EXHIBIT 1.1
850,000 SHARES*
PINNACLE FINANCIAL PARTNERS, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
St. Petersburg, Florida
August __, 2004
Raymond James & Associates, Inc.
As Representative of the Several Underwriters
listed on Schedule I hereto
880 Carillon Parkway
St. Petersburg, Florida 33716
Ladies and Gentlemen:
Pinnacle Financial Partners, Inc., a Tennessee corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several Underwriters named in Schedule I hereto (the
"Underwriters"), an aggregate of 850,000 shares of its Common Stock, par value
$1.00 per share (the "Common Stock"). The aggregate of 850,000 shares to be
purchased from the Company are called the "Firm Shares." In addition, the
Company has agreed to sell to the Underwriters, upon the terms and conditions
stated herein, up to an additional 127,500 shares of Common Stock (the
"Additional Shares") to cover over-allotments by the Underwriters, if any. The
Firm Shares and the Additional Shares are collectively referred to in this
Agreement as the "Shares." Raymond James & Associates, Inc. is acting as the
representative of the several Underwriters and in such capacity is referred to
in this Agreement as the "Representative."
The Company wishes to confirm through this written document (the
"Agreement") its agreement with you and the other several Underwriters, on whose
behalf you are acting, in connection with the several purchases of the Shares
from the Company.
1. Registration Statement and Prospectus. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission
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* Plus an additional 127,500 shares subject to Underwriter's over-allotment
option.
thereunder (collectively, the "Act"), a registration statement on Form S-3 (File
No. 333-117627), including a prospectus subject to completion, relating to the
Shares. Such registration statement, as amended, including the financial
statements, exhibits and schedules thereto, at the time when it becomes
effective and as thereafter amended by any post-effective amendment, is referred
to in this Agreement as the "Registration Statement." The prospectus in the form
included in the Registration Statement or, if the prospectus included in the
Registration Statement omits certain information in reliance upon Rule 430A
under the Act and such information is thereafter included in a prospectus filed
with the Commission pursuant to Rule 424(b) under the Act or as part of a
post-effective amendment to the Registration Statement after the Registration
Statement becomes effective, the prospectus as so filed, is referred to in this
Agreement as the "Prospectus." If the Company elects, with the consent of the
Representative, to rely on Rule 434 under the Act, all references to the
Prospectus shall be deemed to include the form of prospectus and the term sheet
contemplated by Rule 434, taken together, provided to the Underwriters by the
Company in reliance on Rule 434 under the Act (the "Rule 434 Prospectus"). If
the Company files another registration statement with the Commission to register
a portion of the Shares pursuant to Rule 462(b) under the Act (the "Rule 462
Registration Statement"), then any reference to "Registration Statement" herein
shall be deemed to include the registration statement on Form S-3 (File No.
333-117627) and the Rule 462 Registration Statement, as each such registration
statement may be amended pursuant to the Act. The prospectus subject to
completion in the form included in the Registration Statement at the time of the
initial filing of such Registration Statement with the Commission and as such
prospectus is amended from time to time until the date of the Prospectus is
referred to in this Agreement as the "Preliminary Prospectus." All references in
this Agreement to the Registration Statement, the Rule 462 Registration
Statement, the Rule 434 Prospectus, a Preliminary Prospectus or the Prospectus,
or any amendments or supplements to any of the foregoing, shall include any copy
thereof filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval System ("EDGAR"). Any reference in this Agreement to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of the
Registration Statement, such Preliminary Prospectus or the Prospectus, as the
case may be, and any reference to any amendment or supplement to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after such date under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that, upon
filing, are incorporated by reference therein, as required by paragraph (b) of
Item 12 of Form S-3. As used herein, the term "Incorporated Documents" means the
documents that at the time of filing are incorporated by reference in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto.
2. Agreements to Sell and Purchase. The Company hereby agrees to issue
and sell the Firm Shares to the Underwriters and, upon the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, each Underwriter
agrees, severally and not jointly, to purchase from the Company at a purchase
price of $[______] per Share (the "purchase price per Share"), the number of
Firm Shares set forth opposite the name of such Underwriter in Schedule I
hereto.
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The Company hereby also agrees to sell to the Underwriters, and, upon
the basis of the representations, warranties and agreements of the Company
herein contained and subject to all the terms and conditions set forth herein,
the Underwriters shall have the right for 30 days from the date of the
Prospectus to purchase from the Company up to 127,500 Additional Shares at the
purchase price per Share for the Firm Shares. The Additional Shares may be
purchased solely for the purpose of covering over-allotments, if any, made in
connection with the offering of the Firm Shares. If any Additional Shares are to
be purchased, each Underwriter, severally and not jointly, agrees to purchase
the number of Additional Shares (subject to such adjustments as you may
determine to avoid fractional shares) that bears the same proportion to the
total number of Additional Shares to be purchased by the Underwriters as the
number of Shares set forth opposite the name of such Underwriter in Schedule I
hereto bears to the total number of Shares. The option to purchase Additional
Shares may be exercised at any time within 30 days after the date of the
Prospectus, but no more than once.
3. Terms of Public Offering. The Company has been advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable and initially to offer the
Shares upon the terms set forth in the Prospectus.
Not later than 12:00 p.m. on the second business day following the date
the Shares are released by the Underwriters for sale to the public the Company
shall deliver or cause to be delivered copies of the Prospectus in such
quantities and at such places as the Representative shall request.
4. Delivery of the Shares and Payment Therefor. Delivery to the
Underwriters of the Firm Shares and payment therefor shall be made at the
offices of Raymond James & Associates, Inc., 880 Carillon Parkway, St.
Petersburg, Florida at 10:00 a.m., St. Petersburg, Florida time, on
[_________],or such other place, time and date not later than 1:30 p.m., St.
Petersburg, Florida time, on [__________] as the Representative shall designate
by notice to the Company (the time and date of such closing are called the
"Closing Date"). The place of closing for the Firm Shares and the Closing Date
may be varied by agreement between the Representative and the Company. The
Company hereby acknowledges that circumstances under which the Representative
may provide notice to postpone the Closing Date as originally scheduled include
any determination by the Company or the Representative to recirculate to the
public copies of an amended or supplemented Prospectus or a delay as
contemplated by the provisions of Section 11 hereof.
Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at the offices of Raymond
James & Associates, Inc., 880 Carillon Parkway, St. Petersburg, Florida, at
10:00 a.m., St. Petersburg, Florida time, on such date or dates (the "Additional
Closing Date") (which may be the same as the Closing Date, but shall in no event
be earlier than the Closing Date nor earlier than three nor later than seven
business days after the giving of the notice hereinafter referred to) as shall
be specified in a written notice, from the Representative on behalf of the
Underwriters to the Company, of the Underwriters' determination to purchase a
number, specified in such notice, of Additional Shares. Such notice may be given
at any time within 30 days after the date of the Prospectus and
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must set forth (i) the aggregate number of Additional Shares as to which the
Underwriters are exercising the option and (ii) the names and denominations in
which the certificates for which the Additional Shares are to be registered. The
place of closing for the Additional Shares and the Additional Closing Date may
be varied by agreement between you and the Company.
Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 1:00 p.m., St. Petersburg, Florida time, not later
than the second full business day preceding the Closing Date or the Additional
Closing Date, as the case may be. Such certificates shall be made available to
you in St. Petersburg, Florida for inspection and packaging not later than 9:30
a.m., St. Petersburg, Florida time, on the business day immediately preceding
the Closing Date or the Additional Closing Date, as the case may be. The
certificates evidencing the Firm Shares and any Additional Shares to be
purchased hereunder shall be delivered to you on the Closing Date or the
Additional Closing Date, as the case may be, against payment of the purchase
price therefore by wire transfer of immediately available funds to an account
specified in writing, not later than the close of business on the business day
next preceding the Closing Date or the Additional Closing Date, as the case may
be, by the Company. Payment for the Shares sold by the Company hereunder shall
be delivered by the Representative to the Company. In the alternative, delivery
of the Firm Shares and the Additional Shares may be made through the "full fast"
system of the Depository Trust Company, in each case pursuant to the schedule
set forth above.
It is understood that the Representative has been authorized, for its
own account and the accounts of the several Underwriters, to accept delivery of
and receipt for, and make payment of the purchase price per Share for the Firm
Shares and the Additional Shares, if any, that the Underwriters have agreed to
purchase. Raymond James and Associates, Inc., individually and not as
Representative of the Underwriters, may, but shall not be obligated to, make
payment for any Shares to be purchased by any Underwriter whose funds shall not
have been received by the Representative by the Closing Date or the Additional
Closing Date, as the case may be, for the account of such Underwriter, but any
such payment shall not relieve such Underwriter from any of its obligations
under this Agreement.
5. Covenants and Agreements of the Company. The Company covenants and
agrees with the several Underwriters as follows:
(a) The Company will use its every reasonable effort to cause the
Registration Statement and any amendments thereto to become effective, if it has
not already become effective, and will advise you promptly and, if requested by
you, will confirm such advice in writing (i) when the Registration Statement has
become effective and the time and date of any filing of any post-effective
Registration Statement or any amendment or supplement to any Preliminary
Prospectus or the Prospectus and the time and date that any post-effective
amendment to the Registration Statement becomes effective; (ii) if Rule 430A
under the Act is employed, when the Prospectus has been timely filed pursuant to
Rule 424(b) under the Act; (iii) of the receipt of any comments of the
Commission, or any request by the Commission for amendments or supplements to
the Registration Statement, any Preliminary Prospectus or the
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Prospectus or for additional information; (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
of the suspension of qualification of the Shares for offering or sale in any
jurisdiction or the initiation of any proceeding for such purposes; and (v)
within the Prospectus Delivery Period referred to in Section 5(d) below, of any
change in the Company's condition (financial or other), business, properties,
net worth or results of operations, or of any event that comes to the attention
of the Company that makes any statement made in the Registration Statement or
the Prospectus (as then amended or supplemented) untrue in any material respect
or that requires the making of any additions thereto or changes therein in order
to make the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading in any material
respect, or of the necessity to amend or supplement the Prospectus (as then
amended or supplemented) to comply with the Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make every reasonable effort to obtain
the withdrawal or lifting of such order at the earliest possible time. If the
Company elects, with the consent of the Representative, to rely on Rule 434
under the Act, the Company will provide the Underwriters with copies of the form
of Rule 434 Prospectus (including copies of a term sheet that complies with the
requirements of Rule 434 under the Act), in such number as the Underwriters may
reasonably request, and file with the Commission in accordance with Rule 424(b)
of the Act the form of Prospectus complying with Rule 434(b)(2) of the Act
before the close of business on the first business day immediately following the
date hereof. If the Company elects not to rely on Rule 434 under the Act, the
Company will provide the Underwriters with copies of the form of Prospectus, in
such number as the Underwriters may reasonably request, and file with the
Commission such Prospectus in accordance with Rule 424(b) of the Act before the
close of business on the first business day immediately following the date
hereof.
(b) The Company will furnish to you, without charge, two signed
duplicate originals of the Registration Statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits thereto, and will also furnish to you, without charge, such number of
conformed copies of the Registration Statement as originally filed and of each
amendment thereto as you may reasonably request, as well as copies of each form
of the Preliminary Prospectus. Consistent with the provisions of Section 5(d)
hereof, the Company consents to the use, in accordance with the provisions of
the Act and with the securities or Blue Sky laws of the jurisdictions in which
the Shares are offered by the several Underwriters and by dealers, prior to the
date of the Prospectus, of each Preliminary Prospectus so furnished by the
Company.
(c) The Company will not file any Rule 462 Registration Statement or
any amendment to the Registration Statement or make any amendment or supplement
to the Prospectus unless (i) you shall have previously been advised thereof and
been given a reasonable opportunity to review such filing, amendment or
supplement and (ii) you have not reasonably objected to such filing, amendment
or supplement after being so advised and having been given a reasonable
opportunity to review such filing, amendment or supplement.
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(d) As soon after the execution and delivery of this Agreement as is
practicable and thereafter from time to time for such period as in the
reasonable opinion of counsel for the Underwriters a prospectus is required by
the Act to be delivered in connection with sales by any Underwriter or a dealer
(the "Prospectus Delivery Period"), and for so long a period as you may request
for the distribution of the Shares, the Company will deliver to each Underwriter
and each dealer, without charge, as many copies of the Prospectus (and of any
amendment or supplement thereto) as they may reasonably request. The Company
consents to the use of the Prospectus (and of any amendment or supplement
thereto) in accordance with the provisions of the Act and with the securities or
Blue Sky laws of the jurisdictions in which the Shares are offered by the
several Underwriters and by all dealers to whom Shares may be sold, both in
connection with the offering and sale of the Shares and for such period of time
thereafter as the Prospectus is required by the Act to be delivered in
connection with sales by any Underwriter or dealer. If at any time prior to the
later of (i) the completion of the distribution of the Shares pursuant to the
offering contemplated by the Registration Statement or (ii) the expiration of
prospectus delivery requirements with respect to the Shares under Section 4(3)
of the Act and Rule 174 thereunder, any event shall occur that in the judgment
of the Company or in the opinion of counsel for the Underwriters is required to
be set forth in the Prospectus (as then amended or supplemented) or should be
set forth therein in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
to supplement or amend the Prospectus to comply with the Act or any other law,
the Company will forthwith prepare and, subject to Sections 5(a) and 5(c)
hereof, file with the Commission and use its best efforts to cause to become
effective as promptly as possible an appropriate supplement or amendment
thereto, and will furnish to each Underwriter who has previously requested
Prospectuses, without charge, a reasonable number of copies thereof.
(e) The Company will cooperate with you and counsel for the
Underwriters in connection with the registration or qualification of the Shares
for offering and sale by the several Underwriters and by dealers under the
securities or Blue Sky laws of such jurisdictions as you may reasonably
designate and will file such consents to service of process or other documents
as may be reasonably necessary in order to effect and maintain such registration
or qualification for so long as required to complete the distribution of the
Shares; provided that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now so qualified or to take any
action that would subject it to general service of process in suits, other than
those arising out of the offering or sale of the Shares, as contemplated by this
Agreement and the Prospectus, in any jurisdiction where it is not now so
subject. In the event that the qualification of the Shares in any jurisdiction
is suspended, the Company shall so advise you promptly in writing upon its
receipt of written notice thereof.
(f) The Company will make generally available to its security holders a
consolidated earnings statement (in form complying with the provisions of Rule
158), which need not be audited, covering a twelve-month period commencing after
the effective date of the Registration Statement and the Rule 462 Registration
Statement, if any, and ending not later than 15 months thereafter, within 75
days, which consolidated earnings statement shall satisfy the provisions of
Section 11(a) of the Act.
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(g) During the Prospectus Delivery Period, the Company will file all
documents required to be filed with the Commission pursuant to Sections 13, 14
and 15 of the Exchange Act within the time periods required by the Exchange Act.
(h) During the period ending three years from the date hereof, the
Company will furnish to you and, upon your request, to each of the other
Underwriters: (i) as soon as available, a copy of each proxy statement,
quarterly or annual report or other report of the Company mailed to stockholders
or filed with the Commission, the National Association of Securities Dealers,
Inc. (the "NASD") or the Nasdaq Stock Market ("NASDAQ") or any national
securities exchange and (ii) from time to time such other information concerning
the Company as you may reasonably request.
(i) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provision hereof (except pursuant to a termination
under Section 12 hereof, or if this Agreement shall be terminated by the
Underwriters because of any inability, failure or refusal on the part of the
Company to perform in all material respects any agreement herein or to comply in
all material respects with any of the terms or provisions hereof or to fulfill
in all material respects any of the conditions of this Agreement, the Company
agrees to reimburse you and the other Underwriters for all reasonable
out-of-pocket expenses (including reasonable travel expenses and reasonable fees
and expenses of counsel for the Underwriters, but excluding wages and salaries
and other overhead costs paid by you) reasonably incurred by you in connection
herewith.
(j) The Company will apply the net proceeds from the sale of the Shares
to be sold by it hereunder in accordance in all material respects with the
statements under the caption "Use of Proceeds" in the Prospectus.
(k) If Rule 430A under the Act is employed, the Company will timely
file the Prospectus or term sheet (as described in Rule 434(b) under the Act)
pursuant to Rule 424(b) under the Act.
(l) For a period of 90 days after the date of the Prospectus first
filed pursuant to Rule 424(b) under the Act, without your prior written consent,
the Company will not: (i) directly or indirectly, issue, sell, offer or contract
to sell or otherwise dispose of or transfer any shares of Common Stock or
securities convertible into or exchangeable or exercisable for shares of Common
Stock (collectively, "Company Securities") or any rights to purchase Company
Securities, or file any registration statement under the Act with respect to any
of the foregoing or (ii) enter into any swap or other agreement that transfers,
in whole or in part, directly or indirectly, the economic consequences of
ownership of Company Securities whether any such swap or transaction is to be
settled by delivery of Common Stock or other securities, in cash or otherwise,
except to the Underwriters pursuant to this Agreement and except for: (i) grants
of options or other equity-based awards pursuant to the Company's stock option,
stock bonus or other stock plans or arrangements in effect as of the date hereof
and described in the Prospectus, (ii) issuances of shares of Common Stock upon
the exercise of options or other equity-based awards outstanding as of the date
hereof under such stock plans, (iii) shares of Common Stock issuable upon
exercise of warrants previously granted to the Company's organizers, and (iv)
shares
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of Common Stock and options to purchase Common Stock issued in connection with
any acquisition approved by the Company's Board of Directors.
(m) Prior to the Closing Date or the Additional Closing Date, as the
case may be, the Company will furnish to you, as promptly as possible, copies of
any unaudited interim consolidated financial statements of the Company and its
subsidiaries for any quarterly period subsequent to the periods covered by the
financial statements appearing in the Prospectus.
(n) The Company will comply with all provisions of any undertakings
contained in the Registration Statement.
(o) The Company will not at any time, directly or indirectly, take any
action designed, or which might reasonably be expected to cause or result in, or
which will constitute, stabilization or manipulation of the price of the shares
of Common Stock to facilitate the sale or resale of any of the Shares.
(p) 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 the NASDAQ.
(q) For a period of twelve (12) months after the date hereof, the
Company shall engage and maintain, at its expense, a transfer agent and, if
necessary under the jurisdiction of its incorporation or the rules of any
national securities exchange on which the Common Stock is listed, a registrar
(which, if permitted by applicable laws and rules, may be the same entity as the
transfer agent) for the Common Stock.
6. Representations and Warranties of the Company. The Company hereby
represents and warrants to each Underwriter on the date hereof, and shall be
deemed to represent and warrant to each Underwriter on the Closing Date and the
Additional Closing Date, as the case may be, that:
(a) The Company satisfies all of the requirements of the Act for use of
Form S-3 for the offering of Shares contemplated hereby. Each Preliminary
Prospectus included as part of the Registration Statement as originally filed or
as part of any amendment or supplement thereto, or filed pursuant to Rule 424(a)
under the Act, complied as to form when so filed in all material respects with
the provisions of the Act, except that this representation and warranty does not
apply to statements in or omissions from such Preliminary Prospectus (or any
amendment or supplement thereto) made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in writing by
or on behalf of any Underwriter through you expressly for use under the section
captioned "Underwriting." The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus and no proceeding for that
purpose has been instituted or threatened by the Commission or the securities
authority of any state or other jurisdiction.
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(b) The Company has prepared each of the Registration Statement, any
Rule 462 Registration Statement and any post-effective amendment thereto, and
the Prospectus and any amendments or supplements thereto. The Registration
Statement (including any Rule 462 Registration Statement), in the form in which
it becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective, and the Prospectus, and any supplement
or amendment thereto when filed with the Commission under Rule 424(b) under the
Act, will comply as to form in all material respects with the provisions of the
Act and will not at any such times 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, except that this representation
and warranty does not apply to statements in or omissions from the Registration
Statement or the Prospectus (or any amendment or supplement thereto) made in
reliance upon and in conformity with information relating to any Underwriter
furnished to the Company in writing by or on behalf of any Underwriter through
you expressly for use therein under the section captioned "Underwriting."
(c) The Incorporated Documents heretofore filed, when they were filed
(or, if any amendment with respect to any such document was filed, when such
amendment was filed), conformed in all material respects with the requirements
of the Exchange Act and the rules and regulations thereunder, and any further
Incorporated Documents so filed will, when they are filed, conform in all
material respects with the requirements of the Exchange Act and the rules and
regulations thereunder; no such Incorporated Document when it was filed (or, if
an amendment with respect to any such document was filed, when such amendment
was filed), contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and no such further Incorporated Document,
when it is filed, will contain an untrue statement of a material fact or will
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading.
(d) The capitalization of the Company is and will be as set forth in
the Prospectus as of the date set forth therein. All the outstanding shares of
Common Stock of the Company have been, and as of the Closing Date and the
Additional Closing Date, as the case may be, will be, duly authorized and
validly issued, are fully paid and nonassessable and are free of any preemptive
or similar rights; except as set forth in the Prospectus, the Company is not a
party to or bound by any outstanding options, warrants or similar rights to
subscribe for, or contractual obligations to issue, sell, transfer or acquire,
any of its capital stock or any securities convertible into or exchangeable for
any of such capital stock; the Shares to be issued and sold to the Underwriters
by the Company hereunder have been duly authorized and, when issued and
delivered to the Underwriters against full payment therefor in accordance with
the terms hereof will be validly issued, fully paid and nonassessable and free
of any preemptive or similar rights; the capital stock of the Company conforms
to the description thereof in the Registration Statement and the Prospectus (or
any amendment or supplement thereto). The certificates for the Shares being sold
by the Company are in valid and sufficient form.
(e) Each of the Company and its subsidiaries is a corporation duly
organized and validly existing as a corporation in good standing under the laws
of the state of its incorporation with full corporate power and authority to
own, lease and operate its properties and to conduct its
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business as presently conducted and as described in the Registration Statement
and the Prospectus (and any amendment or supplement thereto) and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
to so register or qualify has not had or will not have a material adverse effect
on the condition (financial or other), business, properties, net worth, or
results of operations of the Company and its subsidiaries, taken as a whole (a
"Material Adverse Effect").
(f) There are no legal or governmental proceedings pending or, to the
best knowledge of the Company, threatened, against the Company or its
subsidiaries or to which the Company or its subsidiaries or any of their
properties are subject, that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) but are not
described as required. Except as described in the Prospectus, there is no
action, suit, inquiry, proceeding or investigation by or before any court or
governmental or other regulatory or administrative agency or commission pending
or, to the best knowledge of the Company, threatened, against or involving the
Company or its subsidiaries, which might individually or in the aggregate
prevent or adversely affect the transactions contemplated by this Agreement or
result in a Material Adverse Effect, nor to the Company's knowledge, is there
any basis for any such action, suit, inquiry, proceeding or investigation.
(g) Neither the Company nor any of its subsidiaries is (i) in violation
of (A) its articles of incorporation or bylaws, or other organizational
documents, (B) any law, ordinance, administrative or governmental rule or
regulation applicable to the Company or any of its subsidiaries, the violation
of which would have a Material Adverse Effect or (C) any decree of any court or
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries; or (ii) in default in any material respect in the performance of
any obligation, agreement or condition contained in (A) any bond, debenture,
note or any other evidence of indebtedness or (B) any agreement, indenture,
lease or other instrument (each of (A) and (B), an "Existing Instrument") to
which the Company or any of its subsidiaries is a party or by which any of their
properties may be bound, which default would have a Material Adverse Effect; and
there does not exist any state of facts that constitutes an event of default on
the part of the Company or any of its subsidiaries as defined in such documents
or that, with notice or lapse of time or both, would constitute such an event of
default.
(h) The Company's execution and delivery of this Agreement and the
performance by the Company of its obligations under this Agreement have been
duly and validly authorized by the Company and has been duly executed and
delivered by the Company, and this Agreement constitutes a valid and legally
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent enforceability may be limited by (i) the
application of bankruptcy, reorganization, insolvency and other laws affecting
creditors' rights generally and (ii) equitable principles being applied at the
discretion of a court before which any proceeding may be brought, except as
rights to indemnity and contribution hereunder may be limited by federal or
state securities laws.
(i) None of the issuance and sale of the Shares by the Company, the
execution, delivery or performance of this Agreement by the Company nor the
consummation by the
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Company of the transactions contemplated hereby (i) requires any consent,
approval, authorization or other order of or registration or filing with, any
court, regulatory body, administrative agency or other governmental body, agency
or official (except such as may be required for the registration of the Shares
under the Act, the listing of the Shares for trading on the NASDAQ, the
registration of the Common Stock under the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") and compliance with the securities or Blue
Sky laws of various jurisdictions, all of which will be, or have been, effected
in accordance with this Agreement and except for the NASD's clearance of the
underwriting terms of the offering contemplated hereby as required under the
NASD's Rules of Fair Practice); (ii) conflicts with or will conflict with or
constitutes or will constitute a breach of, or a default under, the Company's
articles of incorporation or the Company's bylaws or any agreement, indenture,
lease or other instrument to which the Company or any of its subsidiaries is a
party or by which any of its properties may be bound; (iii) violates any
statute, law, regulation, ruling, filing, judgment, injunction, order or decree
applicable to the Company or any of its subsidiaries or any of their properties;
or (iv) results in a breach of, or default or Debt Repayment Triggering event
(as defined below) under, or results in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, or requires the consent of any other party to, any
Existing Instrument, except for such conflicts, breaches, defaults, liens,
charges or encumbrances that will not, individually or in the aggregate, result
in a Material Adverse Effect. As used herein, a "Debt Repayment Triggering
Event" means any event or condition that gives, or with the giving of notice or
lapse of time would give, the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf) the right to require
the repurchase, redemption or repayment of all or a portion of such indebtedness
by the Company or any of its subsidiaries.
(j) Except as described in the Prospectus, and except for options to
purchase capital stock issued pursuant to the Company's stock option or stock
incentive plans in place prior to the date of this Agreement, neither the
Company nor any of its subsidiaries has outstanding and at the Closing Date and
the Additional Closing Date, as the case may be, will have outstanding any
options to purchase, or any warrants to subscribe for, or any securities or
obligations convertible into, or any contracts or commitments to issue or sell,
any shares of Common Stock or any such warrants or convertible securities or
obligations. No holder of securities of the Company has rights to the
registration of any securities of the Company as a result of or in connection
with the filing of the Registration Statement or the consummation of the
transactions contemplated hereby that have not been satisfied or heretofore
waived in writing.
(k) KPMG LLP, the certified public accountants who have certified the
financial statements (including the related notes thereto and supporting
schedules) filed as part of the Registration Statement and the Prospectus (or
any amendment or supplement thereto), are independent public accountants as
required by the Act and the Exchange Act.
(l) The financial statements, together with related schedules and
notes, included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly the financial condition,
results of operations, cash flows and changes in financial
-11-
position of the Company on the basis stated in the Registration Statement at the
respective dates or for the respective periods to which they apply; such
statements and related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except as disclosed therein; and the other financial and
statistical information and data set forth in the Registration Statement and
Prospectus (and any amendment or supplement thereto) is accurately presented and
prepared on a basis consistent with such financial statements and the books and
records of the Company.
(m) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), (i)
neither the Company nor any of its subsidiaries has incurred any material
liabilities or obligations, indirect, direct or contingent, or entered into any
transaction that is not in the ordinary course of business; (ii) neither the
Company nor any of its subsidiaries has sustained any material loss or
interference with its business or properties from fire, flood, windstorm,
accident or other calamity, whether or not covered by insurance; (iii) neither
the Company nor any of its subsidiaries has paid or declared any dividends or
other distributions with respect to its capital stock and the Company is not in
default under the terms of any class of capital stock of the Company or any
outstanding debt obligations; (iv) there has not been any change in the
authorized or outstanding capital stock of the Company or any material change in
the indebtedness of the Company (except for subsequent issuances, if any, in the
ordinary course of business under any stock option, bonus or incentive plan that
is in effect as of the date of this Agreement and is described in the Prospectus
or upon the exercise of outstanding stock options or warrants described in the
Prospectus); and (v) there has not been any material adverse change, or any
development involving or that may reasonably be expected to result in a Material
Adverse Effect, in the condition (financial or otherwise), business, properties,
net worth or result of operations of the Company.
(n) The Shares will be eligible to be traded on the Nasdaq National
Market at the opening of the market on the trading day immediately following the
date of this Agreement. The Company has not received any notice of actual or
contemplated delisting from the Nasdaq National Market.
(o) The Company has not distributed and will not distribute, and has
not authorized the Underwriters to distribute, any offering material in
connection with the offering and sale of the Shares other than the Preliminary
Prospectus, the Prospectus or other offering material, if any, as permitted by
the Act.
(p) Other than excepted activity pursuant to Regulation M under the
Exchange Act, the Company has not taken and will not take, directly or
indirectly, any action that constituted, or any action designed to, or that
might reasonably be expected to cause or result in or constitute, under the Act
or otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares or for any other purpose.
-12-
(q) The Company and each of its subsidiaries have filed all tax returns
required to be filed (other than certain state or local tax returns, as to which
the failure to file, individually or in the aggregate, would not have a Material
Adverse Effect), which returns are complete and correct, and neither the Company
nor any subsidiary is in default in the payment of any taxes that were payable
pursuant to said returns or any assessments with respect thereto. Except as
disclosed in the Prospectus, all deficiencies asserted as a result of any
federal, state, local or foreign tax audits have been paid or finally settled
and no issue has been raised in any such audit that, by application of the same
or similar principles, reasonably could be expected to result in a proposed
deficiency for any other period not so audited. There are no outstanding
agreements or waivers extending the statutory period of limitation applicable to
any federal, state, local or foreign tax return for any period. On the Closing
Date and the Additional Closing Date, as the case may be, all stock transfer and
other taxes that are required to be paid in connection with the sale of the
shares to be sold by the Company to the Underwriters will have been fully paid
by the Company and all laws imposing such taxes will have been complied with.
(r) The Company is not an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an investment company
within the meaning of the Investment Company Act of 1940, as amended.
(s) Each of the Company and its subsidiaries has good and valid title
to all property (real and personal) described in the Prospectus as being owned
by it, free and clear of all liens, claims, security interests or other
encumbrances except (i) such as are described in the Prospectus or (ii) such as
are not materially burdensome and do not have or will not result in a Material
Adverse Effect to the use of the property or the conduct of the business of the
Company. All property (real and personal) held under lease by the Company and
its subsidiaries is held by it under valid, subsisting and enforceable leases
with only such exceptions as in the aggregate are not materially burdensome and
do not have or result in a Material Adverse Effect to the use of the property or
the conduct of the business of the Company.
(t) Each of the Company and its subsidiaries has all permits, licenses,
franchises, approvals, consents and authorizations of governmental or regulatory
authorities (hereinafter "permit" or "permits") as are necessary to own its
properties and to conduct its business in the manner described in the
Prospectus, subject to such qualifications as may be set forth in the
Prospectus, except where the failure to have obtained any such permit has not
had and will not have a Material Adverse Effect; each of the Company and its
subsidiaries has operated and is operating its business in material compliance
with and not in material violation of all of its obligations with respect to
each such permit, except where such failure to operate without the permit does
not and will not have a Material Adverse Effect on the Company and the
subsidiaries as a whole, and no event has occurred that allows, or after notice
or lapse of time would allow, revocation or termination of any such permit or
result in any other material impairment of the rights of any such permit,
subject in each case to such qualification as may be set forth in the
Prospectus; and, except as described in the Prospectus, such permits contain no
restrictions that are materially burdensome to the Company or any of its
subsidiaries.
-13-
(u) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance with management's general or specific
authorizations, and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(v) Except as previously disclosed to the Underwriters in writing, no
officer, director or nominee for director of the Company has a direct or
indirect affiliation or association with any member of the NASD.
7. Expenses. Whether or not the transactions contemplated hereby are
consummated or this Agreement becomes effective or is terminated, the Company
agrees to pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Company's counsel and accountants in connection with the
registration of the Shares under the Act and all other expenses in connection
with the preparation, printing and filing of the Registration Statement and the
Prospectus and amendments and supplements thereto and the mailing and delivering
of copies thereof and of any Preliminary Prospectus to the Underwriters and
dealers; (ii) the printing and delivery (including postage, air freight charges
and charges for counting and packaging) of such copies of the Registration
Statement, the Prospectus, each Preliminary Prospectus, the Blue Sky memoranda,
the Master Agreement Among Underwriters, this Agreement, the Selected Dealers
Agreement and all amendments or supplements to any of them as may be reasonably
requested for use in connection with the offering and sale of the Shares; (iii)
consistent with the provisions of Section 5(e), all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws or Blue Sky laws, including reasonable attorneys' fees and out-of-pocket
expenses of the counsel for the Underwriters in connection therewith; (iv) the
filing fees incident to securing any required review by the NASD of the fairness
of the terms of the sale of the Shares and the reasonable fees and disbursements
of the Underwriters' counsel relating thereto; (v) the fees and expenses
associated with listing the Shares on the NASDAQ; (vi) the cost of preparing
stock certificates; (vii) the costs and charges of any transfer agent or
registrar; (viii) the cost of the tax stamps, if any, in connection with the
issuance and delivery of the Shares to the respective Underwriters; (ix) all
other fees, costs and expenses referred to in Item 13 of the Registration
Statement; and (x) the transportation, lodging, graphics and other expenses
incidental to the Company's preparation for and participation in the "roadshow"
for the offering contemplated hereby. Except as provided in this Section 7 and
in Section 8 hereof, the Underwriters shall pay their own expenses, including
the fees and disbursements of their counsel. In addition, in the event that the
proposed offering is terminated for the reasons set forth in Section 5(i)
hereof, the Company agrees to reimburse the Underwriters as provided in Section
5(i).
8. Indemnification and Contribution. Subject to the limitations in this
paragraph below, the Company agrees to indemnify and hold harmless you and each
other Underwriter, the directors, officers, employees and agents of each
Underwriter, and each person, if any, who
-14-
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses, including reasonable costs of investigation and
reasonable attorneys' fees and expenses (collectively, "Damages") arising out of
or based upon any untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus or in the Registration Statement or
the Prospectus or in any amendment or supplement thereto, or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein (in the case of the Prospectus, in
light of the circumstances under which they were made) not misleading, except to
the extent that any such Damages arise out of or are based upon an untrue
statement or omission or alleged untrue statement or omission that has been made
therein or omitted therefrom in reliance upon and in conformity with the
information furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in the section captioned
"Underwriting" in connection therewith. The Underwriters further acknowledge and
agree that the indemnity agreement contained in this Section 8 with respect to
any preliminary prospectus shall not inure to the benefit of any Underwriter or
to the benefit of any person controlling such Underwriter in respect of any
loss, claim, damage, liability or action asserted by a person who purchases the
Firm Shares, or any Additional Shares, as the case may be, from such
Underwriter, if such Underwriter failed to send or give a copy of the Prospectus
(as the same may be amended or supplemented) to such person with or prior to
written confirmation of the sale to such person. This indemnification shall be
in addition to any liability that the Company may otherwise have.
If any action or claim shall be brought against any Underwriter or any
person controlling any Underwriter in respect of which indemnity may be sought
against the Company, such Underwriter or such controlling person shall promptly
notify in writing the party(ies) against whom indemnification is being sought
(the "indemnifying party" or "indemnifying parties"), and such indemnifying
party(ies) shall assume the defense thereof, including the employment of counsel
reasonably acceptable to such Underwriter or such controlling person and the
payment of all reasonable fees of and expenses incurred by such counsel. Such
Underwriter or any such controlling person shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Underwriter or such controlling person, unless (i) the indemnifying party(ies)
has (have) agreed in writing to pay such fees and expenses, (ii) the
indemnifying party(ies) has (have) failed to assume the defense and employ
counsel reasonably acceptable to the Underwriter or such controlling person or
(iii) the named parties to any such action (including any impleaded parties)
include both such Underwriter or such controlling person and the indemnifying
party(ies), and such Underwriter or such controlling person shall have been
advised by its counsel that one or more legal defenses may be available to the
Underwriter that may not be available to the Company (in which case the
indemnifying party(ies) shall not have the right to assume the defense of such
action on behalf of such Underwriter or such controlling person (but the Company
shall not be liable for the fees and expenses of more than one counsel for the
Underwriters and such controlling persons)). The indemnifying party(ies) shall
not be liable for any settlement of any such action effected without its (their
several) written consent, but if settled with such written consent, or if there
be a final judgment for the plaintiff in any such action, the indemnifying
party(ies) agree(s) to indemnify and hold harmless any
-15-
Underwriter and any such controlling person from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment, but in
the case of a judgment only to the extent stated in the first paragraph of this
Section 8.
Each Underwriter agrees, severally and jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and any person who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, to the same extent as the
foregoing several indemnity from the Company to each Underwriter, but only with
respect to information furnished in writing by or on behalf of such Underwriter
through you expressly for use in the Registration Statement, the Prospectus or
any Preliminary Prospectus, or any amendment or supplement thereto. If any
action or claim shall be brought or asserted against the Company, any of its
directors, any of its officers or any such controlling person based on the
Registration Statement, the Prospectus or any Preliminary Prospectus, or any
amendment or supplement thereto, and in respect of which indemnity may be sought
against any Underwriter pursuant to this paragraph, such Underwriter shall have
the rights and duties given to the Company by the immediately preceding
paragraph (except that if the Company shall have assumed the defense thereof
such Underwriter shall not be required to do so, but may employ separate counsel
therein and participate in the defense thereof, but the fees and expenses of
such counsel shall be at such Underwriter's expense), and the Company, its
directors, any such officers and any such controlling persons, shall have the
rights and duties given to the Underwriters by the immediately preceding
paragraph.
In any event, the Company will not, without the prior written consent
of the Representative, settle or compromise or consent to the entry of any
judgment in any proceeding or threatened claim, action, suit or proceeding in
respect of which the indemnification may be sought hereunder (whether or not the
Representative or any person who controls the Representative within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act is a party to such
claim, action, suit or proceeding) unless such settlement, compromise or consent
includes an unconditional release of all Underwriters and such controlling
persons from all liability arising out of such claim, action, suit or proceeding
provided that the foregoing shall not apply to the extent such claim is one as
to which the Company is indisputably entitled to indemnification from the
Underwriters under the foregoing paragraph.
If the indemnification provided for in this Section 8 is unavailable or
insufficient for any reason whatsoever to an indemnified party in respect of any
Damages referred to herein, then an indemnifying party, in lieu of indemnifying
such indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Damages (i) 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 hand, from the offering and sale of the
Shares or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative and
several fault of the Company on the one hand, and the Underwriters on the other
hand, in connection with the statements or omissions that resulted in such
Damages as well as any other relevant equitable considerations. The relative and
several benefits received by the Company on the one hand, and the Underwriters
on the other hand, shall be deemed to be in the
-16-
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; provided that, in the event that the
Underwriters shall have purchased any Additional Shares hereunder, any
determination of the relative benefits received by the Company or the
Underwriters from the offering of the Shares shall include the net proceeds
(before deducting expenses) received by the Company and the underwriting
discounts and commissions received by the Underwriters, from the sale of such
Additional Shares, in each case computed on the basis of the respective amounts
set forth in the notes to the table on the cover page of the Prospectus. The
relative fault of the Company on the one hand, and the Underwriters on the other
hand, 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 by the Underwriters on the other hand 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 contribution pursuant to this Section 8 was determined by a pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Damages
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, 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
Section 8, no Underwriter shall be required to contribute any amount in excess
of the amount of the underwriting commissions received by such underwriter in
connection with the Shares underwritten by it and distributed to the public. 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 to
contribute pursuant to this Section 8 are several in proportion to the
respective numbers of Firm Shares set forth opposite their names in Schedule I
hereto (or such numbers of Firm Shares increased as set forth in Section 10
hereof) and not joint.
The indemnity, contribution and reimbursement agreements contained in
this Section 8 and the representations and warranties of the Company set forth
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Underwriter or
any person controlling any Underwriter, the Company, its directors or officers
or any person controlling the Company, (ii) acceptance of any Shares and payment
therefor hereunder and (iii) any termination of this Agreement. A successor to
any Underwriter or any person controlling any Underwriter, or to the Company,
its directors or officers or any person controlling the Company, shall be
entitled to the benefits of the indemnity, contribution and reimbursement
agreements contained in this Section 8.
-17-
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Firm Shares hereunder are subject to the
following conditions:
(a) The Registration Statement shall have become effective not later
than 5:00 p.m., New York City time, on the date hereof, or at such later date
and time as shall be consented to in writing by the Representative, and all
filings required by Rules 424(b), 430A and 462 under the Act shall have been
timely made.
(b) You shall have received on the Closing Date (and the Additional
Closing Date, if any) an opinion of Bass, Berry & Sims PLC, counsel to the
Company to the effect set forth in Exhibit B attached hereto.
In addition to the opinion required by this Section 9(b), such counsel
shall state that during the course of his participation in the preparation of
the Registration Statement and the Prospectus and the amendments thereto,
nothing has come to the attention of such counsel that has caused him to believe
or given him reason to believe that the Registration Statement or the Prospectus
or any amendment thereto (except for the financial statements and other
financial and accounting information or data contained therein or omitted
therefrom as to which no opinion need be expressed), at the date thereof,
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 the Registration Statement or the Prospectus as of the
date of the opinion (except as aforesaid), contains an untrue statement of a
material fact or omits to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(c) You shall have received on the Closing Date or Additional Closing
Date, as the case may be, an opinion of Powell, Goldstein, Frazer & Murphy LLP,
as counsel for the Underwriters, dated the Closing Date or Additional Closing
Date, as the case may be, with respect to the issuance and sale of the Shares,
the Registration Statement and other related matters as you may reasonably
request, and the Company and its counsel shall have furnished to your counsel
such documents as they may reasonably request for the purpose of enabling them
to pass upon such matters.
(d) You shall have received letters addressed to you and dated the date
hereof and the Closing Date or the Additional Closing Date, as the case may be,
from the firm of KPMG LLP, independent certified public accountants,
substantially in the form heretofore approved by you.
(e) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued by the Commission and no proceedings for that
purpose shall be pending or, to the knowledge of the Company, shall be
threatened or contemplated by the Commission at or prior to the Closing Date or
Additional Closing Date, as the case may be; and (ii) all of the representations
and warranties of the Company contained in this Agreement shall be true and
correct in all material respects (except for such representations and warranties
qualified by materiality, which representations and warranties shall be true and
correct in all respects) on and as of the date hereof, unless such
representation or warranty is as of some other specific date than the date
hereof, and on and as of the Closing Date or Additional Closing Date, as the
case may
-18-
be, as if made on and as of the Closing Date or Additional Closing Date, as the
case may be, and you shall have received a certificate, dated the Closing Date
and signed by the chief executive officer and the chief financial officer of the
Company (or such other officers as are acceptable to you) to the effect set
forth in this Section 9(e) and in Section 9(g) hereof.
(f) The Company shall not have failed in any material respect at or
prior to the Closing Date or the Additional Closing Date, as the case may be, to
have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date or Additional Closing Date, as the case may be.
(g) The Company shall have furnished or caused to have been furnished
to you such further certificates and documents as you shall have reasonably
requested.
(h) At or prior to the Closing Date, you shall have received the
written commitment Lock-Up Agreements, in the form of Exhibit A attached hereto,
from each of the Company's executive officers and directors.
(i) At or prior to the effective date of the Registration Statement,
you shall have received a letter from the Corporate Financing Department of the
NASD confirming that such Department has determined to raise no objections with
respect to the fairness or reasonableness of the underwriting terms and
arrangements of the offering contemplated hereby.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are, in all material
respects, reasonably satisfactory in form and substance to you and your counsel.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the satisfaction on and as of the Additional
Closing Date of the conditions set forth in this Section 9, except that, if the
Additional Closing Date is other than the Closing Date, the certificates,
opinions and letters referred to in this Section 9 shall be dated as of the
Additional Closing Date and the opinions called for by paragraphs (b) and (c)
shall be revised to reflect the sale of Additional Shares.
If any of the conditions hereinabove provided for in this Section 9
shall not have been satisfied when and as required by this Agreement, this
Agreement may be terminated by you by notifying the Company of such termination
in writing or by telegram at or prior to such Closing Date, but you shall be
entitled to waive any of such conditions.
10. Effective Date of Agreement. This Agreement shall become effective
upon the later of (a) the execution and delivery hereof by the parties hereto
and (b) release of notification of the effectiveness of the Registration
Statement by the Commission; provided, however, that the provisions of Sections
7 and 8 shall at all times be effective.
11. Defaulting Underwriters. If any one or more of the Underwriters
shall fail or refuse to purchase Firm Shares that it or they have agreed to
purchase hereunder, and the
-19-
aggregate number of Firm Shares that such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth (1/10) of
the aggregate number of the Firm Shares, each non-defaulting Underwriter shall
be obligated, severally, in the proportion in which the number of Firm Shares
set forth opposite its name in Schedule I hereto bears to the aggregate number
of Firm Shares set forth opposite the names of all non-defaulting Underwriters
or in such other proportion as you may specify in the Agreement Among
Underwriters, to purchase the Firm Shares that such defaulting Underwriter or
Underwriters agreed, but failed or refused to purchase. If any Underwriter or
Underwriters shall fail or refuse to purchase Firm Shares and the aggregate
number of Firm Shares with respect to which such default occurs is more than
one-tenth (1/10) of the aggregate number of Firm Shares and arrangements
satisfactory to you and the Company for the purchase of such Firm Shares are not
made within 48 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company. In any
such case that does not result in termination of this Agreement, either you or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven (7) days, in order that the required changes, if any, in
the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any such default
of any such Underwriter under this Agreement.
12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company by notice to the Company, if prior to the Closing
Date or the Additional Closing Date (if different from the Closing Date and then
only as to the Additional Shares), as the case may be, in your sole judgment:
(i) trading in the Company's Common Stock shall have been suspended by the
Commission or the NASDAQ; (ii) trading in securities generally on the NYSE or
NASDAQ shall have been suspended or materially limited, or minimum or maximum
prices shall have been generally established on such exchange, or additional
material governmental restrictions, not in force on the date of this Agreement,
shall have been imposed upon trading in securities generally by any such
exchange or by order of the Commission or any court or other governmental
authority; (iii) a general moratorium on commercial banking activities shall
have been declared by either federal or New York State authorities; or (iv)
there shall have occurred any outbreak or escalation of hostilities or other
international or domestic calamity, crisis or change in political, financial or
economic conditions or other material event the effect of which on the financial
markets of the United States is such as to make it, in your judgment,
impracticable or inadvisable to market the Shares or to enforce contracts for
the sale of the Shares. Notice of such cancellation shall be promptly given to
the Company and its counsel by telegraph, telecopy or telephone and shall be
subsequently confirmed by letter.
13. Information Furnished by the Underwriters. The Company acknowledges
that the paragraphs under the caption "Underwriting" in any Preliminary
Prospectus, constitute the only information furnished by or on behalf of the
Underwriters through you or on your behalf as such information is referred to in
Sections 6(a), 6(b) and 8 hereof.
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14. Miscellaneous. Except as otherwise provided in Sections 5 and 12
hereof, notice given pursuant to any of the provisions of this Agreement shall
be in writing and shall be delivered:
(i) to the Company:
Pinnacle Financial Partners, Inc.
The Commerce Center
211 Commerce Street, Suite 300
Nashville, Tennessee 37201
Attn: Chief Executive Officer
with a copy to:
Bob F. Thompson
Bass, Berry & Sims PLC
315 Beadrick Street, Suite 2700
Nashville, Tennessee 37238-0002
(ii) to the Underwriters:
Raymond James & Associates, Inc.
880 Carillon Parkway
St. Petersburg, Florida 33716
Attention: [_________________]
with a copy to:
Katherine M. Koops
Powell, Goldstein, Frazer & Murphy LLP
191 Peachtree Street, NE
16th Floor
Atlanta, Georgia 30303
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company and its directors and officers.
15. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of the State of Florida without
reference to choice of law principles thereunder.
This Agreement may be signed in various counterparts, which together
shall constitute one and the same instrument.
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This Agreement shall be effective when, but only when, at least one
counterpart hereof shall have been executed on behalf of each party hereto.
The Company and the Underwriters each hereby irrevocably waive any
right they may have to a trial by jury in respect to any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
[Remainder of this page intentionally left blank.]
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Please confirm that the foregoing correctly sets forth the agreement
among the Company and the several Underwriters.
Very truly yours,
PINNACLE FINANCIAL PARTNERS, INC.
By:
-------------------------------------
Name: M. Terry Turner
Title: President and Chief Executive Officer
CONFIRMED as of the date first above
mentioned, on behalf of the Representative
and the other several Underwriters named in
Schedule I hereto.
RAYMOND JAMES & ASSOCIATES, INC.
By:
-----------------------------
Authorized Representative
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SCHEDULE I
Number
Name Firm Shares
---- -----------
TOTAL:
===========
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EXHIBIT A
August ___, 2004
Pinnacle Financial Partners, Inc.
The Commerce Center
211 Commerce Street, Suite 300
Nashville, Tennessee 37201
RAYMOND JAMES & ASSOCIATES, INC.
As Representative of the Several Underwriters
c/o Raymond James & Associates, Inc.
880 Carillon Parkway
St. Petersburg, FL 33716
RE: PINNACLE FINANCIAL PARTNERS, INC. (THE "COMPANY") - RESTRICTION ON STOCK
SALES
Dear Sirs:
This letter is delivered to you pursuant to the Underwriting Agreement
(the "Underwriting Agreement") to be entered into by the Company, as issuer, and
Raymond James & Associates, Inc., the representative (the "Representative") of
certain underwriters (the "Underwriters") to be named therein. Upon the terms
and subject to the conditions of the Underwriting Agreement, the Underwriters
intend to effect a public offering of Common Stock, par value $1.00 per share,
of the Company (the "Shares"), as described in and contemplated by the
registration statement of the Company on Form S-3, File No. 333-117627 (the
"Registration Statement"), as filed with the Securities and Exchange Commission
on July 23, 2004 (the "Offering").
The undersigned recognizes that it is in the best financial interests
of the undersigned, as an officer or director, or an owner of stock, options,
warrants or other securities of the Company (the "Company Securities"), that the
Company complete the proposed Offering.
The undersigned further recognizes that the Company Securities held by
the undersigned are, or may be, subject to certain restrictions on
transferability, including those imposed by United States federal securities
laws. Notwithstanding these restrictions, the undersigned has agreed to enter
into this letter agreement to further assure the Underwriters that the Company
Securities of the undersigned, now held or hereafter acquired, will not enter
the public market at a time that might impair the underwriting effort.
Therefore, as an inducement to the Underwriters to execute the
Underwriting Agreement, the undersigned hereby acknowledges and agrees that the
undersigned will not (i) offer, sell, contract to sell, pledge, grant any option
to purchase or otherwise dispose of (collectively, a
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"Disposition") any Company Securities, or any securities convertible into or
exercisable or exchangeable for, or any rights to purchase or otherwise acquire,
any Company Securities, held by the undersigned or acquired by the undersigned
after the date hereof, or that may be deemed beneficially owned by the
undersigned (collectively, the "Lock-Up Shares"), pursuant to the Rules and
Regulations promulgated under the Securities Act of 1933, as amended (the
"Act"), and the Securities Exchange Act of 1934, as amended, for a period
commencing on the date hereof and ending 90 days after the date of the Company's
Prospectus first filed pursuant to Rule 424(b) under the Act, inclusive (the
"Lock-Up Period"), without the prior written consent of Raymond James &
Associates, Inc. or (ii) exercise or seek to exercise or effectuate in any
manner any rights of any nature that the undersigned has or may have hereafter
to require the Company to register under the Act the undersigned's sale,
transfer or other disposition of any of the Lock-Up Shares or other securities
of the Company held by the undersigned, or to otherwise participate as a selling
securityholder in any manner in any registration effected by the Company under
the Act, including under the Registration Statement, during the Lock-Up Period.
The foregoing restrictions are expressly agreed to preclude the undersigned from
engaging in any hedging, collar (whether or not for any consideration) or other
transaction that is designed to or reasonably expected to lead or result in a
Disposition of Lock-Up Shares during the Lock-Up Period, even if such Lock-Up
Shares would be disposed of by someone other than such holder. Such prohibited
hedging or other transactions would include any short sale or any purchase, sale
or grant of any right (including any put or call option or reversal or
cancellation thereof) with respect to any Lock-Up Shares or with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or derives any significant part of its value from Lock-Up Shares.
Notwithstanding the agreement not to make any Disposition during the
Lock-Up Period, you have agreed that the foregoing restrictions shall not apply
to:
(1) the Company Securities being offered in the prospectus
included in the Registration Statement;
(2) any grant or exercise of options or other equity-based awards
pursuant to the Company's already existing stock option or
stock incentive plans; or
(3) the exercise of any warrants previously granted to the
undersigned to the extent such exercise is required as a
result of a commitment by the undersigned to the Federal
Reserve Bank of Atlanta.
It is understood that, if the Underwriting Agreement (other than the
provisions thereof that survive termination) shall terminate or be terminated
prior to payment for and delivery of the Shares, you will release the
undersigned from the obligations under this letter agreement.
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In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of Lock-Up
Shares if such transfer would constitute a violation or breach of this letter.
This letter shall be binding on the undersigned and the respective successors,
heirs, personal representatives and assigns of the undersigned. Capitalized
terms used but not defined herein have the respective meanings assigned to such
terms in the Underwriting Agreement.
Very truly yours,
Name:
--------------------------------
Title:
-------------------------------
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EXHIBIT B
Pursuant to Section 9(b) of the Underwriting Agreement, counsel for the
Company shall furnish an opinion to the Representative of the Underwriters to
the effect that:
(i) The Company is a registered bank holding company under the Bank
Holding Company Act; has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Tennessee, with the
corporate power and corporate authority 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 under the column "Actual" under the heading "Capitalization," and all
of the issued shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and nonassessable, and the Shares
conform to the description of the Stock contained in the Prospectus or in
documents incorporated by reference therein;
(iii) The shares of Common Stock of the Company to be issued and sold
by the Company pursuant to the Underwriting Agreement have been duly authorized
for issuance and sale to the Underwriters and, when issued and delivered by the
Company pursuant to the Underwriting Agreement against payment of the
consideration set forth in the Underwriting Agreement, will be validly issued,
fully paid and non-assessable.
(iv) Except as described in the Prospectus or in documents incorporated
by reference therein, (A) there are no outstanding rights (contractual or
otherwise), warrants or options to acquire, or instruments convertible into or
exchangeable for, or agreements or understandings with respect to the sale or
issuance of, any shares of capital stock of or other equity interest in the
Company; and (B) there are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the Company
to file a registration statement under the Act or otherwise register any
securities of the Company owned or to be owned by such person;
(v) 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 such failure to be so qualified
would not have a Material Adverse Effect on the Company;
(vi) Pinnacle National Bank has been duly chartered and is validly
existing as a national bank, in good standing under the laws of the jurisdiction
of its organization, with corporate power and corporate 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 be so qualified
would not have a Material Adverse Effect on the Company and its subsidiaries
taken as a whole. All of the issued and outstanding capital stock of
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Pinnacle National Bank 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 free and clear of any pledge, lien, encumbrance,
claim or equity.
(vii) The Underwriting Agreement has been duly authorized, executed and
delivered by the Company;
(viii) The issue and sale of the Shares being delivered pursuant to the
Underwriting Agreement by the Company and the compliance by the Company with all
of the provisions of the Underwriting Agreement and the consummation of the
transactions therein 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 which has been filed or incorporated by reference as an exhibit to
the Registration Statement or as an exhibit to any document incorporated by
reference in the Registration Statement, nor will such action result in any
violation of the provisions of the articles of incorporation, as amended, or
bylaws of the Company or any statute or any order, rule or regulation known to
such counsel of any court, governmental agency or authority or self-regulating
body, association or organization, except for such violations that would not
have a Material Adverse Effect on the Company and its subsidiaries taken as a
whole;
(ix) No consent, approval, authorization, order, registration or
qualification of or with any court, governmental agency or authority or
self-regulating body, association or organization 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 as may be required for the
registration of the Shares under the Act, the listing of the Shares for trading
on the NASDAQ, the registration of the Shares under the Exchange Act and
compliance with the securities or Blue Sky laws of various jurisdictions, as to
which we express no opinion, and except for the NASD's clearance of the
underwriting terms of the offering contemplated hereby as required under the
NASD's Rules of Fair Practice, and except for those consents, approvals,
authorizations, orders, registrations or qualifications, the failure of which to
obtain will not have a material adverse effect on the consummation of the
transactions contemplated by the Underwriting Agreement and the fulfillment of
the terms thereof by the Company;
(x) To such counsel's knowledge, neither the Company nor any of its
subsidiaries is in violation of its articles of incorporation or charter (as
applicable) or bylaws or, to such counsel's knowledge, 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 and which has been filed or incorporated by
reference as an exhibit to the Registration Statement or as an exhibit to any
document incorporated or deemed to be incorporated by reference in the
Registration Statement;
(xi) The statements set forth in, or incorporated by reference into,
the Prospectus under the caption "Description of Capital Stock," insofar as they
purport to constitute a summary of the terms of, or rights related to, the
Shares to the extent that they constitute matters of law,
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summaries of legal matters, summaries of the provisions of the Company's charter
or bylaws or legal conclusions have been reviewed by us and are correct in all
material respects;
(xii) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act;
(xiii) The documents incorporated by reference in the Prospectus (other
than the financial statements and related schedules therein, and other financial
data included therein or omitted therefrom, as to which such counsel need
express no opinion), when they were filed with the Commission, complied as to
form in all material respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder;
(xiv) The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to the Closing Date
(other than the financial statements and related schedules therein, and other
financial data included therein or omitted therefrom, 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;
(xv) The limitations inherent in the independent verification of
factual matters and the character of determinations involved in the registration
process are such that we have not verified and are not passing upon and do not
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in each of the Registration Statement or Prospectus, except
as otherwise stated herein. We participated in the preparation of the
Registration Statement and the Prospectus (in each case including the documents
incorporated or deemed to be incorporated by reference therein), during the
course of which, among other things, we examined various documents and other
papers and participated in conferences with representatives of the Company, with
representatives of the Company's independent public accountants, and with your
representatives and your counsel, at which conferences the contents of the
Registration Statement and the Prospectus and related matters were discussed. On
the basis of the information that was received, examined and/or developed in the
course of our above-described participation, considered in the light of our
understanding of the applicable law and the experience we have gained through
our practice thereunder, no facts have come to our attention that would lead us
to believe that the Registration Statement (except for financial statements and
schedules and other financial data included or incorporated by reference therein
or omitted therefrom, as to which we make no statement), at the time the
Registration Statement became effective or at the date of this 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,
in light of the circumstances in which they were made, not misleading or that
the Prospectus (except for financial statements and schedules and other
financial data included or incorporated by reference therein or omitted
therefrom, as to which we make no statement), at the time the Prospectus was
issued or at the date of this opinion, included or includes an untrue statement
of a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading (it being understood that we express no
belief or opinion with respect to the
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financial statements and schedules and other financial data included therein or
omitted therefrom).
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