EXHIBIT 1
Underwriting Agreement
EXHIBIT 1
IBF VI - SECURED LENDING CORPORATION
(A Delaware corporation)
UNDERWRITING AGREEMENT
CURRENT INTEREST SUBORDINATED BONDS
ACCRETION SUBORDINATED BONDS
$50,000,000
NATIONAL SECURITIES CORPORATION _________________, 2000
000 X. Xxxxxxxx Xxx., Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Gentlemen:
IBF VI - Secured Lending Corporation (the "Company"), a Delaware
corporation, desires to offer for sale to the public $50,000,000 in principal
amount of its Current Interest Subordinated Bonds and Accretion Subordinated
Bonds ("Bonds"). The Company desires to offer the Bonds for sale through
National Securities Corporation, Inc. (the "Underwriter"). The offering will
be undertaken by the Underwriter as agent for the Company on a "best efforts,
$500,000 Bonds minimum-$50,000,000 Bonds maximum" basis so that in the event
$500,000 for the purchase of Bonds is not received within the agreed period,
no Bonds will be sold, and the Underwriter will not be entitled to any
compensation, except reimbursement of out-of-pocket expenses. On these
premises, we set forth the terms of our proposed agreement as follows:
1. Appointment of Underwriter. The Company hereby appoints the
Underwriter, on all the terms and conditions hereinafter set forth, as the
Company's exclusive agent to use its best efforts to sell on behalf of the
Company the Bonds.
2. Representations and Warranties of the Company. As an inducement
to, and to obtain the reliance of, the Underwriter in connection herewith, the
Company represents, warrants, and agrees with the Underwriter as follows:
(a) The Company has prepared and filed or will prepare and
file with the United States Securities and Exchange Commission (the
"Commission"), a registration statement on form SB-2, including a
prospectus, relating to the Bonds in accordance with section 5 of the
Securities Act of 1933, as amended (the "Securities Act"), and the
rules and regulations of the Commission thereunder. As used in this
Agreement, the term "Registration Statement" means such Registration
Statement, including exhibits, financial statements, and schedules,
as amended, when it becomes effective, and the term "Prospectus"
means the Prospectus filed with the Registration Statement. (The
Registration Statement and Prospectus, as defined herein, are
hereinafter collectively referred to as the "Filing.") The Company
will utilize its best efforts to cause the Filing to become effective
and to maintain its effectiveness during the term hereof.
(b) The Commission has not issued and, to the knowledge and
belief of the Company, does not have cause to issue an order
preventing or suspending the use of the Filing; the Filing conforms
or shall conform in all material respects with the requirements of
the Securities Act and the rules and regulations of the Commission
promulgated thereunder (the "Regulations") and does not include any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and on the
Effective Date (as hereinafter defined) and at all times subsequent
thereto up to the Termination Date (as hereinafter defined), the
Filing and any amendment or supplement thereto will fully comply with
the provisions of the Securities Act and the Regulations and will not
contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements made, in light of the
circumstances under which they are made, not misleading; provided,
that the foregoing representations and warranties shall not apply to
statements in or omissions from the Filing, or any amendments or
supplements thereto, made in reliance on and in conformity with
information furnished herein or in writing to the Company by or on
behalf of the Underwriter expressly for use therein.
(c) The Company has one subsidiary, IBF VI - Asset
Securitization Corp.
(d) Except as reflected in or contemplated by the Filing,
since the respective dates as of which information is given in the
Filing, there has not been and on the Effective Date there will not
have been, any material adverse change in the condition of the
Company, financial or otherwise, or in the results of its operations.
(e) The authorized capital stock of the Company consists of
1,000 shares of common stock, par value $1.00, of which 1,000 shares
are issued and outstanding. On the date of issuance, the Bonds will
be duly and validly authorized and, when issued and paid for in
accordance with this Agreement and the Indenture dated
_______________, 2000 ("Indenture"), will be validly issued, fully
paid, and non-assessable, and will conform to the description thereof
contained in the Filing; and the execution and delivery of, and
compliance with, this Agreement and the Indenture and the issuance of
the Bonds will not conflict or constitute a breach of or default
under the certificate of incorporation or bylaws of the Company, any
indenture, agreement, or other instrument by which the Company is
bound, any order, decree, rule, or regulation of any court, or any
law or administrative regulation applicable to the Company.
(f) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
state of Delaware, with an authorized and outstanding capitalization
as set forth in the Filing and with full corporate power and
authority to carry on the business in which it is now engaged. The
Company is qualified or licensed and in good standing as a foreign
corporation in each jurisdiction in which the ownership or leasing of
any properties or the character of its operations requires such
qualification or licensing. The Company has all requisite corporate
power and authority and all material and necessary authorizations,
approvals, orders, licenses, certificates, and permits of and from
all governmental regulatory officials and bodies to own or lease its
properties and conduct its business as described in the Prospectus,
and the Company is doing business in strict compliance with all such
authorizations, approvals, orders, licenses, certificates, and
permits and all federal, state, and local laws, rules, and
regulations concerning the business in which the Company is engaged.
The disclosures in the Filing concerning the effects of federal,
state, and local regulation on the Company's business as currently
conducted and as contemplated are correct in all material respects
and do not omit to state a material fact. The Company has all
corporate power and authority to enter into this Agreement and the
Indenture and to carry out the provisions and conditions hereof and
thereof, and all consents, authorizations, approvals, and orders
required in connection therewith have been obtained or will have been
obtained prior to the time of closing as provided in subparagraph
3(f) hereto. No consent, authorization, or order of, and no filing
with any court, governmental agency, or other body is required for
the issuance of the Bonds pursuant to the Filing, except with respect
to applicable federal and state securities laws.
(g) The Filing contains audited balance sheets of the
Company as of December 31, 1999, and December 31, 1998, and the
related audited statements of operations, change in shareholder's
equity and cash flows for the period June 8, 1998 (inception) through
December 31, 1999, including the notes thereto, together with the
opinion of Radin, Glass & Co., LLP, independent certified public
accountants, with respect to the audited balance sheet and related
audited statements as well as unaudited balance sheets of the Company
as of June 30, 2000, and the related unaudited statements of
operations, change in shareholder's equity and cash flows for the
period December 31, 1999 through June 30, 2000, including the notes
thereto. Such financial statements have been prepared in accordance
with generally accepted accounting principles consistently followed
throughout the periods indicated, except as otherwise indicated in
the notes thereto. The balance sheet presents fairly as of its date
the financial condition of the Company. The Company did not have, as
of the date of such balance sheet, except as and to the extent
reflected or reserved against therein (including the notes thereto),
any liabilities or obligations (absolute or contingent) of a nature
customarily reflected in a balance sheet or the notes thereto
prepared in accordance with generally accepted accounting principles.
The statement of stockholders' equity presents fairly the information
that should be presented therein in accordance with generally
accepted accounting principles.
(h) Except as set forth in the Filing, there is no action,
suit, or proceeding before any court or government agency, authority,
or body pending or, to the knowledge of the Company, threatened which
might result in judgments against the Company which are not
adequately covered by insurance, or which is pending or, to the
knowledge of the Company, threatened by any public body, agency, or
authority, which might result in any material adverse change in the
condition (financial or otherwise), business, or prospects of the
Company or would materially affect its properties or assets.
(i) The execution and delivery of this Agreement, the
consummation of the transactions herein contemplated and compliance
with the terms and provisions hereof will not conflict with, or
constitute a breach of, any of the terms, provisions, or conditions
of any agreement or instrument to which the Company is a party, nor
will any one nor any combination of the foregoing have such a result.
(j) The Company has the legal right, power, and authority to
enter into this Agreement, and the execution, delivery, and, except
as otherwise indicated in this Agreement, performance thereof by the
Company, do not require the consent or approval of any governmental
body, agency, or authority which has not been obtained.
(k) The Company is not a party to any material contract
(meaning thereby a contract materially affecting its business or
properties) that is not referred to in the Filing. No default of any
material significance exists in the due performance and observance by
the Company of any term, covenant, or condition of any such contract;
all such contracts are in full force and effect and are binding on
the parties thereto in accordance with their terms; and, to the
knowledge of the Company, no other party to any such material
contract has threatened or instituted any action or proceeding
wherein the Company is alleged to be in default thereunder.
(l) No stock options or warrants are or will be outstanding
or issued during the period covered by this Agreement, except as set
forth in the Filing.
(m) The Company is not delinquent in the filing of any tax
return or in the payment of any taxes, knows of no proposed
redetermination or assessment of taxes, and has paid or provided for
adequate reserves for all known tax liabilities.
3. Employment of the Underwriter. On the foregoing representations,
agreements, and warranties and subject to the terms and conditions of this
Agreement:
(a) The Company hereby employs the Underwriter as exclusive
agent to sell for the Company's account the Bonds. The Underwriter
agrees to use its best efforts as agent, promptly following the
receipt of written notice of the Effective Date of the Registration
Statement, to offer for sale the Bonds, subject to the terms,
provisions, and conditions hereinafter set forth.
(b) In the event the Underwriter does not find subscribers
for Bonds having a total aggregate purchase price of $500,000 within
three months following the Effective Date (unless extended by
agreement of the Company and Underwriter for an additional period not
to exceed three months), this Agreement shall terminate, and neither
party to this Agreement shall have any obligation to the other party
hereunder. Appropriate arrangements for placing the funds received
for the Bonds in escrow until a total of $500,000 in cash has been
received shall be made prior to the commencement of the offering
hereunder, with provision for refund to the purchasers as set forth
above or for delivery to the Company of the net proceeds therefrom if
$500,000 or more in cash has been received from the sale of Bonds
hereunder within the specified time period.
(c) The Bonds shall be offered to the general public at face
value without discount; provided, that the Underwriter may, at its
discretion, waive its commission under subsection 3(e), below, and
offer Bonds at face value less the amount of the commission so
waived.
(d) The Underwriter is granted irrevocable authority as
agent for the Company to declare any contract to purchase Bonds
offered to the public hereunder in default if the Bonds are not paid
for in cash within seven business days after the contract date. The
Underwriter shall instruct investors to make all checks tendered as
payment for the Bonds payable to "CSTTC Escrow Agent for IBF VI -
Secured Lending Corporation" and shall deposit promptly, but in no
event later than noon of the next business day following receipt, the
gross proceeds from sales of Bonds in the account with the escrow
agent until $500,000 (or such other amount as may be required by the
securities commission of any state in which the Bonds are offered and
sold) in good funds is received from said sales, and, thereafter, the
escrow account shall continue to be used as a clearing account into
which all checks for the payment for securities shall likewise be
promptly deposited. Subject to and after the sale of Bonds with a
minimum public offering price of $500,000 and the release by the
escrow agent of such funds under the terms of the escrow agreement,
as funds are collected and subscriptions accepted by the Company, the
net proceeds (gross proceeds minus the Underwriter's sales
commissions and accountable expenses as provided herein) shall be
promptly paid to the Company and the Underwriter's sales commission
and accountable expenses shall be paid to it.
(e) As its compensation, and subject to the sale of $500,000
of Bonds, the Underwriter shall be entitled to receive a commission
of 8% of the principal amount of the Bonds sold and for which payment
is made to the Company. In addition, the Underwriter will receive
reimbursement for all accountable out of pocket expenses. Finally,
the Underwriter shall be entitled to receive 2.0% of the Company's
annual Net Income for each calendar year through 2006. For purposes
of this provision, Net Income shall be calculated in the same manner
as set forth in the Indenture. In the event the Underwriter does not
find subscribers for Bonds having a total aggregate purchase price of
$500,000 within three months following the Effective Date (unless
extended by agreement of the Company and Underwriter for an
additional period not to exceed three months), the Underwriter will
be reimbursed only for its actual accountable out of pocket expenses.
(f) The Company agrees to issue or have issued Bonds in such
names and denominations as may be specified by the Underwriter and to
deliver certificates representing the Bonds to the purchasers in
accordance with the Indenture against payment of the purchase price
of the Bonds net of the Underwriter's sales commissions (including
the Underwriter's accountable expenses), as provided herein. Such
payment and delivery shall be at such place and at such date and time
within 21 days following the sale of the minimum amount of Bonds as
provided in subsection 3(b) hereof as shall be agreed on by the
Underwriter and the Company (the "time of closing"). Thereafter,
further payments and deliveries shall be made at such address and at
such subsequent times and dates similarly agreed on so as to effect
the prompt transmittal of funds and of certificates for Bonds to the
purchasers (a "subsequent time of closing"). All requisitions for
Bonds by the Underwriter shall be in writing and shall be given to
the Company before the delivery date.
(g) The Underwriter is authorized to organize a selling
group of participating dealers consisting exclusively of members of
the National Association of Securities Dealers, Inc., or foreign
dealers who are not eligible for membership in said association. The
Underwriter will use the services of Xxxxxxx & Company Securities,
Inc., an affiliate of the Company ("Xxxxxxx") to assist the
Underwriter in making wholesale distribution of the offering to the
selling group of participating dealers. Participating dealers are to
act as agents and shall be allowed to purchase on an equal basis from
the Underwriter at a price which provides a concession out of the
Underwriter's commissions in such amount as the Underwriter may
determine, but in no event in excess of 7.5% of the principal amount
of the Bonds sold by the participating dealers and for which payment
is made to the Company. For the services rendered by Xxxxxxx, it will
receive from the Underwriter 0.5% of the principal amount of the
Bonds sold and for which payment is made to the Company.
(h) The Company has appointed Continental Stock Transfer &
Trust Company, 0 Xxxxxxxx, Xxx Xxxx, XX 00000, as Trustee under the
Indenture and registrar of the Bonds.
4. Representations and Warranties of the Underwriter. As an
inducement to, and to obtain the reliance of, the Company in connection
herewith, the Underwriter represents, warrants, and agrees with the Company as
follows:
(a) The Underwriter is duly registered as a securities
broker-dealer in accordance with the Securities Exchange Act of 1934,
as amended.
(b) The Underwriter will not publish, issue, or circulate or
authorize the publication, issuance, or circulation of any circular,
notice, or advertisement which offers the Bonds for sale which shall
not have previously been approved by the Company and its counsel,
except for so-called "tombstone" advertisements and which has not
been approved by the Commission prior to its use, if such prior
approval is required.
(c) The Underwriter is in good standing and in full and
current compliance in all material respects with the rules of the
National Association of Securities Dealers, Inc.
(d) The Underwriter shall confirm sales to customers only in
those states in which it is licensed to do so as a securities broker
or dealer and shall ensure that all participating dealers similarly
confirm sales to customers only in states in which they are duly
licensed to do so. The Underwriter and participating dealers in the
distribution of the offering will comply with sections 8, 24, 25 and
36 of Article III of the NASD Rules of Fair Practice and rule 15c2-8
promulgated under the Securities Exchange Act of 1934, as amended.
5. Covenants by the Company. In further consideration of the
agreements by the Underwriter herein contained, the Company covenants as
follows:
(a) At least 48 hours prior to submission of the Filing or
any amendment thereto to the Commission, the Underwriter shall be
provided with a copy of such Filing or amendment, and no such Filing
will be made to which the Underwriter shall object within the 48 hour
period.
(b) The Company will use its best efforts to cause the
Registration Statement to become effective and will not at any time,
whether before, on, or after the Effective Date, file any amendments
to the Filing or supplement thereto without first obtaining the
Underwriter's approval. Such approval shall be obtained by compliance
with subsection (a) above. Said Filings or any amendments or
supplements thereto shall be in compliance with the Securities Act
and the Regulations of the Commission to the best of the Company's
knowledge, information, and belief.
(c) As soon as the Company is advised thereof, the Company
will advise the Underwriter and confirm the advice in writing (i) as
to when the Registration Statement has become effective; (ii) of any
request made by the Commission for amendment of or supplement to the
Filing, or for additional information with respect thereto; and (iii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any amendment
thereto or the initiation, or threat of initiation, of any
proceedings for such purpose, and the Company will use its best
efforts to prevent the issuance of any such order and to obtain as
soon as possible the lifting thereof, if issued.
(d) The Company will deliver to the Underwriter prior to the
Effective Date, copies of the preliminary prospectus and, on the
Effective Date of the Registration Statement, without charge and from
time to time thereafter, copies of the Prospectus and amendments
thereto as required by law to be delivered in connection with sales,
in such quantities as the Underwriter may reasonably request.
(e) The Company will deliver to the Underwriter, without
charge, one manually executed copy of the Registration Statement,
together with all required exhibits as filed and all amendments
thereto with exhibits which have not previously been furnished to the
Underwriter, and will deliver to the Underwriter, without charge,
such reasonable number of copies of the Registration Statement and
Prospectus (excluding exhibits) and all amendments thereto as the
Underwriter may reasonably request.
(f) Prior to the Termination Date if, in the opinion of the
Underwriter, any statements are contained in the Filing which are
misleading or inaccurate in light of the circumstances under which
they are made, the Underwriter may require the Company to amend or
supplement the Filing to correct said statements and may request such
reasonable number of copies of any amended or supplemented Filing as
may be necessary to comply with the Securities Act and Regulations.
(g) The Company will have used and will use its best efforts
to secure on or before the Effective Date of the Registration
Statement, and to maintain for such period as may be required for
distribution, such exemptions, registrations and qualifications of
the Bonds as will permit the public offering thereof under the "Blue
Sky Laws" of such states as the Underwriter and the Company shall
agree upon; provided, that no such qualification shall be required
if, as a result thereof, the Company would be made subject to qualify
for authority to do business as a foreign corporation in a
jurisdiction where it is not now so subject or so qualified. The
Company's counsel shall furnish copies of any such filings or other
materials submitted in connection with this subparagraph to the
Underwriter and shall notify the Underwriter, in writing, of those
states in which the Bonds may be offered and sold pursuant to the
terms hereof. The Underwriter agrees to cooperate in securing such
exemptions, registrations and qualifications in accordance with the
terms hereof.
(h) The Company will pay all costs and expenses incident to
the performance of its obligations under this Agreement, including
(i) all expenses incident to its issuance and delivery of the Bonds;
(ii) the fees and expenses incident to the preparation, printing, and
filing of the Filing (including all exhibits thereto) with the
Commission, the various "blue sky" agencies and the National
Association of Securities Dealers, Inc.; and (iii) the costs of
furnishing to the Underwriter copies of the Filing and preliminary
and definitive prospectus. The Company shall not, however, be
required to pay for transfer tax stamps on any sales of the Bonds
which the Underwriter may make or to pay for any of the Underwriter's
expenses or those of any other dealers other than as hereinabove set
forth.
(i) For a period of six years from the Effective Date, the
Company will furnish the Underwriter (i) all reports and financial
statements, if any, the Company files with or furnishes to the
Commission or any stock exchange on which the securities of the
Company are listed; (ii) such other periodic and special reports as
the Company from time to time furnishes generally to holders of any
class of its stock; (iii) every press release and every news item and
article with respect to the affairs of the Company which is released
by the Company; and (iv) such additional documents and information
with respect to the affairs of the Company and any future
subsidiaries of the Company as the Underwriter may from time to time
reasonably request.
(j) The Company will mail or otherwise make generally
available to its security holders as soon as practicable, but in no
event more than 15 months after the close of the fiscal quarter
ending after the Effective Date of the Registration Statement, an
earnings statement, which need not be audited, covering a period of
at least 12 months beginning after the Effective Date of the
Registration Statement.
(k) The Company will, as promptly as practicable after the
end of each fiscal year, release an appropriate report covering its
operations for such year and send to the Underwriter, to all holders
of record of the Company's Bonds, and to recognized statistical
services, a report covering operations for such year, including a
balance sheet of the Company and statements of earnings and of
retained earnings, as examined by the Company's independent
accountants.
(l) The Company will apply the net proceeds from the offering
received by it in substantially the manner set forth in the
Prospectus.
(m) The Company will comply with the reporting requirements
to which it is subject pursuant to section 15(d) of the Securities
Exchange Act of 1934, as amended.
(n) The Company will, as soon as practicable following the
filing of the Filing with the Commission, make application for and
receive a CUSIP number for its securities from Standard and Poor's
Corporation.
6. Reciprocal Indemnification.
(a) The Company agrees to indemnify and hold harmless the
Underwriter and any person who may be deemed to control the
Underwriter within the meaning of section 15 of the Securities Act;
and
(b) The Underwriter agrees to indemnify and hold harmless
the Company, its directors, such of its officers as sign the
Registration Statement, and any person who may be deemed to control
the Company within the meaning of the Securities Act;
against any and all losses, claims, damages, or liabilities whatsoever
(including, but not limited to, any and all legal or other expenses whatsoever
reasonably incurred in investigating, preparing, or defending against any
actions or threatened actions or claims) based on or arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Filing (as from time to time amended or supplemented) or any application or
other document filed in any state in order to register, qualify, or obtain an
exemption for the Bonds under the laws thereof ("blue sky application"), as
the case may be, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or any violation by any of the indemnifying
parties of any provision of the Securities Act or any Regulation, or of common
or statutory law, and against any and all losses, claims, damages, or
liabilities whatsoever to the extent of the aggregate amount paid in
settlement of any action, commenced or threatened, or of any claim whatsoever
based on any such untrue statement or omission or any such violation
(including, but not limited to, any and all legal or other expenses whatsoever
reasonably incurred in investigating, preparing, or defending against any such
actions or claims) if such settlement is effected with the written consent of
any indemnifying party. The indemnification by the Underwriter shall extend
only to any such statements or omissions made in reliance on and in conformity
with written information furnished to the Company by the Underwriter or on
behalf of the Underwriter for use in the remaining statements in or omissions
from the Filing or blue sky applications.
Each of the foregoing indemnifications is expressly conditioned on
the indemnifying party being notified by the person seeking indemnification,
by letter or by telegram confirmed by letter, of any action commenced against
such person, within a reasonable time after such person shall have been served
with the summons or other first legal process giving information as to the
nature and basis of the claim, and in any event at least ten days prior to the
entry of any judgment in such action, but the failure to give such notice
shall not relieve any indemnifying party of any liability which such party may
have to such person otherwise than on account of this indemnity agreement. Any
party whose indemnification is being relied on shall assume the defense of any
action or claim, including the employment of counsel and the payment of all
expenses. Any indemnified party shall have the right to separate counsel in
any such action and to participate in the defense thereof but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment thereof shall have been specifically authorized by
the indemnifying party, or (ii) the indemnifying party shall have failed to
assume the defense and employ counsel.
The indemnifications contained above in this section 6, and the
representations and warranties of the Company set forth in this Agreement,
will remain operative and in full force and effect, regardless of any
investigations made by or on behalf of the Underwriter or any controlling
person thereof, or by or on behalf of the Company or its directors or officers
and will survive delivery of and payment for the Bonds.
7. Conditions to Obligations of the Company. The obligation of the
Company to deliver the Bonds being sold by the Underwriter hereunder is
subject to the conditions that (i) the Registration Statement shall have
become effective not later than 5:00 p.m., Eastern Time, the twenty-fifth
business day following the date hereof or such later time and date as is
acceptable to the Company, and (ii) no stop order suspending the effectiveness
of the Registration Statement shall have been issued and shall be in effect at
the time of closing or at each subsequent time of closing, if any, and no
proceeding for that purpose shall have been initiated or, to the knowledge of
the Company, threatened by the Commission, it being understood that the
Company shall use its best efforts to prevent the issuance of any such stop
order and, if one has been issued, to obtain the lifting thereof. In the event
that the Bonds (or any part thereof) are not delivered by virtue of the
provisions of clause (i) of this paragraph, the Company shall not be liable to
the Underwriter.
8. Conditions to the Obligations of the Underwriter. The several
obligations of the Underwriter hereunder are subject to the accuracy, as of
the date hereof, at the time of closing and at each subsequent time of
closing, if any, of the representations and warranties made herein by the
Company; to the accuracy in all material respects of the statements of the
officers of the Company made pursuant to the provisions hereof; to the
performance by the Company of its obligations hereunder required on its part
to be performed or complied with prior to or at such time of closing; and to
the following additional conditions:
(a) The Filing shall have fully complied with the provisions
of the Securities Act and the Regulations and shall not contain 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; provided, however, that statements
or omissions in the Filing in reliance on, and in conformity with,
information furnished in writing by or on behalf of the Underwriter
expressly for use therein shall not be considered within the scope of
this provision.
(b) The Underwriter shall not have advised the Company that
the Filing, or any amendment or supplement thereto, contains an
untrue statement of fact which, in the opinion of the Underwriter, is
material or omits to state a fact which, in the opinion of the
Underwriter, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(c) The Registration Statement shall have become effective
not later than the date specified in section 7, or such later time
and date as is acceptable to the Underwriter and, prior to the time
of closing, no stop order shall have been issued by the Commission
with respect to the Filing, no proceedings therefor shall have been
initiated by the Commission, and to the knowledge of the Company or
the Underwriter, no such proceedings shall be contemplated by the
Commission.
(d) Each contract to which the Company is a party and which
is filed as an exhibit to the Registration Statement shall be in full
force and effect at such time of closing, or shall have been
terminated, in accordance with its terms; no party to any such
contract shall have given any notice of cancellation or, to the
knowledge of the Company, shall have threatened to cancel any such
contract; and there shall be no material misstatement in any
description of a contract contained in the Filing.
(e) From the date hereof until the time of closing and until
each subsequent time of closing, if any, no material litigation or
legal proceedings of any nature shall have been commenced or
threatened against the Company, nor any litigation or legal
proceedings which are directed against the consummation of the
transactions herein contemplated and no substantial change, financial
or otherwise, shall have occurred in or relating to the condition,
business, or assets of the Company which shall render such condition,
business, or assets substantially less favorable, in the
Underwriter's judgment, than as set forth in the Filing.
(f) The Underwriter shall have been furnished at the time of
closing and at each subsequent time of closing, if any, with such
certificates as the Underwriter may reasonably request evidencing the
continued accuracy in all material respects of the respective
representations and warranties made herein by the Company and the
fulfillment of the conditions stated above in subsections (a), (c),
(d), and (e) of this section.
(g) The Underwriter shall have received at the time of
closing an opinion of the firm of Xxxxx & Xxxx LLP, counsel for the
Company, dated as of the time of closing and in a form and substance
satisfactory to counsel for the Underwriter, to the following effect:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of Delaware, with power and authority to own its
properties, hold its franchises, and conduct its business,
as described in the Prospectus, and, to the best of the
knowledge and information of said counsel, is duly qualified
to do business and is in good standing in every other
jurisdiction where the location of its properties or the
conduct of its business makes such qualification necessary;
(ii) The Bonds have been duly and validly
authorized and are fully paid and non-assessable; and the
description of the Bonds made in the Filing accurately sets
forth matters respecting such securities required to be set
forth therein;
(iii) This Agreement has been duly authorized,
executed, and delivered by the Company and constitutes a
valid and binding agreement of the Company (except that
counsel need render no opinion as to the enforceability of
the indemnification provisions);
(iv) The certificates to be issued for the Bonds are
in proper form;
(v) The final Registration Statement has become
effective under Securities Act and, to the best knowledge of
such counsel, no stop orders suspending the effectiveness of
the offering have been issued and no proceeding for that
purpose has been instituted or pending or contemplated under
the Securities Act; and
(vi) The Registration Statement and each amendment
or supplement thereto (except for the financial data
included therein and any information furnished to the
Company by or on behalf of the Underwriter), complies as to
form in all material respects with the requirements of the
Securities Act and the rules and regulations of the
Commission promulgated thereunder.
The Underwriter shall have received, at each subsequent time of
closing, if any, an opinion of such counsel dated as of the time of such
closing and addressed to the Underwriter, confirming their opinion delivered
at the time of closing as to the matters set forth in subparagraphs (i), (ii),
(iii), (iv), (v), and (vi) of subsection 8(g).
Such counsel may rely, as to matters of local law, on opinions of
local counsel satisfactory to it, and, as to matters of fact, on affidavits or
certificates of officers of the Company.
(h) All proceedings taken and to be taken in connection with
the sale of the Bonds pursuant to this Agreement shall be
satisfactory as to legal aspects to the Underwriter.
(i) If any of the foregoing conditions set forth in
subsections (a), (b), (c), (d), and (e), of this section 8 shall not
have been fulfilled as above provided at or prior to the time of the
initial public offering as defined below, the condition of the
securities market or any material factor, whether of an economic,
military, or political nature or otherwise, bearing on the
marketability of the Bonds proposed to be sold shall be such as, in
the Underwriter's reasonable judgment, would seriously affect the
offering, sale, or delivery to the public of the Bonds, or would
render such delivery at the initial public offering price
impracticable or inadvisable, the Underwriter shall have the right to
terminate its obligations under this Agreement forthwith, by written
or telegraphic notice to the Company, without any liability on the
part of the Underwriter. The term "initial public offering" means the
first publication authorized by the Underwriter, following
effectiveness of the Filing, of a newspaper advertisement relating to
the Bonds to be offered pursuant to this Agreement, or the first
allotments or confirmations by the Underwriter of any of the Bonds to
customers or dealers or others by letter or telegram, whichever shall
occur first. The Underwriter agrees to notify the Company in writing
immediately after the initial public offering shall have been made.
(j) If at any time prior to the time of closing (i) trading
in securities on the New York Stock Exchange shall be suspended, (ii)
minimum prices shall be established on said exchange by action of
said exchange or the Commission, (iii) a bank moratorium shall be
declared by federal authorities, (iv) a significant decline in the
United States or international economies results in a domestic
securities market or other commercial conditions in the opinion of
the Underwriter that are materially adverse or detrimental to the
offering, or (v) there shall be an outbreak of hostilities between
the United States and any foreign power which has resulted in the
declaration of a national emergency or declaration of war or there
shall be an outbreak of civil disorder within the United States which
has resulted in the declaration of a national emergency, the
Underwriter shall have the right to terminate its obligations under
this Agreement forthwith, by written or telegraphic notice to the
Company, without any liability on the part of the Underwriter.
If the sale of the Bonds as herein contemplated shall not be carried
out because of any of the conditions set forth in sections 7 or 8 hereof shall
not have been fulfilled, then the Company shall not be liable to the
Underwriter for lost profits or expenses incurred by it in connection
herewith.
9. Definitions.
(a) "Effective Date" shall mean the date, following any
required waiting period, when the Commission shall have declared the
Registration Statement effective.
(b) "Termination Date" shall mean the date specified below
which first occurs:
(i) __________________;
(ii) The date on which the escrow period set forth
in subsection 3(b) expires without the minimum number of
Bonds having been subscribed to;
(iii) The date on which all offered Bonds are sold.
10. Miscellaneous Provisions.
(a) This Agreement contains the entire agreement of the
parties hereto and cannot be altered, except in a writing making
specific reference hereto.
(b) The representations and warranties contained herein
shall be effective regardless of any investigations made or
participation in the preparation of the Filing, or any amendment or
supplement thereto and shall survive the Termination Date and the
delivery of and payment for the Bonds contemplated herein for a
period of three years.
(c) This Agreement has been and is made solely for the
benefit of the Underwriter, the Company, and their respective
successors, and, to the extent expressly provided herein, for the
benefit of the directors of the Company, the officers of the Company
who signed the Filing or authorized the same, the persons controlling
the Underwriter or the Company, and their respective successors and
assigns, and no other person or persons shall acquire or have any
right under or by virtue of this Agreement. The term "successor"
shall not include any purchaser, as such, of any Bonds from the
Underwriter.
(d) Each of the parties hereto respectively warrant and
represent that the persons executing this Agreement on its behalf
have full power and authority to execute, acknowledge, and deliver
this Agreement for and on behalf of such corporation.
(e) Except as otherwise provided herein, all communications
hereunder shall be in writing and, if sent to the Underwriter, shall
be mailed, delivered, or telegraphed to it at the following address:
National Securities Corporation
000 X. Xxxxxxxx Xxx., Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx, Chairman
with copies to:
Arthur Don, Esq.
or Xxxxx Xxxxxx, Esq.
X'Xxxxxx & Xxxxxx LLC
000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
or, if sent to the Company, shall be mailed, delivered, or
telegraphed and confirmed to it at the following address:
IBF VI - Secured Lending Corporation
0000 Xxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxx X. Xxxxxxx, President
with copies to:
H. Xxxx Xxxxxx
Xxxxx & Xxxx LLP
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
(f) In the event that any party prevails in any action or
suit brought by them to obtain relief for any default under the terms
hereof, the non-prevailing party shall be liable to the prevailing
party for all costs, including reasonable attorneys' fees, incurred
in connection with such action or suit.
(g) The representations, warranties, and undertakings herein
on the part of the Company and the Underwriter shall not create any
rights in or duties to any person to a party to this Agreement. It is
expressly understood and agreed that such persons as shall purchase
Bonds in the public offering described herein, shall be entitled to
rely solely and only on the statements and representations made in
the Filing.
(h) This Agreement may be executed in one or more
counterparts, which taken together shall constitute one and the same
instrument.
If the foregoing correctly sets forth our understanding, please so
indicate in the space provided below for that purpose, whereupon this document
shall constitute a binding agreement among us.
Very truly yours,
IBF VI - Secured Lending Corporation
By________________________________
Xxxxx X. Xxxxxxx, President
The foregoing Underwriter Agreement is accepted as of the date first
above written.
National Securities Corporation
By__________________________________
Xxxxxx X. Xxxxxxxxx, Chairman
