EXHIBIT 1
[FORM OF UNDERWRITING AGREEMENT]
_________ SHARES
▇▇▇▇▇ ▇▇▇▇▇▇ BANCORP, INC.
COMMON STOCK
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UNDERWRITING AGREEMENT
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▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
November __, 2003
Dear Sirs:
▇▇▇▇▇ ▇▇▇▇▇▇ Bancorp, Inc., a Virginia corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. (the "Underwriter"), an aggregate of ______ shares
(the "Firm Securities") of common stock, $1.00 par value per share, of the
Company (the "Common Stock") and, at the election of the Underwriter, up to
______ additional shares (the "Optional Securities"), of Common Stock. The Firm
Securities and the Optional Securities that the Underwriter elects to purchase
pursuant to Section 2 hereof are collectively called the "Securities." The
Securities are more fully described in the Prospectus, referred to below.
1. REPRESENTATIONS AND WARRANTIES.
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) that:
(a) In connection with the transactions contemplated by this
Underwriting Agreement (the "Agreement"), a registration statement on Form S-2
(Registration No. 333-108864) and as a part thereof a preliminary prospectus, in
respect of the Securities has been prepared by the Company in conformity with
the requirements of the Securities Act of 1933, as amended (the "Act") and has
been filed with the Securities and Exchange Commission (the "Commission") in the
form heretofore delivered to you; such registration statement, as amended, has
been declared effective by the Commission; no other document with respect to
such registration statement has heretofore been filed with the Commission; and
no stop order suspending the effectiveness of such registration statement has
been issued and no proceeding for that purpose has been instituted or threatened
by the Commission (any preliminary prospectus included in such registration
statement or filed with the Commission pursuant to Rule 424(a) under the Act
being hereinafter called a "Preliminary Prospectus"; the various parts of such
registration statement, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) of this
Agreement and deemed by virtue of Rule 430A under the Act to be a part of the
registration statement at the time it was declared effective, each as amended at
the time such part became effective, being herein called collectively the
"Registration Statement" and the final prospectus, in the form first filed
pursuant to Rule 424(b), being hereinafter called the "Prospectus");
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain any untrue statement of a material fact or omit
to state a material fact required to be stated or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by or on behalf of the
Underwriter expressly for use therein;
(c) The Registration Statement conforms, and the Prospectus and any
amendments or supplements thereto will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable filing
date as to the Prospectus and any amendment or supplement thereto contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Underwriter expressly
for use therein;
(d) Neither the Company nor its wholly-owned subsidiary bank, ▇▇▇▇▇
▇▇▇▇▇▇ Bank, a Virginia state chartered bank (the "Bank"), has sustained since
the date of the latest audited financial statements included in the Prospectus
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or expressly contemplated in the Prospectus;
(e) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, 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 the Bank, respectively (except for
issuances of Common Stock upon exercise in accordance with the terms of options
reflected in such Prospectus and Registration Statement; and except for increase
in long-term debt related to the July 2003 issuance of trust preferred
securities; and except for issuances of Common Stock in connection with the
Company's 401(k) plan), or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and the Bank taken as a whole and (ii) there have been
no transactions entered into by the Company or the Bank, other than transactions
entered into in the ordinary course of business, that are material with respect
to the Company and the Bank taken as a whole;
(f) The Company and the Bank 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 such
as are described in the Prospectus or such as do not materially affect the value
of such property and do not interfere with the use made and proposed to be made
of such property by the Company and the Bank; and any real property and
buildings held under lease by the Company and the Bank are held by them under
valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and the Bank;
(g) The Company, the Bank and their 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 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 Company and the Bank taken as a whole; and each
of the Company, the Bank and their subsidiaries holds all material licenses,
certificates, authorizations and permits from governmental authorities necessary
for the conduct of its business as described in the Prospectus;
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(h) The Company has an authorized capitalization as set forth in 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
Prospectus; there are no preemptive or other rights to subscribe for or to
purchase any securities of the Company under the Articles of Incorporation of
the Company or under Virginia law; except as described in 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 Securities as
contemplated by this Agreement gives rise to any rights for or relating to the
registration of any securities of the Company;
(i) All outstanding shares of capital stock of the Bank are owned by
the Company free and clear of any perfected security interest and any other
security interests, claims, liens or encumbrances; and, other than the Bank,
▇▇▇▇▇ ▇▇▇▇▇▇ Statutory Trust I, ▇▇▇▇▇ ▇▇▇▇▇▇ Statutory Trust II, ▇▇▇▇▇ ▇▇▇▇▇▇
Insurance Services, Inc. and ▇▇▇▇▇ ▇▇▇▇▇▇ Community Development Corporation, the
Company does not own or control, directly or indirectly, any corporation,
association or other entity;
(j) The Securities 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
Securities contained in the Prospectus;
(k) The issuance and sale of the Securities being issued at each
Delivery Date (as hereinafter defined) 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 imposition of any lien, charge or encumbrance upon any property
or assets of the Company or the Bank pursuant to, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the Company
or the Bank is a party or by which the Company or the Bank is bound or to which
any of the property or assets of the Company or the Bank is subject, nor will
such action result in any violation of the provisions of the Articles of
Incorporation or Bylaws of the Company or the Articles of Incorporation or
Bylaws of the Bank or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or the Bank
or any of their respective properties; and no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body is required for the issuance and sale of the Securities or the
consummation by the Company of the transactions contemplated by this Agreement,
except such consents, approvals, authorizations, orders, registrations or
qualifications as may be required under the Act, under state securities or Blue
Sky laws, and under the rules of the National Association of Securities Dealers,
Inc. (the "NASD") in connection with the purchase and distribution of the
Securities by the Underwriter;
(l) There are no legal or governmental proceedings pending to which the
Company or the Bank is a party or of which any of their respective property or
assets is subject, which, if determined adversely to the Company or the Bank,
would individually or in the aggregate, have a material adverse effect on the
financial position, stockholders' equity or results of operations of the Company
and the Bank taken as a whole and, to the best of the Company's knowledge, no
such proceedings are threatened or contemplated by governmental authorities or
by others;
(m) ▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇, P.C., which has certified certain financial
statements of the Company and the Bank, are independent public accountants
within the meaning of the Act and the rules and regulations of the Commission
thereunder;
(n) All employee benefit plans established, maintained or contributed
to by the Company or the Bank comply in all material respects with all
applicable requirements of the Employee Retirement Income Security Act of 1974,
as amended ("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;
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(o) The consolidated financial statements of the Company, together with
related notes, as set forth in the Registration Statement 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
generally accepted accounting principles, 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 periods have been made; and the selected financial information included in
the Prospectus presents fairly the information shown therein and has been
compiled on a basis consistent with the financial statements presented therein;
(p) The Company and the Bank 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;
(q) No relationship, direct or indirect, exists between or among the
Company and the Bank, on the one hand, and the directors, officers,
shareholders, customers or suppliers of the Company or the Bank, on the other
hand, that is required by the Act or by the rules and regulations thereunder to
be described in the Registration Statement and the Prospectus which is not so
described;
(r) The Company and the Bank 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 Securities;
(s) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding agreement of the Company in
accordance with its terms; and
(t) The Securities have been approved for trading, subject to notice of
issuance, on the Nasdaq SmallCap Market.
2. PURCHASE AND SALE OF THE SECURITIES.
Subject to the terms and conditions herein set forth and in reliance
upon the representations and warranties contained herein, (a) the Company agrees
to sell to the Underwriter, and the Underwriter agrees to purchase from the
Company, at a purchase price per share of $_____, the Firm Securities; provided,
however, that the purchase price per share will be $______ for up to _______
shares of Common Stock [$2 million limit] included in the Firm Securities, which
shares may be purchased by directors, executive officers and founding directors
of the Company and the Bank solely at any office of the Underwriter; and (b) in
the event and to the extent that the Underwriter shall exercise the election to
purchase Optional Securities as provided below, the Company agrees to sell to
the Underwriter and the Underwriter agrees to purchase from the Company, at the
purchase price per share of $______, that number of Optional Securities as to
which such election shall have been exercised.
The Company grants the Underwriter the right to purchase, at its
election up to _______ Optional Securities, at the purchase price per share of
$_____, for the sole purpose of covering over-allotments in the sale of the Firm
Securities. Any such election to purchase the Optional Securities may be
exercised no more than once by written notice from you to the Company, given
within a period of 30 days after the date of this Agreement, setting forth the
aggregate amount of the Optional Securities to be purchased by the Underwriter,
and the date on which such Optional Securities are to be delivered, as
determined by you but in no event earlier than the First Delivery Date (as
defined in Section 4 hereof) or, unless you otherwise agree in writing, earlier
than two or later than seven business days after the date of such notice.
3. OFFERING BY THE UNDERWRITER.
Upon receipt of authorization by the Company to release the Firm
Securities, you propose to offer the Firm Securities for sale upon the terms and
conditions set forth in the Prospectus.
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4. DELIVERY AND PAYMENT.
Certificates in definitive form for the Securities 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, against
payment of the purchase price therefor by wire transfer of same day funds to an
account designated by the Company (the Company agreeing to reimburse the
Underwriter for any costs associated with such settlement, if any), all at the
offices of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇.
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 Securities, 10:00 a.m., New York, New York time, on November __, 2003, or
at such other time and date as you and the Company may agree upon in writing
and, with respect to the Optional Securities, 10:00 a.m., New York, New York
time, on the date specified by you in the written notice of the Underwriter's
election to purchase such Optional Securities, 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 Securities is herein called the "First Delivery Date," such time and
date for delivery of the Optional Securities, 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." Any certificates in definitive form
will be made available to the Underwriter for checking and packaging at least 24
hours prior to each Delivery Date at the offices of the Underwriter in Richmond,
Virginia or such other location designated by the Underwriter to the Company.
5. AGREEMENTS OF THE COMPANY.
The Company agrees with the Underwriter:
(a) To prepare the Prospectus in a form reasonably approved by you and
to file such Prospectus pursuant to Rule 424(b) under the Act within the time
period prescribed or, if applicable, such earlier time as may be required by
Rule 430A under the Act; to make no amendment or supplement to the Registration
Statement or Prospectus which shall be reasonably disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish you with copies thereof; to
file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission subsequent to the date
of the Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Securities; to advise you, promptly
after it receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any such qualification,
to use promptly its best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such actions as you may
reasonably request to qualify the Securities 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 Securities, 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;
(c) To furnish the Underwriter with copies of the Registration
Statement and the Prospectus in such quantities as you may from time to time
reasonably request during such period following the date hereof as a prospectus
is required to be delivered in connection with offers or sales of Securities,
and, if the delivery of a prospectus is required and if at such time any event
shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
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is delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus in order to comply with
the Act, to notify you and upon your request prepare and furnish without charge
to the Underwriter and to any dealer in securities as many copies as you may
from time to time reasonably request of an amended Prospectus or a supplement to
the Prospectus which will correct such statement or omission or effect such
compliance;
(d) 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 12 months beginning after the effective date of the Registration Statement
which will satisfy the provisions of Section 11(a) of the Act (for the purpose
of this subsection 5(d) 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);
(e) To furnish to the holders of the Securities as soon as practicable
after the end of the 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 Securities, 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;
(f) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to shareholders, 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 is listed or the Nasdaq
Stock Market, Inc.; and (ii) such additional information concerning the business
and financial condition of the Company as you may from time to time reasonably
request;
(g) For a period of 120 days from the effective date of the
Registration Statement, not to offer, sell, contract to sell or otherwise
dispose of any securities of the Company which are substantially similar to the
Securities (other than the Securities or pursuant to (i) employee stock option,
stockholder dividend reinvestment plans, or the Company's 401(k) plan, or (ii)
merger and acquisition transactions, (iii) currently outstanding warrants or
options) without your prior written consent; and
(h) To apply the net proceeds from the sale of the Securities for the
purposes set forth in the Prospectus.
6. PAYMENT OF EXPENSES.
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 Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriter and dealers; (ii) the cost of printing or reproducing
this Agreement, the Blue Sky Survey and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iii) all expenses
in connection with the qualification of the Securities for offering and sale
under state securities laws as provided in Section 5(b) hereof, including the
reasonable fees and disbursements of the Underwriter's counsel in connection
with such qualification and in connection with the Blue Sky Survey; (iv) the
filing fees incident to securing any required review by the NASD of the terms of
the sale of the Securities; (v) the cost of preparing stock certificates; (vi)
the costs or expenses of any transfer agent or registrar; (vii) all fees
relating to the inclusion of the Securities on the Nasdaq SmallCap Market; and
(viii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that except as provided in this Section,
Section 8 and Section 10 hereof, the Underwriter will pay all of its own costs
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and expenses, including the fees of its counsel, stock transfer taxes on resale
of any of the Securities by them, and any advertising expenses connected with
any offers they may make.
7. CONDITIONS TO OBLIGATIONS OF THE UNDERWRITER.
The obligations of the Underwriter hereunder, as to the Securities 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 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 theretofore to be performed, and the following additional
conditions:
(a) The Registration Statement is effective; if the filing of the
Prospectus, or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus, and any such supplement, will be filed in the manner and within the
time period required by Rule 424(b); no stop order suspending the effectiveness
of the Registration Statement 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, ▇▇▇▇▇▇▇ ▇▇▇▇, A Professional Corporation,
counsel for the Underwriter, shall have furnished to you such opinion or
opinions, dated such dates, with respect to the issuance and sale of the
Securities on each such Delivery Date, the Registration Statement, 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, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, L.L.P., counsel for
the Company, shall have furnished to you their written opinion, dated such
dates, in form and substance satisfactory to you, to the effect that:
(i) The Company and the Bank have been duly incorporated and
are validly existing as corporations in good standing under the laws of
their respective jurisdictions of incorporation, with corporate power
and authority to own or lease their respective properties and conduct
their respective businesses as described in the Prospectus; and the
Company and the Bank are duly qualified to do business and are in good
standing in each jurisdiction in which it owns or leases properties or
conducts business so as to require such qualification;
(ii) The Company has an authorized capitalization as set forth
under the caption "Description of Our Capital Stock" in the Prospectus,
and all of the issued shares of capital stock of the Company have been
duly and validly authorized and issued, are fully paid and
nonassessable and conform to the description contained in the
Prospectus; there are no preemptive or similar rights to subscribe for
or to purchase any securities of the Company under the Articles of
Incorporation of the Company or under Virginia law; except as described
in the Prospectus, there are no warrants or options to purchase any
securities of the Company which have been granted by the Company; to
the best of such counsel's knowledge, neither the filing of the
Registration Statement nor the offering or sale of the Securities as
contemplated by this Agreement gives rise to any rights for or relating
to the registration of any securities of the Company; and the form of
the certificates evidencing the Securities complies with all formal
requirements of Virginia law;
(iii) The Registration Statement has been declared effective
under the Act and, to the best 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 Act;
(iv) The Securities 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 Securities contained in the Prospectus, as amended
or supplemented;
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(v) All outstanding shares of capital stock of the Bank are
owned by the Company free and clear of any perfected security
interests, claims, liens or encumbrances;
(vi) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending to which the Company or the
Bank is a party or of which any property or assets of the Company or
the Bank is subject which, if determined adversely to the Company or
Bank, would individually or in the aggregate, have a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Company and the Bank taken as a whole; and, to the
best of 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,
and further subject to 12 U.S.C.1818(b)(6)(D) and similar bank
regulatory powers and to the application of principles of public
policy);
(viii) The issue and sale of the Securities and the
performance of this Agreement by the Company and the consummation of
the other transactions contemplated by this Agreement will not 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 imposition of
any lien, charge or encumbrance upon any property or assets of the
Company or Bank pursuant to, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which the Company or Bank is a party or by which the Company
or Bank is bound or to which any of the property or assets of the
Company or Bank is subject, nor will such action result in any
violation of the provisions of the Articles of Incorporation or Bylaws
of the Company or the Articles of Incorporation or Bylaws of the Bank
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 Bank 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 Securities 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 Act,
such as may be required under state securities or Blue Sky laws, and
under the rules of the NASD in connection with the purchase and
distribution of the Securities by the Underwriters;
(x) The Registration Statement 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 Act and the rules and regulations
thereunder; and
(xi) The Company has filed a listing of additional shares and
all required supporting documents with respect to the Securities with
the Nasdaq Stock Market Inc., and such counsel received no information
stating that the Securities will not be authorized for listing, subject
to official notice of issuance and evidence of satisfactory
distribution.
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
the Bank and public officials. On each Delivery Date, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇,
L.L.P. shall also deliver a letter to you stating that nothing has come to their
attention which leads them to believe that, as of the effective date of the
Registration Statement and as of each Delivery Date, either the Registration
Statement 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,
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other than 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 their belief is based upon the procedures set forth therein, but is without
independent check or verification.
(d) At 10:00 a.m., New York, New York time, on the date of this
Agreement and also at each Delivery Date, ▇▇▇▇▇, Hyde & ▇▇▇▇▇▇▇, P.C. shall have
furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in
Annex I hereto;
(e) (i) Neither the Company nor the Bank shall have sustained since the
date of the latest audited financial statements included in the Prospectus, any
material loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set forth or
expressly contemplated in the Prospectus, and (ii) since the respective dates as
of which information is given in the Prospectus there shall not have been any
change in the capital stock or long-term debt of the Company or the Bank,
respectively (except for issuances of Common Stock upon exercise in accordance
with the terms of options reflected in such Prospectus and Registration
Statement; and except for increase in long-term debt related to the July 2003
issuance of trust preferred securities; and except for issuances of Common Stock
in connection with the Company's 401(k) plan),or any change, or any development
involving a prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operation of the Company
or the Bank taken as a whole otherwise than as set forth or contemplated in 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
Securities being issued 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 the Nasdaq SmallCap Market; (ii) a
general moratorium on commercial banking activities in New York or Virginia
declared by federal or state authorities; (iii) the outbreak or escalation of
hostilities involving the United States or the declaration by the United States
of a national emergency or war, if any such event specified in this clause (iii)
would have such a materially adverse effect, in your judgment, as to make it
impracticable or inadvisable to proceed with the offering or the delivery of the
Securities on the terms and in the manner contemplated in the Prospectus; or
(iv) such a material adverse change in general economic, political, financial or
international conditions affecting financial markets in the United States having
a material adverse impact on trading prices of securities in general, as, in
your judgment, makes it impracticable or inadvisable to proceed with the
offering or delivery of the Securities on the terms and in the manner
contemplated in the Prospectus;
(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 specified by you, 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 Common Stock beneficially owned by
them, including any shares of Common Stock acquired in the Offering, or any
securities convertible into, or exchangeable for, Common Stock on or before the
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 the 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 the Delivery Date, as to the matters set forth in
subsections (a) and (e) of this Section and as to such other matters as you may
reasonably request; and
(i) The Securities shall have been approved for trading on the Nasdaq
SmallCap Market.
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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, the Closing Date by the Underwriter. Notice of such cancellation shall
be given to the Company in writing or by telephone or telegraph confirmed in
writing.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company will indemnify and hold harmless the Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
the Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon (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 any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse the Underwriter
for any legal or other expenses reasonably incurred by it in connection with
investigating, preparing to defend or defending, or appearing as a third party
witness in connection with, any such action or claims as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement
or the Prospectus or any amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by you expressly
for use therein.
(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 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 any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement, 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, Registration Statement or Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by 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. The Company acknowledges that for purposes of
this Section 8 the statements set forth on (i) the front cover page of the
Preliminary Prospectus and the Prospectus concerning over-allotment by the
Underwriter, (ii) the inside cover page of the Preliminary Prospectus and the
Prospectus concerning over-allotment and stabilization by the Underwriter, and
(iii) pages 48 and 49 under the heading "Underwriting" of the Preliminary
Prospectus and Prospectus concerning over-allotment and stabilization by the
Underwriter constitute the only information furnished in writing by the
Underwriter for inclusion in the Preliminary Prospectus or the Prospectus, and
you confirm, that such statements are correct.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection, unless 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
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indemnified party and the indemnifying party would present such counsel with a
conflict of interest under applicable standards of professional conduct due to
actual or potential differing interests between them, the indemnified party or
parties shall have the right to select separate counsel to defend such action on
behalf of such indemnified party or parties. It is understood that the
indemnifying party shall, in connection with any such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for the reasonable fees
and expenses of only one separate firm or attorneys together with appropriate
local counsel at any time for all indemnified parties not having actual or
potential differing interests with any indemnified party. Upon receipt of notice
from the indemnifying party to such indemnified party of its election so to
appoint counsel to defend such action and approval by the indemnified party of
such counsel, the indemnifying party will not be liable for any settlement
entered into without its consent and will not be liable to such indemnified
party under this Section 8 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence, (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriter on
the other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriter on the other 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
on the one hand and the Underwriter on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriter, in each case as set forth in the table
and the paragraph immediately following such table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Underwriter on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriter
agree that it would not be just and equitable if contributions pursuant to this
subsection (d) were determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this subsection (d), (i) the
provisions of the Selected Dealers Agreement shall govern contribution between
the Underwriter and the selected dealers named therein, (ii) in no case shall
the Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages that
the Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. Notwithstanding the
provisions of this subsection (d), 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.
(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 Act; and the obligations of the Underwriter under this
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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 Act.
9. REPRESENTATIONS AND WARRANTIES TO SURVIVE.
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
Securities.
10. TERMINATION AND PAYMENT OF EXPENSES.
(a) This Agreement shall be subject to termination in your absolute
discretion, by notice given to the Company prior to the delivery of any payment
for the Securities, 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 the Nasdaq SmallCap Market; (ii) a
general moratorium on commercial banking activities in New York or Virginia
declared by federal, New York State or Virginia authorities; (iii) the outbreak
or escalation of hostilities involving the United States or the declaration by
the United States of a national emergency or war, if any such event specified in
this clause (iii) would have such a materially adverse effect, in your judgment,
as to make it impracticable or inadvisable to proceed with the offering or the
delivery of the Securities on the terms and in the manner contemplated in the
Prospectus; or (iv) such a material adverse change in general economic,
political, financial or international conditions affecting financial markets in
the United States having a material adverse impact on trading prices of
securities in general, as, in your judgment, makes it impracticable or
inadvisable to proceed with the offering or delivery of the Securities on the
terms and in the manner contemplated in the Prospectus.
(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 the sale of the Securities
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
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 expenses, including
fees and disbursements of counsel, reasonably incurred by the Underwriter in
connection with the proposed purchase, sale and delivery of the Securities.
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. NOTICES.
In all dealings hereunder, you shall act on behalf of each of the
selected dealers, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any selected dealer
made or given by you. All statements, requests, notices and agreements hereunder
shall be in writing or by telegram if promptly confirmed in writing, and if to
the Underwriter shall be sufficient in all respects if delivered or sent by
mail, telex or facsimile transmission to ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc., ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: G. ▇▇▇▇▇ ▇▇▇▇▇▇, III, Managing
Director; and if to the Company shall be sufficient in all respects if delivered
or sent by mail, telex or facsimile transmission to the address of the Company
set forth in the Prospectus, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chief Executive
Officer. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof provided, however, that any notice to any selected dealer
pursuant to Section 11 hereof shall be delivered or sent by mail, telex or
facsimile transmission to such selected dealer, which will be supplied to the
Company by you upon request.
-12-
12. SUCCESSORS.
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
Securities from the Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
13. TIME OF THE ESSENCE.
Time shall be of the essence in this Agreement.
14. BUSINESS DAY.
As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
15. APPLICABLE LAW.
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.
16. CAPTIONS.
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.
17. COUNTERPARTS.
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.
18. PARTIAL UNENFORCEABILITY.
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.
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If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, and upon the acceptance hereof by you,
this letter and such acceptance hereof shall constitute a binding agreement
between the Underwriter and the Company.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇▇▇ BANCORP, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President and Chief Executive Officer
Accepted as of the date hereof
at Richmond, Virginia:
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, INC.
By: /s/ G. ▇▇▇▇▇ ▇▇▇▇▇▇, III
----------------------------
G. ▇▇▇▇▇ ▇▇▇▇▇▇, III
Managing Director
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ANNEX I
Pursuant to Section 7(d) of the Underwriting Agreement, ▇▇▇▇▇, Hyde &
▇▇▇▇▇▇▇, P.C., shall furnish letters to the Underwriter to the effect that:
1. They are independent public accountants with respect to the Company
and its subsidiary within the meaning of the Act and the applicable published
rules and regulations thereunder;
2. In their opinion, the consolidated audited financial statements
audited by them and included in the Registration Statement or the Prospectus
comply as to form in all material respects with the applicable accounting
requirements of the Act or the Securities Exchange Act of 1934, as amended, as
applicable, and the related published rules and regulations thereunder;
3. On the basis of limited procedures, not constituting an examination
in accordance with generally accepted auditing standards, consisting of a
reading of the latest unaudited financial statements made available by the
Company, inspection of the minute books of the Company and the Bank since the
date of the latest audited financial statements included in the Prospectus,
inquiries of officials of the Company and the Bank responsible for financial and
accounting matters and such other inquiries and procedures as may be specified
in such letter, nothing came to their attention that caused them to believe
that:
(A) the unaudited consolidated financial statements included
in the Registration Statement or the Prospectus do not comply as to
form in all material respects with the applicable accounting
requirements of the Act and published rules and regulations thereunder
or are not presented in conformity with generally accepted accounting
principles applied on a basis substantially consistent with that of the
audited consolidated financial statements included in the Registration
Statement or Prospectus;
(B) (i) as of a specified date not more than five calendar
days prior to the date of delivery of such letter, there have been any
changes in the capital stock, short-term debt or long-term debt of the
Company, or any decreases in consolidated total assets or stockholders'
equity as compared with amounts shown on the most recent consolidated
balance sheet included in the Registration Statement or Prospectus, and
(ii) for the period from the date of the most recent consolidated
financial statements included in the Registration Statement or
Prospectus to such specified date there were any decreases in
consolidated net interest income or the total or per share amounts of
net income as compared with the corresponding period in the preceding
year, except in each case for increases or decreases which the
Prospectus discloses have occurred or may occur or which are described
in such letter; and
4. In addition to the audit referenced in their report included in the
Registration Statement and the Prospectus and the limited procedures, inspection
of minute books, inquiries and other procedures referred to above, they have
carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information which are derived from the
general accounting records of the Company and the Bank, which appear in any
Preliminary Prospectus, the Prospectus, or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Underwriter, and have
compared certain of such amounts, percentages and financial information with the
accounting records of the Company and have found them to be in agreement.
A-1