November 24, 2009
Exhibit 1.1
November
24, 2009
Sandler
X’Xxxxx & Partners, L.P.,
as
Representative of the several Underwriters
000 Xxxxx
Xxxxxx
0xx
Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Citizens
& Northern Corporation, a Pennsylvania corporation (the “Company”),
proposes, subject to the terms and conditions stated herein, to issue and sell
to Sandler X’Xxxxx & Partners, L.P. (“Sandler X’Xxxxx” or an “Underwriter”)
and each of the other underwriters named in Schedule I hereto (collectively, the
“Underwriters,” which term shall also include any underwriter substituted as
hereinafter provided in Section 11 hereof), for whom Sandler X’Xxxxx is acting
as representative (in such capacity, the “Representative”) with respect to (i)
the sale by the Company, and the purchase by the Underwriters, acting severally
and not jointly, of an aggregate of 2,500,000 shares of common stock, $1.00 par
value per share, of the Company (the “Stock”), as set forth
in Schedule I hereto (the “Firm Shares”) and (ii) the
grant by the Company to the Underwriters, acting severally and not jointly, of
the option described in Section 2 hereof to purchase all or any part of 375,000
additional shares of common stock (the “Optional Shares”) to cover
over-allotments, if any (the Firm Shares and the Optional Shares that the
Underwriters elect to purchase pursuant to Section 2 hereof being collectively
called the “Shares”).
The
Company and the Underwriters agree that up to approximately 1.9% of the Firm
Shares to be purchased by the Underwriters (the “Reserved Shares”) shall be
reserved for sale by the Underwriters to certain eligible directors, officers
and employees and persons having business relationships with the Company (the
“Invitees”) as part of the distribution of the Shares by the Underwriters,
subject to the terms of this Agreement, the applicable rules, regulations and
interpretations of the Financial Industry Regulatory Authority (“FINRA”) and all
other applicable laws, rules and regulations. Boenning &
Scattergood, Inc. has been selected to process the sales of the Reserved Shares
to the Invitees. To the extent that Reserved Shares are not orally
confirmed for purchase by the Invitees by the end of business on the first
business day after the date of this Agreement, such Reserved Shares may be
offered to the public as part of the public offering contemplated
hereby. The Company has supplied Boenning & Scattergood, Inc.
with the names, mail and email addresses and telephone numbers of the
individuals or other entities that the Company has designated to be the
Invitees.
The
Company has filed with the Securities and Exchange Commission (the “Commission”)
a registration statement on Form S-3 (No. 333-162279) covering the registration
of the Shares and other securities of the Company under the Securities Act of
1933, as amended (the “Act”), for offer and sale from time to time in accordance
with Rule 415 of the rules and regulations of the Commission promulgated under
the Act (the “Act Regulations”). Such registration statement has been
declared effective by the Commission. The registration statement (including the
exhibits thereto and schedules thereto, if any) as amended at the time it became
effective, or, if a post-effective amendment has been filed with respect
thereto, as amended by such post-effective amendment at the time of its
effectiveness (including in each case the information (if any) deemed to be part
of such registration statement at the time of effectiveness pursuant to Rule
430A under the Act), is hereinafter referred to as the “Registration
Statement.” The term “Effective Date” shall mean each date that the
Registration Statement and any post-effective amendment or amendments thereto
became or become effective. The term “Base Prospectus” shall mean the
prospectus referred to in Section 1(a)(i) hereof contained in the Registration
Statement at the Effective Date. “Preliminary Prospectus” means any
preliminary prospectus supplement to the Base Prospectus used prior to the
filing of the Prospectus, together with the Base Prospectus; the term
“Prospectus” means the final prospectus supplement to the Base Prospectus first
filed with the Commission pursuant to Rule 424(b) under the Act, together with
the Base Prospectus. Any registration statement filed pursuant to
Rule 462(b) under the Act is herein referred to as the “Rule 462(b) Registration
Statement,” and after such filing the term “Registration Statement” shall
include the Rule 462(b) Registration Statement.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 2
Any
reference in this Agreement to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Act, as of the Effective Date or the date of such Preliminary
Prospectus or the Prospectus, as the case may be. For purposes of
this Agreement, all references to the Registration Statement, any Preliminary
Prospectus, or the Prospectus or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system
(“XXXXX”).
All
references in this Agreement to financial statements and schedules and other
information which is “contained,” “included” or “stated” in the Registration
Statement, any Preliminary Prospectus, the Prospectus or the General Disclosure
Package (as defined below) (or other references of like import) shall be deemed
to mean and include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference in the
Registration Statement, any Preliminary Prospectus, the Prospectus or the
General Disclosure Package, as the case may be, and all references to matters
“disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus” shall be deemed to mean and include information disclosed in the
Exchange Act Reports (as defined below).
1. (a)
The Company represents and warrants to, and agrees with, the Underwriters
that:
(i) The
Company satisfies the registrant eligibility requirements for the use of Form
S-3 under the Act set forth in General Instruction I.A to such form and the
transactions contemplated by this Agreement satisfy the transaction eligibility
requirements for the use of such form set forth in General Instruction I.B.1 to
such form; the Company has filed with the Commission the Registration Statement
on such form, including a Base Prospectus, for registration under the Act of the
offering and sale of the Shares and other securities of the Company, and the
Company may have filed with the Commission one or more amendments to such
Registration Statement, each in the form previously delivered to the
Underwriters. Such Registration Statement, as so amended, has been
declared effective by the Commission, and the Shares have been registered under
the Registration Statement in compliance with the requirements for the use of
Form S-3. Although the Base Prospectus may not include all the
information with respect to the Shares and the offering thereof required by the
Act and the rules and regulations of the Commission thereunder to be included in
the Prospectus, the Base Prospectus includes all such information required by
the Act and the rules and regulations of the Commission thereunder to be
included therein as of the Effective Date. The Company has complied,
to the Commission’s satisfaction, with any and all requests of the Commission
for additional or supplemental information; and no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceeding
for that purpose is pending or has been initiated or, to the knowledge of the
Company, threatened by the Commission. After the execution of this
Agreement, the Company will file with the Commission pursuant to Rules 415 and
424(b)(2) or (5), a final supplement to the Base Prospectus included in such
Registration Statement relating to the Shares and the offering thereof, with
such information as is required or permitted by the Act and as has been provided
to and approved by the Underwriters prior to the date hereof or, to the extent
not completed at the date hereof, containing only such specific additional
information and other changes (beyond that contained in the Base Prospectus and
any Preliminary Prospectus) as the Company has advised the Underwriters, prior
to the date hereof, will be included or made therein;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 3
(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; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by any
Underwriter expressly for use therein (provided that the Company and
the Underwriters hereby acknowledge and agree that the only information that the
Underwriters have furnished to the Company specifically for inclusion in any
Preliminary Prospectus (or any amendment or supplement thereto) are the share
allocation, concession and reallowance figures appearing in the Prospectus in
the section entitled “Underwriting”);
As used
in this subsection and elsewhere in this Agreement:
“Applicable
Time” means 4:30 p.m. (Eastern Time) on November 24, 2009 or such other time as
agreed by the Company and the Representative.
“General
Disclosure Package” means (i) the Preliminary Prospectus, if any, used most
recently prior to the Time of Delivery, (ii) the Issuer-Represented Free Writing
Prospectuses, if any, identified in Schedule II hereto, and (iii) any other Free
Writing Prospectus that the parties hereto shall hereafter expressly agree in
writing to treat as part of the General Disclosure Package.
“Issuer-Represented
Free Writing Prospectus” means any “issuer free writing prospectus,” as defined
in Rule 433 of the Act Regulations (“Rule 433”), relating to the Shares that (i)
is required to be filed with the Commission by the Company, or (ii) is exempt
from filing pursuant to Rule 433(d)(5)(i) because it contains a description of
the Shares or of the offering that does not reflect the final terms, in each
case in the form filed or required to be filed with the Commission or, if not
required to be filed, in the form retained in the Company’s records pursuant to
Rule 433(g) and identified on Schedule II hereto.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 4
Each
Issuer-Represented Free Writing Prospectus, when considered together with the
General Disclosure Package as of the Applicable Time, did not contain any untrue
statement of 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, did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information contained in
the Registration Statement or the Prospectus, including any document
incorporated by reference therein and any preliminary or other prospectus deemed
to be a part thereof that, in each case, has not been superseded or
modified;
(iii) The
Preliminary Prospectus, the Prospectus and each Issuer-Represented Free Writing
Prospectus when filed, if filed by electronic transmission, pursuant to XXXXX
(except as may be permitted by Regulation S-T under the Act), was identical to
the copy thereof delivered to the Underwriters for use in connection with the
offer and sale of the Shares; 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 Effective Date, 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; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by any
Underwriter expressly for use therein;
(iv) The
documents that are incorporated or deemed to be incorporated by reference in the
Registration Statement or any Preliminary Prospectus or the Prospectus or from
which information is so incorporated by reference (the “Exchange Act Reports”),
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 Securities Exchange Act of 1934, as
amended (the “Exchange Act”), and the rules and regulations of the Commission
thereunder and did not require disclosure of any related party transaction as
required under Item 404(a) of Regulation S-K and, when read together with the
other information in the Registration Statement, the General Disclosure Package
or the Prospectus, as the case may be, (a) at the time the Registration
Statement became effective, (b) at the time the Prospectus is first used, (c) at
the Applicable Time and (d) at any Time of Delivery (as defined below), did not
and will 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 light of the circumstances under which they were made, not
misleading;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 5
(v) The
financial statements, including the related schedules and notes, filed with the
Commission as a part of the Registration Statement and included or incorporated
by reference in the Preliminary Prospectus and the Prospectus (the “Financial
Statements”) present fairly the consolidated financial position of the Company
and its subsidiaries as of and at the dates indicated and the results of their
operations, shareholder’s equity and cash flows for the periods specified; such
Financial Statements have been prepared in conformity with generally accepted
accounting principles as applied in the United States (“GAAP”) applied on a
consistent basis throughout the periods involved; no other financial statements
or supporting schedules are required to be included in the Registration
Statement, the Preliminary Prospectus and the Prospectus; the financial data set
forth in the Prospectus under the caption “Summary Selected Consolidated
Financial Data” fairly presents the information therein on a basis consistent
with that of the audited or unaudited financial statements, as the case may be,
incorporated by reference in the Registration Statement, the Preliminary
Prospectus and the Prospectus; no other financial statements or schedules are
required under the Act, the Act Regulations, the Exchange Act or the rules and
regulations of the Commission promulgated under the Exchange Act (the “Exchange
Act Regulations”) to be included, incorporated or deemed incorporated by
reference in the Registration Statement, the General Disclosure Package or the
Prospectus; to the extent applicable, all disclosures contained or incorporated
by reference in the Registration Statement, the Preliminary Prospectus and the
Prospectus or contained in any Issuer-Represented Free Writing Prospectus
regarding “non-GAAP financial measures” (as such term is defined by the rules
and regulations of the Commission) comply in all material respects with
Regulation G of the Exchange Act, the rules and regulations promulgated by the
Commission thereunder and Item 10 of Regulation S-K under the Act;
(vi)
ParenteBeard LLC, the independent registered public accounting firm that
certified the financial statements of the Company and its subsidiaries, that are
included or incorporated by reference in the Registration Statement, the General
Disclosure Package and the Prospectus, is an independent registered public
accounting firm 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 (the “Xxxxxxxx-Xxxxx
Act”) and the related rules and regulations of the Commission;
(vii) The
Company is in compliance, in all material respects, with all applicable rules
and regulations of the Nasdaq Capital Market and is in compliance with Rule 5605
of the Nasdaq Marketplace Rules;
(viii)
The statistical and market related data contained or incorporated by reference
in the Prospectus and Registration Statement or contained in any
Issuer-Represented Free-Writing Prospectus are based on or derived from sources
which the Company believes are reliable and accurate;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 6
(ix) This
Agreement has been duly authorized, executed and delivered by the Company and,
when duly executed by the Representative, will constitute the valid and binding
agreement of the Company enforceable against the Company in accordance with its
terms, except as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditors’ rights generally or by general equitable principles and except as any
indemnification or contribution provisions hereof may be limited under
applicable securities laws or regulations or public policy;
(x)
Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, since the date of the latest audited financial
statements included or incorporated by reference in the Registration Statement
and the Prospectus, (A) neither the Company nor any of its subsidiaries has
sustained 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 court or governmental action, order or decree; and 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 known to the Company that would reasonably be expected to cause a
material adverse change, in or affecting the general affairs, management,
earnings, business, properties, assets, consolidated financial position,
business prospects, shareholders’ equity or results of operations of the Company
and its subsidiaries (considered as one enterprise), whether or not arising in
the ordinary course of business, or that would prevent, or be reasonably likely
to prevent, the Company from consummating the transaction contemplated by this
Agreement (a “Material Adverse Effect”), (B) there have been no transactions
entered into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the Company and
its subsidiaries considered as one enterprise, and (C) except for quarterly
dividends on the Stock, in amounts per share that are consistent with past
practice, and the Series A preferred stock issued to the U. S. Department of the
Treasury, as required by the terms of the Series A preferred stock, there has
been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock;
(xi) 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 that are material to the respective businesses of the Company and its
subsidiaries, in each case free and clear of all mortgages, pledges, security
interests, claims, restrictions, liens, encumbrances and defects, other than
such as do not materially affect the value of such property and do not
materially 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 materially interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries, and neither the
Company nor any subsidiary has any written, or to the Company’s knowledge, oral
notice of any material claim of any sort that has been asserted by anyone
adverse to the rights of the Company or any of its subsidiaries under any of the
leases or subleases mentioned above, or adversely affecting or questioning the
rights of the Company or any such subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 7
(xii) The
Company and Canisteo Valley Corporation (“CVC”) are each a registered bank
holding company under the Bank Holding Company Act of 1956, as amended (“BHCA”),
with respect to Citizens & Northern Bank (“C&N Bank”) and First State
Bank (“FS Bank” and, collectively with C&N Bank, the “Banks”), respectively,
and each of the Company and CVC has been duly incorporated and validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, with the corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
Statement, the General Disclosure Package and the Prospectus and to enter into
and perform its obligations under this Agreement; the Company is duly qualified
as a foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except where
the failure to so qualify or to be in good standing would not reasonably be
expected to result in a Material Adverse Effect;
(xiii)
Each subsidiary of the Company has been duly incorporated or formed, as the case
may be, and is validly existing as a corporation, limited liability company,
trust company, statutory business trust or bank in good standing under the laws
of the jurisdiction of its incorporation or formation and has the requisite
power and authority to own, lease and operate its properties and to conduct its
business as disclosed in the Registration Statement and the Prospectus; each
subsidiary of the Company is duly qualified as a foreign entity to transact
business and is in good standing in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions where the
failure to so qualify, or be in good standing, would not, individually or in the
aggregate, result in a Material Adverse Effect; all of the issued and
outstanding capital stock of each subsidiary that is a corporation or a bank has
been duly authorized and validly issued, is fully paid and nonassessable, and
all of the issued and outstanding capital stock or other equity interests of
each subsidiary is owned by the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance or
claim; the Company does not own or control, directly or indirectly, any
corporation, association or other entity, other than the subsidiaries disclosed
in the Registration Statement, the General Disclosure Package and the
Prospectus; none of the outstanding shares of capital stock or other equity
interests of any subsidiary was issued in violation of the preemptive or similar
rights of any security holder or equity holder of such subsidiary; the
activities of the subsidiaries of C&N Bank are permitted to subsidiaries of
a Pennsylvania chartered bank; and the deposit accounts of the Banks are insured
up to the applicable limits by the Federal Deposit Insurance Corporation (the
“FDIC”) to the fullest extent permitted by law and the rules and regulations of
the FDIC, and no proceeding for the revocation or termination of such insurance
has been instituted or is pending or, to the knowledge of the Company, is
threatened or contemplated;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 8
(xiv) The
Company has an authorized capitalization as set forth in the Prospectus under
the heading “Capitalization”, and all of the issued and outstanding shares of
capital stock of the Company have been duly authorized and validly issued, are
fully paid and non-assessable and have been issued in compliance with federal
and state securities laws; none of the issued and outstanding shares of Stock
were issued in violation of any preemptive rights, rights of first refusal or
other similar rights to subscribe for or purchase securities of the Company; the
description of the Company’s stock option, stock bonus and other stock plans or
arrangements and the options or other rights granted thereunder, set forth or
incorporated by reference in the Prospectus, accurately and fairly presents, in
all material respects, the information required to be shown with respect to such
plans, arrangements, options and rights;
(xv) The
unissued Shares to be issued and sold by the Company to the Underwriters
hereunder have been duly authorized and, when issued and delivered against
payment therefor as provided herein, will be validly issued and fully paid and
non-assessable shares and will conform to the description of the Stock contained
in the Registration Statement and the Prospectus and such description conforms
in all material respects to the rights set forth in the instruments defining the
same; the issuance of the Shares is not subject to the preemptive or other
similar rights of any securityholder of the Company or any other
person;
(xvi)
Except as disclosed in the Registration Statement, the General Disclosure
Package and 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 of the Company owned or to be owned by such person except related to
the Series A preferred stock and the warrant issued to the U.S.
Treasury;
(xvii)
The execution, delivery and performance of this Agreement, the issue and sale of
the Shares by the Company and the performance by the Company of all of its
obligations under this Agreement and the consummation of the transactions
contemplated herein and in the Registration Statement, the General Disclosure
Package and the Prospectus (including the use of the proceeds from the sale of
the Shares as described therein) and compliance by the Company with its
obligations hereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of
its subsidiaries pursuant to, (i) any indenture, mortgage, deed of trust, loan
agreement, note, lease or other agreement, contract 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, (ii) the provisions of the
charter, bylaws or other organizational documents of the Company or any of its
subsidiaries or (iii) any statute or any order, rule or regulation of any U.S.
federal, state or local or international court, government or governmental or
regulatory body or agency (each, a “Governmental Entity”) having jurisdiction
over the Company or any of its subsidiaries or any of their property, assets or
operations except, with respect to clauses (i) and (iii), for those conflicts,
breaches, defaults, Repayment Events, liens, charges or encumbrances that would
not, individually or in the aggregate, result in a Material Adverse
Effect. As used herein, a “Repayment Event” means any event or
condition that gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder’s behalf) the right to require
the repurchase, redemption or repayment of all or a portion of such indebtedness
by the Company or any subsidiary;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 9
(xviii)
No filing with, or consent, approval, authorization, order, license,
registration, qualification or decree of or with any Governmental Entity is
necessary or required in connection with the due authorization, execution and
delivery of this Agreement or for the offering, issuance, sale or delivery of
the Shares, the performance by the Company of its obligations hereunder or the
consummation by the Company of the transactions contemplated by this Agreement,
except as may be required (i) under the rules and regulations of the NASDAQ
Capital Market (the “Nasdaq Capital Market”) and FINRA or (ii) under the
securities or Blue Sky laws of the various states and other jurisdictions in
connection with the purchase and distribution of the Shares by the
Underwriters;
(xix)
Neither the Company nor any of its subsidiaries is in violation of its articles
of incorporation, certificate of incorporation, articles of association,
articles of organization, or charter (as applicable) or bylaws or other
organizational documents or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan or credit 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 or to which any of the property or assets of the Company
or any subsidiary is subject except for such defaults that would not result in a
Material Adverse Effect;
(xx) The
statements set forth in the Prospectus under the captions “Description of Common
Stock,” “Description of Debt Securities,” “Description of Warrants,” and
“Description of our Preferred Stock and Outstanding TARP Securities,” insofar as
they purport to constitute a summary of the terms of the capital stock or other
securities 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;
(xxi)
Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, the Company and its subsidiaries are conducting
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 Federal Reserve Board, the
FDIC, the Pennsylvania Department of Banking, the New York State Banking
Department and the Arizona Department of Insurance and any other government
regulatory entities that have supervisory authority over the Company or its
subsidiaries as well as 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 written, or to the Company’s
knowledge, oral 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 or 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 undertaking which would, individually or in the
aggregate, result in a Material Adverse Effect;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 10
(xxii)
Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, there are no legal or governmental actions or suits,
investigations, inquiries or proceedings before or by any court or other
Governmental Entity, now pending or, to the knowledge of the Company, threatened
or contemplated, 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;
(xxiii)
Each of the Company and its subsidiaries possess all permits, licenses,
approvals, consents and other authorizations of (collectively, “Governmental
Licenses”), issued by the appropriate Governmental Entities and has made all
filings, applications and registrations with, all Governmental Entities
necessary to permit the Company or such subsidiary to conduct the business now
operated by the Company or its subsidiaries except where the failure would not,
individually or in the aggregate, have a Material Adverse Effect; the Company
and its subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
individually or in the aggregate, have a Material Adverse Effect; 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; 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; and neither the Company nor any of its
subsidiaries has failed to file with applicable Governmental Entities any
statement, report, information or form required by any applicable law,
regulation or order, except where the failure to be in such compliance would
not, singly or in the aggregate, result in a Material Adverse Effect, all such
filings were in material compliance with applicable laws when filed and no
material deficiencies have been asserted by any Governmental Entity with respect
to any such filings or submissions;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 11
(xxiv)
Except as would not, individually or in the aggregate, result in a Material
Adverse Effect, (A) neither the Company nor any of its subsidiaries is in
violation of any U.S. federal, state or local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products, asbestos-containing
materials or mold (collectively, “Hazardous Materials”) or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials (collectively, “Environmental Laws”), (B) the
Company and its subsidiaries have all permits, authorizations and approvals
required under any applicable Environmental Laws and are each in compliance with
their requirements, (C) there are no pending or, to the Company’s knowledge,
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or any of its subsidiaries, and (D) to the knowledge of the Company,
there are no events or circumstances that might reasonably be expected to form
the basis of an order for clean up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against or
affecting the Company or any of its subsidiaries relating to Hazardous Materials
or any Environmental Laws;
(xxv) The
Company and each of its subsidiaries own or possess adequate rights to use or
can acquire on reasonable terms ownership or rights to use all material patents,
patent applications, patent rights, licenses, trademarks, service marks, trade
names, trademark registrations, service xxxx registrations, copyrights,
inventions, know-how (including trade secrets and other unpatented and/or
unpatentable property or confidential information, systems or procedures and
excluding generally commercially available “off the shelf” software programs
licensed pursuant to shrink wrap or “click and accept” licenses), licenses or
other intellectual property (collectively, “Intellectual Property”) necessary
for the conduct of their business as currently conducted, 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 infringement or conflict with, any
such rights of others or any facts or circumstances that would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company and its subsidiaries therein, except where such infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or invalidity or
inadequacy, individually or in the aggregate, would result in a Material Adverse
Effect;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 12
(xxvi) 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,
customers or suppliers of the Company or any of its subsidiaries, on the other
hand, that is required to be described in the Registration Statement and the
Prospectus by the Act or by the rules and regulations of the Commission
thereunder which has not been so described;
(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)
There is and has been no failure on the part of the Company or any of the
Company’s directors or officers, in their capacities as such, to comply in all
material respects with any provision of the Xxxxxxxx-Xxxxx Act and the rules and
regulations promulgated in connection therewith, including Section 402 related
to loans and Sections 302 and 906 related to certifications;
(xxix)
Neither the Company nor any of its subsidiaries, nor, any affiliates of the
Company or its subsidiaries, has taken or will take, directly or indirectly, any
action that has constituted or is designed to or that would reasonably be
expected to cause or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares;
(xxx)
Neither the Company nor any of its subsidiaries nor, to the Company’s knowledge,
any director, officer, employee or agent or other person associated with or
acting on behalf of the Company or any of its subsidiaries has (A) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity; (B) made any direct or indirect
unlawful payment to any foreign or domestic government official or employee from
corporate funds; (C) violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977; or (D) made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment;
(xxxi)
Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, the Company and its subsidiaries (considered as one
enterprise) maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (A) transactions are executed in accordance
with management’s general or specific authorization; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management’s general or specific
authorization; and (D) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. Since the end of the Company’s most
recent audited fiscal year, there has been (x) no material weakness in the
Company’s internal control over financial reporting (whether or not remediated)
and (y) no change in the Company’s internal control over financial reporting
that has materially affected, or is reasonably likely to materially affect, the
Company’s internal control over financial reporting;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 13
(xxxii)
The Company and its subsidiaries have established and maintain disclosure
controls and procedures (as such term is defined in Rule 13a-15 and 15d-15 under
the Exchange Act), which (A) are designed to ensure that information required to
be disclosed by the Company in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the Commission’s rules and forms and that material
information relating to the Company and its subsidiaries is made known to the
Company’s principal executive officer and principal financial officer by others
within the Company and its subsidiaries to allow timely decisions regarding
disclosure, and (B) are effective to perform the functions for which they were
established. Based on the evaluation of the disclosure controls and
procedures of the Company and its subsidiaries, the Company is not aware of (1)
any significant deficiency in the design or operation of internal controls which
could adversely affect the Company’s ability to record, process, summarize and
report financial data or any material weaknesses in internal controls or (2) any
fraud, whether or not material, that involves management or other employees who
have a significant role in the Company’s internal controls. Except as
disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, since the most recent evaluation of the disclosure controls and
procedures of the Company and its subsidiaries, there have been no significant
changes in internal controls or in other factors that could significantly affect
internal controls;
(xxxiii)
Neither the Company nor any of its subsidiaries is subject or is party to, or
has received any written or, the Company’s knowledge, oral notice or advice that
any of them may become subject or party to any investigation with respect to,
any corrective, suspension or cease-and-desist order, agreement, memorandum of
understanding, consent agreement or other regulatory enforcement action,
proceeding or order with or by, or is a party to any commitment letter or
similar undertaking to, or is subject to any directive by, or has been a
recipient of any supervisory letter from, or has adopted any board resolutions
at the request of, 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 the Company or any of
its subsidiaries that currently relates to or restricts in any material respect
their business or their management; there is no unresolved violation or
exception by any such Governmental Entity with respect to any report or
statement relating to any examinations of the Company or any of its subsidiaries
which, in the reasonable judgment of the Company, currently results in or is
expected to result in a Material Adverse Effect;
(xxxiv)
Each of the Company, the Company’s subsidiaries and their respective “ERISA
Affiliates” (as defined below) are in compliance in all material respects with
all applicable provisions of the Employee Retirement Income Security Act of
1974, as amended, including the regulations and published interpretations
thereunder (collectively, “ERISA”). No “reportable event” (as defined
in ERISA) has occurred with respect to any “employee benefit plan” (as defined
in ERISA) for which the Company, any of the Company’s subsidiaries or their
respective ERISA Affiliates would have any liability. None of the
Company, the Company’s subsidiaries or their respective ERISA Affiliates have
incurred, or expect to incur, liability under (i) Title IV of ERISA with respect
to termination of, or withdrawal from, any “employee benefit plan” or (ii)
Sections 412, 4971, 4975 or 4980B of the United States Internal Revenue Code of
1986, as amended, and the regulations and published interpretations thereunder
(collectively, the “Code”). Each “employee benefit plan” for which
the Company, any of the Company’s subsidiaries or any of their respective ERISA
Affiliates would have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and nothing
has occurred, whether by action or by failure to act, which would cause the loss
of such qualification. “ERISA Affiliate” means, with respect to the
Company or any of its subsidiaries, any member of any group of organizations
described in Sections 414(b), (c), (m) or (o) of the Code or Section 400(b) of
ERISA of which the Company or such subsidiary is a member;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 14
(xxxv)
The Company and its subsidiaries carry, or are covered by, insurance in such
amounts and covering such risks as the Company reasonably believes are adequate
for the conduct of the business of the Company and its subsidiaries and the
value of their properties and as are customary in the business in which the
Company and its subsidiaries are engaged; and neither the Company nor any of its
subsidiaries has 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 at a cost that would not have a Material Adverse Effect;
neither the Company nor any subsidiary has been denied any insurance coverage
which it has sought or for which it has applied;
(xxxvi)
Except as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, there are no contracts, agreements or understandings
between the Company and any person that would give rise to a valid claim against
the Company, or the Underwriter, for a brokerage commission, finder’s fee or
other like payment as a result of the transaction contemplated by this
Agreement;
(xxxvii)
The Company and each of its subsidiaries have timely filed all necessary
federal, state and foreign income and franchise tax returns or have properly
requested extensions thereof, all such tax returns are true, complete and
correct and have paid all taxes required to be paid by any of them (other than
those which are being contested in good faith, for which appropriate reserves
have been established or which if not paid, would not, individually or in the
aggregate, have a Material Adverse Effect); the Company has made adequate
charges, accruals and reserves in the applicable financial statements referred
to in Section 1(a)(v) above in respect of all federal, state and foreign income
and franchise taxes for all periods as to which the tax liability of the Company
or any of its subsidiaries has not been finally determined;
(xxxviii)
No labor dispute with the employees of the Company or any subsidiary exists or,
to the knowledge of the Company, is imminent, which, in any case, may reasonably
be expected to result in a Material Adverse Effect; and the Company is not aware
of any existing or imminent labor disturbance by the employees of any of its or
any of its subsidiary’s principal suppliers, manufacturers, customers or
contractors, which, in either case, would, singly or in the aggregate, result in
a Material Adverse Effect;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 15
(xxxix)
The operations of the Company and its subsidiaries are and have been conducted
at all times in compliance in all material respects with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, money laundering statutes
applicable to the Company and its subsidiaries, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency;
(xl) Each
subsidiary of the Company which is engaged in the business of acting as an
insurance agency (an “Insurance Subsidiary” ) is duly licensed or registered
with any applicable regulatory authorities in each jurisdiction where it is
required to be so licensed or registered to conduct its business, except where
the failure to be so licensed or registered would not have a Material Adverse
Effect; each Insurance Subsidiary has all other necessary approvals of and from
all applicable regulatory authorities, to conduct its businesses, except where
the failure to have such approvals would not have a Material Adverse Effect; no
Insurance Subsidiary has received any notification from any applicable
regulatory authority to the effect that any additional approvals from such
regulatory authority are needed to be obtained by such subsidiary and have not
been obtained, in any case where it would be reasonably expected that the
Insurance Subsidiary will be unable to obtain such additional approvals and the
failure to obtain any such additional approvals would require such subsidiary to
cease or otherwise materially limit the conduct of its business; and each
Insurance Subsidiary is in compliance with the requirements of insurance laws
and regulations of each jurisdiction that are applicable to such subsidiary,
except where the failure to be in compliance with such requirements would not,
individually or in the aggregate, have a Material Adverse Effect, and has filed
all notices, reports, documents or other information required to be filed
thereunder, except where such failure to file would not have, individually or in
the aggregate, a Material Adverse Effect;
(xli)
None of the Company, any of the Company’s subsidiaries or, to the knowledge of
the Company, any director, officer, agent, employee or affiliate (as such term
is defined in rule 501(b) under the Act, “Affiliates”) of the Company or any of
its subsidiaries is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”). The Company will not directly or indirectly use the
proceeds of any sale of Shares, or lend, contribute or otherwise make available
such proceeds to any subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC;
(xlii)
The Registration Statement is not the subject of a pending proceeding or
examination under Section 8(d) or 8(e) of the Act, and the Company is not the
subject of a pending proceeding under Section 8A of the Act in connection with
the offering of the Shares;
(xliii)
The Company, its subsidiaries and is other Affiliates have not distributed and,
prior to the later to occur of (a) the Time of Delivery, or hereinafter defined,
and (b) completion of the distribution of the Shares, will not distribute any
prospectus (as such term is defined in the Act and the rules and regulations
promulgated by the Commission thereunder) in connection with the offering and
sale of the Shares other than the Registration Statement, any Preliminary
Prospectus, the Prospectus or other materials, if any, permitted by the Act or
by the rules and regulations promulgated by the Commission thereunder
and approved by the Underwriters;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 16
(xliv) 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, the
Prospectus and any Issuer-Represented Free Writing Prospectus has been made or
reaffirmed without a reasonable basis or has been disclosed other than in good
faith;
(xlv)
Each of the Company’s executive officers and directors, in each case as listed
on Schedule III hereto, has executed and delivered a lock-up agreement
substantially in the form of Exhibit A;
(xlvi)
Neither the Company nor any of its subsidiaries has participated in any
reportable transaction, as defined in Treasury Regulation Section
1.6011-(4)(b)(1);
(xlvii)
Each of the Company and its subsidiaries has good and marketable title to all
securities held by it (except securities sold under repurchase agreements or
held in any fiduciary or agency capacity) free and clear of any lien, claim,
charge, option, encumbrance, mortgage, pledge or security interest or other
restriction of any kind, except to the extent such securities are pledged in the
ordinary course of business consistent with prudent business practices to secure
obligations of the Company or any of its subsidiaries and except for such
defects in title or liens, claims, charges, options, encumbrances, mortgages,
pledges or security interests or other restrictions of any kind that would not
have a Material Adverse Effect. Such securities are valued on the
books of the Company and its subsidiaries in accordance with GAAP;
(xlviii)
Any and all material swaps, caps, floors, futures, forward contracts, option
agreements (other than employee stock options) and other derivative financial
instruments, contracts or arrangements, whether entered into for the account of
the Company or one of its subsidiaries or for the account of a customer of the
Company or one of its subsidiaries, were entered into in the ordinary course of
business and in accordance with prudent business practice and applicable laws,
rules, regulations and policies of all applicable regulatory agencies and with
counterparties believed to be financially responsible at the time. The Company
and each of its subsidiaries have duly performed in all material respects all of
their obligations thereunder to the extent that such obligations to perform have
accrued, and there are no breaches, violations or defaults or allegations or
assertions of such by any party thereunder;
(xlix)
The Company solely determined, without any direct or indirect participation by
the Underwriters, the Invitees who may purchase the Reserved Shares (including
the amounts to be purchased by such persons);
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 17
(l) The
Company has not offered, or caused the Underwriters to offer, any Reserved
Shares to any person with the intent to unlawfully influence a customer or
supplier to alter the customer’s or supplier’s level or type of business with
the Company and its subsidiaries or a trade journalist or publication to write
or publish favorable information about the Company and its subsidiaries or their
products; and
(li) The
Company acknowledges that each Underwriter is not acting as a financial advisor
or fiduciary of the Company (or in any similar capacity) with respect to this
Agreement and the transactions contemplated hereby and any advice given by such
Underwriter or any of its respective representatives or agents in connection
with this Agreement and the transactions contemplated hereby is merely
incidental to such Underwriter’s purchase of the Shares. The Company further
represents to each Underwriter that the Company’s decision to enter into this
Agreement has been based solely on the independent evaluation of the Company and
its representatives.
(b) Any
certificate signed by an officer of the Company and delivered to the
Underwriters or to counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to the Underwriters as to the matters
set forth therein.
2. On the
basis of the representations and warranties herein contained and subject to the
terms and conditions herein set forth, (a) the Company agrees to issue and sell
to the Underwriters, and the Underwriters agree, to purchase from the Company,
at a purchase price per share of $7.56, the Firm Shares as set forth in Schedule
I hereto and (b) in the event and to the extent that any of the Underwriters
shall exercise its election to purchase Optional Shares as provided below, the
Company agrees to issue and sell to such Underwriter, and such Underwriter
agrees to purchase from such Company, at the purchase price per share set forth
in clause (a) of this Section 2, the Optional Shares.
Subject
to the terms and conditions set forth herein, the Company hereby grants to the
Underwriters the right to purchase at their election up to 375,000 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 Representative 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, the number of
Optional Shares to be purchased by each Underwriter and the date on which such
Optional Shares are to be delivered, as determined by the Underwriters but in no
event earlier than the First Time of Delivery (as defined in Section 4 hereof)
or, unless the Underwriters 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
Underwriters propose to offer the Firm Shares for sale upon the terms and
conditions set forth in the Prospectus.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 18
4. (a)
The Shares to be purchased by the Underwriters hereunder, in definitive form,
and in such authorized denominations and registered in such names as the
Underwriters may request upon at least 48 hours’ prior notice to the Company,
shall be delivered by or on behalf of the Company to the Underwriters through
the facilities of the Depository Trust Company (“DTC”), for the account of the
Underwriters, against payment by or on behalf of the Underwriters of the
purchase price therefor by wire transfer of Federal (same day) funds to the
account specified by the Company to the Underwriters at least 48 hours in
advance. The time and date of such delivery and payment shall be,
with respect to the Firm Shares, 10:00 a.m., Eastern time, on December 1, 2009
or such other time and date as the Underwriters and the Company may agree upon
in writing, and, with respect to the Optional Shares, 10:00 a.m., New York time,
on the date specified by the Underwriters in the written notice given by the
Representative of the election to purchase such Optional Shares, or such other
time and date as the Underwriters 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 Underwriters pursuant to
Section 7(l) hereof, will be delivered at the offices of Blank Rome LLP, One
Xxxxx Square, 00xx &
Xxxxxx Xxxxxxx, Xxxxxxxxxxxx, XX 00000 (the “Closing Location”), at such Time of
Delivery. A meeting will be held at the Closing Location at 10:00
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 Underwriters:
(a) The
Company, subject to Section 3(b) hereof, will comply with the requirements of
Rule 430B and will notify the Representative immediately, and confirm the notice
in writing, (i) when any post-effective amendment to the Registration Statement
or any new registration statement relating to the Shares shall de declared or
otherwise become effective, or any amendment or supplement to the Prospectus
shall have been transmitted to the Commission for filing, (ii) of the
transmittal to the Commission for filing of any document to be filed or
furnished pursuant to the Exchange Act, (iii) of the receipt of any comments
from the Commission with respect to the Registration Statement, any Preliminary
Prospectus, or the Prospectus or the documents incorporated or deemed to be
incorporated by reference therein, (iv) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
General Disclosure Package or the Prospectus or for additional information
relating thereto, (v) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement, or of any order by
any Governmental Entity preventing or suspending the use of any Preliminary
Prospectus or the Prospectus, or of the initiation or threatening of any
proceeding for any of such purpose, (vi) of any examination pursuant to Section
8(d) or Section 8(e) of the Act concerning the Registration Statement, (vii) if
the Company becomes the subject of a proceeding under Section 8A of the Act in
connection with the offering of the Shares, and (viii) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Shares for sale in any jurisdiction or the institution or threatening of
any proceedings for such purpose. The Company will use
its best efforts to prevent the issuance of any stop, prevention or suspension
order or notification and, if issued, to obtain the lifting thereof at the
earliest possible moment;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 19
(b) The
Company will promptly effect the filings necessary pursuant to Rule 424(b) in
the manner and within the time period required by Rule 424(b) (without reliance
on Rule 424(b)(8)) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus;
(c) The
Company will give the Representative notice of its intention to file or prepare
any amendment to the Registration Statement (including any filing under Rule
462(b)) or any amendment or supplement to the General Disclosure Package or the
Prospectus or any new registration statement relating to the Shares, whether
pursuant to the Act, the Exchange Act or otherwise, will furnish the
Representative with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the Representative or counsel for the
Underwriters shall object;
(d)
Promptly from time to time to take such action as the Underwriters may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as the Underwriters 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 as a dealer in
securities in any such jurisdiction, to file a general consent to service of
process in any jurisdiction, or to subject itself to taxation in any such
jurisdiction if it is not otherwise so subject;
(e) The
Company has furnished or will deliver to the Representative and counsel for the
Underwriters, without charge, signed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to the
Representative, without charge, a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 20
(f) 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 Underwriters with
copies of the Prospectus in New York City in such quantities as the Underwriters
may from time to time reasonably request;
(g) The
Company will comply with the Act, the Act Regulations, the Exchange Act and the
Exchange Act Regulations so as to permit the completion of the distribution of
the Shares as contemplated in this Agreement. If, at any time when a
prospectus relating to the Shares is required to be delivered (or but for the
exception afforded by Rule 172 of the Act Regulations (“Rule 172”) would be
required to be delivered) under the Act, any event or development occurs as a
result of which the Registration Statement, the General Disclosure Package or
the Prospectus would include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein (in the case of
the General Disclosure Package and the Prospectus, in the light of the
circumstances under which they were made) not misleading, or if it shall be
necessary to amend the Registration Statement or amend or supplement the
Preliminary Prospectus or the Prospectus to comply with the Act or the Act
Regulations or to file a new registration statement relating to the Shares, the
Company promptly will (1) notify the Representative of any such event or
development, (2) prepare and file with the Commission, subject to Section 5(c)
hereof, such amendment, supplement or new registration statement which will
correct such untrue statement or omission, effect such compliance or satisfy
such filing requirement, (3) use its best efforts to have any such amendment to
the Registration Statement or new registration statement declared effective as
soon as possible (if not an automatic shelf registration statement) and (4)
supply any amended or supplemented General Disclosure Package or Prospectus to
the Underwriters in such quantities as they may reasonably
request. If at any time following the issuance of an
Issuer-Represented Free Writing Prospectus there occurred or occurs an event or
development as a result of which such Issuer-Represented Free Writing Prospectus
conflicted or would conflict with the information contained in the Registration
Statement (or any other registration statement relating to the Shares), any
Preliminary Prospectus or the Prospectus or included, includes or would include
an untrue statement of a material fact or omitted, omits or would omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances prevailing at that subsequent time, not misleading, the
Company will promptly notify the Underwriters and will promptly amend or
supplement, at its own expense, such Issuer-Represented Free Writing Prospectus
to eliminate or correct such conflict, untrue statement or
omission. The Underwriters’ delivery of any such amendment or
supplement shall not constitute a waiver of any of the conditions in Section 7
hereof;
(h) To
make generally available to its securityholders as soon as practicable, 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);
(i)
During the period beginning from the date hereof and continuing to and including
the date 90 days after the date of the Prospectus, not to directly or
indirectly, offer, sell, contract or grant any option to sell, pledge, transfer
or establish an open “put equivalent position” within the meaning of Rule
16a-l(h) under the Exchange Act, or otherwise dispose of or transfer, or
announce the offering of, or file a registration statement under the Act in
respect of, except as provided hereunder, any 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, Stock or any such substantially similar securities, without your prior
written consent; provided, however, that if: (1) during the last 17 days of such
90-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 90-day period, the Company announces that it will release earnings results
during the 16-day-period beginning on the last day of such 90-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. The
foregoing sentence shall not apply to (A) the Shares to be sold hereunder, (B)
any shares of Stock issued by the Company upon the exercise of an option or
warrant or the conversion of a security outstanding on the date hereof and
referred to in the Prospectus, (C) any shares of Stock issued or options to
purchase Stock granted pursuant to existing director and employee benefit plans
of the Company, including the filing of a registration statement on Form S-8 for
the purpose of registering such shares of Stock or options, (D) any
shares of Stock issued by the Company in connection with an acquisition by or
merger of the Company, and (E) any shares of Stock issued by the Company under
the Company’s Employee Stock Ownership Plan or its Dividend Reinvestment and
Stock Purchase Plan;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 21
(j) The
Company agrees to restrict the transfer of Shares by persons listed on Schedule
III hereto within the 90-day restricted period following the date of this
Agreement;
(k) To
furnish to its shareholders as soon as practicable after the end of each fiscal
year an annual report (including balance sheets 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 date of this
Agreement), to make available to its shareholders consolidated summary financial
information of the Company and its subsidiaries for such quarter in reasonable
detail;
(l)
During a period of five years from the effective date of the Registration
Statement, to furnish to the Underwriters copies of all reports or other
communications (financial or other) furnished to shareholders, and to deliver to
the Underwriters (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 Underwriters 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);
(m) 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”;
(n) To
use its best efforts to list for quotation the Shares on the NASDAQ Capital
Market;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 22
(o)
During the period beginning on the date hereof and ending on the fifth
anniversary of the First Time of Delivery or the date on which the Underwriters
receive full payment in satisfaction of any claim for indemnification or
contribution to which they may be entitled pursuant to Section 8 of this
Agreement that is made prior to the fifth anniversary of the First Time of
Delivery, the Company shall not, without the prior written consent of the
Underwriters, take or permit to be taken any action that could result in the
Company’s common stock becoming subject to any security interest, mortgage,
pledge, lien or encumbrance, except any and all restrictions under applicable
federal and state securities laws or under any statute, order, rule or
regulation of any Governmental Entity having jurisdiction over the Company or
any of its subsidiaries;
(p) Until
completion of the distribution of the Shares, the Company will file all
documents required to be filed with the Commission pursuant to the Exchange Act
within the time periods required by the Exchange Act and the rules and
regulations of the Commission thereunder;
(q) That
unless it obtains the prior consent of the Underwriters, and the Underwriters
represent and agree that, unless it obtains the prior consent of the Company,
they have not made and will not make any offer relating to the Shares that would
constitute an Issuer-Represented Free Writing Prospectus and have complied and
will comply with the requirements of Rule 433 applicable to any
Issuer-Represented Free Writing Prospectus, including where and when required
timely filing with the Commission, legending and record keeping. The
Company represents that it has satisfied and agrees that it will satisfy the
conditions in Rule 433 to avoid a requirement to file with the Commission any
electronic road show or, alternatively that it will file such as is required;
and
(r) The
Company hereby agrees that it will ensure that the Reserved Shares will be
restricted as required by FINRA or the FINRA rules from sale, transfer,
assignment, pledge or hypothecation for a period of three months following the
date of this Agreement. The Underwriters will notify the Company as
to which persons will need to be so restricted. At the request of the
Underwriters, the Company will direct the transfer agent to place a stop
transfer restriction upon such Reserved Shares for such period of
time. If the Company releases, or seeks to release, any of the
Reserved Shares from such restrictions, the Company agrees to reimburse the
Underwriters for any reasonable expenses (including, without limitation, legal
expenses) they incur in connection with the release.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 23
6. The
Company covenants and agrees with the Underwriters that the Company will pay or
cause to be paid the following: (i) 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 the Registration Statement as originally filed and each
amendment and supplement thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any agreement among Underwriters, this Agreement, the Blue Sky survey, closing
documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iv)
all expenses in connection with the qualification of the Shares for offering and
sale under state securities laws, including the fees and disbursements of
counsel for the Underwriters 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 the Nasdaq Capital Market; (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 FINRA of the terms of the
sale of the Shares; (vii) the cost of preparing, issuing and delivering stock
certificates for the Shares to the Underwriters, including any stock or other
transfer taxes and any stamp or other duties payable upon the sale, issuance or
delivery of the Shares to the Underwriters; (viii) the cost and charges of any
transfer agent or registrar; (ix) the costs and expenses of the Company relating
to investor presentations on any “road show” undertaken in connection with the
marketing of the Shares, including without limitation, expenses associated with
the production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations, travel and
lodging expenses of the representatives and officers of the Company and any such
consultants, and the cost of aircraft and other transportation chartered in
connection with the road show; and (x) all other costs and expenses incident to
the performance of the Company’s obligations hereunder which are not otherwise
specifically provided for in this Section. The Company shall not,
however, be required to pay for any of the Underwriters’ expenses (other than
those related to qualification under FINRA regulation and State securities or
Blue Sky laws) except that, if this Agreement shall not be consummated because
the conditions in Section 10 hereof are not satisfied, or because this Agreement
is terminated by the Underwriters pursuant to Section 7 hereof, or by reason of
any failure, refusal or inability on the part of the Company to perform any
undertaking or satisfy any condition of this Agreement or to comply with any of
the terms hereof on its part to be performed, unless such failure, refusal or
inability is due primarily to the default or omission of the Underwriters, the
Company shall reimburse the Underwriters for reasonable out-of-pocket expenses
incurred in connection with investigating, marketing and proposing to market the
Shares or in contemplation of performing their obligations hereunder, including,
without limitation, legal fees and expenses and marketing, syndication and
travel expenses up to $125,000; provided, however, that such
expenses will be credited against any underwriting discount (as described in the
Prospectus) payable to the Representative upon consummation of the sale of the
Shares.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 24
7. The
obligations of the Underwriters hereunder, as to the Shares to be delivered at
each Time of Delivery, shall be subject, in their 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
Registration Statement, including any Rule 462(b) Registration Statement, has
been declared effective by the Commission and no stop order
suspending the effectiveness of the Registration Statement shall have been
issued or proceedings therefor initiated or threatened by the Commission, and
any request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the
Underwriters, (ii) each of the Preliminary Prospectus, and the Prospectus shall
have been filed with the Commission in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)) (or a
post-effective amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule 430B), and no
order preventing or suspending the use of any Preliminary Prospectus, or the
Prospectus shall have been issued by the Commission or any other Governmental
Entity, (iii) any material required to be filed by the Company pursuant to Rule
433(d) under the Act shall have been filed with the Commission within the
applicable time periods prescribed for such filings by Rule 433 and
(iv) there shall not have come to the Representative’s attention any
facts that would cause the Representative to believe that the General Disclosure
Package or the Prospectus, at the time it was, or was required to be, delivered
or made available to purchasers of the Shares, included an untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances existing at such time, not
misleading;
(b) Blank
Rome LLP shall have furnished to the Underwriters such written opinion or
opinions, dated such Time of Delivery, with respect to such matters as the
Underwriters 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 & Sinon LLP, shall have furnished to the Underwriters a written
opinion, dated such Time of Delivery, in form and substance reasonably
satisfactory to the Underwriters, to the effect set forth in Exhibit
B hereto;
(d) At
the time or execution of this Agreement, ParenteBeard LLC shall have furnished
to the Underwriters a letter or letters, dated such date, in form and substance
satisfactory to the Representative, containing statements and information of the
type ordinarily included in accountants “comfort letters” to underwriters with
respect to the financial statements of the Company and certain financial
information contained or incorporated by reference in the Registration
Statement, General Disclosure Package and Prospectus;
(e) At
each Time of Delivery, ParenteBeard LLC shall have delivered a letter to the
Underwriters, dated as of the date of the Time of Delivery, to the effect that
they reaffirm the statements made in the letter furnished pursuant to subsection
(d) of this Section, except that the specified date referred to shall be a date
not more than three business days prior to the date of the Time of
Delivery;
(f) No
event or condition of a type described in Section 1(a)(ix) shall have occurred
or shall exist, otherwise than as set forth or contemplated in the General
Disclosure Package and the Prospectus, the effect of which is in the judgment of
the Underwriters 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;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 25
(g) FINRA
shall have confirmed that it has not raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements in the
public offering contemplated hereby;
(h) 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 Stock Market; (ii) a suspension or material
limitation in trading in the Company’s securities on the NASDAQ Stock Market;
(iii) a general moratorium on commercial banking activities declared by either
Federal or New York 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 the Underwriters 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;
(i) The
Shares to be sold at such Time of Delivery shall have been duly listed for
quotation on the Nasdaq Capital Market and the Company has taken no action
designed to, or likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act or delisting the Common Stock from the
Nasdaq Capital Market, and the Company has not received any notification that
the Commission or the Nasdaq Capital Market is contemplating terminating such
registration or listing;
(j) The
Company has obtained and delivered to the Underwriters executed copies of an
agreement from each officer and director, as listed on Schedule III hereto of
the Company, substantially in the form of Exhibit A;
(k) The
Company shall have complied with furnishing to the Underwriters the General
Disclosure Packages prior to the Applicable Time and the Prospectuses on the New
York Business Day next succeeding the date of this Agreement;
(l) The
Company shall have furnished or caused to be furnished to the Underwriters at
such Time of Delivery certificates of the chief executive officer and chief
financial or accounting officer of the Company to the effect that (i) there has
been no Material Adverse Effect, (ii) the representations and warranties in
Section 1(a) hereof are true and correct with the same force and effect as
though expressly made at and as of the Time of Delivery, (iii) the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Time of Delivery, (iv) no stop order
suspending the effectiveness of the Registration Statement or order preventing
or suspending the use of any Preliminary Prospectus or the Prospectus has been
issued and no proceeding for that purpose has been instituted or is pending or,
to his or her knowledge, is threatened or contemplated by the Commission or any
other Governmental Entity, and (v) as to such other matters as the Underwriters
may reasonably request;
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 26
(m) On or
after the date hereof, there shall not have occurred any of the events,
circumstances or occurrences set forth in Section 7(a) or (i) or Section 10
hereof; and
(n) At
the Time of Delivery, counsel for the Underwriters shall have been furnished
with such documents and opinions as they may have reasonably requested for the
purpose of enabling them to pass upon the issuance and sale of the Shares as
herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection with
the issuance and sale of the Shares as herein contemplated shall be satisfactory
in form and substance to the Representative and counsel for the
Underwriters.
If any
condition specified in this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement may be terminated by the Underwriters
by notice to the Company at any time on or prior to the Time of
Delivery. If the sale of the Shares provided for herein is not
consummated because any condition set forth in this Section 7 is not satisfied,
because of any termination pursuant to Section 10(a) hereof, or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof, the Company will reimburse
the Underwriters upon demand for all documented out-of-pocket expenses as set
forth in Section 6 hereof. In addition, Sections 1, 8 and 9 hereof
shall survive any such termination and remain in full force and
effect.
8. (a)
The Company will indemnify and hold harmless each Underwriter, each person, if
any who controls any Underwriter, within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and its respective partners, directors,
officers, employees and agents 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, in light of the
circumstances under which they were made, not misleading, and will reimburse the
Underwriter for any reasonable 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 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 any Underwriter expressly for use therein (
provided that the Company and the Underwriters hereby acknowledge and
agree that the only information that the Underwriters have furnished to the
Company specifically for inclusion in the Registration Statement, any
Preliminary Prospectus (or any amendment or supplement thereto) are the share
allocation, concession and reallowance figures appearing in the Prospectus in
the section entitled “Underwriting”).
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 27
(b) The
Underwriters will indemnify and hold harmless the Company, its officers,
directors and each person, if any, who controls the Company, within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, 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
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 Underwriters expressly for use therein (provided
that the Company and the Underwriters hereby acknowledge and agree that the only
information that the Underwriters have furnished to the Company specifically for
inclusion in the Registration Statement, any Preliminary Prospectus (or any
amendment or supplement thereto) are the share allocation, concession and
reallowance figures appearing in the Prospectus in the section entitled
“Underwriting”); 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, unless the indemnifying party has been materially
prejudiced thereby. 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) provided, however, if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there
may be legal defenses available to its and/or other indemnified parties which
are different from or additional to those available to the indemnifying party,
the indemnified party or parties shall have the right to select separate counsel
to assume such legal defenses and to otherwise participate in the defense of
such action on behalf of such indemnified party or parties, 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 unless (i) the indemnified party shall have employed separate
counsel in accordance with the proviso to the preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel (together with local counsel),
approved by the indemnifying party or (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party within a reasonable time
after notice of commencement of the action, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
party. The indemnifying party under this Section 8 shall not be
liable for any settlement of any proceedings effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by this Section 8(c), the indemnifying party agrees that it shall be liable for
any settlement of any proceeding effected without its written consent if (i)
such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
(other than those fees and expenses that are being contested in good faith)
prior to the date of such settlement. 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.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 28
(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 Underwriters 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 Underwriters 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 Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts
received by the Underwriters, 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 Underwriters 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 Underwriters 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 account of 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 reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this subsection
(d), the Underwriters 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 Underwriters have otherwise been required to pay by reason
of any 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. For purposes of this Section 8, each officer and
employee of any Underwriters and each person, if any, who controls any
Underwriter within the meaning of the Act and the Exchange Act shall have the
same rights to contribution as the Underwriter, and each director of the
Company, each officer of the Company who signed the Registration Statement, and
each person, if any, who controls the Company with the meaning of the Act and
the Exchange Act shall have the same rights to contribution as the
Company.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 29
(e) The
obligations of the Company under this Section 8 shall be in addition to any
liability which the Company may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act or who is an affiliate or partner of any
Underwriter; and the obligations of the Underwriters under this Section 8 shall
be in addition to any liability which the Underwriters may otherwise have and
shall extend, upon the same terms and conditions, to each officer and director
of the Company, and to each other person, if any, who controls the Company
within the meaning of the Act or who is an affiliate of the
Company.
(f) In
connection with the offer and sale of the Reserved Shares, the Company agrees to
indemnify and hold harmless the Underwriters, their Affiliates, and selling
agents and each person, if any who controls any Underwriter with the meaning of
either Section 15 of the Act or Section 20 of the Exchange Act, from and against
any and all losses, liabilities, claims, damages and expenses (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending, investigating, or settling any such action or claim),
as incurred, (i) caused by the failure of any Invitee to pay for and accept
delivery of Reserved Shares which have been orally confirmed by the end of
business on the first business day following the date of this Agreement or (ii)
related to, or arising out of or in connection with, the offering of the
Reserved Shares.
9. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the Underwriters, as set forth in this Agreement
or made by or on behalf of them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of the Underwriters or
any controlling person of any of the Underwriters, 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. (a)
The Representative may terminate this Agreement, by notice to the Company, at
any time on or prior to the Time of Delivery if, since the time of execution of
this Agreement or, in the case of (i) below, since the date of the most recent
balance sheet included in the Financial Statements, there has occurred, (i) any
Material Adverse Effect, or (ii) a suspension or material limitation in trading
in the Company’s securities on the Nasdaq Capital Market; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States; or (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 the Underwriters 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.
(b) If
this Agreement is terminated pursuant to this Section 10, such termination shall
be without liability of any party to any other party except as provided in
Section 6 hereof and provided further that Sections 1, 8 and 9 hereof shall
survive such termination and remain in full force and effect.
11. If
one or more of the Underwriters shall fail at a Time of Delivery to purchase the
Shares which it is obligated to purchase under this Agreement (the “Defaulted
Securities”), the Representative shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters or one or more other underwriters to purchase all, but not less
than all, of the Defaulted Securities in such amounts as may be agreed upon and
upon the terms herein set forth; if, however, the Representative shall not have
completed such arrangements within such 24-hour period, then:
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 30
(a) if
the number of Defaulted Securities does not exceed 10% of the number of Shares
to be purchased on such date, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters, or
(b) if
the number of Defaulted Securities exceeds 10% of the number of Shares to be
purchased on such date, this Agreement or, with respect to any Time of Delivery
which occurs after the First Time of Delivery, the obligation of the
Underwriters to purchase and of the Company to sell the Shares to be purchased
and sold on such Time of Delivery shall terminate without liability on the part
of any non-defaulting Underwriter.
No action
taken pursuant to this Section shall relieve any defaulting Underwriter from
liability in respect of its default.
In the
event of any such default which does not result in a termination of this
Agreement or, in the case of a Time of Delivery which is after the First Time of
Delivery, which does not result in a termination of the obligation of the
Underwriter to purchase and the Company to sell the relevant Optional Shares, as
the case may be, either (i) the Representative or (ii) the Company shall have
the right to postpone the relevant Time of Delivery, as the case may be, for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term “Underwriter” includes any
person substituted for an Underwriter under this Section 11.
12. All
statements, requests, notices and agreements hereunder shall be in writing, and
if to the Underwriters shall be delivered or sent by mail or facsimile
transmission to the Representative at Sandler X’Xxxxx & Partners,
L.P., 000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, XX 00000,
Attention: General Counsel, with a copy to Blank Rome LLP, One Xxxxx Square,
00xx
& Xxxxxx Xxxxxxx, Xxxxxxxxxxxx, XX 00000, Attention: Xxxx X. Xxxxxxx,
Facsimile No. (000) 000-0000; and if to the Company shall be delivered or sent
by mail or facsimile to Citizens & Northern Corporation, 00-00 Xxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxx 00000, Facsimile No. (000) 000-0000, Attention: Xxxxx X.
Xxxxxxxxxx, President and Chief Executive Officer, with a copy to Xxxxxx &
Xxxxx LLP, Xxx Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxx 00000, Attention: Xxxx X. Xxxxxxx, Facsimile No. (000)
000-0000. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
13. This
Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters, the Company and, to the extent provided in Sections 8 and 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.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 31
14. 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.
15. The
Company acknowledges and agrees that (i) the purchase and sale of the Shares
pursuant to this Agreement, including the determination of the public offering
price of the Shares and any related underwriting discounts, is an arm’s-length
commercial transaction between the Company, on the one hand, and the several
Underwriters, on the other hand, (ii) in connection with the offering
contemplated hereby and the process leading to such transaction each Underwriter
is and has been acting solely as a principal and is not the agent or fiduciary
of the Company, or the Company’s shareholders, creditors, employees or any other
third party, (iii) no Underwriter has assumed or will assume an advisory or
fiduciary responsibility in favor of the Company with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company on other matters)
and no Underwriter has any obligation to the Company with respect to the
offering contemplated hereby except the obligations expressly set forth in this
Agreement, (iv) the Underwriters and their respective affiliates may be engaged
in a broad range of transactions that involve interests that differ from those
of the Company, and (v) the Underwriters have not provided any legal,
accounting, regulatory or tax advice with respect to the offering contemplated
hereby and the Company has consulted its own legal, accounting, regulatory and
tax advisors to the extent it deemed appropriate.
16. THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OF SAID
STATE OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW.
THE
COMPANY, ON BEHALF OF ITSELF AND ITS SUBSIDIARIES, HEREBY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND NEW YORK STATE COURTS LOCATED IN
THE CITY OF NEW YORK IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING RELATED
TO THIS AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES
ANY DEFENSE OF LACK OF PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT. THE COMPANY, ON BEHALF OF ITSELF AND ITS
SUBSIDIARIES, IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO
UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 32
17. This
Agreement constitutes the entire agreement of the parties to this Agreement and
supersedes all prior written or oral and all contemporaneous oral agreements,
understandings and negotiations with respect to the subject matter
hereof. This Agreement may be executed in two or more counterparts,
each one of which shall be an original, but all of which together shall
constitute one and the same instrument. The exchange of copies of
this Agreement and of signature pages by facsimile or other electronic means
shall constitute effective execution and delivery of this Agreement by the
parties hereto and may be used in lieu of the original signature pages to this
Agreement for all purposes. This Agreement may not be amended or
modified unless in writing by all of the parties hereto, and no condition herein
(express or implied) may be waived unless waived in writing by each party whom
the condition is meant to benefit. The Section and provision headings
herein are for convenience only and shall not affect the construction
hereof.
18. 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.
19. 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.
[Signatures
on Next Page]
Sandler
X’Xxxxx & Partners, L.P.
November
24, 2009
Page 33
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 between the
Underwriters and the Company.
|
Very
truly yours,
|
||||
|
CITIZENS
& NORTHERN CORPORATION
|
||||
|
By:
|
/s/ Xxxxx X. Xxxxxxxxxx
|
|||
|
Name:
|
Xxxxx
X. Xxxxxxxxxx
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|||
|
Title:
|
Chairman,
President and CEO
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|||
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Accepted
as of the date hereof:
|
||||
|
SANDLER
X’XXXXX & PARTNERS, L.P.
|
||||
|
By:
|
Sandler
X’Xxxxx & Partners Corp.,
the
sole general partner
|
|||
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By:
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/s/ Xxxxxxxxxxx XxXxxxxx
|
|||
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Name:
|
Xxxxxxxxxxx
XxXxxxxx
|
|||
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Title:
|
Authorized
Signatory
|
|||
Schedule
I
|
Name
of Underwriters
|
Number
of Firm Shares
|
||
|
Sandler
X’Xxxxx & Partners, L.P.
|
2,000,000
|
||
|
Boenning
& Scattergood, Inc.
|
500,000
|
||
Schedule
I
Schedule
II
Issuer-Represented
General Free Writing Prospectus
Dated
November 12, 2009
Schedule
II
Schedule
III
List
of Executive Officers and Directors
|
Xxxxx
X. Xxxxxxxxxx
|
|
Xxxx
X. Xxxxx
|
|
Xxxxxx
X. Xxxxx, III
|
|
Xxxx
X. Xxxxxx
|
|
Xxxxxx
X. Xxxx
|
|
Xxxxxx
X. Xxxx, Xx.
|
|
Xxxxxxx
X. Xxxxx
|
|
Xxxxxxx
X. Xxxxxxxxx, Xx.
|
|
Xxxxxx
X. Xxxxxxxxx
|
|
Xxx
X. Xxxxxx
|
|
R.
Xxxxx Xxxxx
|
|
Xxxxx
X. Xxxxxxx
|
|
Xxx
X. Xxxxxxx
|
|
Xxxxxx
X. Learn
|
|
Xxxxxxx
X. Xxxxxx
|
|
Xxxxxx
X. Xxxxxx, III
|
|
Xxxxxxx
Xxxxxxx
|
|
Xxxxx
X. Xxxxxx
|
|
Xxx
X. Xxxxx
|
Schedule
III
EXHIBIT
A
November
24, 2009
Sandler
X’Xxxxx & Partners, L.P.
000 Xxxxx
Xxxxxx, 0xx Xxxxx
Xxx Xxxx,
XX 00000
|
Re:
|
Proposed
Public Offering by Citizens & Northern
Corporation.
|
The
undersigned, an executive officer, director and/or shareholder of Citizens &
Northern Corporation, a Pennsylvania corporation, or one of its significant
subsidiaries (the “ Company ”), understands that Sandler X’Xxxxx & Partners,
L.P. (the “Underwriter”), proposes to enter into an Underwriting Agreement (the
“ Underwriting Agreement ”) with the Company providing for the public offering
of shares (the “ Shares ”) of the Company’s common stock, $1.00 par value per
share (the “ Stock ”). In recognition of the benefit that such an
offering will confer upon the undersigned as an executive officer, director
and/or shareholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with the Underwriter that, during a period of 90 days from
the date of the Underwriting Agreement, the undersigned will not, without the
prior written consent of the Underwriter, directly or indirectly, (i) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant for
the sale of, or otherwise dispose of or transfer any shares of the Company’s
Stock or any securities convertible into or exchangeable or exercisable for
Stock, whether now owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires the power of
disposition, or file any registration statement under the Securities Act of
1933, as amended, with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Stock, whether any such swap or transaction is to be settled by delivery of
Stock or other securities, in cash or otherwise. If either (i) during
the period that begins on the date that is 15 calendar days plus three (3)
business days before the last day of the 90-day restricted period and ends on
the last day of the 90-day restricted period, the Company issues an earnings
release or material news or a material event relating to the Company occurs, or
(ii) prior to the expiration of the 90-day restricted period, the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the 90-day restricted period, the restrictions set
forth herein will continue to apply until the expiration of the date that is 15
calendar days plus three (3) business days after the date on which the earnings
release is issued or the material news or event related to the Company
occurs. The Company shall promptly notify the Underwriter of any
earnings releases, news or events that may give rise to an extension of the
initial restricted period.
Notwithstanding
the foregoing, the undersigned may transfer the undersigned’s shares of Stock
(i) as a bona fide gift or gifts, provided that the donee or donees agree to be
bound in writing by the restrictions set forth herein, (ii) to any trust or
family limited partnership for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust or general partner of the family limited partnership, as the case may be,
agrees to be bound by the restrictions set forth herein, and provided further
that any such transfer shall not involve a disposition for value, (iii) pledged
in a bona fide transaction outstanding as of the date hereof to a lender to the
undersigned, as disclosed in writing to the Underwriter, (iv) pursuant to the
exercise by the undersigned of stock options that have been granted by the
Company prior to, and are outstanding as of, the date of the Underwriting
Agreement, where the Stock received upon any such exercise is held by the
undersigned, individually or as fiduciary, in accordance with the terms of this
Lock-Up Agreement, (v) pursuant to Rule 10b5-1 plans of the undersigned in
effect as of the date of the Underwriting Agreement, or (vi) with the prior
written consent of the Underwriter. For purposes of this Lock-Up
Agreement, “immediate family” shall mean any relationship by blood, marriage or
adoption, not more remote than first cousin.
The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company’s transfer agent and registrar against the transfer of the
undersigned’s Company Stock, except in compliance with this Lock-Up
Agreement. In furtherance of the foregoing, the Company and its
transfer agent are hereby authorized to decline to make any transfer of
securities if such transfer would constitute a violation or breach of this
Lock-Up Agreement.
The
undersigned represents and warrants that the undersigned has full power and
authority to enter into this Lock-Up Agreement. The undersigned
agrees that the provisions of this Lock-Up Agreement shall be binding also upon
the successors, assigns, heirs and personal representatives of the
undersigned.
The
undersigned understands that, if the Underwriting Agreement does not become
effective, or if the Underwriting Agreement (other than the provisions thereof
which survive termination) shall terminate or be terminated prior to payment for
and delivery of the Stock to be sold thereunder, the undersigned shall be
released from all obligations under this Lock-up
Agreement. Notwithstanding anything herein to the contrary, this
Lock-up Agreement shall automatically terminate and be of no further effect as
of 5:00 p.m. Eastern Time on ________ __, 2009 if a closing for the offering of
the Shares has not yet occurred as of that time.
This
Lock-up Agreement shall be governed by and construed in accordance with the laws
of the State of New York.
|
Very
truly yours,
|
|
|
Signature:
|
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Print
Name
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