2,800,000 Shares RAND LOGISTICS, INC. Common Stock ($0.0001 par value per share)

 

 

 

 

September 16, 2011

 

BB&T Capital Markets, a division of

Scott & Stringfellow, LLC

901 East Byrd Street, Suite 300

Richmond, VA 23219

 

Ladies and Gentlemen:

 

Rand Logistics, Inc., a Delaware corporation (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell an aggregate of 2,800,000 shares (the “Firm Shares”) of its common stock $0.0001 par value (the “Common Stock”) to BB&T Capital Markets, a division of Scott & Stringfellow, LLC (the “Underwriter”).  In addition, the Company proposes to grant to the Underwriter an option to purchase up to 420,000 additional shares of Common Stock (the “Optional Shares”).  The Firm Shares and the Optional Shares that the Underwriter elects to purchase pursuant to Section 2 hereof are collectively called the “Shares.”

 

The term “Registration Statement” as used herein means the registration statement on Form S-3 (File No. 333-172815) at the time it originally became effective (or any part thereof that is deemed effective under Rule 430B(f)(2)) (the “Effective Date”), including financial statements, all exhibits and all documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act of 1933, as amended (the “Securities Act”) and, if applicable, the information deemed to be included by Rule 430B of the Securities Act.

 

The term “Prospectus” as used herein means, together with the Base Prospectus (as defined in Section 1(a)), the final prospectus supplement relating to the Shares, as first filed with the Securities and Exchange Commission (the “Commission”) pursuant to Rule 424(b) of the Securities Act on or before the second business day after the date hereof (or such earlier time as may be required under the Securities Act) (the “Prospectus Supplement”).

 

 

The term “Preliminary Prospectus” as used herein shall mean a preliminary prospectus as contemplated by Rule 430B of the Securities Act included at any time in the Registration Statement, including the Base Prospectus and any preliminary prospectus supplement with respect to this offering (the “Preliminary Prospectus Supplement”), and including in each case the documents incorporated by reference therein.

 

The term “Free Writing Prospectus” as used herein shall have the meaning set forth in Rule 405 of the Securities Act.

 

The term “Issuer Free Writing Prospectus” as used herein shall have the meaning set forth in Rule 433 of the Securities Act.

 

The term “Disclosure Package” as used herein shall mean the Preliminary Prospectus as most recently amended or supplemented on or prior to the Initial Time of Sale (as defined below) together with certain Issuer Free Writing Prospectuses identified in Schedule I hereto, if any, and any other Free Writing Prospectus that the parties hereto shall hereafter expressly agree in writing to treat as part of the Disclosure Package.

 

The terms “supplement,” “amendment” and “amend” as used herein with respect to the Registration Statement, the Prospectus, any Free Writing Prospectus, or the Disclosure Package shall mean amendments to the Registration Statement, Prospectus, any Free Writing Prospectus, or the Disclosure Package, as the case may be, and shall include all documents subsequently filed by the Company with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are incorporated by reference therein.  As used herein, the term “Incorporated Documents” means the documents that are incorporated by reference in the Registration Statement, the Prospectus, any Preliminary Prospectus, or any amendment or supplement thereto during the period when a prospectus (or in lieu thereof, the notice contemplated by Rule 173(a) of the Securities Act) relating to any of the Shares is required to be delivered under the Securities Act by the Underwriter or any dealer.

 

For the purposes of this Agreement, all references to the Registration Statement, any Preliminary Prospectus, any Free Writing Prospectus or the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (“EDGAR”).

 

 

The Company represents and warrants to, and agrees with the Underwriter as of the date hereof and as of each “Delivery Date” (as defined below in Section 4) that:

 

(a)           In connection with the transactions contemplated by this Underwriting Agreement (the “Agreement”), a registration statement on Form S-3 (Registration No. 333-172815) with respect to the Shares, including a base prospectus (the “Base Prospectus”), and such amendments or post-effective amendments to such registration statement as may have been required to the date of this Agreement, have been prepared by the Company in conformity with the requirements of the Securities Act and have been filed with the Commission in the form heretofore delivered to you.  Copies of such registration statement, including any amendments thereto, each related preliminary prospectus (meeting the requirements of Rule 430B of the Securities Act) contained therein, and the exhibits, financial statements and schedules thereto have heretofore been made available by the Company to the Underwriter.  A final prospectus containing information permitted to be omitted at the time of effectiveness by Rule 430B of the Securities Act will be filed promptly by the Company with the Commission in accordance with Rule 424(b) of the Securities Act.

 

 

(b)           The Company meets the requirements for use of Form S-3 under the Securities Act.  Neither the Commission nor any state or other jurisdiction or other regulatory body has issued, and none is, to the knowledge of the Company, threatening in writing to issue, any stop order under the Securities Act or other order suspending the effectiveness of the Registration Statement (as amended or supplemented) or preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending the qualification or registration of the Shares for offering or sale in any jurisdiction nor instituted or, to the knowledge of the Company, threatened in writing to institute proceedings for any such purpose.  The Disclosure Package as of 8:00 am ET on the date hereof (the “Initial Time of Sale”), the Registration Statement at each Effective Date, and the Prospectus and any amendments or supplements thereto when they are filed with the Commission or become effective, as the case may be, in all material respects conform or will conform, as the case may be, to the requirements of the Securities Act.  Neither the Registration Statement nor any amendment thereto, as of the applicable Effective Date, contains or will contain, as the case may be, any untrue statement of a material fact or omits or will omit to state any material fact required to be stated therein or necessary to make the statements therein, not misleading.  Neither the Prospectus nor any amendment or supplement thereto contains or will contain, as the case may be, any untrue statement of a material fact or omits or will omit to state any 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.  Neither the Disclosure Package nor any amendment or supplement thereto, at the Initial Time of Sale, contains or will contain, as the case may be, any untrue statement of a material fact or omits or will 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.  Notwithstanding the foregoing, the Company makes no representation or warranty as to information contained in or omitted from the Registration Statement, the Disclosure Package or the Prospectus, or any such amendment or supplement, in reliance upon, and in conformity with, written information furnished by the Underwriter to the Company relating to the Underwriter for use in the preparation thereof (as provided in Section 8(b) hereof).  There is no contract, agreement, understanding or arrangement, whether written or oral, or document required to be described in the Registration Statement, Disclosure Package or Prospectus or to be filed as an exhibit to the Registration Statement that is not described, filed or incorporated by reference as required by the Securities Act.

 

(c)           The Registration Statement conforms, and the Disclosure Package and the Prospectus and any further amendments or supplements to the Registration Statement, the Disclosure Package and/or the Prospectus will conform, in all material respects to the requirements of the Securities 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

 

 

(d)           The Incorporated Documents, at the time they became effective or at the time they were filed with the Commission, complied in all material respects with the requirements of the Exchange Act.  During the period when a prospectus (or in lieu thereof, the notice contemplated by Rule 173(a) of the Securities Act) relating to any of the Shares is required to be delivered under the Securities Act by the Underwriter or any dealer, any future documents incorporated by reference or deemed incorporated by reference so filed, when they are filed, will comply in all material respects with the requirements of the Exchange Act.  No such incorporated document contained or will contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and, when read together and with the other information in each of the Disclosure Package and the Prospectus, at the Effective Date of the Registration Statement, at the Initial Time of Sale and at the First Delivery Date (and, if any Optional Shares are purchased, at the Second Delivery Date), each such incorporated document did not or will not, as the case may be, 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.

 

(e)           The Preliminary Prospectus, any Free Writing Prospectus and the Prospectus when filed, if filed by electronic transmission, pursuant to EDGAR (except as may be permitted by Regulation S-T under the Securities Act), were identical to the copies thereof delivered to the Underwriter for use in connection with the offer and sale of the Shares.

 

(f)           The Company is not an “ineligible issuer” as defined in Rule 405 under the Securities Act in connection with the offering; any Free Writing Prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder; each Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder.  Except for the Issuer Free Writing Prospectus, if any, identified in Schedule I hereto, the Company has not prepared, used or referred to, and will not, without the prior consent of the Underwriter, prepare, use or refer to, any free writing prospectus.

 

(g)           Since the respective dates as of which information is given in the Registration Statement, the Disclosure Package and the Prospectus, and except as otherwise set forth or expressly contemplated therein, (i) there has not been any change in the capital stock or long-term debt of the Company or its subsidiaries or any material adverse change, or any development involving a prospective material adverse change, in or affecting the management, condition (financial or otherwise), business, properties, stockholders’ equity or results of operations of the Company or its subsidiaries taken as a whole; (ii) there have been no transactions entered into by the Company, or its subsidiaries, other than transactions entered into in the ordinary course of business, that are material with respect to the Company or its subsidiaries taken as a whole; and (iii) there has been no dividend or distribution of any kind declared, paid or made by the Company or its subsidiaries on any class of its respective capital stock or membership interests.

 

 

(h)           The Company and its subsidiaries have good and marketable title 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 (i) such as are described in the Disclosure Package and Prospectus or (ii) maritime liens arising in the ordinary course of business of the Company and its subsidiaries or other liens, none of which 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 or its subsidiaries; and any real property and buildings held under lease by the Company or 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 or its subsidiaries.

 

(i)           The Company and its subsidiaries have been duly incorporated and are validly existing as corporations, in good standing under the laws of their respective jurisdictions of incorporation, with power and authority (corporate and other) to own or lease their respective properties and conduct their respective businesses as described in the Disclosure Package and Prospectus; and each 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 effect on the condition (financial or otherwise), prospects, earnings, business or properties of the Company or its subsidiaries taken as a whole (“Material Adverse Effect”); and each of the Company and its subsidiaries holds all material licenses, certificates, authorizations and permits from governmental authorities necessary for the conduct of its business as described in the Disclosure Package and Prospectus.

 

(j)           The Company has an authorized capitalization as set forth in the Disclosure Package and the Prospectus; 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 capital stock of the Company contained in the Disclosure Package and the Prospectus; there are no preemptive or other rights to subscribe for or to purchase any securities of the Company under the Amended and Restated Certificate of Incorporation of the Company or under Delaware law; except as described in the Disclosure Package and the Prospectus, there are no warrants, options or other rights to purchase any securities of the Company which have been granted by the Company; and neither the filing of the Registration Statement nor the offering or sale of the Shares as contemplated by this Agreement gives rise to any rights for or relating to the registration of any securities of the Company.

 

(k)           The Shares have been duly authorized and, when issued and delivered against payment therefor as provided herein, will be validly issued and fully paid and nonassessable and will conform to the description of the Shares contained in the Disclosure Package and the Prospectus.

 

(l)           The issuance and sale of the Shares being issued at each Delivery Date by the Company and the performance of this Agreement and the consummation by the Company of the other 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, or result in the creation or

 

 

(m)           There are no legal or governmental proceedings pending to which the Company or its subsidiaries is a party or of which any of their respective properties or assets is subject, which, if determined adversely to the Company or 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 by others.  Except as previously disclosed to the Underwriter, neither the Company nor any of its subsidiaries is subject or is party to, or has received any notice or advice that any of them may become subject or party to any investigation with respect to, any corrective, suspension or cease-and-desist order, agreement, memorandum of understanding, consent agreement or other regulatory enforcement action, proceeding or order.

 

(n)           Grant Thornton LLP, the independent registered chartered accounting firm that certified the financial statements of the Company and its subsidiaries that are included in or incorporated by reference into the Registration Statement, the Disclosure Package and the Prospectus, is an independent registered chartered accounting firm as required by the Securities Act and the rules and regulations of the Commission thereunder and by the rules of the Public Company Accounting Oversight Board, and such accountants are not in violation of the auditor independence requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and the related rules and regulations of the Commission.

 

(o)           All employee benefit plans established, maintained or contributed to by the Company and its subsidiaries comply in all material respects with all applicable requirements of ERISA and no such plan has incurred or assumed an “accumulated funding deficiency” within the meaning of Section 302 of ERISA or has incurred or assumed any material liability to the Pension Benefit Guaranty Corporation.

 

(p)           The consolidated financial statements of the Company, together with related notes, as set forth in the Registration Statement, the Disclosure Package and the Prospectus, present fairly the consolidated financial position and the results of operations of the Company at the indicated dates and for the indicated periods, all in accordance with accounting principles generally accepted in the United States of America, consistently applied throughout the periods presented except as noted in such financial statements and the notes thereon, and all adjustments necessary for a fair presentation of results for such

 

 

(q)           Neither the Company nor any of its subsidiaries are, and after giving effect to the offering and sale of the Shares as herein contemplated 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.

 

(r)           The Company and its subsidiaries (i) are in compliance with any and all applicable United States and Canadian federal, state, provincial and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”); (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, have a Material Adverse Effect.

 

(s)           Except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus, neither the Company nor any of its subsidiaries is aware of (i) any material weakness in its internal control over financial reporting or (ii) change in internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

(t)           To the extent that the Sarbanes-Oxley Act and the rules and regulations promulgated by the Commission and the Nasdaq Stock Market, Inc. thereunder have been applicable to the Company, there is and has been no failure on the part of the Company to comply in all material respects with any provision of the Sarbanes-Oxley Act or such rules and regulations.  The Company has taken all necessary actions to ensure that it is in compliance with all provisions of the Sarbanes-Oxley Act and such rules and regulations that are in effect and with which the Company is required to comply.

 

(u)           There are no contracts or documents which are required to be described in the Registration Statement, the Disclosure Package and the Prospectus or the documents incorporated by reference therein or to be filed as exhibits thereto which have not been so described and filed as required.

 

(v)           The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; neither the

 

 

(w)           The Company and its subsidiaries have filed all federal, state, local and foreign income and franchise tax returns that have been required to be filed (or have received extensions with respect thereto) other than those filings being contested in good faith, and have paid, or made adequate reserves for, all taxes indicated by said returns and all assessments received by them to the extent that such taxes have become due and are not being contested in good faith.

 

(x)           No relationship, direct or indirect, exists between or among the Company and its subsidiaries, on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company and its subsidiaries, on the other hand, that is required by the Securities Act or by the rules and regulations thereunder to be described in the Registration Statement, the Disclosure Package and the Prospectus which is not so described.

 

(y)           The Company and any of its subsidiaries that own the marine vessels described in the Prospectus that operate in the United States coastwise trade (the “U.S. Vessels”) are, and at all times have been, citizens of the United States within the meaning of Section 2 of the Shipping Act of 1916, as amended, 46 U.S.C. §802 (the “Shipping Act”), and qualified to engage in coastwise trade. At no time during the Company or any subsidiary’s ownership of the U.S. Vessels have any of the U.S. Vessels been sold, chartered or otherwise transferred to any person or entity in violation of any applicable laws, rules or regulations. Except as set forth on Schedule II, each U.S. Vessel has a clean certificate of inspection from the United States Coast Guard and an American Bureau of Shipping load line certificate where applicable, in each case free of reported or reportable exceptions or notations of record.  In addition, each U.S. Vessel has proper classification certificates and national certificates which are valid and without condition or recommendation by class or any of the relevant authorities and the operation of each U.S. Vessel is not in violation of any applicable United States or Canadian law or regulation.

 

(z)           The Company and any of its subsidiaries that own the marine vessels described in the Prospectus that operate in the Canadian coastwise trade (the “Canadian Vessels”) are, and at all times have been, qualified to engage in such coastwise trade pursuant to the Coasting Trade Act (Canada), and at no time during the Company or any subsidiary’s ownership of such Canadian Vessels have any of such Canadian Vessels been sold, chartered or otherwise transferred to any person or entity in violation of any applicable laws, rules or regulations. Except as set forth on Schedule II, each Canadian Vessel has a clean certificate of inspection from Transport Canada Marine Inspection and a Great Lakes and Inland Waters of Canada Load Line Certificate issued by Transport Canada, where applicable, in each case free of reported or reportable exceptions or notations of record.  In addition, each Canadian Vessel has proper classification certificates and national certificates which are valid and without condition or recommendation by class or any of the relevant authorities and the operation of each Canadian Vessel is not in violation of any applicable United States or Canadian law or regulation.

 

 

(aa)           Neither the Company nor any of its subsidiaries nor, to the Company’s knowledge, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of its subsidiaries has (i) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder; (ii) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity or to influence official action; (iii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

 

(bb)           The Shares to be delivered and sold by the Company are duly authorized for listing and quotation, subject to official notice of issuance, on NASDAQ.  The Company will timely file with NASDAQ all documents and notices required by NASDAQ of companies that have or will issue securities that are traded on NASDAQ.

 

(cc)           The Company and its subsidiaries have not taken and will not take, directly or indirectly, any action which is designed to or which has constituted or which might reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares.

 

(dd)           This Agreement has been duly authorized, executed and delivered, by the Company and is a valid and binding agreement of the Company in accordance with its terms.

 

(ee)           Each “forward-looking statement” (within the meaning of Section 27A of the Securities Act or Section 21E of the Exchange Act) contained or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus has been made or reaffirmed with a reasonable basis and in good faith.

 

(ff)           All statistical or market-related data included or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus are based on or derived from sources that the Company reasonably believes to be reliable and accurate, and the Company has obtained the written consent for the use of such data from such sources to the extent required.

 

(gg)           The Company has not received any notice from NASDAQ regarding the delisting of the Common Stock from NASDAQ.

 

(hh)           Except pursuant to this Agreement, neither the Company nor any of its subsidiaries has incurred any liability for any finder’s or broker’s fee or agent’s commission in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby or by the Registration Statement.

 

(ii)           To the Company’s knowledge, there are no affiliations or associations between (i) any member of FINRA and (ii) the Company or any of the Company’s officers, directors or 5% or greater security holders or any beneficial owner of the Company’s unregistered equity securities that were acquired at any time on or after the 180th day immediately preceding the date the Registration Statement was initially filed with the Commission, except (a) as disclosed in the Registration Statement (excluding exhibits thereto), the Disclosure Package and the Prospectus, and (b) Richard Berner and Thomas Berner, affiliates of Islandia, L.P., none of whom will participate as an underwriter, or receive any compensation in connection with, this offering.

 

 

(jj)           Each of the Company and its subsidiaries owns or possesses all inventions, patent applications, patents, trademarks (both registered and unregistered), tradenames, service names, copyrights, trade secrets and other proprietary information described in the Registration Statement, the Preliminary Prospectus, the Prospectus and the Issuer Free Writing Prospectus, if any, as being owned or licensed by it or which is necessary for the conduct of, or material to, its businesses (collectively, the “Intellectual Property”), except where the failure to own or possess such Intellectual Property would not, individually or in the aggregate, have a Material Adverse Effect, and the Company is unaware of any claim to the contrary or any challenge by any other person to the rights of the Company or any of its subsidiaries with respect to the Intellectual Property that, if resolved adversely to the Company, would, individually or in the aggregate, have a Material Adverse Effect; neither the Company nor any of its subsidiaries has infringed or is infringing the intellectual property of a third party, and neither the Company nor any of its subsidiaries has received notice of a claim by a third party to the contrary that, if resolved adversely to the Company, would, individually or in the aggregate, have a Material Adverse Effect.

 

(kk)           Neither the Company nor any of its subsidiaries is engaged in any unfair labor practice; except for matters which would not, individually or in the aggregate, have a Material Adverse Effect, (i) there is (A) no unfair labor practice complaint pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries before the National Labor Relations Board, and no grievance or arbitration proceeding arising out of or under collective bargaining agreements is pending or, to the Company’s knowledge, threatened, (B) no strike, labor dispute, slowdown or stoppage pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries and (C) no union representation dispute currently existing concerning the employees of the Company or any of its subsidiaries, (ii) to the Company’s knowledge, no union organizing activities are currently taking place concerning the employees of the Company or any of its subsidiaries and (iii) there has been no violation of any federal, state, local or foreign law relating to discrimination in the hiring, promotion or pay of employees, any applicable wage or hour laws or any provision of the Employee Retirement Income Security Act of 1974 (“ERISA”) or the rules and regulations promulgated thereunder concerning the employees of the Company or any of its subsidiaries.

 

 

Subject to the terms and conditions herein set forth, (a) the Company agrees to issue and sell to the Underwriter, and the Underwriter agrees to purchase from the Company, at a purchase price per share of $5.745 (representing a public offering of $6.00 per share, less an underwriting discount of $.255 per share), and (b) in the event and to the extent that the Underwriter shall exercise its election to purchase Optional Shares as provided below, the Company agrees to issue and sell to the Underwriter, and the Underwriter agrees to purchase from the Company, at the purchase price per share set forth in clause (a) of this Section 2 that portion of the number of Optional Shares as to which such election shall have been exercised.

 

Subject to the terms and conditions herein set forth, the Company hereby grants to the Underwriter the right to purchase at its election up to 420,000 Optional Shares, at the purchase price per share set forth in clause (a) of the paragraph above, for the

 

 

 

Upon authorization by the Company of the release of the Firm Shares, the Underwriter proposes to offer the Firm Shares for sale upon the terms and conditions set forth in the Prospectus.

 

 

Certificates in definitive form for the Shares to be purchased by the Underwriter hereunder, and in such denominations and registered in such names as you may request upon at least two business days’ prior notice to the Company, shall be delivered by or on behalf of the Company to you for the account of the Underwriter, against payment of the purchase price therefor by wire transfer of same day funds to an account designated by the Company at least 24 hours in advance (the Company agreeing to reimburse the Underwriter for any costs associated with such settlement, if any), all at the offices of BB&T Capital Markets, a division of Scott & Stringfellow, LLC, 901 East Byrd Street, Suite 300, Richmond, Virginia 23219.  Such certificates may be deposited with the Depository Trust Company (“DTC”) or a custodian for DTC and registered in the name Cede & Co., as nominee for DTC.  The time and date of such delivery and payment shall be with respect to the Firm Shares, 10:00 a.m., Richmond, Virginia time, on September 21, 2011, or at such other time and date as you and the Company may agree upon in writing and, with respect to the Optional Shares, 10:00 a.m., Richmond, Virginia time, on the date specified by you in the written notice of the Underwriter’s election to purchase such Optional Shares, or at such other time and date as you and the Company may agree upon in writing.  Such time and date for delivery of the Firm Shares is herein called the “First Delivery Date,” such time and date for delivery of the Optional Shares, if not the First Delivery Date, is herein called the “Second Delivery Date,” and each such time and date for delivery is herein called a “Delivery Date.”  Such certificates will be made available to the Underwriter for checking and packaging at least 24 hours prior to each Delivery Date at the offices of BB&T Capital Markets, a division of Scott & Stringfellow, LLC, in Richmond, Virginia or such other location designated by the Underwriter to the Company.

 

 

The Company agrees with the Underwriter:

 

(a)           To prepare the Prospectus in a form reasonably approved by you and to file the Prospectus pursuant to Rule 424(b) under the Securities Act within the time period prescribed or, if applicable, such earlier time as may be required by Rule 430B under the Securities Act; to make no amendment or supplement to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Prospectus which shall be reasonably disapproved by you promptly after reasonable notice thereof;

 

 

(b)           To furnish to the Underwriter a copy of each proposed Free Writing Prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed Free Writing Prospectus to which the Underwriter reasonably objects.

 

(c)           Not to take any action that would result in the Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a Free Writing Prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.

 

(d)           If the Disclosure Package is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Disclosure Package in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if any event shall occur or condition exist as a result of which the Disclosure Package conflicts with the information contained in the Registration Statement then on file, or if, in the reasonable opinion of counsel for the Underwriter, it is necessary to amend or supplement the Disclosure Package to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriter and to any dealer upon request, either amendments or supplements to the Disclosure Package so that the statements in the Disclosure Package as so amended or supplemented will not, in the light of the circumstances when delivered to a prospective purchaser, be misleading or so that the Disclosure Package, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Disclosure Package, as amended or supplemented, will comply with applicable law.

 

(e)           If, during such period after the first date of the public offering of the Shares as, in the opinion of counsel for the Underwriter the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is required by law to be delivered in connection with sales by the Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is delivered to a purchaser, not misleading, or if, in the reasonable opinion of counsel for the Underwriter, it is necessary to amend or supplement the Prospectus

 

 

(f)           Promptly from time to time to take such actions as you may reasonably request to qualify the Shares for offering and sale under the securities laws of such jurisdictions as you have requested and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Shares, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction.

 

(g)           As soon as practicable, but not later than the Availability Date (as defined below), to make generally available to its security holders and deliver to you an earnings statement of the Company covering a period of at least twelve months beginning after the effective date of the Registration Statement which will satisfy the provisions of Section 11(a) of the Securities Act (for the purpose of this subsection 5(g) only, “Availability Date” means the 45th day after the end of the fourth fiscal quarter following the fiscal quarter that includes the effective date of the Registration Statement, except that, if such fourth fiscal quarter is the last quarter of the Company’s fiscal year, “Availability Date” means the 90th day after the end of such fourth fiscal quarter).

 

(h)           To furnish to the holders of the Shares as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of operations, changes in stockholders’ equity and cash flows of the Company and its consolidated subsidiaries certified by independent public accountants) and, make available to the holders of the Shares 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 consolidated subsidiaries for such quarter in reasonable detail.

 

(i)           During a period of five years from the effective date of the Registration Statement, to make available on EDGAR or furnish to you copies of all reports or other communications (financial or other) furnished to stockholders, and 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 are listed; and (ii) such additional information concerning the business and financial condition of the Company as you may from time to time reasonably request, except to the extent such information is publicly available through the Commission’s website or disseminated through a national news service.

 

 

(j)           If the Company elects to rely on Rule 462(b), the Company shall file a Rule 462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 p.m., Eastern time on the date of this Agreement, and the Company shall at the time of filing either pay to the Commission the filing fee for the Rule 462(b) Registration Statement or give irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the Securities Act.

 

(k)           During the period beginning from the date hereof and continuing to and including the date ninety (90) days after the date hereof, the Company will not offer, sell, contract to sell or otherwise dispose of, except as provided hereunder, any securities of the Company that are substantially similar to the Shares, including but not limited to any securities that are convertible into or exchangeable for, or that represent the right to receive, Shares or any such substantially similar securities without the prior written consent of the Underwriter; provided, however, that (A) the Company may issue and sell the securities pursuant to this Agreement, (B) the Company may issue and sell Common Stock and options to purchase Common Stock pursuant to any employee or director stock option, employee stock purchase, deferred compensation or 401(k) plans described in the Prospectus, as such plans (the “Existing Plans”) are in effect on the date of this Agreement, and (C) the Company may issue Common Stock upon the exercise of stock options pursuant to any such Existing Plan.  Notwithstanding anything contained in this Section 5(k) to the contrary, if (A) during the last seventeen (17) days of the ninety-day period referenced above, the Company issues an earnings release or material news or material event relating to the Company occurs; or (B) prior to the expiration of the ninety-day period referenced above, the Company announces that it will release earnings results during the sixteen-day period beginning on the last day of such ninety-day period, and, in either the case of clause (A) or (B) immediately above, the safe harbor pursuant to Rule 139 under the Securities Act is not available to the Underwriter, the restrictions imposed by this Section 5(k) shall continue to apply until the expiration of the eighteen-day period beginning on the issuance of the earnings release or the occurrence of the materials news or material event.

 

(l)           To apply the net proceeds from the sale of the Shares for the purposes set forth in the Prospectus.

 

 

The Company agrees with the Underwriter that the Company will pay or cause to be paid the following, whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated: (i) the fees, disbursements and expenses of the Company’s counsel and accountants in connection with the registration of the Shares under the Securities Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus, the Disclosure Package, the Prospectus and any Free Writing Prospectus and amendments and supplements thereto, and the mailing and delivering of copies thereof to the Underwriter and dealers; (ii) the cost of printing or reproducing this Agreement, the Blue Sky memorandum and any other documents in connection with the offering, purchase, sale and delivery of the Shares; (iii) all expenses in connection with the qualification of the Shares for offering and sale under state securities laws as provided in Section 5(f) hereof, including the reasonable fees and disbursements of counsel for the Underwriter in connection with such qualification and in connection with the Blue Sky memorandum; (iv) the filing fees incident to securing any required review

 

 

If the sale of the Shares provided for herein is not consummated because any condition to the obligations of the Underwriter set forth in Section 7 hereof is not satisfied or because of any refusal, inability or failure on the part of the Company to perform any agreement herein or comply with any provision hereof other than by reason of a default by the Underwriter, the Company will reimburse the Underwriter upon demand for all out-of-pocket accountable expenses (including reasonable fees and disbursements of counsel) that shall have been actually incurred by it in connection with the proposed purchase and sale of the Shares.

 

 

The obligations of the Underwriter hereunder, as to the Shares to be delivered at each Delivery Date, shall be subject, in its discretion, to the condition that all representations and warranties and other statements of the Company herein are, at and as of the date hereof and each Delivery Date, true and correct and the condition that the Company shall have performed all of its obligations hereunder theretofor to be performed, and the following additional conditions:

 

(a)           The Prospectus, and, any such supplement, shall have been filed with the Commission in the manner and within the time period required by Rule 424(b); no stop order suspending the use of the Prospectus or any Issuer Free Writing Prospectus shall have been issued and no proceeding for that purpose shall have been initiated or, to the knowledge of the Company, 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)           On each Delivery Date, Squire, Sanders & Dempsey (US) LLP, counsel for the Underwriter, shall have furnished to you an opinion or opinions, dated such dates, with respect to the issuance and sale of the Shares on each such Delivery Date, the Registration Statement, the Disclosure Package, the Prospectus, 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)           On each Delivery Date, Katten Muchin Rosenman LLP (“Katten”), counsel for the Company, shall have furnished to you its written opinion, dated such dates, in form and substance satisfactory to you, to the effect that:

 

 

(i)           Neither the Company nor its subsidiaries are an “investment company” as such term is defined in the Investment Company Act of 1940, as amended;

 

(ii)           The Company and its subsidiaries have been duly incorporated or organized and are validly existing as corporations or limited liability companies, as applicable, in good standing under the laws of their respective jurisdictions of incorporation or organization, with corporate power and authority to own or lease their respective properties and conduct their respective businesses as described in the Disclosure Package and the Prospectus, and each of the Company and its subsidiaries is duly qualified to do business and are in good standing in each jurisdiction in which it owns or leases property or conducts business so as to require such qualification except where the failure to so qualify would not result in a Material Adverse Effect;

 

(iii)           All of the issued shares of capital stock of the Company have been duly authorized and validly issued and conform to the description contained in the Prospectus; and there are no preemptive or similar rights to subscribe for or to purchase any securities of the Company under the Amended and Restated Certificate of Incorporation of the Company or under Delaware law;

 

(iv)           The Registration Statement has been declared effective under the Securities Act; any required filing of the Prospectus, and any supplements thereto, pursuant to Rule 424(b) has been made in the manner and within the time period required by Rule 424(b), to the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose has been instituted or threatened under the Securities Act;

 

(v)           The Shares have been duly authorized and, when issued and delivered against payment therefor as provided herein, will be validly issued and fully paid and nonassessable and conform to the description of the Shares contained in the Prospectus, as amended or supplemented, and will be free of statutory preemptive rights and contractual preemptive rights, resale rights, rights of first refusal and similar rights;

 

(vi)           To such counsel’s knowledge, 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 or assets of the Company or its subsidiaries is subject which, if determined adversely to the Company or its subsidiaries would individually or in the aggregate, have a Material Adverse Effect, and, to such counsel’s knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others;

 

(vii)           This Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding agreement of the Company enforceable against the Company in accordance with its terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent conveyance or other similar laws affecting the rights of creditors now or hereafter in effect, and to equitable principles that may limit the right to specific enforcement of remedies, and except insofar as the enforceability of the indemnity and contribution provisions contained in this Agreement may be limited by federal and state securities laws);

 

 

(viii)           The issuance and sale of the Shares and the performance of this Agreement by the Company and the consummation of the other transactions contemplated by this Agreement will not result in any violation of the provisions of the certificate of incorporation, bylaws, articles of organization or operating agreement of the Company or its subsidiaries, as applicable, or of 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 its subsidiaries or any of their respective properties;

 

(ix)           No consent, approval, authorization, order, registration or qualification of or with any court or governmental agency or body is required for the issuance and sale of the Shares by the Company or the consummation by the Company of the other transactions contemplated by this Agreement, except such as have been obtained under the Securities Act, such as may be required under state securities or Blue Sky laws, any necessary listing application with NASDAQ, and such as may be required under the rules of FINRA in connection with the purchase and distribution of the Shares by the Underwriter;

 

(x)           The Registration Statement, the Disclosure Package and the Prospectus and any further amendments and supplements thereto made by the Company prior to such Delivery Date (other than the financial statements and related schedules and other financial and statistical information included therein and information furnished for use therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Securities Act and the rules and regulations thereunder; the eligibility requirements for the use of Form S-3 in connection with the registration of Shares were met at the time of filing the Registration Statement; and the Registration Statement meets, and the offering and sale of the Shares as contemplated by the Underwriting Agreement complies with, the requirements of Rule 415 under the Act;

 

(xi)           The Amended and Restated Certificate of Incorporation of the Company and the Second Amended and Restated By-laws of the Company, each in the form filed as an exhibit to the Registration Statement, have been duly adopted and are in full force and effect as of the date hereof, in each case in accordance with the Delaware General Corporation Law, and the Amended and Restated Certificate of Incorporation has been filed as required with the Secretary of State of Delaware;

 

(xii)           The Shares are duly listed and authorized for trading, subject to official notice of issuance, on The NASDAQ Stock Market;

 

(xiii)           To such counsel’s knowledge, there are no contracts, licenses, agreements, leases or documents of any character that are required to be described in the Registration Statement, the Disclosure Package and the Prospectus or to be filed as an exhibit to the Registration Statement, the Disclosure Package and the Prospectus that have not been so described or filed as required; and

 

 

(xiv)           Except for the rights described in the Prospectus that have not been exercised, no person has the right, pursuant to the terms of any contract, agreement or other instrument described in or filed as an exhibit to the Registration Statement or any Incorporated Documents, or otherwise known to us, to cause the Company to register under the Securities Act any shares of capital stock of the Company or to include any such shares in the Registration Statement or the offering contemplated thereby.

 

In rendering such opinions, such counsel may rely as to matters of fact, to the extent deemed proper, on certificates of responsible officers of the Company and its subsidiaries, and public officials.  On each Delivery Date, Katten shall also deliver a letter to you stating that nothing has come to its attention which leads it to believe that, as of the effective date of the Registration Statement and as of each Delivery Date, the Registration Statement, the Disclosure Package or the Prospectus or, as of its date, any further amendment or supplement thereto made by the Company prior to the Delivery Date (in each case, except for the financial statements and the related schedules and other financial and statistical information included therein, as to which such counsel need not address) contains an untrue statement of a material fact or omits 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.  With respect to such statement, such counsel may state that its belief is based upon the procedures set forth therein, but is without independent check or verification.

 

(d)           At 10:00 a.m., Richmond, Virginia time, on the date of this Agreement and also at each Delivery Date, Grant Thornton LLP shall have furnished to you a letter or letters, dated the respective dates of delivery thereof, in form and substance satisfactory to you, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information of the Company contained or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus.

 

(e)           (i) The Company and its subsidiaries shall not have sustained since the date of the latest audited financial statements included in the Prospectus, any loss or interference with their respective businesses 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 expressly contemplated in the Disclosure Package and the Prospectus, and (ii) since the respective dates as of which information is given in the Prospectus there shall not have been any change in the capital stock or long-term debt of the Company or 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 or its subsidiaries, otherwise than as set forth or contemplated in the Disclosure Package and the Prospectus, the effect of which, in any such case described in clause (i) or (ii), is in your judgment so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Shares being delivered at such Delivery Date on the terms and in the manner contemplated by 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 the NASDAQ; (ii) a suspension or material limitation in trading in the Company’s securities on the NASDAQ; or (iii) (A) the outbreak or escalation of hostilities involving the

 

 

(g)           The Company shall have furnished or caused to be furnished to you copies of agreements between the Company and each of the executive officers and directors of the Company named on Schedule III hereto, in form and content satisfactory to you, pursuant to which such persons agree not to offer, sell, or contract to sell, or otherwise dispose of any shares of the Common Stock beneficially owned by them, or any securities convertible into, or exchangeable for, shares of Common Stock on or before the ninetieth (90th) day after the date of this Agreement without your prior written consent.

 

(h)           The Company shall have furnished or caused to be furnished to you on the date of this Agreement and on each Delivery Date 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 the date hereof and the Delivery Date, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Delivery Date, 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.

 

(i)           The Shares shall have been approved for quotation and trading on the NASDAQ.

 

(j)           FINRA shall not have raised any objection with respect to the fairness or reasonableness of the underwriting, or other arrangements of the transactions contemplated hereby.

 

If any of the conditions specified in this Section 7 shall not have been fulfilled in all material respects when and as provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere in this Agreement shall not be in all material respects reasonably satisfactory in form and substance to the Underwriter and its counsel, this Agreement and all obligations of the Underwriter hereunder may be canceled at, or at any time prior to, each Delivery Date by the Underwriter.  Notice of such cancellation shall be given to the Company in writing, or by telephone or facsimile (with written confirmation of receipt).

 

 

(a)           The Company will indemnify and hold harmless the Underwriter, and each person, if any, who controls the Underwriter within the meaning of the Securities Act and the Exchange Act, against any losses, claims, damages or liabilities, joint or several, to which the Underwriter may become subject, under the Securities Act or otherwise, insofar as such losses, claims damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any breach of any representation, warranty, agreement or covenant of the Company herein contained or (ii) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof, or in any Preliminary Prospectus, Issuer Free Writing Prospectus, the Disclosure Package 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

 

 

(b)           The Underwriter agrees to indemnify and hold harmless the Company against any losses, claims, damages or liabilities, joint, or several, to which the Company may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information deemed to be a part thereof, any Preliminary Prospectus, Issuer Free Writing Prospectus, the Disclosure Package 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, Issuer Free Writing Prospectus, the Disclosure Package or Prospectus or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by the Underwriter through you expressly for use therein; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating, preparing to defend or defending, or appearing as a third party witness in connection with, any such action or claim as such expenses are incurred.

 

(c)           Promptly after receipt by an indemnified party under subsections (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection, unless and to the extent that such indemnifying party did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses.  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 reasonably satisfactory to such indemnified party; provided, however, that if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have been advised by counsel that representation of such indemnified party and the indemnifying party would present such counsel with a conflict of

 

 

(d)           If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsections (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriter on the other from the offering of the Shares.  If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law, then the indemnifying party shall contribute to such amount paid or payable by the indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company and the Underwriter in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions or proceedings in respect thereof), as well as any other relevant equitable considerations.  The relative benefits received by the Company and the Underwriter shall be deemed to be in the same proportion in the case of the Company as the total price paid to the Company for the Shares by the Underwriter (net of underwriting discount but before deducting expenses), and in the case of the Underwriter as the underwriting discount received by it bears to the total of such amounts paid to the Company and received by the Underwriter as underwriting discount in each case as contemplated by the Prospectus.  The relative fault of the Company and the Underwriter 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 or by the Underwriter and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The Company

 

 

(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 officer, director, employee and agent of the Underwriter and each person, if any, who controls the Underwriter within the meaning of the Securities Act; and the obligations of the Underwriter under this Section 8 shall be in addition to any liability which the Underwriter may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company and to each person, if any, who controls the Company within the meaning of the Securities Act.

 

 

The respective indemnities, agreements, representations, warranties and other statements of the Company and the Underwriter, as set forth in this Agreement or made by them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation (or any statement as to the results thereof) made by or on behalf of the Underwriter or any controlling person of the Underwriter, or the Company, or any officer or director or controlling person of the Company and shall survive delivery of and payment for the Shares.

 

 

(a)           This Agreement shall be subject to termination in your absolute discretion, by notice given to the Company at any time on or prior to the delivery of any payment for the Shares, if prior to such time there shall have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange or on the Nasdaq Stock Market, Inc.; (ii) a suspension or material limitation in trading in the Company’s securities on the Nasdaq Stock Market, Inc., (iii) a general moratorium on commercial banking activities declared by either Federal, New York or Delaware authorities or a material disruption in commercial banking or securities settlement or clearance, services in the United States; or (iv)

 

 

(b)           If this Agreement shall be terminated pursuant to this Section 10, the Company shall not then be under any liability to the Underwriter except as provided in Section 6 and Section 8 hereof; but if for any other reason the sale of the Shares provided for herein is not consummated because any condition to the obligations of the Underwriter set forth in Section 7 hereof is not satisfied, because of any termination pursuant to this Section 10 or because of any refusal, inability or failure on the part of the Company to perform any agreements herein or comply with the provisions hereof other than by reason of a default by the Underwriter, the Company will be responsible for and will reimburse the Underwriter upon demand, for all out-of-pocket accountable expenses, including fees and disbursements of counsel, actually incurred by the Underwriter in connection with the proposed purchase, sale and delivery of the Shares.  Nothing in this Section 10 shall be deemed to relieve the Underwriter of its liability, if any, to the Company for damages occasioned by its default hereunder.

 

11.           Information Furnished by the Underwriter.

 

The date the Underwriter expects to deliver the Firm Shares on the cover page of the Prospectus, the identity of the Underwriter set forth on the cover page and in the first paragraph under the heading “Underwriting,” the concession and reallowance figures appearing in the fourth  paragraph under the heading “Underwriting,” the representations with respect to stabilization activities in the eleventh and twelfth paragraphs under the heading “Underwriting,” the eleventh and twelfth paragraphs under the heading “Underwriting” regarding short sales, the representations of the Underwriter in the fourteenth and fifteenth paragraphs under the heading “Underwriting” and the statement regarding discretionary authority in the ninth paragraph under the heading “Underwriting” constitute the only written information furnished by reference or on behalf of the Underwriter referred to in Sections 1(b) and (c) and 8(a) and (b) hereof.

 

 

In all dealings hereunder, you shall act on behalf of the Underwriter, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of the Underwriter made or given by you.  All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriter shall be sufficient in all respects if delivered, or sent by mail or facsimile (with written confirmation of receipt) to BB&T Capital Markets, a division of Scott & Stringfellow, LLC, 901 East Byrd Street, Suite 300, Richmond, Virginia 23219, Attention: Michael L. Essex and if to the Company shall be sufficient in all respects if delivered or sent by mail or facsimile (with written confirmation of receipt) to the address of the Company set forth in the Prospectus, Attention: Laurence S. Levy.  Any such statements, requests, notices or agreements shall take effect upon receipt thereof.

 

 

 

This Agreement shall be binding upon, and inure solely to the benefit of, the Underwriter and the Company and, to the extent provided in Sections 8 and 9 hereof, the officers and directors of the Company, the officers and directors, employees and agents of the Underwriter and each person who controls the Company or the Underwriter and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement.  No purchaser of any of the Shares from the Underwriter shall be deemed a successor or assign by reason merely of such purchase.

 

 

Time shall be of the essence in 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.

 

 

The Company acknowledges and agrees that (i) the purchase and sale of the Shares pursuant to this Agreement, including the determination of the public offering price of the Shares and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the Underwriter, on the other hand, (ii) in connection with the offering contemplated hereby and the process leading to such transaction the Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, or the Company’s stockholders, creditors, employees or any other third party, (iii) the Underwriter has not assumed or will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether the Underwriter has advised or is currently advising the Company on other matters) and the Underwriter does not have any obligation to the Company with respect to the offering contemplated hereby except the obligations expressly set forth in this Agreement, (iv) the Underwriter and its affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (v) the Underwriter has not provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.

 

 

The Company acknowledges that the Underwriter’s research analysts and research departments are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that the Underwriter’s research analysts may hold views and make statements or investment recommendations and/or publish reports with respect to the Company and/or the offering that differ from the views of their respective investment banking divisions.  The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may

 

 

 

This Agreement shall be construed in accordance with the internal laws of the State of New York applicable to agreements made and to be performed in such state.

 

 

The captions included in this Agreement are included solely for convenience of reference and shall not be deemed to be a part of this Agreement.

 

 

The invalidity or unenforceability of any Section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other Section, paragraph or provision hereof.  If any Section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.

 

 

This Agreement may be executed by any one or more of the parties 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.

 

 

No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.

 

[Signatures appear on following page]

 

 

If the foregoing is in accordance with your understanding of our agreement, please sign and return to us two counterparts hereof, whereupon this instrument shall constitute a binding agreement between the Underwriter and the Company.

 

 

 

[Signature Page of Underwriting Agreement]