Exhibit 1
Xxxxxxx Investments, Inc.
0000-000 Xxxxxxxxx-Xxxxxxxx Xx.
Charlotte, NC 28226-4707
Xxxxx X. Xxxxxxx
President and Chief Executive Officer
The Xxxxxxx Group, Inc.
0000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Re: Offering of Subordinated Daily and Term Notes of
The Xxxxxxx Group, Inc./Sales Agent Agreement
Gentlemen:
This letter confirms the agreement between The Xxxxxxx Group, Inc. (the
"Company") and Xxxxxxx Investments, Inc. ("Xxxxxxx") regarding the participation
of Xxxxxxx on a "best efforts" basis in the offering by the Company of its
Subordinated Term Notes Due 1, 6, 12 36 and 60 Months and Subordinated Daily
Notes (collectively, the "Notes") registered under the Securities Act of 1933,
as amended (the "1933 Act"), pursuant to a Registration Statement on Form SB-2
(File No. 333-42623) (the "Registration Statement"), and to be issued under an
Indenture, dated __________, 1998 (the "Indenture") between the Company and The
Bank of New York (the "Trustee"). The offering of the Notes (the "Offering")
will commence on or about February _________, 1998 and will continues for up to
two years, unless otherwise terminated or suspended by the Company. All of the
Notes will be offered pursuant to the Prospectus included in the Registration
Statement, as it may be amended or supplemented (the "Prospectus"). Xxxxxxx
understands that the Notes are eligible for sale only in Georgia, Florida, South
Carolina, North Carolina and Tennessee, except that no Daily Notes may be
offered or sold in South Carolina.
(a) Representations of the Company. The Company represents and warrants to
Xxxxxxx as follows:
(i) The Registration Statement and Prospectus contain all material
statements required to be stated therein in accordance with the 1933 Act
and the regulations promulgated thereunder by the Securities and Exchange
Commission (the "Commission"), and do not and will not contain any untrue
statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein in light of the circumstances under
which they were made not misleading;
(ii) During of the Offering, the Company will have all requisite power
and authority and all necessary authorizations, approvals, orders,
licenses, certificates and permits of and from all governmental regulatory
officials and bodies to own its properties and carry on its businesses as
set forth in the Prospectus and to complete the sale of the Notes and to
enter into this Letter Agreement and to carry out the provisions and
conditions hereof;
(iii) Neither the execution and delivery of this Letter Agreement, the
consummation of the transactions herein contemplated, nor compliance with
the terms and provisions hereof will conflict with or result in a breach of
any of the terms, provisions or conditions of the articles of incorporation
or bylaws of the Company, or any agreement or instrument to which the
Company is a party, or by which it or any of its properties, is bound or
affected, or violate any franchise, license, permit, judgment, decree,
order, statute, rule or regulation applicable to the Company;
(iv) The Notes, when issued and delivered to purchasers in exchange
for payment to the Company of the respective principal amounts thereof and
authenticated by the Trustee as provided in the Indenture, will be duly and
validly issued and fully paid.
(v) This Letter Agreement has been duly and validly authorized,
executed and delivered by the Company and is a valid and binding agreement
and obligation of the Company enforceable according to its terms except as
such obligations may be limited by bankruptcy or other laws relating to or
affecting creditors' rights generally; and
(vi) The Company is not subject to any material contingent obligation
nor are its properties or business subject to any material risks, except
those that have been disclosed in the Prospectus.
(b) Representations of Xxxxxxx. Xxxxxxx represents and warrants to the
Company that:
(i) Xxxxxxx has all appropriate licenses and registrations with the
Commission, the National Association of Securities Dealers, Inc. ("NASD")
and any applicable state regulatory bodies to offer and sell the Notes on a
"best efforts" basis as a selling agent for the Company;
(ii) Neither Xxxxxxx nor any person associated with Xxxxxxx that
participates in the Offering will make any statements to potential
purchasers of the Notes respecting the Notes, the Company, its operations,
financial condition or prospects except such statements as are contained in
the Prospectus; and
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(iii) In connection with the offer and sale of any Notes by Xxxxxxx,
Xxxxxxx will comply with all rules and regulations of the NASD applicable
to the conduct of its business including, without limitation, rules of the
NASD applicable to "fair dealing" with customers and the "suitability" of
the Notes for investment by non-institutional investors.
(x) Xxxxxxx as Selling Agent. On the basis of the representations and
warranties of the Company herein contained, and subject to the terms and
conditions herein set forth, Xxxxxxx agrees to act as a nonexclusive sales agent
for the Company in connection with the Offering, it being understood by the
parties that Xxxxxxx shall not receive any commissions or other compensation
with respect to any sales of Notes that Xxxxxxx may make hereunder.
(d) Termination Date. The Termination Date of this Letter Agreement shall
be thirty days from the date on which the Company notifies Xxxxxxx in writing
that this Letter Agreement is terminated. Xxxxxxx may also terminated this
Letter Agreement upon thirty days written notice to the Company.
(e) Indemnification. To the extent permitted by law, the Company will
indemnify Xxxxxxx against all claims, losses, damages or liabilities (or actions
in respect thereof), whether arising in connection with court action, regulatory
action or arbitration to the extent such claims, losses, damages or liabilities
arise out of or are based upon any untrue statement (or alleged untrue
statement) of a material fact contained in the Prospectus or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading and
the Company will reimburse Xxxxxxx for any legal and other expenses reasonably
incurred in connection with investigating or defending any such claim, loss,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that any such claims, loss, damage, liability or
expense arises out of or is based on any untrue statement or omission based upon
written information furnished to the Company by or on behalf of and relating to
Xxxxxxx specifically for use in the Prospectus.
(f) Representations and Agreements to Survive Termination. Except as the
context otherwise requires, all representations, warranties and agreements
contained in this Letter Agreement shall be deemed to be representations,
warranties and agreements as of the date hereof, the Termination Date and for
the period between such dates, and such representation, warranties and
agreements shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any party hereto and shall survive
termination of this Letter Agreement and the occurrence of the Termination Date.
(g) Independent Contractors. The Company and Xxxxxxx are independent
contractors and nothing herein shall be deemed or construed to create any
relationship between any of the parties hereto other than that of independent
contractors.
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(h) Integration Clause. This Letter Agreement contains all of the
understandings between the parties hereto with reference to the Offering, and
cannot be modified or changed except by a written instrument signed by the
parties hereto.
(i) Parties. This Letter Agreement shall inure solely to the benefit of and
shall be binding upon each of the parties hereto and their respective
successors, and assigns and no other person shall have or be construed to have
any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Letter Agreement or any provision herein contained.
(j) Arbitration. Any controversy, dispute or question arising out of or in
connection with or in relation to this Letter Agreement or its interpretation
performance or non-performance or any breach thereof shall be determined by
arbitration conducted in Charlotte, North Carolina in accordance with then
existing rules of the American Arbitration Association. The Company shall select
one arbitrator, Xxxxxxx shall select one arbitrator and the two arbitrators
shall select a third with substantially similar qualifications. Any decision
rendered shall be binding upon the parties thereto and may be enforced in any
jurisdiction. However, the arbitrators have no authority to grant any relief
that is inconsistent with this Letter Agreement. The expense of arbitration
shall be borne equally by the Company and Xxxxxxx.
(k) Applicable Law. This Letter Agreement shall be governed by, and
construed in accordance with, the laws of the State of North Carolina.
If the foregoing correction sets forth our understanding with respect to
Xxxxxxx'x proposed participation in the Offering, please so confirm by signing
and returning one copy of this letter.
Xxxxxxx Investments Inc.
By: __________________________________
Xxxxxx X. Xxxxxxxx, Xx., President
ACCEPTED AND AGREED TO
this _____ day of February ______, 1998.
THE XXXXXXX GROUP, INC.
By: ____________________________________
Xxxxx X. Xxxxxxx, President
