Exhibit 1.1
$25,000,000*
SUN CAPITAL TRUST
SUN BANCORP, INC.
____% Preferred Securities
(Liquidation Amount $25 per Preferred Security)
UNDERWRITING AGREEMENT
_________ __, 1997
ADVEST, INC.
As Representative of the Several
Underwriters
One World Financial Center
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Sun Capital Trust (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C.
Section 3801 et seq.), and Sun Bancorp, Inc., a New Jersey corporation (the
"Company"), as depositor of the Trust and as guarantor, hereby confirms its
agreement with you and the several underwriters, on whose behalf you have been
duly authorized to act as their representative (the "Representative"), as
follows:
SECTION 1. Introduction. The Company agrees, upon the terms and
conditions set forth in this Underwriting Agreement (this "Agreement"), to issue
and sell to the several underwriters identified in Scheduled A annexed hereto
(the "Underwriters"), who are acting severally and not jointly, an aggregate
liquidation amount of $25,000,000 (the "Firm Securities") of the Trust's _____%
preferred securities (the "Preferred Securities"). The Trust and the Company
also propose to issue and sell to the Underwriters, at the Underwriters' option,
up to an additional $3,750,000 aggregate Liquidation Amount of Preferred
Securities (the "Option Securities") as set forth herein. The term "Preferred
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* Plus an option to acquire up to an additional $3,750,000 aggregate liquidation
amount of Preferred Securities from the Trust to cover over-allotments.
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Securities" as used herein, unless indicated otherwise, shall mean the Firm
Securities and the Option Securities.
The Preferred Securities and the Common Securities (as defined
herein) are to be issued pursuant to the terms of an Amended and Restated Trust
Agreement dated as of ___________, 1997 (the "Trust Agreement"), among the
Company, as depositor, and, together with the Trust, the "Offerors," and Bankers
Trust Company ("Trust Company"), a New York banking corporation, as property
trustee ("Property Trustee") and Bankers Trust (Delaware) ("Trust Delaware"), a
Delaware banking corporation, as Delaware trustee ("Delaware Trustee") and the
holders from time to time of undivided interests in the assets of the Trust. The
Preferred Securities will be guaranteed by the Company on a subordinated basis
and subject to certain limitations with respect to distributions and payments
upon liquidation, redemption or otherwise (the "Guarantee") pursuant to the
Preferred Securities Guarantee Agreement dated as of ____________, 1997 (the
"Guarantee Agreement"), between the Company and the Trust Company, as Trustee
(the "Guarantee Trustee"). The assets of the Trust will consist of ______%
junior subordinated deferrable interest debentures, due ___________, 2027 (the
"Subordinated Debentures") of the Company which will be issued under an
indenture dated as of ___________, 1997 (the "Indenture"), between the Company
and the Trust Company, as Trustee (the "Indenture Trustee"). Under certain
circumstances, the Subordinated Debentures will be distributable to the holders
of undivided beneficial interests in the assets of the Trust. The entire
proceeds from the sale of the Preferred Securities will be combined with the
entire proceeds from the sale by the Trust to the Company of the Trust's common
securities (the "Common Securities"), and will be used by the Trust to purchase
an equivalent amount of the Subordinated Debentures.
The Offerors have filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-1 (Nos. 333-________ and
333-________-01) and a related preliminary prospectus for the registration of
the Preferred Securities, the Guarantee and the Subordinated Debentures under
the Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations thereunder (the "Securities Act Regulations"). The Offerors have
prepared and filed such amendments thereto, if any, and such amended preliminary
prospectuses, if any, as may have been required to the date hereof, and will
file such additional amendments thereto and such amended prospectuses as may
hereafter be required. The registration statement has been declared effective
under the Securities Act by the Commission. The registration statement as
amended at the time it became effective (including the Prospectus and all
information deemed to be a part of the registration statement at the time it
became effective pursuant to Rule 430A(b) of the Securities Act Regulations) is
hereinafter called the "Registration Statement," except that, if the Company
files a post-effective amendment to such registration statement which becomes
effective prior to the Closing Date (as defined below), "Registration Statement"
shall refer to such registration statement as so amended. Each prospectus
included in the registration statement, or amendments thereof, before it became
effective under the Securities Act and any prospectus filed with the Commission
by the Company with the consent of the
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Underwriters pursuant to Rule 424(a) of the Securities Act Regulations
(including the documents incorporated by reference therein) is hereinafter
called the "Preliminary Prospectus." The term "Prospectus" means the final
prospectus (including the documents incorporated by reference therein, if any),
as first filed with the Commission pursuant to paragraph (1) or (4) of Rule
424(b) of the Securities Act Regulations. The Commission has not issued any
order preventing or suspending the use of any Preliminary Prospectus.
SECTION 2. Representations and Warranties. Each of the Offerors
represents and warrants to, and agrees with, each of the Underwriters as
follows:
(a) The Company is duly incorporated and validly existing as
a corporation in good standing under the laws of the State of New Jersey with
full power and authority (corporate and other) to own, lease, and operate its
properties and conduct its business as described in the Prospectus (as defined
in Section 2(e) of this Agreement); the Company is duly registered under the
Bank Holding Company Act of 1956, as amended (the "BHCA"); the Company has no
subsidiaries except those described in the Registration Statement (each a
"Subsidiary"); the Company owns, directly or indirectly, beneficially and of
record all of the outstanding capital stock of each Subsidiary free and clear of
any claim, lien, encumbrance or security interest. The Company and each of its
Subsidiaries is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which any of them own or lease
properties, has an office, or in which the business conducted by any of them
make such qualification necessary, except where the failure to so qualify would
not have a material adverse effect on the condition (financial or otherwise),
business, prospects, assets, properties, results of operations, or net worth of
the Company or any of the Subsidiaries ("Material Adverse Effect"); and no
proceeding has been instituted in any jurisdiction revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and authority or
qualification.
(b) The Preferred Securities have been duly and validly
authorized for issuance and sale to the Underwriters pursuant to this Agreement
and, when executed and authenticated in accordance with the terms of the Trust
Agreement and delivered to the Underwriters against payment of the consideration
set forth herein, will constitute valid and legally binding obligations of the
Trust enforceable in accordance with their terms and entitled to the benefits
provided by the Trust Agreement. The Trust Agreement has been duly authorized
and, when executed by the proper officers of the Trust and delivered by the
Trust, will have been duly executed and delivered by the Trust and will
constitute the valid and legally binding instrument of the Trust, enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other laws relating to or affecting enforcement of
creditors' rights generally or by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law). The
Subordinated Debentures have been duly and validly authorized for delivery by
the Company and, when duly authenticated in accordance with the terms of the
Indenture and delivered to the Trust against payment of the consideration set
forth herein, will constitute valid and
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legally binding obligations of the Company enforceable against the Company in
accordance with their terms (except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership, readjustment of
debt, moratorium, fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally, general equity principles (whether considered in a
proceeding in equity or at law)) and entitled to the benefits provided by the
Indenture. The Indenture has been duly authorized and, when executed by the
proper officers of the Company and delivered by the Company, will have been duly
executed and delivered by the Company and will constitute the valid and legally
binding instrument of the Company, enforceable in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy, insolvency or other
laws relating to or affecting enforcement of creditors' rights generally or by
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law). The Trust Agreement, the Guarantee Agreement,
and the Indenture have been duly qualified under the Trust Indenture Act; and
the Preferred Securities, the Common Securities, the Trust Agreement, the
Guarantee Agreement, the Subordinated Debentures and the Indenture conform in
all material respects to the descriptions thereof contained in the Registration
Statement and the Prospectus.
(c) Neither the Trust nor the Company or any Subsidiary, is,
or with the giving of notice or lapse of time or both will be, in violation or
breach of, or in default under, nor will the execution or delivery of, or the
performance and consummation of the transactions contemplated by this Agreement
(including the offer, sale, or delivery of the Preferred Securities), conflict
with, or result in a violation or breach of, or constitute a default under, any
provision of the organization documents of the Trust or the Articles of
Incorporation, Bylaws (as amended or restated) of the Company, or other
governing documents of the Trust, the Company or any Subsidiary, or of any
provision of any agreement, contract, mortgage, deed of trust, lease, loan
agreement, indenture, note, bond, or other evidence of indebtedness, or other
material agreement or instrument to which the Trust, the Company or any
Subsidiary is a party or by which any of them is bound or to which any of their
properties is subject, nor will the performance by the Offerors of their
obligations hereunder violate any rule, regulation, order, or decree, applicable
to the Trust, the Company or any Subsidiary of any court or any regulatory body,
administrative agency, or other governmental body having jurisdiction over the
Trust, the Company or any Subsidiary or any of their respective properties, or
any order of any court or governmental agency or authority entered in any
proceeding to which the Trust, the Company or any Subsidiary was or is now a
party or by which it is bound, except those, if any, described in the Prospectus
or which are not material to the Company and the Trust taken as a whole. No
consent, approval, filing, authorization, registration, qualification, or order,
including with or by any bank regulatory agency, is required for the execution,
delivery, and performance of this Agreement or the consummation of the
transactions contemplated by this Agreement, other than such that have been
obtained or made, except for compliance with the Securities Act, the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the Blue Sky Laws
applicable to the public offering of the Preferred Securities by the
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Underwriters, the clearance of such offering and the underwriting arrangements
evidenced hereby with the National Association of Securities Dealers, Inc.
("NASD"), and the listing of the Preferred Security on the Nasdaq Stock Market.
This Agreement has been duly authorized, executed and delivered by the Company
and the Trust and constitutes a valid and binding obligation of the Company and
the Trust and is enforceable against the Company and the Trust in accordance
with the terms.
(d) The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus, and each Preliminary
Prospectus complies with the requirements of the Securities Act and the
Securities Act Regulations. As of the effective date of the Registration
Statement, and at all times subsequent thereto up to the Closing Date or any
Option Closing Date (as defined below), the Registration Statement and the
Prospectus, and any amendments or supplements thereto, contained or will contain
all statements that are required to be stated therein in accordance with the
Securities Act and the Securities Act Regulations and conformed or will conform
in all respects to the requirements of the Securities Act and the Securities Act
Regulations and conformed or will conform in all respects to the requirements of
the Securities Act and the Securities Act Regulations, and neither the
Registration Statement nor the Prospectus, nor any amendment or supplement
thereto included or will include any untrue statement of a material fact or
omitted or will omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
no representation or warranty is made as to information contained in or omitted
from the Registration Statement, the Prospectus or any amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company and the Trust by the Underwriters.
(e) Deloitte & Touche which has audited, reviewed, and
expressed its opinion with respect to certain of the financial statements and
schedules filed with the Commission as a part of the Registration Statement and
included or to be included, as the case may be, in the Prospectus and in the
Registration Statement, and whose report is included in the Prospectus and the
Registration Statement are independent accountants as required by the Securities
Act and the Securities Act Regulations.
(f) The financial statements and schedules and the related
notes thereto included or to be included, as the case may be, in the
Registration Statement, the Preliminary Prospectus, and the Prospectus present
fairly the financial position of the entities purported to be shown thereby as
of the respective dates of such financial statements and schedules, and the
results of operations and changes in equity and in cash flows of the entities
purported to be shown thereby for the respective periods covered thereby, all in
conformity with generally accepted accounting principles consistently applied
throughout the periods involved, except as may be disclosed in the Prospectus.
All adjustments necessary for a fair presentation of the results of such periods
have been made. The Company had an outstanding capitalization as set forth under
"Capitalization" in the Prospectus as of the date indicated therein and there
has been no material change therein since such date except as disclosed in the
Prospectus.
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The financial, operating, and statistical information set forth in the
Prospectus under captions "Summary," "Summary Financial Information," "Use of
Proceeds," "Capitalization," "Selected Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," "Business" and "Management" are fairly presented and prepared on a
basis consistent with the audited financial statements of the Company.
(g) There is no litigation or governmental proceeding,
action, or investigation pending or, to the knowledge of the Trust or the
Company, threatened, to which the Trust, the Company or any Subsidiary is or may
be a party or to which property owned or leased by the Company or any Subsidiary
is or may be subject, or related to environmental or discrimination matters,
which is required to be disclosed in the Registration Statement or the
Prospectus by the Securities Act or the Securities Act Regulations and is not so
disclosed, or which questions the validity of this Agreement or any action taken
or to be taken pursuant hereto.
(h) Either the Company or a Subsidiary, as the case may be,
has good and marketable title in fee simple to all items of real property and
good and marketable title to all the personal properties and assets reflected as
owned by the Company or a Subsidiary in the Prospectus (or elsewhere in the
Registration Statement), in each case clear of all liens, mortgages, pledges,
charges, or encumbrances of any kind or nature except those, if any, reflected
in the financial statements described above (or elsewhere in the Registration
Statement) or which are not material to the Company or any Subsidiary; all
properties held or used by the Company or a Subsidiary under leases, licenses,
franchises or other agreements are held by them under valid, existing, binding,
and enforceable leases, franchises, licenses, or other agreements with respect
to which it is not in default.
(i) Neither the Trust nor the Company or any Subsidiary has
taken or will 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, under the Exchange Act or
otherwise, of the price of the Preferred Securities.
(j) Except as reflected in or contemplated by the
Registration Statement, since the respective dates as of which information is
given in the Registration Statement and prior to the Closing Date and Option
Closing Date (as such terms are hereinafter defined):
(i) neither the Company nor any Subsidiary has or will
have incurred any material liabilities or obligations, direct or contingent, or
entered into any material transaction not in the ordinary course of business;
(ii) neither the Company nor any Subsidiary has or will
have paid or declared any dividend or other distribution with respect to its
capital stock and neither the
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Company nor any Subsidiary has or will be delinquent in the payment of principal
or interest on any outstanding debt obligations; and
(iii) there has not been and will not be any change in
the capital stock or any material change in the indebtedness of the Company
or any Subsidiary (except as may result from the closing of the transactions
contemplated by this Agreement), or any adverse change in the condition
(financial or otherwise), or any development involving a prospective adverse
change in their respective businesses (resulting from litigation or
otherwise), prospects, properties, condition (financial or otherwise), net
worth, or results of operations which is material to the Company or any
Subsidiary.
(k) There is no contract or other document, transaction, or
relationship required to be described in the Registration Statement, or to be
filed as an exhibit to the Registration Statement, by the Securities Act or by
the Securities Act Regulations that has not been described or filed as required.
(l) All documents delivered or to be delivered by the
Offerors or any of their representatives in connection with the issuance and
sale of the Preferred Securities were on the dates on which they were delivered,
or will be on the dates on which they are to be delivered, true, complete, and
correct in all material respects.
(m) The Company and each Subsidiary have filed all necessary
federal and all state and foreign income and franchise tax returns and paid all
taxes shown as due thereon; and no tax deficiency has been asserted or
threatened against the Company or any Subsidiary that would have a Material
Adverse Effect, except as described in the Prospectus.
(n) Neither the Trust nor the Company or any Subsidiary has,
directly or indirectly, at any time:
(i) made any unlawful contribution to any candidate for
political office, or failed to disclose any contribution in violation of law; or
(ii) made any payment to any federal, state, local, or
foreign government officer or official, or other person charged with similar
public or quasi-public duties, other than payments required or permitted by
the laws of the United States or any jurisdiction thereof or applicable
foreign jurisdictions.
(o) The Company or a Subsidiary owns or possesses adequate
rights to use all patents, patent applications, trademarks, service marks, trade
names, trademark registrations, servicemark registrations, copyrights, and
licenses necessary for the conduct of the business of the Company and the
Subsidiaries or ownership of their respective properties, and neither the
Company nor any Subsidiary has received notice of conflict with the asserted
rights of others in respect thereof which has not been resolved.
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(p) 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.
(q) The Company and each Subsidiary have and hold, and at
the Closing Date or Option Closing Date will have and hold, and are operating in
compliance with, and have fulfilled and performed all of their material
obligations with respect to, all permits, certificates, franchises, grants,
easements, consents, licenses, approvals, charters, registrations,
authorizations, and orders (collectively, "Permits") required under all laws,
rules, and regulations in connection with their respective businesses, and all
of such Permits are in full force and effect; and there is no pending
proceeding, and neither the Company nor any Subsidiary has received notice of
any threatened proceeding, relating to the revocation or modification of any
such Permits. Neither the Company nor any Subsidiary is or has been (by virtue
of any action, omission to act, contract to which it is a party or by which it
is bound, or any occurrence or state of facts whatsoever) in violation of any
applicable federal, state, municipal, or local statutes, laws, ordinances,
rules, regulations and/or orders issued pursuant to foreign, federal, state,
municipal, or local statutes, laws, ordinances, rules, or regulations (including
those relating to any aspect of banking, bank holding companies, environmental
protection, occupational safety and health, and equal employment practices)
heretofore or currently in effect, except such violation that has been fully
cured or satisfied without recourse or that is not reasonably likely to have a
Material Adverse Effect.
(r) The provisions of any employee pension benefit plan
("Pension Plan") as defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), in which the Company or any
Subsidiary is a participating employer are in substantial compliance with ERISA,
and neither the Company nor any Subsidiary is in violation of ERISA. The
Company, each Subsidiary, or the plan sponsor thereof, as the case may be, has
duly and timely filed the reports required to be filed by ERISA in connection
with the maintenance of any Pension Plans in which the Company or any Subsidiary
is a participating employer, and no facts, including any "reportable event" as
defined by ERISA and the regulations thereunder, exist in connection with any
Pension Plan in which the Company or any Subsidiary is a participating employer
which might constitute grounds for the termination of such plan by the Pension
Benefit Guaranty Corporation or for the appointment by the appropriate U.S.
District Court of a trustee to administer any such plan. The provisions of any
employee benefit welfare plan, as defined in Section 3(1) of ERISA, in which the
Company or any Subsidiary is a participating employer, are in substantial
compliance with ERISA, and the Company, any Subsidiary, or the plan sponsor
thereof, as the case may be, has duly and timely filed the reports required to
be filed by ERISA in connection with the maintenance of any such plans.
(s) Neither the Company nor the Trust is an open-end
investment company, unit investment trust or face-amount certificate company
that is, or is required to be,
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registered under Section 8 of the Investment Company Act of 1940, as amended, or
subject to regulation under such Act.
(t) The Company is a member in good standing of the Federal
Reserve System and the deposits of each bank or savings bank Subsidiary are
insured by the Federal Deposit Insurance Corporation ("FDIC").
(u) Neither this Agreement nor any certificate, statement or
other document delivered or to be delivered by the Offerors or any Subsidiary
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading.
(v) The Company and the Trust have satisfied the conditions
for the use of Form S-1 with respect to the offering of the Preferred
Securities, the Guarantee and the Subordinated Debentures for sale to the
public.
Any certificate signed by any director or officer of the Company or
the Trust, as the case may be, and delivered to the Representative or to counsel
for the Underwriters shall be deemed a representation and warranty of the
Company or the Trust, as the case may be, to the Underwriters as to the matters
covered thereby.
Any certificate delivered by the Company or the Trust, as the case
may be, to their respective counsel for purposes of enabling such counsel to
render an opinion pursuant to Section 8 will also be furnished to the
Representative and counsel for the Underwriters and shall be deemed to be
additional representations and warranties to the Underwriters by the Company and
the Trust as to the matters covered thereby.
SECTION 3. Purchase Sale and Delivery to Underwriters, Closing. On
the basis of the representations and warranties herein contained and subject to
the terms and conditions herein set forth, the Trust and the Company, as the
case may be, agree that the Trust will issue and sell to the Underwriters, and
each of the Underwriters agrees, severally and not jointly to purchase from the
Trust, the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule A at a purchase price of $ per Firm Security.
Payment of the purchase price for, and delivery of, the Firm
Securities shall be made at the offices of ▇▇▇▇▇▇ & ▇▇▇▇▇▇, 555 Twelfth Street,
N.W., Washington, D.C., or at such other place as shall be agreed upon by the
Representative, the Trust and the Company, at 9:00 A.M. Eastern Standard Time,
on the third business day (unless postponed in accordance with the provisions of
Section 14) following the date of this Agreement, or such other time not later
than ten (10) business days after such date as shall be agreed upon by the
Representative, the Trust and the Company (such time and date of payment and
delivery being herein called the "Closing Date").
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As compensation (the "Underwriting Commission") for the commitments
of the Underwriters contained in this Section 2, the Company hereby agrees to
pay to the Underwriters an amount equal to _____% of the public offering price
of the Preferred Securities. Such payment will be made on the Closing Date or on
the Option Closing Date (as defined below) with respect to the Option
Securities.
Payment for the Firm Securities shall be made to the Trust by wire
transfer of immediately available funds, against delivery to the Underwriter of
the Firm Securities to be purchased by it. The Firm Securities shall be issued
in the form of one or more fully registered global notes (the "Global Notes") in
book-entry form in such denominations and registered in the name of the nominee
of The Depository Trust Company (the "DTC") or in such names as the
Representative may request in writing at least two business days before the
Closing Date. The Global Notes representing the Firm Securities shall be made
available for examination by the Representative and counsel to the Underwriters
not later than ______ A.M. Eastern Standard Time on the last business day prior
to the Closing Date.
In addition, on the basis of the representations, warranties, and
agreements contained herein, but subject to the terms and conditions set forth
herein, the Trust hereby grants to the Underwriters an option to purchase,
severally and not jointly, from the Trust the Option Securities in the same
proportion as the number of Preferred Securities set forth opposite their names
on Schedule A bears to the total number of Firm Securities, at the same purchase
price per Preferred Security to be paid for the Firm Securities, for use solely
in covering any over-allotments made by the Underwriters in the sale and
distribution of the Firm Securities. The option granted hereunder may be
exercised at any time (but not more than once) within thirty (30) days after the
date of this Agreement, upon notice by the Representative to the Trust which
sets forth the aggregate liquidation amount of Option Securities as to which the
Underwriters are exercising the option, and the time and place at which the
certificate representing the Option Securities will be delivered. Such time of
delivery may not be earlier than the Closing Date and herein is called the
"Option Closing Date." The Option Closing Date shall be determined by the
Representative, but if at any time other than the Closing Date, shall not be
earlier than three nor later than five full business days after delivery of such
notice to exercise. Certificates for the Option Securities will be made
available for inspection at least 24 hours prior to the Option Closing Date at
the offices of the DTC, or its designated custodian, or at such other location
as specified by the Representative. The manner of payment for a delivery of the
Option Securities shall be the same as for the Firm Securities as specified in
this Section 4.
SECTION 4. Representations and Warranties of the Underwriters. The
Representative, on behalf of the Underwriters, represents and warrants to the
Company that the information set forth (a) in the last paragraph of the cover
page of the Prospectus, (b) on the inside front cover page of the Prospectus
relating to stabilization, and (c) in the section in the Prospectus entitled
"Underwriting" was the only written information furnished to the Company by and
on behalf of any Underwriter expressly for use in connection with the
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preparation of the Registration Statement, and is correct and complete in all
material respects and does not include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading.
SECTION 5. Offering by the Underwriters. The Trust and the Company
are advised by the Representative that the Underwriters propose to make a public
offering of the Preferred Securities, on the terms and conditions set forth in
the Registration Statement from time to time as and when the Underwriters deem
advisable after the Registration Statement becomes effective. Because the NASD
is expected to view the Preferred Securities as interests in a direct
participation program, the offering of the Preferred Securities is being made in
compliance with the applicable provisions of Rule 2810 of the NASD's Conduct
Rules.
SECTION 6. Agreements of the Offerors. Each of the Offerors
covenants and agrees with the Underwriter that:
(a) If any information shall have been omitted from the
Registration Statement in reliance upon Rule 430A, the Company, at the earliest
possible time, will furnish the Representative with a copy of the Prospectus to
be filed by the Offerors with the Commission to comply with Rule 424(b) and Rule
430A under the Securities Act, and, if the Representative does not object to the
contents thereof, will file such Prospectus with the Commission in compliance
with such Rules. Upon compliance with such Rules, the Company will so advise the
Representative promptly. The Company will advise the Representative and counsel
to the Underwriter promptly of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the institution
of any proceedings for that purpose, or of any notification of the suspension of
qualification of the Preferred Securities for sale in any jurisdiction or the
initiation or threatening of any proceedings for that purpose. The Company also
will advise the Representative and counsel to the Underwriters promptly of any
request of the Commission for amendment or supplement of the Registration
Statement, of any Preliminary Prospectus, or of the Prospectus, or for
additional information, and the Offerors will not file any amendment or
supplement to the Registration Statement (either before or after it becomes
effective), to any Preliminary Prospectus, or to the Prospectus (including a
prospectus filed pursuant to Rule 424(b)) if the Representative has not been
furnished with a copy prior to such filing or if the Representative reasonably
objects to such filing.
(b) During the time during which a Prospectus relating to
the Preferred Securities is required to be delivered under the Securities Act,
the Offerors shall comply with all requirements imposed on them by the
Securities Act, as now and hereafter amended, and by the Securities Act
Regulations, as from time to time in force, so far as is necessary to permit the
continuance of sales or dealings in the Preferred Securities as contemplated by
the provisions hereof and the Prospectus. If any event occurs as a result of
which the Prospectus, including any subsequent amendment or supplement, would
include an untrue
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statement of a material fact, or would omit 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
becomes necessary at any time to amend the Prospectus, including any amendment
or supplement thereto, to comply with the Securities Act, the Company promptly
will advise the Representative and counsel to the Underwriters thereof and the
Offerors will promptly prepare and file with the Commission an amendment or
supplement that will correct such statement or omission or an amendment that
will effect such compliance; and, if any Underwriter is required to deliver a
prospectus nine (9) months or more after the effective date of the Registration
Statement, the Company, upon request of the Representative but at the expense of
such Underwriter, will prepare promptly such prospectus or prospectuses as may
be necessary to permit compliance with the requirements of Section 10(a)(3) of
the Securities Act.
(c) The Offerors will not, prior to the Option Closing Date
or thirty (30) days after the date of this Agreement, whichever occurs first,
incur any material liability or obligation, direct or contingent, or enter into
any material transaction, other than in the ordinary course of business, or any
transaction with a related party which is required to be disclosed in the
Prospectus pursuant to Item 404 of Regulation S-K under the Securities Act,
except as contemplated by the Prospectus.
(d) The Company will make generally available to its
security holders and the Representative an earnings statement of the Company as
soon as practicable, but in no event later than fifteen (15) months after the
end of the Company's current fiscal quarter, covering a period of twelve (12)
consecutive calendar months beginning after the effective date of the
Registration Statement, but beginning not later than four (4) months after such
effective date, which will satisfy the provisions of the last subsection of
Section 11(a) of the Securities Act and Rule 158 promulgated thereunder.
(e) During such period as a prospectus is required by law to
be delivered in connection with sales by an underwriter or dealer, the Company
will furnish to the Representative, at the expense of the Company, copies of the
Registration Statement, the Prospectus, any Preliminary Prospectus, and all
amendments and supplements to any such documents in each case as soon as
available and in such quantities as the Representative may reasonably request,
for the purposes contemplated by the Securities Act.
(f) The Offerors shall take or cause to be taken in
cooperation with the Representative and counsel to the Underwriters all actions
required in qualifying or registering the Preferred Securities for sale under
the Blue Sky Laws of such jurisdictions as the Representative may reasonably
designate, provided the Offerors shall not be required to qualify generally as
foreign corporations or to consent generally to the service of process under the
law of any such state (except with respect to the offering and sale of the
Preferred Securities), and will continue such qualifications or registrations in
effect so long as reasonably requested by the Representative to effect the
distribution of the Preferred
- 13 -
Securities (including, without limitation, compliance with all undertakings
given pursuant to such qualifications or registrations). In each jurisdiction
where any of the Preferred Securities shall have been qualified as provided
above, the Offerors will file such reports and statements as may be required to
continue such qualification for a period of not less than one (1) year from the
date of this Agreement.
(g) The Company will furnish to its security holders annual
reports containing financial statements audited by independent public
accountants and quarterly reports containing financial statements and financial
information which may be unaudited. During the period ending five (5) years
after the date of this Agreement, (i) as soon as practicable after the end of
the fiscal year, the Company will furnish to the Representative two copies of
the annual report of the Company containing the consolidated balance sheet of
the Company as of the close of such fiscal year and corresponding consolidated
statements of earnings, stockholders' equity and cash flows for the year then
ended, such consolidated statements financial statements to be under the
certificate or opinion of the Company's independent accountants, and (ii) the
Company will file promptly and will furnish to the Representative at or before
the filing thereof copies of all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13, 14, or 15 of the Exchange Act. During such five-year period the
Company also will furnish to the Representative one copy of the following:
(i) as soon as practicable after the filing thereof,
each other report, statement, or other document filed by the Company with the
Commission;
(ii) as soon as practicable after the filing thereof,
all reports, statements, other documents and financial statements furnished by
the Company to Nasdaq pursuant to requirements of or agreements with Nasdaq; and
(iii) as soon as available, each report, statement, or
other document of the Company mailed to its stockholders.
(h) The Offerors will use their best efforts to satisfy or
cause to be satisfied the conditions to the obligations of the Underwriters in
Section 8 hereof.
(i) The Offerors shall deliver the requisite notice of
issuance to the NASD and shall take all necessary or appropriate action within
its power to maintain the authorization for trading of the Preferred Securities
on the Nasdaq Stock Market for a period of at least thirty-six (36) months after
the date of this Agreement.
(j) The Company shall prepare and timely file with the
Commission, from time to time, such reports as may be required by the Securities
Act Regulations.
- 14 -
(k) The Trust shall comply in all respects with the
undertakings given by the Trust in connection with the qualification or
registration of the Preferred Securities for offering and sale under the Blue
Sky Laws.
(l) The Trust shall apply the net proceeds from the sale of
the Preferred Securities to be sold by it hereunder in the manner and for the
purposes specified under the heading "Use of Proceeds" in the Prospectus. The
Offerors shall file, and will furnish or cause to be furnished to the
Underwriter and counsel to the Underwriter copies of all reports as may be
required in accordance with Rule 463 under the Securities Act.
(m) The Company shall supply the Representative and counsel
to the Underwriters, at the Company's cost, four copies of a bound volume of the
offering contemplated by this Agreement and Underwriting materials within a
reasonable time after the Closing Date.
(n) Except for the sale of Preferred Securities pursuant to
this Agreement, neither the Company nor any Subsidiary shall, directly or
indirectly, offer, sell, contract to sell, issue, distribute, grant any option,
right, or warrant to purchase or otherwise dispose of any shares of common stock
of the Company or the Preferred Securities, in the open market or otherwise, for
a period of one-hundred eighty (180) days after the later of the effective date
of the Registration Statement or the date of this Agreement, without the express
prior written consent of the Representative.
SECTION 7. Payment of Expenses and Fees
(a) Whether or not the transactions contemplated hereunder
are consummated, or if this Agreement is terminated for any reason, the Company
will pay or cause to be paid the costs, fees, and expenses incurred in
connection with the offering of the Preferred Securities as follows:
(i) All costs, fees, and expenses incurred in
connection with the performance of the Company and the Trust's obligations
hereunder, including all fees and expenses of the Company and the Trust's
accountants and counsel, all costs and expenses incurred in connection
with the preparation, printing, filing, and distribution (including deliver
and shipping costs) of the Registration Statement, each Preliminary
Prospectus, and the Prospectus (including all amendments and exhibits
thereto and the financial statements therein), and agreements and supplements
provided for herein, this Agreement and other underwriting documents, including
various Underwriters' letters, and the Preliminary and Supplemental Blue Sky
Memoranda.
(ii) All filing and registration fees and expenses,
including the legal fees and disbursements of counsel, incurred in connection
with qualifying or registering all or any part of the Preferred Securities, the
Guarantee and the Subordinated Debentures for offer and sale under the Blue Sky
Laws.
(iii) All fees and expenses of the Offerors' registrar
and transfer agent; all transfer taxes, if any, and all other fees and expenses
incurred in connection with the sale and delivery of the Preferred
Securities to the Underwriters.
- 15 -
(iv) The filing fees of the NASD and applicable fee
charged by Nasdaq for inclusion of the Preferred Securities for quotation on th
National Market System, and
(v) All other costs and expenses incident to the
performance of the Company's and the Trust's obligations hereunder which are not
otherwise provided for in this Section 7(a).
(b) On the consummation of the offering of the Preferred
Securities, the Company shall pay Advest, Inc. Twenty-Five Thousand Dollars and
00/100 ($25,000.00) as a financial advisory fee.
SECTION 8. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters under this Agreement shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Trust set forth herein as of the Closing Date, and if applicable, as of the
Option Closing Date, as the case may be, to the accuracy of the statements of
the Offerors' directors and officers, to the performance by the Company and the
Trust of their obligations hereunder, and to the following additional
conditions, except to the extent expressly waived in writing by the
Representative:
(a) The Registration Statement and all post-effective
amendments thereto shall have been declared effective by the Commission no later
than 5:30 p.m. eastern time, on the date of this Agreement, or such later time
as shall have been consented to by the Representative, but in any event not
later than 5:30 p.m., eastern time, on the third full business day following the
date hereof; if the Offerors omitted information from the Registration Statement
at the time it became effective in reliance on Rule 430A under the Securities
Act, the Prospectus shall have been filed with the Commission in compliance with
Rule 424(b) and Rule 430A under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement or any amendment or supplement
thereto shall have been issued; no proceeding for the issuance of such an order
shall have been initiated or shall be pending or, to the knowledge of the
Offerors or the Representative, threatened or contemplated by the Commission;
and any request of the Commission for additional information (to be included in
the Registration Statement or the Prospectus or otherwise) shall have been
disclosed to the Representative and complied with to the Representative's
satisfaction.
(b) The Preferred Securities, the Guarantee and the
Subordinated Debentures shall have been qualified or registered for sale, or
subject to an available exemption from such qualification or registration, under
the Blue Sky Laws of such jurisdictions as shall have been reasonably specified
by the Representative and the offering contemplated by this Agreement shall have
been cleared by the NASD.
- 16 -
(c) Since the dates as of which information is given in the
Registration Statement:
(i) There shall not have been any adverse change, or
any development involving a prospective material adverse change, in the ability
of the Company or any Subsidiary to conduct their respective business (whether
by reason of any court, legislative, other governmental action, order, decree,
or otherwise), or in the general affairs, condition (financial and
otherwise) business, prospectus, properties, management, financial position or
earnings, results of operations, or net worth of the Company or any Subsidiary,
whether or not arising from transactions in the ordinary course of business; and
(ii) Neither the Company nor any Subsidiary shall have
sustained any loss or interference from any labor dispute, strike, fire, flood
windstorm, accident, or other calamity (whether or not insured) or from any
court or governmental action, order, or decree.
The effect of which on the Company or any Subsidiary, in any such case described
in clause (c)(i) or (ii) above, is in the reasonable opinion of the
Representative so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Preferred
Securities on the terms and in the manner contemplated in the Registration
Statement and the Prospectus.
(d) There shall have been furnished to the Representative on
the Closing Date, except as otherwise expressly provided below:
(i) An opinion of ▇▇▇▇▇▇▇, Spidi, Sloane & ▇▇▇▇▇, P.C.,
counsel the Company, dated as of the Closing Date and any Option Closing Date,
in form and substance substantially in the form attached hereto as Exhibit A.
(ii) The favorable opinion, dated the Closing Date, of
White & Case, counsel to the Trust Company and Trust Delaware, substantially
in the form attached hereto as Exhibit B.
(iii) The favorable opinion, dated the Closing Date, of
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, special Delaware counsel to the Company and the
Trust, substantially to the effect and in the form attached hereto as Exhibit C.
(iv) The favorable opinion, dated the Closing Date, of
▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel to the Underwriters as to such matters as the
Representative shall reasonably request.
In rendering such opinions specified in clause
(d)(ii), (iii) or (iv) above, counsel may rely upon an opinion or opinions, each
dated the Closing Date, of other
- 17 -
counsel retained by them or the Company as to laws of any jurisdiction other
than the United States or the State of New York, provided that (A) such reliance
is expressly authorized by each opinion so relied upon and a copy of each such
opinion is delivered to the Representative, and (B) counsel shall state in their
opinion that they believe that they and the Underwriters are justified in
relying thereon. Insofar as such opinions involve factual matters, such counsel
may rely, to the extent such counsel deems proper, upon certificates of officers
of the Company, its subsidiaries and the Trust and certificates of public
officials.
(e) At the time this Agreement is executed and also on the
Closing Date and the Option Closing Date, as the case may be, there shall be
delivered to the Representative a letter addressed to the Representative from
Deloitte & Touche, the Company's independent accountants, the first letter to be
dated the date of this Agreement, the second letter to be dated the Closing
Date, and the third letter to be dated the Option Closing Date if any, which
shall be in form and substance reasonably satisfactory to the Representative and
shall contain information as of a date within five days of the date of such
letter. There shall not have been any change set forth in any letter referred to
in this subsection c that makes it impracticable or inadvisable in the judgment
of the Representative to proceed with the public offering or purchase of the
Preferred Securities as contemplated hereby.
(f) On the Closing Date, a certificate signed by the
Chairman of the Board, the President, a Vice Chairman of the Board or any
Executive or Senior Vice President and the principal financial or accounting
officer of the Company, dated the Closing Date, to the effect that the signers
of such certificate have carefully examined the Registration Statement and this
Agreement and that:
(i) The representations and warranties of the
Company in this Agreement are true and correct in all material respects on and
as of the Closing Date with the same effect as if made on the Closing Date and
the Company has complied in all material respects with all the agreements and
satisfied in all material respects all the conditions on its part to be
performed or satisfied at or prior to the Closing Date; and
(ii) The Commission has not issued an order preventing
or suspending the use of the Prospectus or any Preliminary Prospectus or any
amendment thereto; no stop order suspending the effectiveness of the
Registration Statement has been issued; and, to the best knowledge of the
respective signatories, no proceeding for that purpose has been instituted or is
pending or contemplated under the Securities Act;
(iii) Each of the respective signatories of the
certificate has carefully examined the Registration Statement, the Prospectus,
and any amendments or supplements thereto, and such documents contai all
statements and information required to be made therein, and neither the
Registration Statement nor any amendment or supplement thereto includes any
untrue statement of a material fact or omits to state any material fact required
to
- 18 -
be stated therein or necessary to make the statements therein not misleading
and, since the date on which the Registration Statement was initially filed, no
event has occurred that was required to be set forth in an amended or
supplemented prospectus or in an amendment to the Registration Statement that
has not been so set forth; provided, however, that no representation need be
made as to information contained in or omitted from the Registration Statement
or any amendment or supplement in reliance upon and in conformity with written
information furnished to the Company and the Trust by or on behalf of any
Underwriter through the Representative; and
(iv) Since the date on which the Registration Statement was
initially filed with the Commission, there has not been any material adverse
change or a development involving a prospective material adverse change in the
business, properties, financial condition, or earnings of the Company or any of
its Subsidiaries, whether or not arising from transactions in the ordinary
course of business, except as disclosed in the Registration Statement as
heretofore amended or (but only if the Representative expressly consents thereto
in writing) as disclosed in an amendment or supplement thereto filed with the
Commission and delivered to the Representative after the execution of this
Agreement; since such date and except as so disclosed or in the ordinary course
of business, neither the Company nor any Subsidiary has incurred any liability
or obligation, direct or indirect, or entered into any transaction that is
material to the Company or such Subsidiary, as the case may be, not contemplated
in the Prospectus; since such date and except as disclosed there has not been
any change in the outstanding capital stock of the Company , or any change that
is material to the Company or any of its Subsidiaries in the short-term debt or
long-term debt of the Company or any Subsidiary; since such date and except as
so disclosed, neither the Company nor any of its Subsidiaries have incurred any
material contingent obligations, and no material litigation is pending or
threatened against the Company or any Subsidiary; and, since such date and
except as so disclosed, neither the Company nor any of its Subsidiaries have
sustained any material loss or interference from any strike, fire, flood,
windstorm, accident or other calamity (whether or not insured) or from any court
or governmental action, order, or decree.
(g) Prior to the Closing Date, the Company shall have
furnished to the Representative such further information, certificates and
documents as the Representative may reasonably request in connection with the
offering of the Preferred Securities.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice from the Representative to the Company at any time
without liability on the part of any Underwriters, including the Representative,
or the Company, except for expenses to be paid by the Company pursuant to
Section 7 hereof or reimbursed by the Company pursuant to Section 9 and except
to the extent provided in Section 11.
- 19 -
SECTION 9. Reimbursement of Underwriters' Expenses. If the sale of
the Preferred Securities to the Underwriters on the Closing Date is not
consummated because the offering is terminated or indefinitely suspended by the
Company or by the Representative for any reason permitted by this Agreement,
other than the Underwriter's inability to legally act as Underwriter, the
Company will reimburse the Underwriter for the Underwriter's reasonable
out-of-pocket expenses, including fees and disbursements of its counsel, that
shall have been incurred by the Underwriter in connection with the proposed
purchase and sale of the Preferred Securities in an aggregate amount not to
exceed $90,000. Any such termination or suspension shall be without liability of
any party to the other except that the provisions of this Section 9, and
Sections 7 and 11 shall remain effective and shall apply.
SECTION 10. Maintain Effectiveness of Registration Statement. The
Representative and the Company will use their respective best efforts to prevent
the issuance of any stop order or other such order suspending the effectiveness
of the Registration Statement and, if such stop order is issued, to obtain the
lifting thereof as soon as possible.
SECTION 11. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of the Securities Act or the Exchange Act, against any losses, claims,
damages, expenses, liabilities, or actions in respect thereof ("Claims"), joint
or several to which such Underwriter or each such controlling person may become
subject under the Securities Act, the Exchange Act, the Securities Act
Regulations, Blue Sky Laws or other federal or state statutory laws or
regulations, at common law or otherwise (including payments made in settlement
of any litigation, if such settlement is effected with the written consent of
the Company, which consent shall not be unreasonably withheld), insofar as such
Claims arise out of or are based upon the inaccuracy or breach of any
representation, warranty, or covenant of the Company or the Trust contained in
this Agreement, any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto, or in any application filed
under any Blue Sky Law or other document executed by the Offerors for that
purpose or based upon written information furnished by the Offerors and filed in
any state or other jurisdiction to qualify or register any or all of the
Preferred Securities under the securities laws thereof (any such document,
application, or information being hereinafter called a "Blue Sky Application"),
or arise out of or are based upon the omission or alleged omission to state in
any of the foregoing a material fact required to be stated therein or necessary
to make the statements therein not misleading. The Company agrees to reimburse
each Underwriter and each such controlling person promptly for any legal fees or
other expenses incurred by such Underwriter or any such controlling person in
connection with investigating or defending any such Claim or appearing as a
third-party witness in connection with any such Claim; provided, however, that
the Company will not be liable in any such case to the extent that:
- 20 -
(i) Any such Claim arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto or in any Blue Sky
Application in reliance upon and in conformity with the written information
furnished by or on behalf of the Underwriters to the Offerors expressly for use
therein pursuant to Section 4 of this Agreement; or
(ii) Such statement or omission was contained or
made in any Preliminary Prospectus and corrected in the Prospectus and (1)
any such Claim suffered or incurred by any Underwriter (or any person who
controls such Underwriter) resulted from an action, claim, or suit by any person
who purchased Preferred Securities that are the subject thereof from such
Underwriter in the offering of the Preferred Securities, and (2) such
Underwriter failed to deliver a copy of the Prospectus (as then amended if the
Offerors shall have amended the Prospectus) to such person at or prior to the
confirmation of the sale of such Preferred Securities in any case where such
delivery is required by the Securities Act, unless such failure was due to
failure by the Company to provide copies of the Prospectus (as so amended) to
the Underwriter as required by this Agreement.
(b) Each Underwriter severally, but not jointly, agrees to
indemnify and hold harmless the Offerors, each of their directors, each of their
officers who sign the Registration Statement, and each person who controls the
Company or the Trust within the meaning of the Securities Act, against any Claim
to which the Offerors, or any such director, officer, or controlling person may
become subject under the Securities Act, the Exchange Act, the Securities Act
Regulations, Blue Sky Laws, or other federal or state statutory laws or
regulations, at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Underwriter and the Representative, which consent shall not be unreasonably
withheld), insofar as such Claim arises out of or is based upon any untrue or
alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto, or in any Blue Sky Application, or arises out of or is based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, or in any Blue Sky Application, in reliance
upon and in conformity with the written information furnished by such
Underwriter to the Offerors pursuant to Section 4 of this Agreement. Each
Underwriter will severally reimburse any legal fees or other expenses reasonably
incurred by the Offerors, or any such director, officer, or controlling person
in connection with investigating or defending any such Claim, and from any and
all Claims resulting from failure of such Underwriter to deliver a copy of the
Prospectus, if the person asserting such Claim purchased Shares from such
Underwriter and a copy of the Prospectus (as then amended if the Offerors shall
have amended the Prospectus) was not sent or given by or on behalf of such
Underwriter to such
- 21 -
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Preferred Securities to such person, and if the
Prospectus (as so amended) would have cured the defect giving rise to such Claim
(unless such failure was due to a failure by the Company and the Trust to
provide sufficient copies of the Prospectuses (as so amended) to each
Underwriter). The indemnification obligations of each Underwriter as provided
above are in addition to any liabilities any such Underwriter may otherwise
have.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) of this Section 11 of notice of the commencement of any
action in respect of a Claim, such indemnified party will, if a Claim in respect
thereof is to be made against an indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement thereof. In case
any such action is brought against any indemnified party, and such indemnified
party notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in and, to the extent that it
may wish, jointly with all other indemnifying parties, similarly notified,
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to the indemnified party and/or other indemnified parties
that are different from or additional to those available to the indemnifying
party, the indemnified party or parties shall have the right to select separate
counsel to assume such legal defenses and to otherwise participate in the
defense of such action on behalf of such indemnified party or parties.
(d) Upon receipt of notice from the indemnifying party to
such indemnified party of the indemnifying party's election to assume the
defense of such action and upon approval by the indemnified party of counsel
selected by the indemnifying party, the indemnifying party will not be liable to
such indemnified party under subsection (a) or (b) of this Section 11 for any
legal fees or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless:
(i) the indemnified party shall have employed separate
counsel in connection with the assumption of legal defenses in accordance with
the proviso to the last sentence of subsection (c) of this Section 11 (it being
understood, however, that the indemnified party shall not be liable for the
legal fees and expenses of more than one separate counsel, approved by the
Representative if one or more of the Underwriters or their controlling persons
are the indemnified parties);
(ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after the indemnified party's
notice to the indemnifying party of commencement of the action; or
- 22 -
(e) If the indemnification provided for in this Section 11
is unavailable to an indemnified party or insufficient to hold harmless an
indemnified party under subsection (a) or (b) of this Section 11 in respect of
any Claim referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall, subject, to the limitations
hereinafter set forth, contribute to the amount paid or payable by such
indemnified party as a result of such Claim:
(i) in such proportion as is appropriate to reflect the
relative benefits received by the Offerors on the one hand and the Underwriters
on the other hand from the offering of the Preferred Securities; or
(ii) if the allocation provided by clause (e)(i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (e)(i) above,
but also the relative fault of the Offerors on the one hand and the Underwriters
on the other hand in connection with the statements or omissions that resulted
in such Claim, as well as any other relevant equitable considerations.
The respective relative benefits received by the Offerors on the
one hand and the Underwriters on the other hand shall be deemed to be in such
proportion that the Underwriters are responsible for that portion represented by
the percentage that the amount of the Underwriting Commission bears to the
public offering price per Preferred Security appearing thereon, and the Company
(including the Company's directors, officers, and controlling persons) is
responsible for the remaining portion.
The relative fault of the Offerors on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Offerors 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 untrue statement or omission. The amount
paid or payable by a party as a result of the Claims referred to above shall be
deemed to include, subject to the limitations set forth in subsections (c) and
(d) of this Section 11, any legal or other fees or expenses reasonably incurred
by such party in connection with investigating or defending any action or claim.
(f) The Offerors and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this Section 11 were
determined by pro rata or per capita allocation or by any other method or
allocation that does not take into account the equitable considerations referred
to in subsection (e) of this Section 11. Notwithstanding the other provisions of
this Section 11, no underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Preferred Securities
underwritten by it and distributed 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
- 23 -
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligation to contribute pursuant to this Section 11 are several
in proportion to their respective underwriting commitments and not joint.
(g) The obligations of the Company, the Trust and the
Underwriters under this Section 11 shall be in addition to any liability that
the Company, the Trust or the Underwriter may otherwise have.
SECTION 12. Default of Underwriters. It shall be a condition to
this Agreement and to the obligations of the Trust to sell and deliver the
Preferred Securities hereunder, and to the obligations of each Underwriter to
purchase the Preferred Securities in the manner described herein, that, except
as hereinafter provided in this Section 12, each of the Underwriters (except a
defaulting Underwriter) shall purchase and pay for all the Preferred Securities
agreed to be purchased by such Underwriter hereunder upon tender to the
Representative of all such Preferred Securities in accordance with the terms
hereof. If any Underwriter or Underwriters default in its or their obligations
to purchase Preferred Securities hereunder on either the Closing Date or the
Option Closing Date and the aggregate number of Preferred Securities that such
defaulting Underwriter or Underwriters agreed but failed to purchase does not
exceed ten percent (10%) of the liquidation amount of Preferred Securities the
Underwriters are obligated to purchase on such Closing Date, the Representative
may make arrangements for the purchase of such Preferred Securities by other
persons, including any of the Underwriters, but if no such arrangements are made
by such Closing Date or Option Closing Date the nondefaulting Underwriters shall
be obligated severally, in proportion to their respective commitments hereunder,
to purchase the Preferred Securities such defaulting Underwriters agreed but
failed to purchase on such Closing Date or Option Closing Date. If any
Underwriter or Underwriters so default and the liquidation amount of Preferred
Securities with respect to which such default or defaults occur is greater than
the above percentage and arrangements satisfactory to the Representative for the
purchase of such Preferred Securities by other person are not made within
thirty-six (36) hours after such default, this Agreement will terminate without
liability on the part of any nondefaulting Underwriter or the Company, except to
the extent provided in Section 11.
If Preferred Securities to which a default relates are to be
purchased by the nondefaulting Underwriters or by another party or parties, the
Representative or the Company shall have the right to postpone the Closing Date
or Option Closing Date, as the case may be, for not more than seven (7) business
days in order that the necessary changes in the Registration Statement,
Prospectus, and any other documents, as well as any other arrangements, may be
effected. As used in this Agreement, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 12. Nothing herein will
relieve a defaulting Underwriter from liability for its default.
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SECTION 13. Effective Date. This Agreement shall become effective
immediately on the date hereof.
SECTION 14. Termination. Without limiting the right to terminate
this Agreement pursuant to any other provision hereof, this Agreement may be
terminated by the Representative prior to the Closing Date and the option from
the Company and the Trust referred to in Section 3, if exercised, may be
canceled by the Representative at any time prior to the Option Closing Date, if:
(a) The Offerors shall have failed, refused, or been unable,
at or prior to the Closing Date or Option Closing Date, as the case may be to
perform any agreement on its part to be performed hereunder.
(b) Any other condition to the obligations of the
Underwriters hereunder is not fulfilled; or
(c) In the Representative's judgment, payment for and
delivery of the Preferred Securities is rendered impracticable or inadvisable
because:
(i) Additional governmental restrictions, not in force
and effect on the date hereof, shall have been imposed upon trading in
securities generally or minimum or maximum prices shall have been generally
established on any national securities exchange or over-the-counter market,
or trading in securities generally shall have suspended on any national
securities exchange or on the Nasdaq Stock Market, or a general banking
moratorium shall have been established by federal or state authorities;
(ii) Any event shall have occurred or shall exist that
makes untrue or incorrect in any material respect any statement or information
contained in the Registration Statement or that is not reflected in the
Registration Statement but should be reflected therein to make the statements
or information contained therein not misleading in any material respect; or
(iii) Any outbreak or escalation of major hostilities
or other national or international calamity or any substantial change in
political, financial or economic conditions shall have occurred or shall
have accelerated to such extent, in the Representative's judgment, as to have
a material adverse effect on the general securities market or make it
impracticable or inadvisable to proceed with completion of the sale and payment
for the Preferred Securities as provided in this Agreement.
Any termination pursuant to this Section 14 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 7 or reimbursed by the
- 25 -
Company pursuant to Section 9 and except as to indemnification to the extent
provided in Section 11).
SECTION 15. Representations and Indemnities to Survive Delivery.
The respective indemnity and contribution agreements of the Company and the
Underwriters, and the representations, warranties, covenants, other statements
of the Offerors and of their directors and officers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter, the Offerors, or any
of its or their partners, officers, directors, or any controlling person, as the
case may be, and will survive delivery of and payment for the Preferred
Securities sold hereunder or the termination or cancellation of this Agreement.
SECTION 16. Notices. All communications hereunder shall be in
writing and, if sent to the Representative, will be mailed, delivered, or
telecopied (with receipt confirmed) to Advest, Inc., at One World Financial
Center, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇, Managing Director (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇) with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ & ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, (Fax No. (202)
▇▇▇-▇▇▇▇; and if sent to the Company or the Trust will be mailed, delivered, or
telecopied (with receipt confirmed) to Sun Bancorp, Inc., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇) with a copy to ▇▇▇▇ ▇.
Spidi, ▇▇▇▇▇▇▇, Spidi, Sloane & ▇▇▇▇▇, P.C., One Franklin Square, ▇▇▇▇ ▇ ▇▇▇▇▇▇,
▇.▇., ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ (Fax No. (▇▇▇) ▇▇▇-▇▇▇▇).
SECTION 17. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors or
assigns, and to the benefit of the directors and officers (and their personal
representatives) and controlling persons referred to in Section 11, and no other
person shall acquire or have any right or obligation hereunder. The terms
"successors or assigns," as used in this Agreement, shall not include any
purchaser of the Preferred Securities from any Underwriter merely by reason of
such purchase.
SECTION 18. Partial Unenforceability. If any section, subsection,
clause, or provision of this Agreement is for any reason determined to be
invalid or unenforceable, such determination shall not affect the validity or
enforceability of any other section, subsection, clause, or provision hereof.
SECTION 19. Applicable Law. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York.
SECTION 20. Entire Agreement. This Agreement embodies the entire
agreement among the parties hereto with respect to the transactions contemplated
herein, and there have been and are no agreements among the parties with respect
to such transactions other than as set forth or provided for herein.
- 26 -
SECTION 21. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one and the same instrument.
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed counterparts hereof,
whereupon it will become a binding agreement among the Company, the Trust and
the Underwriters, including the Representative, in accordance with its terms.
Very truly yours,
SUN BANCORP, INC.
By:
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Title:
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SUN CAPITAL TRUST
By:
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Title:
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ADVEST, INC.
As representative of the several Underwriters listed
in Schedule A.
By:
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Title:
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SUN CAPITAL TRUST
SUN BANCORP, INC.
SCHEDULE A
Liquidation Amount of
Firm Securities to be
Name of Underwriter Purchased
------------------- ---------
Advest, Inc......................................... $
Aggregate Liquidation Amount........................ $25,000,000
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