Exhibit 1.1
________ Shares
XXXXXXX.XXX, INC.
Common Stock
(par value $1.00 per share)
Underwriting Agreement
______ __, 0000
Xxxxxxx X'Xxxxx & Partners, L.P.,
As representative of the several Underwriters
named in Schedule I hereto,
Two World Trade Center, 000xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
XXXXxxx.xxx, Inc., a Pennsylvania corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
________ shares (the "Firm Shares") and, at the election of the Underwriters, up
to _______ additional shares (the "Optional Shares") of the common stock, par
value $1.00 per share ("Stock") of the Company (the Firm Shares and the Optional
Shares that the Underwriters elect to purchase pursuant to Section 2 hereof
being collectively called the "Shares").
1. (a) The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(i) A registration statement on Form SB-2 (File No. 333-_______) (the
"Initial Registration Statement") in respect of the Shares has been filed with
the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits thereto, delivered to
you for each of the other Underwriters, have been declared effective by the
Commission in such form; other than a registration statement, if any, increasing
the size of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as
amended (the "Act"), which became effective upon filing, no other document with
respect to the Initial Registration Statement has heretofore been filed with the
Commission; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, is hereinafter called a "Preliminary Prospectus"; the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof and
deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective or such part of the
Rule 462(b) Registration Statement, if any, became or hereinafter becomes
effective, are hereinafter collectively called the "Registration Statement"; and
such final prospectus, in the form first filed pursuant to Rule 424(b) under the
Act, is hereinafter called the "Prospectus");
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; 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 an
Underwriter through Sandler X'Xxxxx & Partners, L.P. expressly for use therein
(it being acknowledged that the only information so furnished by the
Underwriters is as described in Section 8(b) hereof);
(iii) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration Statement and
any amendment thereto, and as of the applicable filing date as to the Prospectus
and any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; 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 an Underwriter through Sandler X'Xxxxx & Partners, L.P. expressly
for use therein (it being acknowledged that the only information so furnished by
the Underwriters is as described in Section 8(b) hereof);
(iv) Neither the Company nor any of its subsidiaries has sustained since
the date of the latest audited financial statements included in the Prospectus
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus; and since the respective dates as of
which information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, (i) there has been no material adverse
change, or any development or developments involving a prospective material
adverse change, in or affecting the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, in each case whether or not arising
in the ordinary course of business (a "Material Adverse Effect"), (ii) there
have been no transactions entered into by the Company or any of its
subsidiaries, other than those in ordinary course of business, which are
material with respect to the Company and its subsidiaries considered as one
enterprise, and (iii) there has not been any change in the capital stock, assets
or long-term debt of the Company or any of its subsidiaries;
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(v) The Company and its subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its subsidiaries;
(vi) The Company is a registered bank holding company under the Bank
Holding Company Act of 1956, as amended (the "BHC Act"), and has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania, with power and authority (corporate
and other) to own its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any business so
as to require such qualification, except where the failure to so qualify or to
be in good standing would not result in a Material Adverse Effect;
(vii) Each subsidiary of the Company that is a significant subsidiary
(as defined in Rule 1-02 of Regulation S-X of the Commission) either has been
duly incorporated and is validly existing as a corporation or has been duly
chartered and is validly existing as a savings bank, in each case in good
standing under the laws of the jurisdiction of its organization, with power and
authority (corporate and other) to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties or
conducts any business in all places where such qualification, or good standing
is necessary or the extent not so qualified or not in good standing, where the
failure to obtain such qualification or to be in good standing would not have a
Material Adverse Effect; no proceeding has been instituted in any such
jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or
curtail, such power and authority or qualification; the activities of the
Company, a bank holding company under the BHC Act, and its subsidiaries are
authorized and permitted for bank holding companies and their subsidiaries under
applicable federal and Pennsylvania law and the rules and regulations of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board")
and the Pennsylvania Department of Banking (the "Department"); the activities of
the subsidiaries of BankPhiladelphia, a Pennsylvania chartered and federally
insured stock savings bank (the "Bank"), are authorized and permitted to
subsidiaries of a Pennsylvania-charted savings bank under applicable federal and
Pennsylvania law and the rules and regulations of the Department and the Federal
Deposit Insurance Corporation (the "FDIC"); all of the issued and outstanding
capital stock of each subsidiary of the Company has been duly authorized and
validly issued and is fully paid and nonassessable and is owned, directly or
through other subsidiaries of the Company, by the Company; and all of the
capital stock of each subsidiary of the Company that is owned by the Company,
directly or through other subsidiaries of the Company, is owned free and clear
of any pledge, lien, encumbrance, claim or equity;
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(viii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and nonassessable
and conform to the description of the Stock contained in the Prospectus; and all
of the issued shares of capital stock of each subsidiary of the Company have
been duly and validly authorized and issued, are fully paid and nonassessable
and are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims;
(ix) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and nonassessable and will conform to the
description of the Stock contained in the Prospectus and the holders of
outstanding capital stock of the Company are not entitled to preemptive or other
rights afforded by the Company to subscribe for the Shares;
(x) Except as described in the Prospectus, there are no outstanding
rights, 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;
(xi) The issue and sale of the Shares by the Company and the compliance
by the Company with all of the provisions of this Agreement and the consummation
of the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the provisions of the
Articles of Incorporation or Bylaws of the Company or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the Company
of the transactions contemplated by this Agreement, except such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters;
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(xii) Neither the Company nor any of its subsidiaries is in violation of
its charter or bylaws or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, note, lease or other
agreement or instrument to which it is a party or by which it or any of its
properties may be bound, except for such defaults that would result, singly or
in the aggregate, in a Material Adverse Effect;
(xiii) The statements set forth in the Prospectus under the caption
"Description of Capital Stock," insofar as they purport to constitute a summary
of the terms of the capital stock, options and warrants of the Company and under
the captions "Risk Factors," "Business," "Regulation of the Company and the
Bank," "Management"and "Underwriting," insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate, complete
and fair;
(xiv) Except as disclosed in the Prospectus, the Company and its
subsidiaries are conducting their respective businesses in compliance in all
material respects with all laws, rules, regulations, decisions, directives and
orders (including, without limitation, all regulations and orders of, or
agreements with, the Department, Federal Reserve Board and the FDIC) applicable
to them; there is no action, suit, investigation or proceeding before or by any
government, governmental instrumentality or court, domestic or foreign, now
pending or, to the knowledge of the Company, threatened against or affecting the
Company or any of its subsidiaries (A) that is required to be disclosed in the
Registration Statement and not disclosed therein, (B) that could result in any
Material Adverse Effect, (C) that could materially and adversely affect the
properties, assets or leasehold interests of the Company and its subsidiaries,
or (D) that could adversely affect the consummation of the transactions
contemplated in this Agreement; 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, 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;
(xv) The Company and its subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies necessary to conduct the business now operated by the Company
or its subsidiaries; the Company and its subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failures so to comply would not, singly or in the aggregate, have a Material
Adverse Effect; all of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the failure
of such Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or modification of
any such Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a Material
Adverse Effect;
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(xvi) The Company and each of its subsidiaries own or possess, or can
acquire on reasonable terms, adequate foreign and domestic patents, patent
rights, licenses, trademarks, service marks, trade names, inventions, copyrights
and know-how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures) (collectively,
"intellectual property") necessary to carry on their business as presently
conducted, and neither the Company nor any of its subsidiaries has received any
notice of any infringement of or conflict with asserted rights of others with
respect to any intellectual property which would render any intellectual
property invalid or inadequate to protect the interest of the Company or any
subsidiaries therein and which infringement or conflict, singly or in the
aggregate, would have a Material Adverse Effect;
(xvii) Each of the Company and its subsidiaries is in compliance in all
material respects with all applicable federal, state and local environmental
laws and regulations, including, without limitation, those applicable to
emissions to the environment, waste management, and waste disposal
(collectively, the "Environmental Laws"), except where such noncompliance could
not be reasonably likely to have a Material Adverse Effect, or except as
disclosed in the Prospectus, and to the knowledge of the Company, there are no
circumstances that would prevent, interfere with or materially increase the cost
of such compliance in the future;
(xviii) Except as disclosed in the Prospectus, there is no claim under
any Environmental Law, including common law, pending or, to the best knowledge
of the Company, threatened against the Company (an "Environmental Claim"), which
would be reasonably likely to have a Material Adverse Effect, and, to the
knowledge of the Company, under applicable law, there are no past or present
actions, activities, circumstances, events or incidents, including, without
limitation, releases of any material into the environment, that are reasonably
likely to form the basis of any Environmental Claim against the Company or its
subsidiaries which would be reasonably likely to have a Material Adverse Effect;
(xix) The Company has disclosed to the Underwriters all legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject; other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material Adverse
Effect; and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others;
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(xx) The Company is not and, after giving effect to the offering and
sale of the Shares, 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");
(xxi) The consolidated financial statements and the notes thereto of the
Company and its subsidiaries included in the Registration Statement and the
Prospectus fairly present the financial condition of the Company and its
subsidiaries as of the dates indicated and the results of operations, changes in
stockholders' equity and cash flows for the periods therein specified; such
statements and related notes have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved; and the tables included in the Registration Statement and the
Prospectus present fairly the information purported to be shown thereby at the
dates indicated and for the periods therein specified and conform in all
material respects with the Act and the rules and regulations thereunder;
(xxii) 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 with respect to any securities of
the Company owned or to be owned by such person or to require the Company to
include such securities registered pursuant to the Registration Statement or in
any securities being registered pursuant to any other registration statement
filed by the Company under the Act;
(xxiii) Xxxxx Xxxxxxxx LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(xxiv) The Company and the Bank, and their directors and executive
officers, with respect to all announcements, press releases, interviews,
communications and statements publicly made prior to the commencement of the
offering of the Shares (including any and all communications made by, to and
through all types of media including the news media and the Internet) have
complied with the federal securities laws and the rules and interpretations of
the Commission relating to prohibited offers under Section 5 of the Securities
Act and permissible public announcements by a registrant during the periods (i)
prior to the filing of the Registration Statement and (ii) prior to the
Registration Statement being declared effective by the Commission; and
(xxv) Except as disclosed in the Prospectus or disclosed to Sandler
X'Xxxxx & Partners, L.P., there are no agreements, arrangements, understandings,
letters of intent, joint ventures, alliances, affinity partnerships or other
relationships between the Company and/or its subsidiaries and any third parties
to provide services to or for the Company.
(b) The Bank represents and warrants to, and agrees with, each of the
Underwriters that:
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(i) The Bank has been duly chartered and is validly existing as a
savings bank in good standing under the laws of the Commonwealth of
Pennsylvania, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification
except where the failure to so qualify would not result in a material adverse
change, or any development or developments involving a prospective material
adverse change, in or affecting the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Bank and its
subsidiaries considered as one enterprise, in each case whether or not in the
ordinary course of business (a "Bank Material Adverse Effect");
(ii) Neither the Bank nor any of its subsidiaries is in violation of its
charter, bylaws or other charter documents or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan agreement,
note, lease or other agreement or instrument to which the Bank or any of its
subsidiaries is a party or by which it or any of them may be bound, or to which
any of the property of the Bank or any of its subsidiaries is subject, except
for such defaults that would not result, singly or in the aggregate, in a Bank
Material Adverse Effect; and
(iii) The execution, delivery and performance of this Agreement by the
Bank and the compliance by the Bank with all of the provisions of this Agreement
and the consummation of the transactions herein contemplated will not conflict
with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Bank or any of its
subsidiaries is a party or by which the Bank or any of its subsidiaries is bound
or to which any of the property or assets of the Bank or any of its subsidiaries
is subject (except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not result in a Bank Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter of the Bank
or any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Bank or any of its subsidiaries or
any of their properties.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price per share of $________, the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto and (b) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company agrees to issue and sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per share set forth
in clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction, the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
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The Company hereby grants to the Underwriters the right to purchase at
their election up to _________ Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement,
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier than
two or later than five business days after the date of such notice.
It is understood that each Underwriter has authorized Sandler X'Xxxxx &
Partners, L.P., for such Underwriter's account, to accept delivery of, receipt
for, and make payment of the purchase price for, the Firm Shares and the
Optional Shares, if any, which such Underwriter has agreed to purchase. Sandler
X'Xxxxx & Partners, L.P., individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Firm Shares or the Optional Shares, if any, to be purchased by any
Underwriter whose funds have not been received by the relevant Time of Delivery
but such payment shall not relieve such Underwriter from its obligations
hereunder.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Sandler X'Xxxxx & Partners, L.P. may request upon at least
twenty-fours' prior notice to the Company shall be delivered by or on behalf of
the Company to Sandler X'Xxxxx & Partners, L.P., through the facilities of the
Depository Trust Company ("DTC"), for the account of such Underwriter, against
payment by or on behalf of such Underwriter of the purchase price therefor by
wire transfer. The Company will cause the certificates representing the Shares
to be made available for checking and packaging at least twenty-four hours prior
to the Time of Delivery (as defined below) with respect thereto at the office of
DTC or its designated custodian (the "Designated Office"). The time and date of
such delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m.,
Eastern Time, on ______ __, 1999 or such other time and date as Sandler X'Xxxxx
& Partners, L.P. and the Company may agree upon in writing, and, with respect to
the Optional Shares, 9:30 a.m., New York time, on the date specified by Sandler
X'Xxxxx & Partners, L.P. in the written notice given by Sandler X'Xxxxx &
Partners, L.P. of the Underwriters' election to purchase such Optional Shares,
or such other time and date as Sandler X'Xxxxx & Partners, L.P. and the Company
may agree upon in writing. Such time and date for delivery of the Firm Shares is
herein called the "First Time of Delivery," such time and date for delivery of
the Optional Shares, if not the First Time of Delivery, is herein called the
"Second Time of Delivery," and each such time and date for delivery is herein
called a "Time of Delivery".
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(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(k) hereof, will be delivered at the offices
of Elias, Matz, Xxxxxxx & Xxxxxxx L.L.P., 000 00xx Xxxxxx, X.X., Xxxxxxxxxx,
X.X. 00000 (the "Closing Location"), and the Shares will be delivered at the
Designated Office, all at such Time of Delivery. A meeting will be held at the
Closing Location at ______ p.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 each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the execution and
delivery of this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or Prospectus which shall be
disapproved by you promptly after reasonable notice thereof; to advise you,
promptly after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to
the Prospectus or any amended Prospectus has been filed and to furnish you with
copies thereof; to advise you, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or prospectus, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or prospectus or suspending any
such qualification, promptly to use its best efforts to obtain the withdrawal of
such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws of
such jurisdictions as you 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 dealer in securities, to subject itself to taxation as
doing business in any jurisdiction, or to file a general consent to service of
process in any jurisdiction;
(c) Prior to 10:00 am, 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 you may from time to time reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine months after
the time of issue of the Prospectus in connection with the offering or sale of
the Shares and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such period to amend or
supplement the Prospectus in order to comply with the Act, to notify you and
upon your request to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such compliance;
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(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
thereunder (including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to
and including the date 180 days after the date of the Prospectus, not to, and
not to allow its directors and executive officers to, offer, sell, contract to
sell or otherwise dispose of 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 (other than pursuant
to employee stock option plans existing on, or upon the conversion or exchange
of convertible or exchangeable securities outstanding as of, the date of this
Agreement, provided, however, the Company agrees it will not grant any stock
options pursuant to its existing stock option plans to its existing directors
and executive officers), without your prior written consent;
(f) To furnish to its stockholders as soon as practicable after the end
of each fiscal year an annual report (including a balance sheet and statements
of income, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and, as
soon as practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the effective date
of the Registration Statement), consolidated summary financial information of
the Company and its subsidiaries for such quarter in reasonable detail;
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to deliver to
you (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 you 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
stockholders generally or to the Commission);
11
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under the
caption "Use of Proceeds";
(i) If the Company elects to rely on Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act;
(j) To use its best efforts to list for quotation the Shares on the
National Association of Securities Dealers Automated Quotations National Market
System ("NASDAQ"); and
(k) During the period beginning on the date hereof and ending on the
later of the third 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, neither the Company nor the Bank shall, without the
prior written consent of the Representative, take or permit to be taken any
action that could result in the Bank's common stock becoming subject to any
security interest, mortgage, pledge, lien or encumbrance; provided, however,
that this covenant shall be null and void if the Department and the FDIC, and
any other state and federal agency having jurisdiction over the Bank, by
regulation, policy statement or interpretive release or by written order or
written advice addressed to the Bank and specifically addressing the provisions
of Section 8 hereof, permits indemnification of the Underwriters by the Bank as
contemplated by such provisions.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the reasonable
out-of-pocket expenses incurred by the Underwriters in connection with the
transactions contemplated hereby (regardless of whether the sale of the Shares
is consummated), including, without limitation, disbursements, fees and expenses
of the Underwriters' counsel and marketing, syndication and travel expenses;
(ii) the fees, disbursements and expenses of the Company's counsel and
accountants in connection with the registration of the Shares under the Act and
all other expenses in connection with the preparation, printing and filing of
the Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (iii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Blue Sky Memorandum,
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 as provided in Section 5(b) hereof, 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 NASDAQ; (vi) the filing fees
incident to, and the fees and disbursements of counsel for the Underwriters in
connection with, securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (vii) the cost
of preparing stock certificates; (viii) the cost and charges of any transfer
agent or registrar; and (ix) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section.
12
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 Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Eastern Time, on the date of this Agreement; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information
on the part of the Commission shall have been complied with to your
reasonable satisfaction;
(b) Elias, Matz, Xxxxxxx & Xxxxxxx L.L.P., counsel for the
Underwriters, shall have furnished to you such opinion or opinions, dated
such Time of Delivery, with respect to the incorporation of the Company,
the validity of the Shares, the Registration Statement, the Prospectus as
amended or supplemented and other related matters as you 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) Jenkens & Xxxxxxxxx, a Professional Corporation, counsel for the
Company, shall have furnished to you their written opinion, dated such Time
of Delivery, in form and substance satisfactory to you, to the effect that:
(i) The Company is a registered savings and loan holding company
under the Bank Holding Company Act of 1956, as amended (the "BHC
Act"), and has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Commonwealth of
Pennsylvania, with power and authority (corporate and other) to own
its properties and conduct its business as described in the
Prospectus;
(ii) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company (including the Shares being delivered at such Time of
Delivery) have been duly and validly authorized and issued and are
fully paid and nonassessable; the Shares conform to the description of
the Stock contained in the Prospectus; and the holders of outstanding
capital stock of the Company are not entitled to preemptive or other
rights afforded by the Company to subscribe for the Shares;
13
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except where the failure to so qualify or to be in good
standing, as applicable, would not result in a Material Adverse
Effect;
(iv) Each subsidiary of the Company that is a significant
subsidiary (as defined in Rule 1-02 of Regulation S-X of the
Commission) either has been duly incorporated and is validly existing
as a corporation or has been duly chartered and is validly existing as
a savings bank, in each case in good standing under the laws of the
jurisdiction of its organization, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business in all places where such
qualification, or good standing is necessary or the extent not so
qualified or not in good standing, where the failure to obtain such
qualification or to be in good standing would not have a Material
Adverse Effect; no proceeding has been instituted in any such
jurisdiction, revoking, limiting or curtailing, or seeking to revoke,
limit or curtail, such power and authority or qualification; the
activities of the Company, a bank holding company under the BHC Act,
and its subsidiaries are authorized and permitted for bank holding
companies and their subsidiaries under applicable federal and
Pennsylvania law and the rules and regulations of the Board of
Governors of the Federal Reserve System (the "Federal Reserve Board")
and the Pennsylvania Department of Banking (the "Department"); the
activities of the subsidiaries of BankPhiladelphia, a Pennsylvania
chartered and federally insured stock savings bank (the "Bank"), are
authorized and permitted to subsidiaries of a Pennsylvania-charted
savings bank under applicable federal and Pennsylvania law and the
rules and regulations of the Department and the Federal Deposit
Insurance Corporation (the "FDIC"); all of the issued and outstanding
capital stock of each subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable and
is owned, directly or through other subsidiaries of the Company, by
the Company; and all of the capital stock of each subsidiary of the
Company that is owned by the Company, directly or through other
subsidiaries of the Company, is owned free and clear of any pledge,
lien, encumbrance, claim or equity;
(v) The Company and its subsidiaries have good and marketable
title in fee simple to all real property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially affect
the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries;
14
(vi) To the best of such counsel's knowledge, except as disclosed
in the Prospectus, the Company and its subsidiaries are conducting
their respective businesses in compliance in all material respects
with all laws, rules, regulations, decisions, directives and orders
(including, without limitation, all regulations and orders of, or
agreements with, the Department, the Federal Reserve Board and the
FDIC applicable to them); there is no action, suit, investigation or
proceeding before or by any government, governmental instrumentality
or court, domestic or foreign, now pending or, to the knowledge of
such counsel, threatened against or affecting the Company or any of
its subsidiaries (A) that is required to be disclosed in the
Registration Statement and not disclosed therein, (B) that could
result in any Material Adverse Effect, (C) that could materially and
adversely affect the properties, assets or leasehold interests of the
Company and its subsidiaries, considered as one enterprise, or (D)
that could adversely affect the consummation of the transactions
contemplated in this Agreement; 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, which are not
described in the Registration Statement, including ordinary routine
litigation incidental to their respective businesses, would not have a
Material Adverse Effect;
(vii) This Agreement has been duly authorized, executed and
delivered by the Company and the Bank and constitutes a valid and
binding agreement of each of the Company and the Bank, enforceable
against the Company and the Bank in accordance with its terms, except
to the extent that enforceability may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity);
(viii) The issue and sale of the Shares being delivered at such
Time of Delivery by the Company and the compliance by the Company with
all of the provisions of this Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument known to such counsel
to which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the
provisions of the Articles of Incorporation or Bylaws of the Company
or any statute or any order, rule or regulation known to such counsel
of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties;
(ix) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale of the Shares or the consummation
by the Company of the transactions contemplated by this Agreement;
15
(x) Neither the Company nor any of its subsidiaries is in
violation of its Articles of Incorporation, By-laws or charter or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be
bound, except for such defaults that would not result , singly or in
the aggregate, in a Material Adverse Effect;
(xi) The statements set forth in the Prospectus under the caption
"Description of Capital Stock," insofar as they purport to constitute
a summary of the terms of the Stock and under the captions "Risk
Factors," "Business," "Regulation of the Company and the Bank,"
"Management" and "Underwriting," insofar as they purport to describe
the provisions of the laws and documents referred to therein, are
accurate, complete and fair;
(xii) The Company is not, and after giving effect to the offering
and sale of the Shares, will not be, an "investment company" or an
entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act; and
(xiii) Neither the Company nor any other person acting on behalf
of the Company has offered or sold to any person any Stock, or any
securities of the same or a similar class as the Stock which could be
integrated with the offering of the Shares under the rules and
interpretations of the Commission relating to integration of public
and private offerings.
(xiv) The Registration Statement and the Prospectus and any
further amendments and supplements thereto made by the Company prior
to such Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder;
although they do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those referred to
in the opinion in subsection (xi) of this section 7(c), they have no
reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior
to such Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that, as of its date,
the Prospectus or any further amendment or supplement thereto made by
the Company prior to such Time of Delivery (other than the financial
statements and related schedules therein, as to which such counsel
need express no opinion) contained an untrue statement of a material
fact or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading or that, as of such Time of Delivery, either
the Registration Statement or the Prospectus or any further amendment
or supplement thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contains an
untrue statement of a material fact or omits to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and they do
not know of any amendment to the Registration Statement required to be
filed or of any contracts or other documents of a character required
to be filed as an exhibit to the Registration Statement or required to
be described in the Registration Statement or the Prospectus which are
not filed or described as required.
16
(d) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., Eastern Time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, Xxxxx Xxxxxxxx LLP
shall have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance satisfactory to you, to the effect set
forth in Annex I hereto;
(e)(i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included in
the Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus, and (ii) since the respective dates as
of which information is given in the Prospectus there shall not have been any
change in the capital stock, assets, allowance for loan losses or long-term debt
of the Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (i) or
(ii), in the judgment of the Representatives 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;
(f) 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 NASDAQ; (ii) a suspension or
material limitation in trading in the Company's securities on NASDAQ; (iii) a
general moratorium on commercial banking activities declared by either Federal
or New York or Pennsylvania authorities; 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, if the effect of any such event specified in
this Clause (iv) in the judgment of the Representatives 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;
17
(g) The Shares to be sold at such Time of Delivery shall have been duly
listed for quotation on NASDAQ;
(h) The Company has obtained and delivered to the Underwriters executed
copies of an agreement from the stockholders listed on Schedule II hereto,
substantially to the effect set forth in Subsection 5(e) hereof in form and
substance satisfactory to you;
(i) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement; and
(j) The Company shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Company satisfactory to
you as to the accuracy of the representations and warranties of the Company
herein at and as of such Time of Delivery, as to the performance by the Company
of all of its obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (e) of this Section
7 and as to such other matters as you may reasonably request.
8. (a) The Company and the Bank, jointly and severally, will indemnify \and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
Company and the Bank shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Sandler X'Xxxxx
& Partners, L.P. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or 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 such Underwriter through Sandler X'Xxxxx
& Partners, L.P. expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred.
18
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the 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 and commissions 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 (even if the Underwriters
were treated as one entity for such purpose) 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), no Underwriter shall 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 such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
19
(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 respective 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.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such Shares,
then the Company shall be entitled to a further period of thirty-six hours
within which to procure another party or other parties satisfactory to you to
purchase such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so arranged for the
purchase of such Shares, or the Company notifies you that it has so arranged for
the purchase of such Shares, you or the Company shall have the right to postpone
such Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
20
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-tenth of the aggregate number of all the
Shares to be purchased at such Time of Delivery, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the number of
shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-tenth of the aggregate number of all the Shares
to be purchased at such Time of Delivery, or if the Company shall not exercise
the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several 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 any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof, the
Company shall not then be under any liability to any Underwriter except as
provided in Sections 6 and 8 hereof; but, if for any other reason, any Shares
are not delivered by or on behalf of the Company as provided herein, the Company
will reimburse the Underwriters through you for all out-of-pocket expenses ,
including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company shall then be under no further
liability to any Underwriter except as provided in Sections 6 and 8 hereof.
21
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representative at Xxx Xxxxx Xxxxx Xxxxxx,
000xx Xxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxxxx X. Xxxxxx, Principal; and
if to the Company shall be delivered or sent by mail to the address of the
Company set forth in the Registration Statement, Attention: Chief Executive
Officer; provided, however, that any notice to an Underwriter pursuant to
Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its Underwriters'
Questionnaire, or telex constituting such Questionnaire, which address will be
supplied to the Company by you upon request. 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
10 hereof, the officers, partners and directors of the Company and each person
who controls the Company or any 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 any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
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. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York without regard to conflict of law principles.
Each of the Company and the Bank, on behalf of itself and its subsidiaries,
hereby irrevocably submits to the exclusive jurisdiction of the federal and
NewYork 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. Each of the
Company and the Bank, 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.
22
16. 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.
23
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, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters and the Company.
Very truly yours,
XXXXXXXXXXXXX.XXX, INC.
By:_________________________________
Name:
Title:
vBANK
By:_________________________________
Name:
Title:
By:_________________________________
Name:
Title:
Accepted as of the date hereof:
Sandler X'Xxxxx & Partners, L.P.
As representative of the Underwriters
By: Sandler X'Xxxxx & Partners Corp.
the sole general partner
By:_____________________________
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
24
SCHEDULE I
Number of Optional
Shares to be
Total Number of Purchased if
Firm Shares Maximum Option
Underwriter to be Purchased Exercised
----------- --------------- ------------------
Sandler X'Xxxxx & Partners, L.P.
[Names of other Underwriters]...................
---------------- --------------------
Total.....................................
================ ====================
25
SCHEDULE II
Certain Stockholders
26
ANNEX I
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included in the Registration Statement or the Prospectus comply as to form
in all material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the related published rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information,
financial forecasts and/or condensed financial statements derived from
audited financial statements of the Company for the periods specified in
such letter, as indicated in their reports thereon, copies of which have
been separately furnished to the representatives of the Underwriters (the
"Representatives");
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus as
indicated in their reports thereon copies of which have been separately
furnished to the Representatives; and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in the related in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related published rules and regulations, nothing came to their attention
that caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus agrees
with the corresponding amounts (after restatement where applicable) in the
audited consolidated financial statements for such five fiscal years;
1
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the Prospectus, inquiries
of officials of the Company and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus for
them to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in Clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
2
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included in the Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or any decreases
in consolidated net current assets or stockholders' equity or other
items specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with
amounts shown in the latest balance sheet included in the Prospectus,
except in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are described
in such letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date referred
to in Clause (E) there were any decreases in consolidated net revenues
or operating profit or the total or per share amounts of consolidated
net income or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the
Representatives, except in each case for increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs (iii) and
(vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives which are derived from the
general accounting records of the Company and its subsidiaries, which
appear in the Prospectus or in Part II of, or in exhibits and schedules to,
the Registration Statement specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and have
found them to be in agreement.
3
