EXHIBIT 1.1
1,000,000 SHARES
BEACH FIRST NATIONAL BANCSHARES, INC.
COMMON STOCK
PAR VALUE $1.00 PER SHARE
UNDERWRITING AGREEMENT
______________, 0000
Xxxxxxx X'Xxxxx & Partners, L.P.,
000 Xxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Beach First National Bancshares, Inc., a South Carolina corporation
(the "Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to Sandler X'Xxxxx & Partners, L.P. (the "Underwriter") an
aggregate of 1,000,000 shares (the "Firm Shares") and, at the election of the
Underwriter, up to 150,000 additional shares (the "Optional Shares") of the
common stock, par value $1.00 per share (the "Common Stock") of the Company (the
Firm Shares and the Optional Shares that the Underwriter elects to purchase
pursuant to Section 2 hereof being collectively called the "Shares").
1. (a) The Company represents and warrants to, and agrees with, the
Underwriter that:
(i) A registration statement on Form SB-2 (File No. 333-_____)
(the "Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in the
form heretofore delivered to the Underwriter, and, excluding exhibits thereto,
delivered to the Underwriter, have been declared effective by the Commission in
such form; other than a registration statement, if any, increasing the size of
the offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission; and no
stop order suspending the effectiveness of the Initial Registration Statement,
any post-effective amendment thereto or the Rule 462(b) Registration Statement,
if any, has been issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule 424(a) of
the rules and regulations of the Commission under the Act, is hereinafter called
a "Preliminary Prospectus"); the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, including all
exhibits thereto and
including the information contained in the form of final prospectus filed with
the Commission pursuant to Rule 424(b) under the Act in accordance with Section
5(a) hereof and deemed by virtue of Rule 430A under the Act to be part of the
Initial Registration Statement at the time it was declared effective, each as
amended at the time such part of the Initial Registration Statement became
effective or such part of the Rule 462(b) Registration Statement, if any, became
or hereafter becomes effective, are hereinafter collectively called the
"Registration Statement"; and such final prospectus, in the form first filed
pursuant to Rule 424(b) under the Act, is hereinafter called the "Prospectus";
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects to
the requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(iii) The Registration Statement conforms, and the Prospectus
and any further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration Statement and
any amendment thereto, and as of the applicable filing date as to the Prospectus
and any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(iv) Since January 1, 2004, the reports, filings and financial
statements furnished to or filed with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), when they became
effective or were filed with the Commission, as the case may be (or, if an
amendment with respect to any such documents was filed or became effective, when
such amendment was filed or became effective), complied in all material respects
to the requirements of the Exchange Act and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make to the statements therein not misleading;
(v) The consolidated financial statements, audited and
unaudited (including the notes thereto), included in the Registration Statement
present fairly the consolidated financial position of the Company and its
subsidiaries as of the dates indicated and the consolidated results of
operations and cash flows of the Company and its subsidiaries for the periods
specified. Such financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved, except as otherwise stated therein. The
financial statement schedules, if any, included in the Registration Statement
present fairly the information required to be stated therein. The summary
financial, pro forma and statistical data included in the Prospectus are
accurate in all material respects and present fairly the information shown
therein and have been compiled on a basis consistent with that of the audited
and unaudited consolidated financial statements included in the Registration
Statement;
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(vi) Neither the Company nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements included in
the Prospectus, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or action, order or decree of any Governmental Entity (as
defined below), otherwise than as set forth or contemplated in the Prospectus;
and, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any material
change in the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development that may cause a
prospective material adverse change, in or affecting the general affairs,
management, financial position, business prospects, shareholders' equity or
results of operations of the Company and its subsidiaries, otherwise than as set
forth or contemplated in the Prospectus;
(vii) The Company and its subsidiaries have good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as are described in the Prospectus
or such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and any real property and buildings held under
lease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material and
do not interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries;
(viii) The Company is a registered bank holding company under
the Bank Holding Company Act of 1956, as amended ("BHCA") with respect to Beach
First National Bank (the "Bank") and has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of South
Carolina, with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to any liability or disability by reason of the failure to be so
qualified in any jurisdiction;
(ix) Each subsidiary of the Company either has been duly
incorporated and is validly existing as a corporation or a statutory business
trust or has been duly chartered and is validly existing as a national banking
association, in each case in good standing under the laws of the jurisdiction of
its organization, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to any liability or disability by reason of the failure to be so
qualified in any jurisdiction, except where the failure to be so qualified would
not have a material adverse effect on the business, properties, assets, current
or future consolidated financial position, business prospects, shareholders'
equity or results of operations of the Company and its subsidiaries taken as a
whole or on the ability of the Company to consummate the transactions
contemplated herein (a "Material Adverse Effect"); the activities of the Bank
are permitted to be conducted by a national banking association and the deposit
accounts of the Bank are insured up to the applicable limits by the Federal
Deposit Insurance Corporation (the "FDIC");
(x) The Company has an authorized capitalization as set forth
in the
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Prospectus under the heading "Capitalization", and all of the issued shares of
capital stock of the Company have been duly and validly authorized and issued,
are fully paid and nonassessable; all of the issued and outstanding capital
stock of each subsidiary of the Company has been duly authorized and validly
issued and is fully paid and nonassessable and is owned, directly or through
other subsidiaries of the Company, by the Company free and clear of any pledge,
lien, encumbrance, claim or equity;
(xi) This Agreement has been duly authorized, executed and
delivered by the Company and, when duly executed by the Underwriters, will
constitute the valid and binding agreement of the Company enforceable against
the Company in accordance with its terms;
(xii) The unissued Shares to be issued and sold by the Company
to the Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be duly
and validly issued and fully paid and non-assessable and will conform to the
description of the Common Stock contained in the Prospectus;
(xiii) Except as described in the Prospectus, (A) there are no
outstanding rights (contractual or otherwise), warrants or options to acquire,
or instruments convertible into or exchangeable for, or agreements or
understandings with respect to the sale or issuance of, any shares of capital
stock of or other equity interest in the Company; and (B) there are no
contracts, agreements or understandings between the Company and any person
granting such person the right to require the Company to file a Registration
Statement under the Act or otherwise register any securities the Company owned
or to be owned by such person;
(xiv) The issue and sale of the Shares by the Company and the
compliance by the Company with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of the
provisions of the articles of incorporation or bylaws of the Company or any
statute or any order, rule or regulation of any federal, state, local or foreign
court, or governmental agency or body (each a "Governmental Entity") having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such Governmental Entity is required for the issue
and sale of the Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the Act of the
Shares and except as may be required under the rules and regulations of the
National Association of Securities Dealers, Inc. ("NASD") and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or "blue sky" laws in connection with the purchase and
distribution of the Shares by the Underwriters;
(xv) Neither the Company nor any of its subsidiaries is in
violation of its articles of incorporation or charter (as applicable) or bylaws
or in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, note, lease or other agreement or instrument to which it
is a party or by which it or any of its properties may be bound;
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(xvi) The statements set forth in the Prospectus under the
caption "Description of our Capital Stock", insofar as they purport to
constitute a summary of the terms of the capital stock of the Company and under
the caption "Underwriting", insofar as they purport to describe the provisions
of the laws and documents referred to therein, are accurate and complete;
(xvii) Except as disclosed in the Prospectus, the Company and
its subsidiaries conduct their respective businesses in compliance in all
material respects with all federal, state, local and foreign statutes, laws,
rules, regulations, decisions, directives and orders applicable to them
(including, without limitation, all regulations and orders of, or agreements
with, the Office of the Comptroller of the Company (the "OCC"), the Board of the
Federal Reserve System (the "FRB") and the FDIC, the Equal Credit Opportunity
Act, the Fair Housing Act, the Community Reinvestment Act, the Home Mortgage
Disclosure Act, all other applicable fair lending laws or other laws relating to
discrimination and the Bank Secrecy Act and Title III of the USA Patriot Act),
and neither the Company nor any of its subsidiaries has received any
communication from any Governmental Entity asserting that the Company or any of
its subsidiaries is not in compliance with any statute, law, rule, regulation,
decision, directive or order;
(xviii) Except as disclosed in the Prospectus, there are no
legal or governmental actions or suits, investigations or proceedings before or
by any Governmental Entity, now pending or, to the knowledge of the Company,
threatened or contemplated by Governmental Entities or threatened or
contemplated by others, to which the Company or any of its subsidiaries is a
party or of which any property of the Company or any of its subsidiaries is the
subject (A) that is required to be disclosed in the Registration Statement by
the Act or by the rules and regulations of the Commission thereunder and not
disclosed therein or (B) which, if determined adversely to the Company or any of
its subsidiaries, would, individually or in the aggregate, have a Material
Adverse Effect; all pending legal or governmental proceedings to which the
Company or any of its subsidiaries is a party or of which any of their property
is the subject, either individually or in the aggregate, which are not described
in the Registration Statement, including ordinary routine litigation incidental
to their respective businesses, would not have a Material Adverse Effect; and
there are no contracts or documents of the Company or any of its subsidiaries
which would be required to be described in the Registration Statement or to be
filed as exhibits thereto by the Act or by the rules and regulations of the
Commission thereunder which have not been so described and filed;
(xix) Each of the Company and its subsidiaries possess all
permits, licenses, approvals, consents and other authorizations of
(collectively, "Governmental Licenses"), and has made all filings, applications
and registrations with all Governmental Entities to permit the Company or such
subsidiary to conduct the business now operated by the Company or its
subsidiaries; the Company and its subsidiaries are in compliance with the terms
and conditions of all such Governmental Licenses; all of the Governmental
Licenses are valid and in full force and effect, except where the invalidity of
such Governmental Licenses or the failure of such Governmental Licenses to be in
full force and effect would not, individually or in the aggregate, have a
Material Adverse Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, individually or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect;
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(xx) Neither the Company nor any of its subsidiaries is a
party to or subject to any order, decree, agreement, memorandum of understanding
or similar agreement with, or a commitment letter, supervisory letter or similar
submission to, any Governmental Entity charged with the supervision or
regulation of depository institutions or engaged in the insurance of deposits
(including the FDIC) or the supervision or regulation of it or any of its
subsidiaries and neither the Company nor any of its subsidiaries has been
advised by any such Governmental Entity that such Governmental Entity is
contemplating issuing or requesting (or is considering the appropriateness of
issuing or requesting) any such order, decree, agreement, memorandum of
understanding, commitment letter, supervisory letter or similar submission;
(xxi) Each of the Company and its subsidiaries is in
compliance in all material respects with all applicable federal, state and local
environmental laws and regulations, including, without limitation, those
applicable to emissions to the environment, waste management, and waste disposal
(collectively, the "Environmental Laws"), except where such noncompliance would
not be reasonably likely to have a Material Adverse Effect, or except as
disclosed in the Prospectus, and to the knowledge of the Company, there are no
circumstances that would prevent, interfere with or materially increase the cost
of such compliance in the future;
(xxii) Except as disclosed in the Prospectus, there is no
claim under any Environmental Law, including common law, pending or, to the best
knowledge of the Company, threatened against the Company or its subsidiaries (an
"Environmental Claim"), which would be reasonably likely to have a Material
Adverse Effect, and, to the knowledge of the Company, under applicable law,
there are no past or present actions, activities, circumstances, events or
incidents, including, without limitation, releases of any material into the
environment, that are reasonably likely to form the basis of any Environmental
Claim against the Company or its subsidiaries which would be reasonably likely
to have a Material Adverse Effect;
(xxiii) The Company and each of its subsidiaries own or
possess adequate rights to use all patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service xxxx registrations,
copyrights and licenses necessary for the conduct of their respective businesses
and have no reason to believe that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of conflict
with, any such rights of others;
(xxiv) No relationship, direct or indirect, exists between or
among the Company on the one hand, and the directors, officers, customers or
suppliers of the Company on the other hand, which is required to be described in
the Registration Statement by the Act or by the rules and regulations of the
Commission thereunder which has not been so described;
(xxv) The statistical and market related data contained in the
Prospectus and Registration Statement are based on or derived from sources which
the Company believes are reliable and accurate;
(xxvi) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the Company or any
of its subsidiaries, would individually or in the aggregate have a Material
Adverse Effect; and, to the knowledge of the Company, no such legal
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or governmental proceedings are threatened or contemplated by Governmental
Entities or threatened or contemplated by others;
(xxvii) The Company is not and, after giving effect to the
offering and sale of the Shares and after receipt of payment for the Shares and
the application of such proceeds as described in the Prospectus, will not be an
"investment company" or an entity "controlled" by an "investment company", as
such terms are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(xxviii) The Company and its subsidiaries, taken as a whole,
are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in the
business in which they are engaged; and neither the Company nor any of its
subsidiaries has (i) any reason to believe that it will not be able to renew its
existing insurance coverage from similar insurers as may be necessary to
continue its business, or (ii) received notice from any insurer or agent of such
insurer that capital improvements or other expenditures are required or
necessary to be made in order to continue such insurance;
(xxix) Xxxxxxx Xxxxx, LLC, who has certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder and such accountants are not in violation of the auditor
independence requirements of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and
regulations of the Commission promulgated thereunder (the "Xxxxxxxx-Xxxxx Act");
(xxx) The Company is in compliance with the applicable
provisions of the Xxxxxxxx-Xxxxx Act and the rules and regulations of the
Commission thereunder;
(xxxi) No relationship, direct or indirect, exists between or
among the Company or any of its subsidiaries, on the one hand, and the
directors, officers, shareholders, clients or customers of the Company or any of
its subsidiaries, on the other, that is required by the Act to be described in
the Registration Statement and the Prospectus and that is not so described;
(xxxii) Each employee benefit plan, within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), that is maintained, administered or contributed to by the Company or
any of its affiliates for employees or former employees of the Company and its
affiliates has been maintained in compliance with its terms and the requirements
of any applicable statutes, orders, rules and regulations, including but not
limited to ERISA and the Internal Revenue Code of 1986, as amended (the "Code");
no prohibited transaction, within the meaning of Section 406 of ERISA or Section
4975 of the Code, has occurred with respect to any such plan excluding
transactions effected pursuant to a statutory or administrative exemption; and
for each such plan that is subject to the funding rules of Section 412 of the
Code or Section 302 of ERISA, no "accumulated funding deficiency" as defined in
Section 412 of the Code has been incurred, whether or not waived, and the fair
market value of the assets of each such plan (excluding for these purposes
accrued but unpaid contributions) exceeds the present value of all benefits
accrued under such plan determined using reasonable actuarial assumptions;
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(xxxiii) The Company and its subsidiaries maintain systems of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences;
(xxxiv) Neither the Company nor any of its subsidiaries nor,
to the Company's knowledge, any director, officer, agent, employee or other
person associated with or acting on behalf of the Company or any of its
subsidiaries has (i) used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expense relating to political activity;
(ii) made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; (iii) violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment;
(xxxv) The Company has not taken, directly or indirectly, any
action designed to or that could reasonably be expected to cause or result in
any stabilization or manipulation of the price of the Shares;
(xxxvi) No forward-looking statement (within the meaning of
Section 27A of the Act and Section 21E of the Exchange Act) contained in the
Registration Statement and the Prospectus has been made or reaffirmed without a
reasonable basis or has been disclosed other than in good faith; and
(xxxvii) The Company is in compliance with the corporate
governance and other rules and requirements of the Nasdaq National Market.
(b) The Bank represents and warrants to, and agrees with, the
Underwriter that:
(i) The Bank has been duly chartered by the OCC and is validly existing
as a national banking association in good standing under the laws of the United
States, with power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus, and has been duly qualified
as a foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, or is subject to
no material liability or disability by reason of the failure to be so qualified
in any such jurisdiction;
(ii) The Bank is not in violation of its stock charter, bylaws or other
charter documents or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan agreement, note, lease or other
agreement or instrument to which the Bank is a party or by which it may be
bound, or to which any of the property of the Bank is subject; and
(iii) The execution, delivery and performance of this Agreement by the
Bank and the compliance by the Bank with all of the provisions of this Agreement
and the
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consummation of the transactions herein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Bank is a party or by
which the Bank is bound or to which any of the property or assets of the Bank is
subject, nor will such action result in any violation of the provisions of the
charter or bylaws of the Bank or any statute or any order, rule or regulation of
any Governmental Entity having jurisdiction over the Bank or any of its
properties.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to the Underwriter, and the Underwriter agrees
to purchase (i) ___ shares of the Firm Shares from the Company, at a purchase
price per share of $_____ ($____, less an underwriting discount of $___) and
(ii) ___ shares of the Firm Shares (such shares being reserved for sale to
directors, officers and employees of the Company) from the Company, at a
purchase price per share of $___ ($___ less an underwriting discount of $___)
and (b) in the event and to the extent that the Underwriter shall exercise the
election to purchase Optional Shares as provided below, the Company agrees to
issue and sell to the Underwriter, and the Underwriter agrees, to purchase from
the Company, at the purchase price per share set forth in clause (a)(i) of this
Section 2, up to 150,000 Optional Shares as to which such election shall have
been exercised.
The Company hereby grants to the Underwriter the right to purchase at
its election up to 150,000 Optional Shares, at the purchase price per share set
forth in clause (a) of the paragraph above, for the sole purpose of covering
sales of shares in excess of the number of Firm Shares. Any such election to
purchase Optional Shares may be exercised only by written notice from the
Underwriter to the Company, given within a period of 30 calendar days after the
date of this Agreement, setting forth the aggregate number of Optional Shares to
be purchased and the date on which such Optional Shares are to be delivered, as
determined by the Underwriter but in no event earlier than the First Time of
Delivery (as defined in Section 4 hereof) or, unless the Underwriter and the
Company otherwise agree in writing, no earlier than two or later than ten
business days after the date of such notice.
3. Upon the authorization by the Company of the release of the Firm
Shares, the Underwriter proposes to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by the Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as the Underwriter may request upon at least forty-eight hours' prior
notice to the Company shall be delivered by or on behalf of the Company to the
Underwriter, through the facilities of the Depository Trust Company ("DTC"), for
the Underwriter's account, against payment by or on the Underwriter's behalf of
the purchase price therefor by wire transfer of federal (same day) funds to the
account specified by the Company to the Underwriter at least 48 hours in
advance. The Company will cause the certificates representing the Shares to be
made available for checking and packaging at least twenty-four hours prior to
the Time of Delivery (as defined below) with respect thereto at the office of
DTC or its designated custodian (the "Designated Office"). The time and date of
such delivery and payment shall be, with respect to the Firm Shares, ____ a.m.,
Eastern time, on ________, 2005 or such other time and date as Sandler X'Xxxxx &
Partners, L.P. and the Company may agree upon in writing, and, with respect to
the Optional Shares, ____ a.m., Eastern time, on the date specified by Sandler
X'Xxxxx & Partners, L.P. in the written notice
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given by Sandler X'Xxxxx & Partners, L.P. of its election to purchase such
Optional Shares, or such other time and date as Sandler X'Xxxxx & Partners, L.P.
and the Company may agree upon in writing. Such time and date for delivery of
the Firm Shares is herein called the "First Time of Delivery", such time and
date for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross receipt for the Shares and any additional documents requested by the
Underwriter pursuant to Section 7(k) hereof, will be delivered at the offices of
Xxxxxxxx Xxxxxxx LLP, 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000
(the "Closing Location"), and the Shares will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at _____ a.m., Eastern time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with the Underwriter:
(a) To prepare the Prospectus in a form approved by the
Underwriter and to file such Prospectus pursuant to Rule 424(b) under the Act
not later than the Commission's close of business on the second business day
following the execution and delivery of this Agreement, or, if applicable, such
earlier time as may be required by Rule 430A(a)(3) under the Act; to make no
further amendment or any supplement to the Registration Statement or Prospectus
which shall be disapproved by the Underwriter promptly after reasonable notice
thereof; to advise the Underwriter, promptly after it receives notice thereof,
of the time when any amendment to the Registration Statement has been filed or
becomes effective or any supplement to the Prospectus or any amended Prospectus
has been filed and to furnish the Underwriter with copies thereof; to advise the
Underwriter, promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or Prospectus, of the suspension of the qualification
of the Shares for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus or suspending any such qualification,
promptly to use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the
Underwriter may reasonably request to qualify the Shares for offering and sale
under the securities laws of such jurisdictions as the Underwriter may request
and to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Shares, provided that in connection therewith
the Company shall not be required to qualify as a foreign corporation or to file
a general consent to service of process in any jurisdiction;
10
(c) Prior to 10:00 a.m., Eastern time, on the New York
Business Day next succeeding the date of this Agreement and from time to time,
to furnish the Underwriter with copies of the Prospectus in New York City in
such quantities as the Underwriter may from time to time reasonably request,
and, if the delivery of a prospectus is required at any time prior to the
expiration of nine months after the time of issue of the Prospectus in
connection with the offering or sale of the Shares and if at such time any event
shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus in order to comply with
the Act, to notify the Underwriter and upon the Underwriter's request to prepare
and furnish without charge to the Underwriter and to any dealer in securities as
many copies as the Underwriter may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case the Underwriter is
required to deliver a prospectus in connection with sales of any of the Shares
at any time nine months or more after the time of issue of the Prospectus, upon
the Underwriter's request but at the expense of the Underwriter, to prepare and
deliver to the Underwriter as many copies as the Underwriter may request of an
amended or supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company and its subsidiaries (which need
not be audited) complying with Section 11(a) of the Act and the rules and
regulations thereunder (including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of the Prospectus,
not to, and not to allow its directors and executive officers listed on Schedule
I hereto to, offer, sell, contract to sell or otherwise dispose of, except as
provided hereunder, any shares of Common Stock or securities of the Company that
are substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the
right to receive, Common Stock or any such substantially similar securities
(other than pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities outstanding as
of, the date of this Agreement), without the Underwriter's prior written
consent; provided, however, that if: (1) during the last 17 days of such 180-day
period the Company issues an earnings release or material news or a material
event relating to the Company occurs; or (2) prior to the expiration of such
180-day period, the Company announces that it will release earnings results
during the 16-day-period beginning on the last day of such 180-day period, the
restrictions imposed by this Section 5(e) shall continue to apply until the
expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event;
(f) To furnish to its shareholders as soon as practicable
after the end of each fiscal year an annual report (including a balance sheet
and statements of income, shareholders' equity and cash flows of the Company and
its consolidated subsidiaries certified by independent public accountants) and,
as soon as practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the effective date
of the Registration Statement), to make available to its shareholders
consolidated summary financial
11
information of the Company and its subsidiaries for such quarter in reasonable
detail;
(g) During a period of five years from the effective date of
the Registration Statement, to furnish to the Underwriter copies of all reports
or other communications (financial or other) furnished to shareholders, and to
deliver to the Underwriter (i) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the Commission or
any national securities exchange on which any class of securities of the Company
is listed; and (ii) such additional information concerning the business and
financial condition of the Company as the Underwriter may from time to time
reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and its subsidiaries are consolidated in
reports furnished to its shareholders generally or to the Commission);
(h) To use the net proceeds received by it from the sale of
the Shares pursuant to this Agreement in the manner specified in the Prospectus
under the caption "Use of Proceeds";
(i) If the Company elects to rely on Rule 462(b), the Company
shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 p.m., Eastern time on the date of this
Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act;
(j) To use its best efforts to list for quotation the Shares
on the Nasdaq National Market System ("Nasdaq");
(k) To file with the Commission such information on Form 10-Q
or Form 10-K (or Form 10-QSB or Form 10-KSB, if applicable) as may be required
by Rule 463 of the Act;
(l) During the period beginning on the date hereof and ending
on the later of the fifth anniversary of the First Time of Delivery or the date
on which the Underwriter receives full payment in satisfaction of any claim for
indemnification or contribution to which they may be entitled pursuant to
Section 9 of this Agreement, neither the Company nor the Bank shall, without the
prior written consent of Sandler X'Xxxxx & Partners, L.P., take or permit to be
taken any action that could result in the Bank's common stock becoming subject
to any security interest, mortgage, pledge, lien or encumbrance; provided,
however, that this covenant shall be null and void if the FRB, the OCC, the
FDIC, or any other federal agency having jurisdiction over the Bank, by
regulation, policy statement or interpretive release or by written order or
written advice addressed to the Bank and specifically addressing the provisions
of Section 8 hereof, permits indemnification of the Underwriter by the Bank as
contemplated by such provisions.
(m) The Company will comply with the Xxxxxxxx-Xxxxx Act; and
(n) The Company will comply with the corporate governance and
other rules and requirements of the Nasdaq National Market.
6. The Company covenants and agrees with the Underwriter that the
Company will pay or cause to be paid the following, whether or not the
transactions contemplated herein are completed: (i) the reasonable out-of-pocket
expenses incurred by the Underwriter in connection
12
with the transactions contemplated hereby, including, without limitation,
disbursements, fees and expenses of Underwriter's counsel and marketing,
syndication and travel expenses; (ii) the fees, disbursements and expenses of
the Company's counsel and accountants in connection with the registration of the
Shares under the Act and all other expenses in connection with the preparation,
printing and filing of amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (iii) the cost of
printing or producing this Agreement, the Blue Sky survey (if applicable),
closing documents (including any compilations thereof) and any other documents
in connection with the offering, purchase, sale and delivery of the Shares; (iv)
if applicable, all expenses in connection with the qualification of the Shares
for offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriter in
connection with such qualification and in connection with the Blue Sky survey;
(v) all fees and expenses in connection with listing the Shares on Nasdaq; (vi)
the filing fees incident to, and the fees and disbursements of counsel for the
Underwriter in connection with, securing any required review by the NASD of the
terms of the sale of the Shares; (vii) the cost of preparing stock certificates;
(viii) the cost and charges of any transfer agent or registrar; (ix) the cost of
obtaining all securities and regulatory approvals from any applicable
Governmental Entity; and (x) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section.
7. The obligations of the Underwriter hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in its discretion, to the
condition that all representations and warranties and other statements of the
Company herein are, at and as of such Time of Delivery, true and correct, the
condition that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M., Eastern
time, on the date of this Agreement; no stop order suspending the effectiveness
of the Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Underwriter's reasonable
satisfaction;
(b) Xxxxxxxx Xxxxxxx LLP, counsel for the Underwriter, shall
have furnished to the Underwriter such written opinion or opinions, dated such
Time of Delivery, with respect to such matters as the Underwriter may reasonably
request, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) Xxxxxx Xxxxxxx Xxxxx & Scarborough, LLP, counsel for the
Company, shall have furnished to the Underwriter their written opinion (a form
of such opinion to be delivered is attached as Exhibit A hereto), dated such
Time of Delivery, in form and substance satisfactory to the Underwriter;
(d) (i) At the time of the execution of this Agreement, the
Underwriter shall have received from Xxxxxxx Xxxxx, LLC, a letter dated such
date, in form and substance
13
satisfactory to the Underwriter, to the effect that (i) they are independent
public accountants with respect to the Company and its subsidiaries within the
meaning of the Code of Ethics of the AICPA, the Act and the rules and
regulations of the Commission thereunder and they are not in violation of the
auditor independence requirements of the Xxxxxxxx-Xxxxx Act; (ii) it is their
opinion that the consolidated financial statements and supporting schedules
included in the Registration Statement and covered by their opinions therein
comply as to form in all material respects with the applicable accounting
requirements of the Act and the rules and regulations of the Commission
thereunder; (iii) based upon limited procedures as agreed upon by the
Underwriter and Xxxxxxx Xxxxx, LLC set forth in detail in such letter, including
a reading of the latest available interim financial statements of the Company
and its subsidiaries, a reading of the minute books of the Company and its
subsidiaries, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing has come to their
attention which causes them to believe that (A) the unaudited financial
statements and supporting schedules of the Company and its subsidiaries included
in the Registration Statement do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the rules and
regulations of the Commission thereunder or are not presented in conformity with
generally accepted accounting principles used in the United States applied on a
basis substantially consistent with that of the audited financial statements
included in the Registration Statement and the Prospectus, (B) the unaudited
amounts of net interest income and net income, and the other balance sheet data
and operating data, set forth under "Selected Consolidated Financial Data" in
the Registration Statement and the Prospectus do not agree with the amounts set
forth in unaudited consolidated financial statements as of and for the dates and
periods presented under such captions or such amounts were not determined on a
basis substantially consistent with that used in determining the corresponding
amounts in the audited financial statements included in the Registration
Statement, (C) at a specified date not more than five days prior to the date of
this Agreement, there has been any change in the capital stock of the Company or
any increase in the consolidated long term or short term debt of the Company and
its subsidiaries or any decrease in consolidated total assets, the provision for
loan losses, total deposits, retained earnings or stockholders' equity of the
Company and its subsidiaries, in each case as compared with the amounts shown in
the most recent consolidated balance sheet of the Company and its subsidiaries
included in the Registration Statement, or (D) during the period from the date
of the most recent consolidated statement of income included in the Registration
Statement to a specified date not more than five days prior to the date of this
Agreement, there were any decreases, as compared with the corresponding period
in the preceding year, in total interest income, net interest income, net
interest income after provision for loan losses, income before income taxes or
net income of the Company and its subsidiaries, except in all instances for
changes, increases or decreases which the Registration Statement and the
Prospectus disclose have occurred or may occur, and (iv) in addition to the
audits referred to in their opinions and the limited procedures referred to in
clause (iii) above, they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information which are included in the Registration Statement and the
Prospectus and which are specified by the Underwriter, and have found such
amounts, percentages and financial information to be in agreement with the
relevant accounting, financial and other records of the Company and its
subsidiaries identified in such letter.
(ii) At 9:30 a.m., Eastern time, on the effective date of any
post-effective amendment to the Registration Statement filed after the date of
this Agreement and also at each
14
Time of Delivery, the Underwriter shall have received from Xxxxxxx Xxxxx, LLC a
letter, dated as of each such date, to the effect that they reaffirm the
statements made in the letter furnished pursuant to Section 7(d)(i) hereof,
except that the specified date referred to shall be a date not more than five
days prior to the date of such letter.
(e) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or action, order or decree of any Governmental Entity,
otherwise than as set forth or contemplated in the Prospectus, and (ii) since
the respective dates as of which information is given in the Prospectus there
shall not have been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus, the
effect of which, in any such case described in clause (i) or (ii), is in the
judgment of Sandler X'Xxxxx & Partners, L.P. so material and adverse as to make
it impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the terms and
in the manner contemplated in the Prospectus;
(f) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities;
(g) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on the Nasdaq; (ii) a
suspension or material limitation in trading in the Company's securities on the
Nasdaq; (iii) a general moratorium on commercial banking activities declared by
either Federal or New York or South Carolina authorities or a material
disruption in commercial banking or securities settlement or clearance services
in the United States; (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war; or (v) the occurrence of any other calamity or crisis or any
change in financial, political or economic conditions in the United States or
elsewhere, including without limitation, as a result of terrorist activities
occurring after the date hereof, if the effect of any such event specified in
clause (iv) or (v), in the judgment of Sandler X'Xxxxx & Partners, L.P. makes it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares being delivered at such Time of Delivery on the terms and in the
manner contemplated in the Prospectus;
(h) The Shares to be sold at such Time of Delivery shall have
been duly listed for quotation on the Nasdaq;
(i) Prior to the effective date of the Initial Registration
Statement the Company shall have obtained and delivered to the Underwriter
executed copies of an agreement from each officer and director listed on
Schedule I hereto of the Company, substantially to the effect set forth in
Exhibit B hereto, in form and substance satisfactory to the Underwriter;
15
(j) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement;
(k) The Company shall have furnished or caused to be furnished
to the Underwriter at such Time of Delivery certificates of officers of the
Company satisfactory to the Underwriter as to the accuracy of the
representations and warranties of the Company herein at and as of such Time of
Delivery, as to the performance by the Company of all of its obligations
hereunder to be performed at or prior to such Time of Delivery, as to the
matters set forth in subsections (a) and (e) of this Section and as to such
other matters as the Underwriter may reasonably request; and
(l) On or prior to the First Time of Delivery or the Second
Time of Delivery, as the case may be, the Company shall have furnished to the
Underwriter such further certificates and documents as the Underwriter may
reasonably request.
8. (a) The Company and the Bank, jointly and severally, will indemnify
and hold harmless the Underwriter against any losses, claims, damages or
liabilities, joint or several, to which the Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse the Underwriter for any legal or other expenses reasonably incurred by
the Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company and the
Bank shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by the Underwriter. expressly for use therein (provided
that the Company and the Underwriter hereby acknowledge and agree that the only
information that the Underwriter has furnished to the Company specifically for
inclusion in the Registration Statement, any Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto) are the concession and
reallowance figures appearing in the Prospectus in the section entitled
"Underwriting" and the information contained under the captions "Underwriting --
Stabilization" and "Underwriting -- Passive Market Making"). Notwithstanding the
foregoing, the indemnification provided for in this paragraph (a) shall not
apply to the Bank to the extent that such indemnification by the Bank is found
in a final judgment by a court of competent jurisdiction to constitute a covered
transaction under Section 23A of the Federal Reserve Act.
(b) The Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or
16
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 any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by the Underwriter expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party which consent shall not be
unreasonably withheld, be counsel to the indemnifying party), and, after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriter on
the other from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriter on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriter on the other shall be deemed to
17
be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriter, in each case as set forth
in the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the Underwriter on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriter agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to above in this subsection
(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect thereof) referred
to above in this subsection (d) shall be deemed to include any legal or other
expenses incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
subsection (d), the Underwriter shall not be required to contribute any amount
in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
(e) The obligations of the Company under this Section 8 shall
be in addition to any liability which the Company or the Bank may otherwise have
and shall extend, upon the same terms and conditions, to each person, if any,
who controls the Underwriter within the meaning of the Act or who is an
affiliate or partner of the Underwriter; and the obligations of the Underwriter
under this Section 8 shall be in addition to any liability which the Underwriter
may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company or the Bank, as the case may be, and to each
other person, if any, who controls the Company or the Bank within the meaning of
the Act or who is an affiliate of the Company or the Bank, as the case may be.
9. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the Underwriter, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of the Underwriter or any controlling person of the Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
10. If for any reason any Shares are not delivered by or on behalf of
the Company as provided herein, the Company will reimburse the Underwriter for
all its out-of-pocket expenses, including fees, expenses and disbursements of
counsel, reasonably incurred by the Underwriter in making preparations for the
purchase, sale and delivery of the Shares not so delivered, but the Company
shall then be under no further liability to the Underwriter except as provided
in Sections 6 and 8 hereof.
11. All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriter shall be delivered or sent by mail, telex
or facsimile transmission to the
18
Underwriter at 000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, XX 00000, Attention:
General Counsel; and if to the Company shall be delivered or sent by mail or
facsimile to Beach First National Bancshares, Inc., 0000 Xxx Xxxxxx, Xxxxxx
Xxxxx, Xxxxx Xxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxxx III, Chief Executive
Officer. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
12. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriter, the Company and, to the extent provided in Sections
8 and 9 hereof, the officers and directors of the Company and each person who
controls the Company or the Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from the Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
13. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
14. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
15. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
16. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective
unless the same shall be in writing and signed by the parties hereto.
19
If the foregoing is in accordance with your understanding, please sign
and return to us four counterparts hereof, and upon the acceptance hereof by
you, this letter and such acceptance hereof shall constitute a binding agreement
among the Underwriter, the Company and the Bank.
Very truly yours,
BEACH FIRST NATIONAL BANCSHARES, INC.
By:
----------------------------------
Name:
Title:
BEACH FIRST NATIONAL BANK
By:
---------------------------------
Name:
Title:
Accepted as of the date hereof:
SANDLER X'XXXXX & PARTNERS, L.P.
By: Sandler X'Xxxxx & Partners Corp.
the sole general partner
By:
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Name:
Title:
20
