificates and opinions as they may
reasonably require for the purpose of enabling them to review the
matters referred to in subsection (b) of this Section 5, and in order
to evidence the accuracy, completeness or satisfaction of the
representations, warranties or conditions herein contained.
(e) Prior to each Closing Date, (i) there shall have been no
material adverse change in the condition or prospects, financial or
otherwise, of the Company or the Bank; (ii) there shall have been no
material transaction, not in the ordinary course of business, entered
into by the Company or the Bank except as set forth in the Registration
Statement and Prospectus, other than transactions referred to or
contemplated therein or to which Xxxxx has given its written consent;
(iii) neither the Company nor the Bank shall be in default (nor shall
an event have occurred which, with notice or lapse of time, or both,
would constitute a default) under any provision of any material
agreement, understanding or instrument relating to any outstanding
indebtedness that is material in amount; (iv) no action, suit or
proceeding, at law or in equity, shall be pending or threatened against
the Company or the Bank before or by any court or Federal, state or
other commission, board or other administrative agency having
jurisdiction
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over the Company or the Bank, as the case may be, which is expected to
have a material adverse effect on the Company or the Bank; and (v) no
stop order shall have been issued under the Securities Act and no
proceedings therefor shall have been initiated or be threatened by the
Commission.
(f) At each Closing Date, Xxxxx shall have received a
certificate signed by the Chairman of the Board, and the President or
Secretary of the Company dated the Firm Shares Closing Date or Optional
Shares Closing Date, as the case may be, to the effect that the
conditions set forth in subsection (e) above have been satisfied and as
to the accuracy, as of the Firm Shares Closing Date or the Optional
Shares Closing Date, as the case may be, of the representations and
warranties of the Company set forth in Section 4 hereof.
(g) At or prior to each Closing Date, Xxxxx shall have
received a "blue sky" memorandum of Xxxxxxxxx Xxxxxx PLLC, counsel for
the Company, addressed to Xxxxx and in form and scope reasonably
satisfactory to Xxxxx, concerning compliance with the blue sky or
securities laws of the states listed in EXHIBIT A attached to this
Agreement.
(h) All proceedings taken in connection with the sale of the
Shares as herein contemplated shall be reasonably satisfactory in form
and substance to Xxxxx and to counsel for Xxxxx, and Xxxxx shall have
received from counsel for Xxxxx a favorable opinion, dated as of each
Closing Date, with respect to such of the matters set forth under
subsections (b) (i), (iii), (vi), (vii), and (xv) of this Section 5,
and with respect to such other related matters as Xxxxx may reasonably
require, if the failure to receive a favorable opinion with respect to
such other related matters would cause Xxxxx to deem it inadvisable to
proceed with the sale of the Shares.
(i) There shall have been duly tendered to Xxxxx certificates
representing all the Shares agreed to be sold by the Company on the
Firm Shares Closing Date or the Optional Shares Closing Date, as the
case may be.
(j) No order suspending the sale of the Shares prior to each
Closing Date, in any jurisdiction listed in EXHIBIT A, shall have been
issued on the Firm Shares Closing Date or the Optional Shares Closing
Date, as the case may be, and no proceedings for that purpose shall
have been instituted or, to Roney's knowledge or that of the Company,
shall be contemplated.
(k) The NASD, upon review of the terms of the public offering
of the Shares, shall not have objected to the Underwriter's
participation in the same.
If any condition to the Underwriter's obligations hereunder to
be fulfilled prior to or at the Firm Shares Closing Date or the Optional Shares
Closing Date, as the case may be, is not so fulfilled, Xxxxx may terminate this
Agreement pursuant to Section 9(c) hereof or, if Xxxxx so elects, waive any such
conditions which have not been fulfilled or extend the time of their
fulfillment.
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6. COVENANTS.
The Company covenants and agrees that it will:
(a) Use its best efforts to cause the Registration Statement
to become effective and will notify Xxxxx immediately, and confirm the
notice in writing, (i) when the Registration Statement and any
post-effective amendment thereto becomes effective, (ii) of the
issuance by the Commission of any stop order or of the initiation, or
the threatening, of any proceedings for that purpose and (iii) of the
receipt of any comments from the Commission. The Company will make
every reasonable effort to prevent the issuance of a stop order, and,
if the Commission shall enter a stop order at any time, the Company
will make every reasonable effort to obtain the lifting of such order
at the earliest possible moment.
(b) During the time when a prospectus is required to be
delivered under the Securities Act, comply so far as it is able with
all requirements imposed upon it by the Securities Act, as now and
hereafter amended, and by the Rules, as from time to time in force, so
far as necessary to permit the continuance of sales of or dealings in
the Shares. If at any time when a prospectus relating to the Shares is
required to be delivered under the Securities Act any event shall have
occurred as a result of which, in the reasonable opinion of counsel for
the Company or counsel for Xxxxx, the Registration Statement or
Prospectus as then amended or supplemented includes an untrue statement
of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or if it is necessary at any time to amend or supplement the
Registration Statement or Prospectus to comply with the Securities Act,
the Company will notify Xxxxx promptly and prepare and file with the
Commission an appropriate amendment or supplement in form satisfactory
to Xxxxx. The cost of preparing, filing and delivering copies of such
amendment or supplement shall be paid by the Company.
(c) Deliver to the Underwriter such number of copies of each
preliminary prospectus as may reasonably be requested by Xxxxx and, as
soon as the Registration Statement, or any amendment or supplement
thereto, becomes effective, deliver to the Underwriter three signed
copies of the Registration Statement, including exhibits, and all
post-effective amendments thereto and deliver to the Underwriter such
number of copies of the Prospectus, the Registration Statement and
supplements and amendments thereto, if any, without exhibits, as Xxxxx
may reasonably request.
(d) Endeavor in good faith, in cooperation with Xxxxx and its
counsel, at or prior to the time the Registration Statement becomes
effective, to qualify the Shares for offering and sale under the
securities laws relating to the offering or sale of the Shares of the
states listed in EXHIBIT A. In each jurisdiction where such
qualification shall be effected, the Company will, unless Xxxxx agrees
that such action is not at the time necessary or advisable, file and
make such statements or
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reports at such times as are or may reasonably be required by the laws
of such jurisdiction. The Company will advise Xxxxx promptly of the
suspension of the qualification of the Shares for offering, sale or
trading in any jurisdiction, or any initiation or threat of any
proceeding for such purpose, and in the event of the issuance of any
order suspending such qualification, the Company, with the cooperation
of Xxxxx, will use all reasonable efforts to obtain the withdrawal
thereof.
(e) Furnish its security holders as soon as practicable an
earnings statement (which need not be certified by independent
certified public accountants unless required by the Securities Act or
the Rules) covering a period of at least twelve months beginning after
the effective date of the Registration Statement, which shall satisfy
the provisions of Section 11(a) of the Securities Act and the Rules
thereunder.
(f) For a period of five years from the Effective Date,
furnish to its shareholders annual audited consolidated financial
statements with respect to the Company including balance sheets and
income statements.
(g) For a period of five years from the Effective Date,
furnish to Xxxxx the following:
(i) at the time they have been sent to shareholders
of the Company or filed with the Commission three copies of
each annual, quarterly, interim, or current financial and
other report or communication sent by the Company to its
shareholders or filed with the Commission;
(ii) as soon as practicable, three copies of every
press release and every material news item and article in
respect of the Company or the affairs of the Company which was
released by the Company;
(iii) all other information reasonably requested by
Xxxxx with respect to the Company to comply with Rule 15c2-11
of the Rules and Section 4 of Schedule H of the NASD By-Laws;
and
(iv) such additional documents and information with
respect to the Company and its affairs as Xxxxx may from time
to time reasonably request.
(h) Acquire ________ shares of the Bank's common stock, free
and clear of all liens, encumbrances, or other claims or restrictions
whatsoever (other than imposed by Sections 77 and 201 of the Banking
Code), from the proceeds of the offering and, in all other material
respects, apply the net proceeds from the offering in the manner set
forth under "Use of Proceeds" in the Prospectus.
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(i) Not file any amendment or supplement to the Registration
Statement or Prospectus after the effective date of the Registration
Statement to which Xxxxx shall reasonably object in writing after being
furnished a copy thereof.
(j) Timely file with the Commission reports on Form SR (if
applicable) containing the information required by that Form in
accordance with the provisions of Rule 463 of the Regulation under the
Act.
(k) Comply with all registration, filing and reporting
requirements of the Securities Act or the Exchange Act, which may from
time to time be applicable to the Company.
(l) Comply and ensure that the Bank will comply with (1) all
of the requirements of, and satisfy the conditions of, the FIB Order,
the FDIC Order and the Federal Reserve Board Approval, (2) the
applicable rules and regulations of each of the FIB, the FDIC and the
Federal Reserve Board, and (3) any formal or informal enforcement
action by, or agreement with, any of such agencies; provided, however,
that it shall not be a breach of this Section 6(l) for the Company or
the Bank to fail to maintain any specified level of capital, surplus,
capital ratio, valuation reserve or financial or operating performance
if such failure is accepted or performance of such requirement or
condition is waived by the FIB, the FDIC, and/or the Federal Reserve
Board, as applicable.
(m) Pay, or reimburse if paid by the Underwriter, whether or
not the transactions contemplated hereby are consummated or this
Agreement is terminated, all costs and expenses incident to the
performance of the obligations of the Company under this Agreement,
including those relating to (1) the preparation, printing, filing and
delivery of the Registration Statement, including all exhibits thereto,
each preliminary prospectus, the Prospectus, all amendments of and
supplements to the Registration Statement and the Prospectus, and the
photocopying of the Underwriting Agreement and related agreements
including, without limitation, the Dealer Agreement; (2) the issuance
of the Shares and the preparation and delivery of certificates for the
Shares to the Underwriter; (3) the registration or qualification of the
Shares for offer and sale under the securities or "blue sky" laws of
the various jurisdictions referred to in EXHIBIT A, including the fees
and disbursements of counsel in connection with such registration and
qualification and the preparation and printing of preliminary,
supplemental, and final blue sky memoranda; (4) the furnishing
(including costs of shipping and mailing) to the Underwriter of copies
of each preliminary prospectus, the Prospectus and all amendments of or
supplements to the Prospectus, and of the several documents required by
this Section to be so furnished; (5) the filing requirements and fees
of the NASD in connection with its review of the terms of the public
offering and the underwriting; (6) the furnishing (including costs of
shipping and mailing) of copies of all reports and information required
by Section 6(g); (7) all transfer taxes, if any, with respect to the
sale and delivery of the Shares by the Company to the Underwriter; (8)
the inclusion of the Shares on the OTC Bulletin Board; and (9) the
Underwriter's out-of-pocket expenses, including
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without limitation, road show expenses and legal fees of counsel to
Xxxxx (such out-of-pocket expenses and legal fees payable by the
Company shall not exceed $50,000). Upon a successful completion of the
offering, the Underwriter will credit the out-of-pocket and legal fee
reimbursement described in Section 6(m)(9) against the underwriting
discount.
(n) Not, without the prior written consent of Xxxxx, sell,
contract to sell or grant any option for the sale of or otherwise
dispose of, directly or indirectly, or register with the Commission,
any shares of Common Stock of the Company (or any securities
convertible into or exercisable for such shares of Common Stock) within
150 days after the date of the Prospectus, except as provided in this
Agreement and except for (i) grants and exercises of Stock Options
under the Stock Option Plan as described in the Prospectus and (ii)
any registration of securities in connection with the Company's or the
Bank's 401(K) Plan.
(o) For not less than three fiscal years after the Effective
Date, unless Xxxxx shall otherwise consent in writing, (i) timely file
with the Commission all reports required by Section 15(d) of the
Exchange Act and not seek suspension of the duty to file such reports,
and (ii) not less frequently than annually prepare a proxy statement
and annual report which conform substantially to the requirements of
Commission Regulation 14A and distribute such proxy statement and
annual report to record and beneficial owners substantially in the
manner which would be required by Commission Regulation 14A if
applicable.
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless the
Underwriter and each person, if any, who controls the Underwriter
within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act against any and all losses, claims, damages and
liabilities, joint or several (including any reasonable investigation,
legal and other expenses incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claim
asserted), to which they may become subject under the Securities Act,
the Exchange Act or other Federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in any
preliminary prospectus, the Registration Statement or the Prospectus or
any amendment thereof or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that such indemnity shall
not inure to the benefit of the Underwriter (or any person controlling
the Underwriter) on account of any losses, claims, damages or
liabilities arising from the sale of the Shares in the public offering
to any person by the Underwriter if such untrue statement or omission
or alleged untrue statement or omission was made in such preliminary
prospectus, the Registration Statement or the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of the
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Underwriter specifically for use therein. The Company shall not be
liable hereunder to the Underwriter (or any controlling person thereof)
to the extent that any loss, claim, damage or other liability incurred
by the Underwriter arises from the Underwriter's fraudulent act or
omission.
(b) The Underwriter agrees to indemnify and hold harmless the
Company, each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, each director of the Company and each officer of the
Company who signs the Registration Statement, to the same extent as the
foregoing indemnity from the Company to the Underwriter, but only
insofar as such losses, claims, damages or liabilities arise out of or
are based upon any untrue statement or omission or alleged untrue
statement or omission which was made in any preliminary prospectus, the
Registration Statement or the Prospectus, or any amendment thereof or
supplement thereto, in reliance upon and in conformity with information
furnished in writing to the Company by the Underwriter specifically for
use therein; provided, however, that the obligation of the Underwriter
to indemnify the Company (including any controlling person, director or
officer thereof) hereunder shall be limited to the total price at which
the Shares purchased by the Underwriter hereunder were offered to the
public. The Underwriter shall not be liable hereunder to the Company
(including any controlling person, director or officer thereof) to the
extent that any loss, claim, damage or other liability incurred by the
Company arises from a fraudulent act or omission by the Company.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such party in
respect of which a claim is to be made against an indemnifying party or
parties under this Section, notify each such indemnifying party of the
commencement of such action, suit or proceeding, enclosing a copy of
all papers served, but the omission so to notify such indemnifying
party of any such action, suit or proceeding shall not relieve it from
any liability that it may have to any indemnified party otherwise than
under this Section. In case any such action, suit or proceeding 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 in, and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof
and the approval by the indemnified party of such counsel, the
indemnifying party shall not be liable to such indemnified party for
any legal or other expenses, except as provided below and except for
the reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (1) the employment of counsel
by such indemnified party has been authorized in writing by the
indemnifying parties, (2) the indemnified party shall
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have reasonably concluded that, because of the existence of different
or additional defenses available to the indemnified party or of other
reasons, there may be a conflict of interest between the indemnifying
parties and the indemnified party in the conduct of the defense of such
action (in which case the indemnifying parties shall not have the right
to direct the defense of such action on behalf of the indemnified
party) or that, under the circumstances, it is otherwise appropriate,
or (3) the indemnifying parties shall not have employed counsel to
assume the defense of such action within a reasonable time after notice
of the commencement thereof, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any settlement
of any action, suit, proceeding or claims effected without its written
consent.
8. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 7(a) or 7(b) is due in accordance with its terms but for any reason is
held to be unavailable, the Company and the Underwriter shall contribute to the
aggregate losses, claims, damages and liabilities (including any investigation,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claims asserted,
but after deducting any contribution received from other persons), to which the
Company and the Underwriter may be subject, in such proportion so that the
Underwriter is responsible for that portion represented by the percentage that
the underwriting discount appearing on the front cover page of the Prospectus
bears to the public offering price appearing thereon and the Company is
responsible for the balance; provided, however, that (a) in no case shall the
Underwriter be responsible for any amount in excess of the underwriting discount
applicable to the Shares purchased by the Underwriter hereunder and (b) no
person found guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section, each person, if any, who controls the Underwriter within the
meaning of the Securities Act or the Exchange Act shall have the same rights to
contribution as the Underwriter, and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act, each
officer and each director of the Company shall have the same rights to
contribution as the Company, subject in each case to clauses (a) and (b) of this
Section. Any party entitled to contribution will, promptly after receipt of
notice of commencement of any action, suit or proceeding against such party in
respect of which a claim for contribution may be made against another party or
parties under this Section, notify such party or parties from whom contribution
may be sought, but the omission so to notify such party or parties from whom
contribution may be sought shall not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may have
hereunder or otherwise than under this Section. No party shall be liable for
contribution with respect to any action, suit, proceeding or claim settled
without its written consent.
In any proceeding relating to the Registration Statement, any
preliminary prospectus, the Prospectus or any supplement thereto or amendment
thereof, each party against whom contribution may be sought under this Section 8
hereby consents to the jurisdiction of any court in Michigan, agrees that
process issuing from such court may be served upon him or it by any other
contributing party and consents to the service of such process and agrees that
any other
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contributing party may join him or it as an additional defendant in any such
proceeding in which such other contributing party is a party.
9. TERMINATION. This Agreement may be terminated by Xxxxx by notifying
the Company at any time:
(a) before the earliest of (1) 11:00 a.m., Detroit time, on
the business day following the Effective Date, (2) the time of release
by Xxxxx for publication of the first newspaper advertisement with
respect to the Shares and (3) the time when the Shares are first
generally offered by the Underwriter to dealers by letter or telegram;
(b) at or before any Closing Date if, in the judgment of
Xxxxx, payment for and delivery of the Shares is rendered impracticable
or inadvisable because (1) additional material governmental
restrictions, not known to be in force and effect when this Agreement
is signed, shall have been imposed upon trading in securities generally
or minimum or maximum prices shall have been generally established on
the New York Stock Exchange, on the American Stock Exchange or on the
over-the-counter market, or trading in securities generally shall have
been suspended on either such Exchange or on the over-the-counter
market or a general banking moratorium shall have been established by
federal, New York or Michigan authorities, (2) a war or other calamity
shall have occurred or shall have accelerated to such an extent as to
affect adversely the marketability of the Shares, (3) the Company or
the Bank shall have sustained a material loss by fire, flood, accident,
hurricane, earthquake, theft, sabotage or other calamity or malicious
act, which, whether or not said loss shall have been insured, will in
Roney's opinion, make it inadvisable to proceed with the offering of
the Shares, (4) the FIB Order, the FDIC Order, or the Federal Reserve
Board Approval shall have been withdrawn, rescinded, revoked or
materially altered, or (5) there shall have been such material change
in the condition, business operations or prospects of the Company or
the market for the Shares or similar securities as in Roney's judgment
would make it inadvisable to proceed with the offering of the Shares;
or
(c) at or before any Closing Date, if any of the conditions
specified in Section 5 or any other agreements, representations or
warranties of the Company in this Agreement shall not have been
fulfilled when and as required by this Agreement.
If this Agreement is terminated pursuant to any of its provisions, except as
otherwise provided in this Agreement, the Company shall not be under any
liability to the Underwriter (other than for obligations assumed in
Section 6(m) hereof), and the Underwriter shall not be under any liability to
the Company; provided, however, that if this Agreement is terminated by Xxxxx
because of any failure, refusal or inability on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement,
or for any reasons provided in subparagraphs (b) (other than (b)(5)) and (c)
above, the Company will reimburse the Underwriter for all accountable
out-of-pocket expenses (including, without limitation, road show expenses and
fees and disbursements
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of counsel to Xxxxx) up to a maximum of $50,000 incurred by it in connection
with the proposed purchase and sale of the Shares or in contemplation of
performing its obligations hereunder.
10. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties and agreements contained in this Agreement shall be
deemed to be representations, warranties and agreements at the Closing Dates,
and such representations, warranties and agreements of the Company, including,
without limitation, the payment and reimbursement agreements contained in
Section 6 hereof and the indemnity and contribution agreements contained in
Sections 7 and 8 hereof, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of the Underwriter or any
controlling person and shall survive termination of this Agreement and/or
delivery of the Shares to and payment for the Shares by the Underwriter pursuant
to this Agreement. In addition, the covenants contained in Section 6 hereof, the
agreements contained in this Section 10 and in Sections 7, 8 and 9 shall survive
termination of this Agreement and/or delivery of the Shares to and payment for
the Shares by the Underwriter pursuant to this Agreement.
11. MISCELLANEOUS. This Agreement has been and is made for the benefit
of the Underwriter, the Company and their respective successors and assigns,
and, to the extent expressed herein, for the benefit of persons controlling the
Underwriter or the Company, and directors and certain officers of the Company,
and their respective successors and assigns, and no other person, partnership,
association or corporation shall acquire or have any right under or by virtue of
this Agreement. The term "successors and assigns" shall not include any
purchaser of Shares from the Underwriter merely because of such purchase.
If any action or proceeding shall be brought by the
Underwriter or the Company in order to enforce any right or remedy under this
Agreement, the Underwriter and the Company hereby consent to, and agree that
they will submit to, the jurisdiction of the courts of the State of Michigan and
of any Federal court sitting in the State of Michigan.
All notices and communications hereunder shall be in writing
and mailed or delivered or by telephone or telegraph, if subsequently confirmed
in writing, to the Underwriter, Xxxxx, at Xxx Xxxxxxxx, Xxxxxxx, Xxxxxxxx 00000
(facsimile No. (000) 000-0000) (with a copy to Xxxxxx X. Xxxx, Xxxxxxxx Xxxxxx
Xxxxxxxx and Xxxx, 0000 Xxxxx Xxxxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxxxx 00000
(facsimile No. (000) 000-0000)); and to the Company at 000 X. Xxxxxxxx Xxxxxx,
Xxxxx Xxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxx, Xx., Chairman of the
Board and Chief Executive Officer (with a copy to Xxxxxx X. Xxxxxxxx, Xxxxxxxxx
Xxxxxx PLLC, 000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000 (facsimile
No. (000) 000-0000)).
The laws of the State of Michigan shall govern this Agreement,
its construction, and the determination of any rights, duties or remedies of the
parties arising out of or relating to this Agreement. The parties acknowledge
that the United States District Court for the Eastern District of Michigan or
the Michigan Circuit Court for the County of Xxxxx shall have exclusive
jurisdiction over any case or controversy arising out of or relating to this
Agreement and that all litigation arising out of or relating to this Agreement
shall be commenced in the United States District Court for the Eastern District
of Michigan or in the Xxxxx County (Michigan) Circuit Court.
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Please confirm that the foregoing correctly sets forth the agreement
between us.
Very truly yours,
MERCANTILE BANK CORPORATION
By:
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Xxxxxx X. Xxxxxxx, Xx.
Its: Chief Executive Officer
Confirmed by Xxxxx,
XXXXX CAPITAL MARKETS, A DIVISION OF
FIRST CHICAGO CAPITAL MARKETS, INC.
By:
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Xxxx X. Xxxxxxxx
Its: Managing Director
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EXHIBIT A
States
