Shares Patriot Capital Funding, Inc. Common Stock FORM OF UNDERWRITING AGREEMENT
Exhibit (h)
Shares
Common Stock
FORM OF UNDERWRITING AGREEMENT
July __, 2005
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
As Representative of the several Underwriters
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
As Representative of the several Underwriters
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Introductory. Patriot Capital Funding, Inc., (the “Company”) a Delaware corporation, proposes
to issue and sell to the several underwriters named in Schedule A (the “Underwriters”) an
aggregate of [ ] shares of its common stock, par value $0.01 per share (the “Shares”); and
the stockholders of the Company named in Schedule B (the “Selling Stockholders”) propose to
sell to the Underwriters an aggregate of [ ] Shares. The
[ ] Shares to be sold by the
Company and the [ ]
Shares to be sold by the Selling Stockholders are collectively called the
“Firm Shares.” In addition, the Company and the Selling Stockholders have granted to the
Underwriters an option to purchase up to an additional [ ]
Shares (the “Optional Shares”), as
provided in Section 2. The Firm Shares and, if and to the extent such option is exercised, the
Optional Shares are collectively called the “Offered Shares.” ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. (“▇.▇.
▇▇▇▇▇▇▇”) has agreed to act as representative of the several Underwriters (in such capacity, the
“Representative”) in connection with the offering and sale of the Offered Shares.
The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form N-2 (File No. 333-124831), which contains a form of
prospectus to be used in connection with the public offering and sale of the Offered Shares. A Form
N-6F Notice of Intent to Elect to be Subject to Sections 55 through 65 of the Investment Company
Act of 1940 (File No. 333-814-00707) (the “Notice of Intent”) was filed, pursuant to Section 6(f)
of the Investment Company Act of 1940, as amended, and the rules and regulations thereunder
(collectively, the “Investment Company Act”) with the Commission on May 12, 2005. A Form N-54A
Notification of Election to be Subject to Sections 55 Through 65 of the Investment Company Act of
1940 filed pursuant to Section 54(a) of the Investment Company Act (File No. 814-___) (the
“Notification of Election”) was filed under the Investment Company Act with the Commission on July
___, 2005. The registration statement, as amended, including the financial statements, exhibits
and schedules thereto, in the form in which it was declared effective by the Commission under the
Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder
(collectively, the “Securities Act”), including any information contained in a prospectus
subsequently filed with the Commission pursuant to Rule 497 under the Securities Act and deemed to
be a part of the registration statement at the time of effectiveness pursuant to Rule 430A or Rule
434 under the Securities Act, is called the “Registration Statement.” Any registration statement
filed by the Company pursuant to Rule 462(b) under the Securities Act is called the “Rule 462(b)
Registration Statement,” and from and after the date and time of filing of the
Rule 462(b) Registration Statement, the term “Registration Statement” shall include the Rule
462(b) Registration Statement. The prospectus, in the form first used by the Underwriters to
confirm sales of the Offered Shares, is called the “Prospectus”. The Company’s preliminary
prospectus subject to completion dated July 13, 2005 relating to the Offered Shares is hereinafter
referred to as the “Preliminary Prospectus”. All references in this Agreement to the Registration
Statement, the Rule 462(b) Registration Statement, the 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 (“▇▇▇▇▇”).
The Company and the Selling Stockholders hereby confirm their respective agreements with the
Underwriters as follows:
Section 1. Representations and Warranties.
A. Representations and Warranties of the Company. The Company hereby represents, warrants and
covenants to each Underwriter as follows:
(a) Compliance with Registration Requirements. The Registration Statement and any Rule 462(b)
Registration Statement have been declared effective by the Commission under the Securities Act.
The Company has complied with all requests of the Commission for additional or supplemental
information. No stop order suspending the effectiveness of the Registration Statement or any Rule
462(b) Registration Statement is in effect and no proceedings for such purpose have been instituted
or are pending or, to the best knowledge of the Company, are threatened by the Commission.
The Preliminary Prospectus and the Prospectus when filed with the Commission complied in all
material respects with the requirements of the Securities Act and, if filed by electronic
transmission pursuant to ▇▇▇▇▇ (except as may be permitted by Regulation S-T under the Securities
Act), was identical to the copy thereof delivered to the Underwriters for use in connection with
the offer and sale of the Offered Shares. Each of the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendment thereto, at the time it became effective
and at all subsequent times, complied and will comply in all material respects with the
requirements of the Securities Act and did not and will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading. The Prospectus as amended or supplemented, as of its date
and at all subsequent times, did not and will not contain any untrue statement of a material fact
or omit 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. The representations and warranties
set forth in the two immediately preceding sentences do not apply to statements in or omissions
from the Registration Statement, any Rule 462(b) Registration Statement, or any post-effective
amendment thereto, or the Prospectus, or any amendments or supplements thereto, made in reliance
upon and in conformity with information relating to any Underwriter furnished to the Company in
writing by the Representative expressly for use therein, it being understood and agreed that the
only such information furnished by the Representative to the Company consists of the information
described in Section 8(b) below. There are no contracts or other documents required to be
described in the Prospectus or to be filed as exhibits to the Registration Statement which have not
been described or filed as required.
(b) Offering Materials Furnished to Underwriters. The Company has delivered to the
Representative one complete manually signed copy of the Registration Statement and of each consent
and certificate of experts filed as a part thereof, and conformed copies of the Registration
Statement (without exhibits) and Preliminary Prospectuses and the Prospectus, as amended or
supplemented, in such quantities and at such places as the Representative has reasonably requested
for each of the Underwriters.
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(c) Distribution of Offering Material By the Company. The Company has not distributed and
will not distribute, prior to the later of (i) the expiration or termination of the option granted
to the several Underwriters in Section 2, (ii) the completion of the Underwriters’ distribution of
the Offered Shares and (iii) the expiration of twenty-five (25) days after the date of the
Prospectus, any offering material in connection with the offering and sale of the Offered Shares
other than the Preliminary Prospectus, the Prospectus or the Registration Statement.
(d) The Underwriting Agreement. This Agreement has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company, enforceable against the Company
in accordance with its terms except as the enforcement hereof or thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting
the rights and remedies of creditors or by general equitable principles and except as rights to
indemnity hereunder may be limited by general equitable principles or federal or state securities
laws or public policy underlying such laws.
(e) Authorization of the Offered Shares. The Offered Shares to be purchased by the
Underwriters from the Company have been duly authorized for issuance and sale pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this Agreement, will be validly
issued, fully paid and nonassessable. The Offered Shares to be purchased by the Underwriters from
the Selling Stockholders have been duly authorized, validly issued, fully paid and nonassessable.
(f) No Applicable Registration or Other Similar Rights. Other than the agreement by the
Company to include the Offered Shares held by the Selling Stockholders in the Registration
Statement and the offering contemplated by this Agreement, there are no persons with registration
or other similar rights to have any equity or debt securities registered for sale under the
Registration Statement or included in the offering contemplated by this Agreement.
(g) Subsidiaries. The Company does not own, directly or indirectly, any shares of stock or
any other equity or long-term debt securities of any corporation or other entity other than those
corporations or other entities described in the Prospectus under the caption “Portfolio Companies”
(each a “Portfolio Company” and collectively, the “Portfolio Companies”). The Company does not
control (as such term is defined in Section 2(a)(9) of the Investment Company Act) any of the
Portfolio Companies. In accordance with Article 6 of Regulation S-X under the Securities Act, the
Company is not required to consolidate the financial statements of any corporation, association or
other entity with the Company’s financial statements.
(h) No Material Adverse Change. Except as otherwise disclosed in the Prospectus, subsequent
to the respective dates as of which information is given in the Prospectus: (i) there has been no
material adverse change, or any development that could reasonably be expected to result in a
material adverse change, in the condition, financial or otherwise, or in the earnings, business,
management, operations or prospects, whether or not arising from transactions in the ordinary
course of business, of the Company (any such change is called a “Material Adverse Change”); (ii)
the Company has not incurred any material liability or obligation, indirect, direct or contingent,
not in the ordinary course of business nor entered into any material transaction or agreement not
in the ordinary course of business; and (iii) there has been no dividend or distribution of any
kind declared, paid or made by the Company on any class of capital stock or repurchase or
redemption by the Company of any class of capital stock.
(i) Independent Accountants. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have expressed their opinion with
respect to the financial statements and the related notes thereto filed with the Commission as a
part of the Registration Statement and included in the Prospectus (the “Financial Statements”),
are: (i) independent public or certified public accountants as required by the Securities Act and
the Securities Exchange Act of
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1934, as amended, and the rules and regulations promulgated thereunder (collectively, the
“Exchange Act”); (ii) to the best of the Company’s knowledge, in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X; and
(iii) to the best of the Company’s knowledge, a registered public accounting firm as defined by the
Public Company Accounting Oversight Board (the “PCAOB”) whose registration has not been suspended
or revoked and who has not requested such registration to be withdrawn.
(j) Preparation of the Financial Statements. The Financial Statements present fairly in all
material respects the combined financial position of the Company and Wilton Funding, LLC (“Wilton”)
as of and at the dates indicated and the results of their operations and cash flows for the periods
specified. Such Financial Statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods involved, except as may
be expressly stated in the related notes thereto. No other financial statements or supporting
schedules are required to be included in the Registration Statement. The financial data set forth
in the Prospectus in the column “Actual” under the caption “Capitalization” fairly presents the
information set forth therein on a basis consistent with that of the audited financial statements
and related notes thereto contained in the Registration Statement. To the best of the Company’s
knowledge, no person who has been suspended or barred from being associated with a registered
public accounting firm, or who has failed to comply with any sanction pursuant to Rule 5300
promulgated by the PCAOB, has participated in or otherwise aided the preparation of, or audited,
the Financial Statements, supporting schedules or other financial data filed with the Commission as
a part of the Registration Statement and included in the Prospectus.
(k) Company’s Accounting System. The Company makes and keeps accurate books and records and
maintains a system of accounting controls sufficient to provide reasonable assurances that: (i)
transactions are executed in accordance with management’s general or specific authorization; (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
authorization; 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.
(l) Organization and Good Standing of the Company. The Company has been duly incorporated and
is validly existing as a corporation, in good standing under the laws of the State of Delaware, (i)
has the corporate power and authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform its obligations under this
Agreement, (ii) is duly qualified as a foreign corporation to transact business and is in good
standing in the State of Connecticut and each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the conduct of business,
except to the extent that the failure to be so qualified or be in good standing would not
reasonably be expected to result in a Material Adverse Change.
(m) Capitalization and Other Capital Stock Matters. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Prospectus in the column entitled “Actual”
under the caption “Capitalization”. The Shares (including the Offered Shares) conform in all
material respects to the description thereof contained in the Prospectus. All of the issued and
outstanding Shares will have been duly authorized and validly issued, are fully paid and
nonassessable and will have been issued in compliance with federal and state securities laws. None
of the outstanding Shares have been issued in violation of any preemptive rights, rights of first
refusal or other similar rights to subscribe for or purchase securities of the Company arising
under the Delaware General Corporation Law (“DGCL”), the Company’s charter or bylaws or any
agreement to which the Company is party. There are no authorized or outstanding options, warrants,
preemptive rights, rights of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any capital stock of the
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Company other than those accurately described in the Prospectus. The description of the
Company’s stock option plan, and the options or other rights granted thereunder, set forth in the
Prospectus accurately and fairly presents the information required to be shown with respect to such
plan and options. The Company has no other stock plans or arrangements other than those described
in the Prospectus.
(n) Listing. The Offered Shares have been approved for inclusion on the Nasdaq National
Market, subject only to official notice of issuance.
(o) Agreement with iStar. The Merger (as defined in Section 1(A)(kk) below) and the
transactions contemplated by this Agreement and the Prospectus violate certain covenants and
trigger certain events of default (the “iStar Defaults”) under that certain credit agreement (the
“iStar Facility”) dated as of February 11, 2003 by and between Wilton Funding, LLC and iStar
Financial Inc. (“iStar”). The Company has an enforceable agreement (the “iStar Waiver”) with iStar
whereby iStar has agreed to refrain from exercising certain rights under the iStar Facility,
including the right to declare an event of default thereunder as a result of the iStar Defaults,
until ten (10) calendar days following the date of the Merger. Because of the iStar Waiver and
the Company’s agreement to use the proceeds of this offering as set forth in the Prospectus under
“Use of Proceeds” to repay all outstanding borrowings under the iStar Facility, the iStar Defaults
will not result in a Material Adverse Change.
(p) Non-Contravention of Company Instruments; No Further Authorizations or Approvals Required.
The Company (i) is not in violation of its charter or by-laws and (ii) except for the iStar
Defaults, is not in default (or, with the giving of notice or lapse of time, would be in default)
(a “Company Default”) under any indenture, mortgage, loan or credit agreement, note, contract,
franchise, lease or other instrument to which the Company is a party or by which it may be bound,
or to which any of the property or assets of the Company is subject (each, a “Company Instrument”),
except, with respect to clause (ii) to the extent that any such Company Default (including the
iStar Defaults) would not reasonably be expected to result in a Material Adverse Change. The
Company’s execution, delivery and performance of this Agreement, the consummation of the
transactions contemplated hereby and by the Prospectus (including the Merger (as defined below))
and the issuance and sale of the Offered Shares: (i) will not result in any violation of the
provisions of the charter or by-laws of the Company; (ii) will not conflict with or constitute a
breach of, or Company Default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company pursuant to, or require the consent of any
other party to, any Company Instrument; and (iii) will not result in any violation of any law,
administrative regulation or administrative or court decree applicable to the Company, except with
respect to clauses (ii) and (iii), to the extent that any such contravention would not reasonably
be expected to result in a Material Adverse Change. No consent, approval, authorization or other
order of, or registration or filing with, any court or other governmental or regulatory authority
or agency is required for the Company’s execution, delivery and performance of this Agreement and
consummation of the transactions contemplated hereby and by the Prospectus (including the Merger),
except (i) registration of the Offered Shares under the Securities Act, which has been effected,
(ii) the filing of a certificate of merger with the Secretary of State of the State of Delaware,
which has been effected,
(iii) the filing of a certificate of amendment to the Company’s charter with the Secretary of State of the
State of Delaware
to effectuate the stock split described in the Prospectus, which has been effected,
(iv) any necessary qualification under the securities or blue sky laws of
the various jurisdictions in which the Offered Shares are being offered by the Underwriters and
(v) under the rules and regulations of the NASD in connection with the purchase and distribution
of Offered Shares by the Underwriters.
(q) No Material Actions or Proceedings. Except as otherwise disclosed in the Prospectus,
there are no legal or governmental actions, suits or proceedings pending or, to the best of the
Company’s knowledge, threatened: (i) against or affecting the Company; (ii) which has as the
subject thereof any officer or director of, or property owned or leased by, the Company; or (iii)
relating to environmental or discrimination matters against or affecting the Company, where in each
such case (A) there is a reasonable possibility that such action, suit or proceeding might be
determined adversely to the Company
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or such officer or director and (B) any such action, suit or proceeding, if so determined
adversely, would reasonably be expected to result in a Material Adverse Change or adversely affect
the consummation of the transactions contemplated by this Agreement. No material labor dispute
with the employees of the Company exists or, to the best of the Company’s knowledge, is threatened
or imminent.
(r) Intellectual Property Rights. The Company owns or possesses sufficient trademarks, trade
names, patent rights, copyrights, domain names, licenses, approvals, trade secrets and other
similar rights (collectively, “Intellectual Property Rights”) reasonably necessary to conduct its
business as now conducted and as described in the Prospectus, except where the failure to own or
possess such rights would not reasonably be expected to result in a Material Adverse Change; and
the expected expiration of any of such Intellectual Property Rights would not result in a Material
Adverse Change. The Company has not received, and has no reason to believe that it will receive,
any notice of infringement or conflict with asserted Intellectual Property Rights of others. The
Company is not a party to or bound by any options, licenses or agreements with respect to the
Intellectual Property Rights of any other person or entity that are required to be set forth in the
Prospectus and are not described therein. None of the technology employed by the Company has been
obtained or is being used by the Company in violation of any contractual obligation binding on the
Company or, to the Company’s knowledge, any of its officers, directors or employees in violation of
the rights of any persons, except to the extent that any such violation would not reasonably be
expected to result in a Material Adverse Change.
(s) All Necessary Permits. The Company possesses such valid and current certificates,
authorizations or permits issued by the appropriate state or federal regulatory agencies or bodies
necessary to conduct its business, and the Company has not received, and has no reason to believe
that it will receive, any notice of proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be
expected to result in a Material Adverse Change.
(t) Title to Properties. The Company has good and marketable title to all of the real and
personal property and other assets reflected as owned in the Financial Statements, in each case,
except as disclosed in the Prospectus, free and clear of any security interests, mortgages, liens,
encumbrances, equities and adverse claims. The real property, improvements, equipment and personal
property held under lease by the Company are held under valid and enforceable leases, with such
exceptions as are not material and do not materially interfere with the use made or proposed to be
made of such real property, improvements, equipment or personal property by the Company.
(u) Tax Law Compliance. The Company has filed all necessary federal and state income and
franchise tax returns and has paid all taxes required to be paid by it and, if due and payable, any
related or similar assessment, fine or penalty levied against it. The Company has made adequate
charges, accruals and reserves in the Financial Statements in respect of all income tax and
franchise taxes for all periods as to which the tax liability of the Company has not been finally
determined. The Company is not aware of any tax deficiency that has been or might be asserted or
threatened against the Company that would reasonably be expected to result in a Material Adverse
Change.
(v) Insurance. The Company maintains insurance policies in such amounts and with such
deductibles and covering such risks as it deems appropriate for its business. The Company has no
reason to believe that it will not be able: (i) to renew its existing insurance coverage as and
when such policies expire; or (ii) to obtain comparable coverage from similar institutions as may
be necessary or appropriate to conduct its business as now conducted and at a cost that would not
reasonably be expected to result in a Material Adverse Change. The Company has not been denied any
insurance coverage which it has sought or for which it has applied.
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(w) No Price Stabilization or Manipulation; Compliance with Regulation M. The Company has not
taken, directly or indirectly, any action designed to or that might be reasonably expected to cause
or result in stabilization or manipulation of the price of the Shares or any other “reference
security” (as defined in Rule 100 of Regulation M under the Exchange Act (“Regulation M”)) whether
to facilitate the sale or resale of the Offered Shares or otherwise, and has taken no action which
would directly or indirectly violate Regulation M. The Company acknowledges that the Underwriters
may engage in passive market making transactions in the Offered Shares on the Nasdaq National
Market in accordance with Regulation M.
(x) Related Party Transactions. There are no business relationships or transactions that
exist between or among the Company, on the one hand, and any director, executive officer,
stockholder or any other person, on the other hand, which are required to be described in the
Prospectus which have not been described as required.
(y) No Unlawful Contributions or Other Payments. Neither the Company nor, to the best of the
Company’s knowledge or any employee of the Company or any agent on behalf of the Company, has made
any contribution or other payment to any official of, or candidate for, any federal, state or
foreign office in violation of any law or of the character required to be disclosed in the
Prospectus.
(z) Disclosure Controls and Procedures; Deficiencies in or Changes to Internal Control Over
Financial Reporting. The Company has established and maintains disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), which: (i) are designed to ensure that
material information relating to the Company is made known to the Company’s principal executive
officer and its principal financial officer by others within the Company; and (ii) are effective in
all material respects to perform the functions for which they were established. The Company is not
aware of (x) any significant deficiencies or material weaknesses in the design or operation of its
internal control over financial reporting (as such term is defined in Exchange Act Rules 13a-15(f)
and 15d-15(f)) which are reasonably likely to adversely affect the Company’s ability to record,
process, summarize and report financial information or (y) any fraud, whether or not material, that
involves management or other employees who have a significant role in the Company’s internal
control over financial reporting.
(aa) ERISA Compliance. The Company and any “employee benefit plan” (as defined under the
Employee Retirement Income Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, “ERISA”)) established or maintained by the Company are in
compliance with ERISA. No “reportable event” (as defined under ERISA) has occurred or is
reasonably expected to occur with respect to any “employee benefit plan” established or maintained
by the Company. No “employee benefit plan” established or maintained by the Company if such
“employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities”
(as defined under ERISA). The Company has not incurred and does not reasonably expect to incur any
liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any
“employee benefit plan” or (ii) Sections 412, 4971, 4975 or 4980B of the Internal Revenue Code of
1986, as amended, and the regulations and published interpretations thereunder (collectively, the
“Code”). Each “employee benefit plan” established or maintained by the Company that is intended to
be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether by
action or failure to act, which would cause the loss of such qualification. The Company has not
received any notification of any investigation, examination, audit or review of any type by or with
the Internal Revenue Service or Department of Labor regarding or in connection with any “employee
benefit plan” established or maintained by the Company.
(bb) Brokers. Except as otherwise disclosed in the Prospectus, there is no broker, finder or
other party that is entitled to receive from the Company any brokerage or finder’s fee or other fee
or commission as a result of any transactions contemplated by this Agreement.
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(cc) No Outstanding Loans or Other Extensions of Credit. The Company has not extended or
maintained credit, arranged for the extension of credit, or renewed any extension of credit, in the
form of a personal loan, to or for any director or executive officer of the Company except for such
extensions of credit as are (i) expressly permitted by Section 13(k) of the Exchange Act or (ii)
fully repaid, discharged, forgiven or otherwise no longer outstanding or owing in any way on the
date of this Agreement.
(dd) Compliance with Laws. The Company has not been advised, and has no reason to believe,
that it is not conducting business in compliance with all applicable laws, rules and regulations of
the jurisdictions in which it is conducting business, except as disclosed in the Prospectus
relating to the asset coverage requirements under the Investment Company Act (which the Company has
determined will not result in a Material Adverse Change).
(ee) Notice of Intent. When the Notice of Intent was filed with the Commission, it (i)
contained all statements required to be stated therein in accordance with, and complied in all
material respects with the requirements of, the Investment Company Act and (ii) did not include any
untrue statement of a material fact or omit to state a material fact necessary to make the
statements therein not misleading.
(ff) Notification of Election. When the Notification of Election was filed with the
Commission, it (i) contained all statements required to be stated therein in accordance with, and
complied in all material respects with the requirements of, the Investment Company Act and (ii) did
not include any untrue statement of a material fact or omit to state a material fact necessary to
make the statements therein not misleading.
(gg) Election as a Business Development Company. The Company will not, as of the First
Closing Date (as defined below) and any Option Closing Date (as defined below), have filed with the
Commission any notice of withdrawal of the Notification of Election pursuant to Section 54(c) of
the Investment Company Act. The Notification of Election is effective and no order of suspension
or revocation of such election has been issued or proceedings therefor initiated or, to the best
knowledge of the Company, threatened by the Commission.
(hh) Portfolio Companies. The Company has duly authorized, executed and delivered agreements
required to make the investments described in the Prospectus under the caption “Portfolio
Companies” (each a “Portfolio Company Agreement”).
(ii) Termination of Agreements. Except as disclosed in the Prospectus, the Company has not
sent or received any communication regarding termination of, or intent not to renew, any of the
contracts or agreements referred to or described in, or filed as an exhibit to, the Registration
Statement, and no such termination or non-renewal has been threatened by the Company or, to the
Company’s knowledge after due inquiry, any other party to any such contract or agreement.
(jj) No Affiliations. To the best of the Company’s knowledge, there are no affiliations or
associations between any member of the NASD and any of the Company’s officers, directors or 5% or
greater securityholders, except as set forth in the Prospectus.
(kk) Merger. The merger transaction described in the Registration Statement under the heading
entitled “Reorganization, Business Development Company and Regulated Investment Company Elections”
is referred to herein as the “Merger”. The Company has complied with all requirements of
applicable law in connection with the Merger and the Merger has been duly consummated under the
laws
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of the DGCL and the Delaware Limited Liability Company Act. The Merger (i) did not result in
any violation of the provisions of the charter, by-laws or limited liability company agreement of
the Company or Wilton; (ii) except for the iStar Defaults, did not constitute a breach of, or
Company Default under, or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company pursuant to, any Company Instrument; (iii) did not
result in any violation of any federal or state law or, to the best of the Company’s knowledge, any
administrative regulation or administrative or court decree, applicable to the Company or Wilton;
or (iv) did not require any consents, approvals or authorizations to be obtained by the Company or
Wilton, or any registrations, declarations or filings to be made by the Company or Wilton, in each
case, under any federal or state statute, rule or regulation applicable to the Company or Wilton
that has not have been obtained or made.
(ll) Interested Persons. Except as disclosed in the Prospectus, (i) no person is serving or
acting as an officer or director of the Company except in accordance with the provisions of the
Investment Company Act and (ii) no director of the Company is an “interested person” (as defined in
the Investment Company Act) of the Company or an “affiliated person” (as defined in the Investment
Company Act) of any of the Underwriters.
(mm) Operations Comply with Investment Company Act. Except as disclosed in the Prospectus
relating to the asset coverage requirements under the Investment Company Act, the operations of the
Company are in compliance in all material respects with the provisions of the Investment Company
Act applicable to “business development companies”. The provisions of the charter and by-laws of
the Company and the investment objective, strategies, policies and restrictions described in the
Prospectus, assuming they are implemented as so described, will comply in all material respects
with the requirements of the Investment Company Act. Once the Company applies the proceeds of the
offering in accordance with the “Use of Proceeds” section of the Prospectus, it will be in
compliance in all material respects with the provisions of the Investment Company Act applicable to
“business development companies”.
(nn) No Transfer Taxes or Other Fees. There are no transfer taxes or other similar fees or
charges under federal law or the laws of any state, or any political subdivision thereof, required
to be paid in connection with the execution and delivery of this Agreement or the issuance and sale
by the Company of the Offered Shares.
(oo) Lock-Up Agreements. Each ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
and the Selling Stockholders signed an agreement in the form attached hereto as Exhibit A (the
“Lock-up Agreements”). The Company has provided to counsel for the Underwriters true, accurate and
complete copies of all the Lock-up Agreements.
(pp) Conditions for Use of Form N-2. The Company has satisfied the conditions for the use of
Form N-2, as set forth in the general instructions thereto, with respect to the Registration
Statement.
The Company acknowledges that the Underwriters and, for purposes of the opinions to be
delivered pursuant to Section 5 hereof, counsel to the Company and counsel to the Underwriters,
will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents
to such reliance.
B. Representations and Warranties of the Selling Stockholders. The Selling Stockholders
jointly and severally represent, warrant and covenant to each Underwriter as follows:
(a) Accurate Disclosure. To the best knowledge of the Selling Stockholders, the
representations and warranties of the Company contained in Section 1(A) hereof are true and
correct. The representations and warranties referred to in the immediately preceding sentence do
not apply to statements in or omissions from the Registration Statement, any Rule 462(b)
Registration Statement, or any post-effective
9
amendment thereto, or the Prospectus, or any amendments or supplements thereto, made in
reliance upon and in conformity with information relating to any Underwriter furnished to the
Company in writing by the Representative expressly for use therein, it being understood and agreed
that the only such information furnished by the Representative to the Company consists of the
information described in Section 8(b) below. The Selling Stockholders have reviewed and are
familiar with the Registration Statement and the Prospectus and to the knowledge of the Selling
Stockholders, neither the Prospectus nor any amendments or supplements thereto includes any untrue
statement of a material fact 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.
(b) The Underwriting Agreement. This Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Stockholders and is a valid and binding agreement of the
Selling Stockholders, enforceable in accordance with its terms, except as the enforcement hereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating
to or affecting the rights and remedies of creditors or by general equitable principles and except
as rights to indemnity hereunder may be limited by general equitable principles or federal or state
securities laws or public policy underlying such laws.
(c) The Custody Agreement. The Custody Agreement signed by the Selling Stockholders and
American Stock Transfer & Trust Company, as custodian (the “Custodian”), relating to the deposit of
the Offered Shares to be sold by the Selling Stockholders (the “Custody Agreement”) has been duly
authorized, executed and delivered by the Selling Stockholders and is a valid and binding agreement
of the Selling Stockholders, enforceable in accordance with its terms, except as rights to
indemnification thereunder may be limited by applicable law and except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating
to or affecting the rights and remedies of creditors or by general equitable principles.
(d) Power of Attorney. The Power of Attorney appointing certain individuals named therein as
the attorneys-in-fact for the Selling Stockholders (each, an “Attorney-in-Fact”) to the extent set
forth therein relating to the transactions contemplated hereby and by the Prospectus (the “Power of
Attorney”), has been duly authorized, executed and delivered by the Selling Stockholders and is a
valid and binding agreement of the Selling Stockholders, enforceable in accordance with its terms,
except as rights to indemnification thereunder may be limited by applicable law and except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors or by general equitable
principles.
(e) Title to Offered Shares to be Sold. The Selling Stockholders have, and on the First
Closing Date and each applicable Option Closing Date will have, good and valid title to all of the
Offered Shares which may be sold by the Selling Stockholders pursuant to this Agreement on such
date and the legal right and power to sell, transfer and deliver all of the Offered Shares which
may be sold by the Selling Stockholders pursuant to this Agreement and to comply with its other
obligations hereunder and thereunder.
(f) Delivery of the Offered Shares to be Sold. Delivery of the Offered Shares which are to be
sold by the Selling Stockholders pursuant to this Agreement will pass good and valid title to such
Offered Shares, free and clear of any security interest, mortgage, pledge, lien, encumbrance or
other adverse claim.
(g) Non-Contravention; No Further Authorizations or Approvals Required. The execution and
delivery by the Selling Stockholders of, and the performance by each Selling Stockholder of its
obligations under, this Agreement, the Custody Agreement and the Power of Attorney will not
contravene
10
or conflict with, result in a breach of, or constitute a default under, or require the consent
of any other party to, the charter or by-laws, partnership agreement, or other organizational
documents of the applicable Selling Stockholder or any other agreement or instrument to which such
Selling Stockholder is a party or by which it is bound or under which it is entitled to any right
or benefit, any provision of applicable law or any judgment, order, decree or regulation applicable
to such Selling Stockholder of any court, regulatory body, administrative agency, governmental body
or arbitrator having jurisdiction over such Selling Stockholder, except for such contraventions,
conflicts, breaches, defaults or consents that have been duly waived or would not be reasonably
expected to adversely affect the consummation of the transactions contemplated by this Agreement or
the ability of the Selling Stockholders to perform their obligations hereunder. No consent,
approval, authorization or other order of, or registration or filing with, any court or other
governmental authority or agency, is required for the consummation by the Selling Stockholders of
the transactions contemplated in this Agreement, except such as have been obtained or made and are
in full force and effect under the Securities Act, applicable state securities or blue sky laws and
from the NASD.
(h) No Registration, Pre-emptive, Co-Sale or Other Similar Rights. No Selling Stockholder (i)
has any registration or other similar rights to have any equity or debt securities registered for
sale by the Company under the Registration Statement or included in the offering contemplated by
this Agreement, except for such rights as are described in the Prospectus under “Shares Eligible
for Future Sale,” (ii) has any preemptive right, co-sale right or right of first refusal or other
similar right to purchase any of the Offered Shares that are to be sold by the Company to the
Underwriters pursuant to this Agreement, except for such rights the Selling Stockholders have
waived prior to the date hereof and as have been described in the Registration Statement and
Prospectus, and (iii) owns any warrants, options or similar rights to acquire, or has any right or
arrangement to acquire, any capital stock, right, warrants, options or other securities from the
Company, other than those described in the Registration Statement and the Prospectus.
(i) No Further Consents, etc. Except for such consents, approvals and waivers which have been
obtained by the Selling Stockholders on or prior to the date of this Agreement, no consent,
approval or waiver is required under any instrument or agreement to which any Selling Stockholder
is a party or by which it is bound or under which it is entitled to any right or benefit, in
connection with the offering, sale or purchase by the Underwriters of any of the Offered Shares
which may be sold by the Selling Stockholders under this Agreement or the consummation by the
Selling Stockholders of any of the other transactions contemplated hereby.
(j) Disclosure Made by the Selling Stockholders in the Prospectus. All information furnished
by or on behalf of the Selling Stockholders in writing expressly for use in the Registration
Statement and Prospectus is, and on the First Closing Date and the applicable Option Closing Date
will be, true, correct, and complete in all material respects, and does not, and on the First
Closing Date and the applicable Option Closing Date will not, contain any untrue statement of a
material fact or omit to state any material fact necessary to make such information not misleading.
The number of shares held (i) of record by the Selling Stockholders and (ii) beneficially by
Compass Group Investments, Inc. (“CGI”) (both prior to and after giving effect to the sale of the
Offered Shares) are accurately set forth in the Prospectus under the caption “Control Persons and
Principal and Selling Stockholder”.
(k) No Price Stabilization or Manipulation; Compliance with Regulation M. The Selling
Stockholders have not taken, directly or indirectly, any action designed to or that might be
reasonably expected to cause or result in stabilization or manipulation of the price of the Shares
or any other reference security, whether to facilitate the sale or resale of the Offered Shares or
otherwise, and have taken no action which would directly or indirectly violate any provision of
Regulation M.
11
(l) Distribution of Offering Materials by the Selling Stockholders. The Selling Stockholders
have not distributed and will not distribute, prior to the later of (i) the expiration or
termination of the option granted to the several Underwriters under Section 2 and (ii) the
completion of the Underwriters’ distribution of the Offered Shares, any offering material in
connection with the offering and sale of the Offered Shares other than the Preliminary Prospectus,
the Prospectus or the Registration Statement.
(m) No Affiliations. There are no affiliations or associations between any members of the
NASD and any Selling Stockholder.
Each Selling Stockholder acknowledges that the Underwriters and, for purposes of the opinion
to be delivered pursuant to Section 5 hereof, counsel to the Selling Stockholders, counsel to the
Company and counsel to the Underwriters, will rely upon the accuracy and truthfulness of the
foregoing representations and hereby consents to such reliance.
Section 2. Purchase, Sale and Delivery of the Offered Shares.
(a) The Firm Shares. Upon the terms herein set forth, (i) the Company agrees to issue and
sell to the several Underwriters an aggregate of 7,333,334 Firm Shares and (ii) each Selling
Stockholder agrees to sell to the several Underwriters that number of Firm Shares set forth in
Schedule B opposite the name of such Selling Stockholder. On the basis of the representations,
warranties and agreements herein contained, and upon the terms but subject to the conditions herein
set forth, the Underwriters agree, severally and not jointly, to purchase from the Company and the
Selling Stockholders the respective number of Firm Shares set forth opposite their names on
Schedule A. The purchase price per Firm Share to be paid by the several Underwriters to
the Company and the Selling Stockholders shall be
$[ ] per share; provided that, the aggregate amount paid to the each of the Company and the Selling
Stockholders shall be reduced by the amount of the advisory fees set forth in Section 2(h) (in the
case of the Company) and Section 2(i) (in the case of the Selling Stockholders), which amounts
shall be paid to ▇.▇. ▇▇▇▇▇▇▇.
(b) The First Closing Date. Delivery of certificates for the Firm Shares to be purchased by
the Underwriters and payment therefor shall be made at the offices of Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇
llp, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (or such other place as may be agreed to
by the Company and the Representative) at 9:00 a.m. New York time, on [___],1or such
other time and date not later than 1:30 p.m. New York time, on [___]2as the
Representative shall designate by notice to the Company (the time and date of such closing are
called the “First Closing Date”). The Company and the Selling Stockholders hereby acknowledge that
circumstances under which the Representative may provide notice to postpone the First Closing Date
as originally scheduled include, but are in no way limited to, any determination by the Company,
the Selling Stockholders 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 10.
(c) The Optional Shares; Option Closing Date. In addition, on the basis of the
representations, warranties and agreements herein contained, and upon the terms but subject to the
conditions herein set forth, the Company hereby grants an option to the several Underwriters to
purchase, severally and not jointly, up to an aggregate of 1,100,000 Optional Shares from the
Company at the purchase price per share to be paid by the Underwriters for the Firm Shares as set
forth in Section 2(a) above and each Selling Stockholder hereby grants an option to the several
Underwriters to purchase, severally and not jointly, up to that number of Optional Shares set forth
in Schedule B opposite the name of such Selling Stockholder at the purchase price per share to be
paid by the Underwriters for the Firm Shares as set forth
12
in Section 2(a) above. The option granted hereunder is for use by the Underwriters solely in
covering any over-allotments in connection with the sale and distribution of the Firm Shares. The
option granted hereunder may be exercised at any time and from time to time in whole or in part
upon notice by the Representative to the Company and the Selling Stockholders, which notice may be
given at any time within thirty (30) days from the date of this Agreement. Such notice shall set
forth: (i) the aggregate number of Optional Shares as to which the Underwriters are exercising the
option; (ii) the names and denominations in which the certificates for the Optional Shares are to
be registered; and (iii) the time, date and place at which such certificates will be delivered
(which time and date may be simultaneous with, but not earlier than, the First Closing Date; and in
such case the term “First Closing Date” shall refer to the time and date of delivery of
certificates for the Firm Shares and such Optional Shares). Such time and date of delivery, if
subsequent to the First Closing Date, is called an “Option Closing Date” and shall be determined by
the Representative and shall not be earlier than three (3) nor later than five (5) full business
days after delivery of such notice of exercise. If any Optional Shares are to be purchased, each
Underwriter agrees, severally and not jointly, to purchase the number of Optional Shares (subject
to such adjustments to eliminate fractional shares as the Representative may determine) that bears
the same proportion to the total number of Optional Shares to be purchased as the number of Firm
Shares set forth on Schedule A opposite the name of such Underwriter bears to the total
number of Firm Shares. The Representative may cancel the option at any time prior to its
expiration by giving written notice of such cancellation to the Company and the Selling
Stockholders. If less than all of the Optional Shares are to be sold, Optional Shares will be sold
to the Underwriters by the Company and the Selling Stockholders on a pro rata basis between the
Company, on the one hand, and the Selling Stockholders, on the other hand, in proportion to the
aggregate number of Optional Shares to be sold by the Company, on the one hand, and the Selling
Stockholders, on the other hand, as set forth in this Section 2(c).
(d) Public Offering of the Offered Shares. The Representative hereby advises the Company and
the Selling Stockholders that the Underwriters intend to offer for sale to the public, initially on
the terms set forth in the Prospectus, their respective portions of the Offered Shares as soon
after this Agreement has been executed and the Registration Statement has been declared effective
as the Representative, in its sole judgment, has determined is advisable and practicable.
(e) Payment for the Offered Shares. Payment for the Offered Shares to be sold by the Company
shall be made at the First Closing Date (and, if applicable, at each Option Closing Date) by wire
transfer of immediately available funds to the order of the Company. Payment for the Offered
Shares to be sold by the Selling Stockholders shall be made at the First Closing Date (and, if
applicable, at each Option Closing Date) by wire transfer of immediately available funds to the
order of the Custodian.
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 for, the Firm Shares and any Optional Shares the Underwriters have agreed to
purchase. ▇.▇. ▇▇▇▇▇▇▇, individually and not as the Representative of the Underwriters, may (but
shall not be obligated to) make payment for any Offered Shares to be purchased by any Underwriter
whose funds shall not have been received by the Representative by the First Closing Date or the
applicable Option 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.
Each Selling Stockholder hereby agrees that (i) it will pay all stock transfer taxes, stamp
duties and other similar taxes, if any, payable upon the sale or delivery of the Offered Shares to
be sold by such Selling Stockholder to the several Underwriters, or otherwise in connection with
the performance of such Selling Stockholder’s obligations hereunder and (ii) the Custodian is
authorized to deduct for such payment any such amounts from the proceeds to each Selling
Stockholder hereunder and to hold such amounts for the account of such Selling Stockholder with the
Custodian under the Custody Agreement.
13
(f) Delivery of the Offered Shares. The Company and the Selling Stockholders shall deliver,
or cause to be delivered, to the Representative for the accounts of the several Underwriters,
certificates for the Firm Shares to be sold by them at the First Closing Date, against the
irrevocable release of a wire transfer of immediately available funds for the amount of the
purchase price therefor. The Company and the Selling Stockholders shall also deliver, or cause to
be delivered, to the Representative for the accounts of the several Underwriters, certificates for
the Optional Shares the Underwriters have agreed to purchase from them at the First Closing Date or
the applicable Option Closing Date, as the case may be, against the irrevocable release of a wire
transfer of immediately available funds for the amount of the purchase price therefor. The
certificates for the Offered Shares shall be in definitive form and registered in such names and
denominations as the Representative shall have requested at least two (2) full business days prior
to the First Closing Date (or the applicable Option Closing Date, as the case may be) and shall be
made available for inspection on the business day preceding the First Closing Date (or the
applicable Option Closing Date, as the case may be) at a location in New York City as the
Representative may designate. Time shall be of the essence, and delivery at the time and place
specified in this Agreement is a further condition to the obligations of the Underwriters.
(g) Delivery of Prospectus to the Underwriters. Not later than 12:00 p.m. on the second
business day following the date the Offered Shares are first 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.
(h) Advisory Fee Payable by the Company. The Company shall pay to ▇.▇. ▇▇▇▇▇▇▇ a financial
advisory fee of 0.5% of the gross proceeds (before underwriting discounts or commissions) to the
Company from the sale of the Offered Shares at the First Closing and, if applicable, each Option
Closing Date. This fee shall be payable on the applicable Closing Date by wire transfer of
immediately available funds to an account designated by ▇.▇. ▇▇▇▇▇▇▇.
(i) Advisory Fee Payable by the Selling Stockholder. The Selling Stockholders shall pay to
▇.▇. ▇▇▇▇▇▇▇ a financial advisory fee of 0.5% of the gross proceeds (before underwriting discounts
or commissions) to the Selling Stockholders from the sale of the Offered Shares at the First
Closing and, if applicable, each Option Closing Date. This fee shall be payable on the applicable
Closing Date by wire transfer of immediately available funds to an account designated by ▇.▇.
▇▇▇▇▇▇▇.
Section 3. Additional Covenants.
A. Covenants of the Company. The Company further covenants and agrees with each Underwriter
as follows:
(a) Representative’s Review of Proposed Amendments and Supplements. During the period
beginning on the date hereof and ending on the later of the First Closing Date or such date, as in
the opinion of counsel for the Underwriters, the Prospectus is no longer required by law to be
delivered in connection with sales by an Underwriter or dealer (the “Prospectus Delivery Period”),
prior to amending or supplementing the Registration Statement (including any Rule 462(b)
Registration Statement) or the Prospectus, the Company shall furnish to the Representative for
review a copy of each such proposed amendment or supplement, and the Company shall not file any
such proposed amendment or supplement without the Representative’s consent, which consent shall not
be unreasonably withheld or delayed.
(b) Securities Act Compliance. After the date of this Agreement, the Company shall promptly
advise the Representative in writing (i) of the receipt of any comments of, or requests for
additional or supplemental information from, the Commission regarding the Registration Statement,
the Preliminary Prospectus or the Prospectus, or affecting the information contained therein, (ii)
of the time and date of
14
any filing of any post-effective amendment to the Registration Statement or any amendment or
supplement to the Preliminary Prospectus or the Prospectus, (iii) of the time and date that any
post-effective amendment to the Registration Statement becomes effective, and (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the Registration Statement or
any post-effective amendment thereto or of any order preventing or suspending the use of the
Preliminary Prospectus or the Prospectus, or of the suspension of the qualification of the Offered
Shares for offering and sale in any jurisdiction. If the Commission shall enter any such stop
order at any time, the Company will use its best efforts to obtain the lifting of such order at the
earliest possible moment. Additionally, the Company agrees that it shall comply with the
provisions of Rules 430A and 497, as applicable, under the Securities Act and will use its
reasonable efforts to confirm that any filings made by the Company under Rule 497(c) of the
Securities Act were received in a timely manner by the Commission.
(c) Amendments and Supplements to the Prospectus and Other Securities Act Matters. If, during
the Prospectus Delivery Period, any event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Prospectus in order to make the statements therein, in the
light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if
in the opinion of the Representative or counsel for the Underwriters it is otherwise necessary to
amend or supplement the Prospectus to comply with law, the Company agrees to promptly prepare
(subject to Section 3(a) hereof), file with the Commission and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Prospectus so that the statements in
the Prospectus as so amended or supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the Prospectus, as amended or
supplemented, will comply with law. Neither the Representative’s consent to, or delivery of, any
such amendment or supplement shall constitute a waiver of any of the Company’s obligations under
this Section 3(A)(c).
(d) Copies of any Amendments and Supplements to the Prospectus. The Company agrees to furnish
the Representative, without charge, during the Prospectus Delivery Period, as many copies of the
Prospectus and any amendments and supplements thereto as the Representative may request.
(e) Copies of Notice of Intent and Notification of Election. The Company agrees to furnish
the Underwriters with copies of the Notice of Intent and Notice of Election and all amendments
thereto (including exhibits).
(f) Blue Sky Compliance. The Company shall cooperate with the Representative and counsel for
the Underwriters to qualify or register the Offered Shares for sale under (or obtain exemptions
from the application of) the state securities or blue sky laws or Canadian provincial securities
laws of those jurisdictions designated by the Representative, shall comply with such laws and shall
continue such qualifications, registrations and exemptions in effect so long as required for the
distribution of the Offered Shares; provided, however, the Company shall not be required to qualify
as a foreign corporation or to take any action that would subject it to general service of process
in any such jurisdiction where it is not presently qualified. The Company will advise the
Representative promptly of the suspension of the qualification or registration of (or any such
exemption relating to) the Offered Shares for offering, sale or trading in any jurisdiction or any
initiation or threat of any proceeding for any such purpose, and in the event of the issuance of
any order suspending such qualification, registration or exemption, the Company shall use its best
efforts to obtain the withdrawal thereof at the earliest possible moment.
(g) Use of Proceeds. The Company shall apply the net proceeds from the sale of the Offered
Shares sold by it in the manner described under the caption “Use of Proceeds” in the Prospectus.
(h) Transfer Agent. For the period of five years from the date of this Agreement, the Company
shall engage and maintain, at its expense, a registrar and transfer agent for the Shares.
15
(i) Earnings Statement. As soon as practicable, the Company will make generally available to
its security holders and to the Representative an earnings statement (which need not be audited)
covering the twelve-month period ending [___]3that satisfies the provisions of Section
11(a) of the Securities Act.
(j) Periodic Reporting Obligations. During the Prospectus Delivery Period, the Company shall
file, on a timely basis, with the Commission and the Nasdaq National Market all reports and
documents required to be filed under the Exchange Act.
(k) Listing. The Company will use its best efforts to effect the inclusion of the Offered
Shares on the Nasdaq National Market.
(l) Agreement Not to Offer or Sell Additional Shares. During the period commencing on the
date hereof and ending one hundred and eighty (180) days following the date of the Prospectus (the
“Lock-up Period”), the Company will not, without the prior written consent of ▇.▇. ▇▇▇▇▇▇▇ (which
consent may be withheld at the sole discretion of ▇.▇. ▇▇▇▇▇▇▇), directly or indirectly, issue,
sell, offer, contract or grant any option to sell, pledge, transfer or establish an open “put
equivalent position” within the meaning of Rule 16a-1(h) under the Exchange Act, or otherwise
dispose of or transfer, or announce the offering of, or file any registration statement under the
Securities Act in respect of, any Shares, options or warrants to acquire Shares or securities
exchangeable or exercisable for or convertible into Shares (other than as contemplated by this
Agreement with respect to the Offered Shares). Notwithstanding the foregoing, if (1) during the
last 17 days of the Lock-up Period, the Company issues an earnings release or material news or a
material event relating to the Company occurs, or (2) prior to the expiration of the Lock-up
Period, the Company announces that it will release earnings results or becomes aware that material
news or a material event will occur during the 16-day period beginning on the last day of the
Lock-up Period, the restrictions imposed by this Section (3)(A)(l) shall continue to apply until
the expiration of the 18-day period beginning on the issuance of the earnings release or the
occurrence of the material news or material event, as applicable, unless ▇.▇. ▇▇▇▇▇▇▇ waives, in
writing, such extension.
The foregoing restrictions in the immediately preceding paragraph shall not apply to (A) the
issuance by the Company of its Shares pursuant to the dividend reinvestment plan or (B) any options
granted pursuant to the existing stock option plan of the Company referred to in the Prospectus.
(m) Future Reports to the Representative. During the period of five (5) years hereafter, but
only to the extent not otherwise available on ▇▇▇▇▇, the Company will furnish to ▇.▇. ▇▇▇▇▇▇▇ at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention:
[ ]: (i) as soon as practicable after
the end of each fiscal year, copies of the annual report of the Company containing the balance
sheet of the Company as of the close of such fiscal year and statements of income, stockholders’
equity and cash flows for the year then ended and the opinion thereon of the Company’s independent
public or certified public accountants; (ii) as soon as practicable after the filing thereof,
copies of each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current
Report on Form 8-K or other report filed by the Company with the Commission, the NASD or any
securities exchange or association; (iii) as soon as available, copies of any report or
communication of the Company mailed generally to holders of its capital stock and (iv) as soon as
practically after the filing thereof, copies of all other documents or reports filed with the
Commission, the NASD or any national securities exchange or association.
(n) No Stabilization or Manipulation; Compliance with Regulation M. The Company will not
take, directly or indirectly, any action designed to or that might be reasonably expected to cause
or result in stabilization or manipulation of the price of the Shares or any other reference
security, whether to
16
facilitate the sale or resale of the Offered Shares or otherwise, and the Company will, and
shall cause each of their respective affiliates to, comply with all applicable provisions of
Regulation M. If the limitations of Rule 102 of Regulation M (“Rule 102”) do not apply with
respect to the Offered Shares or any other reference security pursuant to any exception set forth
in Section (d) of Rule 102, then promptly upon notice from the Representative (or, if later, at the
time stated in the notice), the Company will, and shall cause each of its respective affiliates to,
comply with Rule 102 as though such exception were not available but the other provisions of Rule
102 (as interpreted by the Commission) did apply.
(o) Maintain Status as a Business Development Company. The Company, during a period of two
(2) years from the effective date of the Notification of Election, will use its best efforts to
maintain its status as a “business development company” under the Investment Company Act; provided,
however, the Company may change the nature of its business so as to cease to be, or to withdraw its
election as, a business development company with the approval of the board of directors and a vote
of stockholders as required by Section 58 of the Investment Company Act or any successor provision.
(p) Qualification as a Regulated Investment Company. The Company will use its best efforts to
qualify for and elect to be treated as a “regulated investment company” under Subchapter M of the
Code on August 1, 2005, and to maintain such qualification and election in effect for each full
fiscal year during which it is a business development company under the Investment Company Act;
provided however, that at the discretion of the Company’s board of directors, it may elect not to
be so treated.
(q) Compliance with Securities Laws. The Company will comply in all material respects with
all applicable securities and other laws, rules and regulations, including without limitation, the
provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, and use its best efforts to cause the officers and directors
of the Company, in their capacities as such, to comply with such laws, rules and regulations,
including without limitation, the provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, in each case , so as to
permit the completion of the distribution of the Offered Shares as contemplated in this Agreement
and the Prospectus.
B. Covenants of the Selling Stockholders. The Selling Stockholders further covenant and agree
with each Underwriter:
(a) Agreement Not to Offer or Sell Additional Shares. The Selling Stockholders will not,
without the prior written consent of ▇.▇. ▇▇▇▇▇▇▇ (which consent may be withheld in its sole
discretion), directly or indirectly, sell, offer, contract or grant any option to sell (including
without limitation any short sale), pledge, transfer, establish an open “put equivalent position”
within the meaning of Rule 16a-1(h) under the Exchange Act, or otherwise dispose of any Shares,
options or warrants to acquire Shares, or securities exchangeable or exercisable for or convertible
into Shares currently or hereafter owned either of record or beneficially (as defined in Rule 13d-3
under Securities Exchange Act of 1934, as amended) by the Selling Stockholders, or publicly
announce the Selling Stockholder’s intention to do any of the foregoing, for a period commencing on
the date hereof and continuing through the close of trading on the last day of the Lock-up Period.
The foregoing sentence shall not apply to (i) bona fide gifts, provided the recipient thereof
agrees in writing with the Representative to be bound by the terms of this agreement, (ii)
dispositions to any trust for the direct or indirect benefit of the Selling Stockholders and/or
immediate family of the Selling Stockholders, provided that such trust agrees in writing with the
Representative to be bound by the terms of this agreement, (iii) shares of common stock of the Company purchased by the Selling Stockholders in
the secondary market following the Offering and (iv) shares of common stock of the Company acquired
by the Selling Stockholders in connection with the Company’s dividend reinvestment plan.
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Notwithstanding the foregoing, if (1) during the last 17 days of the Lock-up Period, the
Company issues an earnings release or material news or a material event relating to the Company
occurs, or (2) prior to the expiration of the Lock-up Period, the Company announces that it will
release earnings results or becomes aware that material news or a material event will occur during
the 16-day period beginning on the last day of the Lock-up Period, the restrictions imposed by this
Section (3)(B)(a) shall continue to apply until the expiration of the 18-day period beginning on
the issuance of the earnings release or the occurrence of the material news or material event, as
applicable, unless ▇.▇. ▇▇▇▇▇▇▇ waives, in writing, such extension.
(b) No Stabilization or Manipulation; Compliance with Regulation M. The Selling Stockholders
will not take, directly or indirectly, any action designed to or that might be reasonably expected
to cause or result in stabilization or manipulation of the price of the Shares or any other
reference security, whether to facilitate the sale or resale of the Offered Shares or otherwise,
and each Selling Stockholder will, and shall cause each of its affiliates to, comply with all
applicable provisions of Regulation M. If the limitations of Rule 102 do not apply with respect to
the Offered Shares or any other reference security pursuant to any exception set forth in Section
(d) of Rule 102, then promptly upon notice from the Representative (or, if later, at the time
stated in the notice), each Selling Stockholder will, and shall cause each of its affiliates to,
comply with Rule 102 as though such exception were not available but the other provisions of Rule
102 (as interpreted by the Commission) did apply.
C. Waiver by ▇.▇. ▇▇▇▇▇▇▇. ▇.▇. ▇▇▇▇▇▇▇, on behalf of the several Underwriters, may, in its
sole discretion, waive in writing the performance by the Company or the Selling Stockholders of any
one or more of the foregoing covenants or extend the time for their performance.
Section 4. Payment of Expenses. The Company agrees to pay all costs, fees and expenses
incurred in connection with the performance of its obligations hereunder and in connection with the
transactions contemplated hereby, including without limitation: (i) all expenses incident to the
issuance and delivery of the Offered Shares (including all printing and engraving costs); (ii) all
fees and expenses of the registrar and transfer agent of the Shares; (iii) all necessary issue,
transfer and other stamp taxes in connection with the issuance and sale of the Offered Shares to
the Underwriters; (iv) all fees and expenses of the Company’s counsel, independent public or
certified public accountants and other advisors; (v) all costs and expenses incurred in connection
with the preparation, printing, filing, shipping and distribution of the Registration Statement
(including financial statements, exhibits, schedules, consents and certificates of experts), the
Preliminary Prospectus and the Prospectus, and all amendments and supplements thereto, and this
Agreement; (vi) all filing fees, attorneys’ fees and expenses incurred by the Company or the
Underwriters in connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Offered Shares for offer and sale under
the state securities or blue sky laws or the provincial securities laws of Canada, and, if
requested by the Representative, preparing and printing a “Blue Sky Survey” or memorandum, and any
supplements thereto, advising the Underwriters of such qualifications, registrations,
determinations and exemptions; (vii) the filing fees incident to, and the reasonable fees and
expenses of counsel for the Underwriters in connection with, the NASD’s review and approval of the
Underwriters’ participation in the offering and distribution of the Offered Shares; (viii) the
fees and expenses associated with including the Offered Shares on the Nasdaq National Market; and
(ix) all other fees, costs and expenses referred to in Item 27 of Part C of the Registration
Statement. For the avoidance of doubt, the Company and the Underwriters agree that each party
shall be responsible for its own expenses in connection with the road show. Except
18
as provided in this Section 4, Section 6, Section 8 and Section 9 hereof, the Underwriters
shall pay their own expenses, including the fees and disbursements of their counsel.
The Selling Stockholders further agree, jointly and severally, with each Underwriter to pay
(directly or by reimbursement) all fees and expenses incident to the performance of their
obligations under this Agreement and the consummation of the transactions contemplated thereby,
including but not limited to (i) fees and expenses of counsel and other advisors for the Selling
Stockholders, (ii) fees and expenses of the Custodian and (iii) expenses and taxes incident to the
sale and delivery of the Offered Shares to be sold by the Selling Stockholders to the Underwriters
hereunder (which taxes, if any, may be deducted by the Custodian under the provisions of Section 2
of this Agreement).
This Section 4 shall not affect or modify any separate, valid agreement relating to the
allocation of payment of expenses between the Company, on the one hand, and the Selling
Stockholders, on the other hand.
Section 5. Conditions of the Obligations of the Underwriters. The obligations of the several
Underwriters to purchase and pay for the Offered Shares as provided herein on the First Closing
Date and, with respect to the Optional Shares, each Option Closing Date, shall be subject to the
accuracy of the representations and warranties on the part of the Company and the Selling
Stockholders set forth in Sections 1(A) and 1(B) hereof as of the date hereof and as of the First
Closing Date as though then made and, with respect to the Optional Shares, as of each Option
Closing Date as though then made, to the timely performance by the Company and the Selling
Stockholders of their respective covenants and other obligations hereunder, and to each of the
following additional conditions:
(a) Accountants’ Comfort Letter. On the date hereof, the Representative shall have received
from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent public or certified public accountants for the Company, (i) a
letter dated the date hereof addressed to the Underwriters, in form and substance satisfactory to
the Representative, containing statements and information of the type customarily included in
accountant’s “comfort letters” to underwriters, delivered according to Statement of Auditing
Standards No. 72 (or any successor bulletin), with respect to the audited and unaudited financial
statements and certain financial information contained in the Registration Statement and the
Prospectus (and the Representative shall have received an additional three (3) conformed copies of
such accountants’ letter for each of the several Underwriters), and (ii) confirming that they are
(A) independent public or certified public accountants as required by the Securities Act and the
Exchange Act and (B) in compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X.
(b) Compliance with Registration Requirements; No Stop Order; No Objection from NASD. For the
period from and after effectiveness of this Agreement and prior to the First Closing Date and, with
respect to the Optional Shares, each Option Closing Date:
(i) the Company shall have filed the Prospectus with the Commission (including the
information required by Rule 430A under the Securities Act) in the manner and within the
time period required by Rule 497 under the Securities Act; or the Company shall have filed a
post-effective amendment to the Registration Statement containing the information required
by such Rule 430A, and such post-effective amendment shall have become effective;
(ii) no stop order suspending the effectiveness of the Registration Statement, any Rule
462(b) Registration Statement, or any post-effective amendment to the Registration
Statement, shall be in effect and no proceedings for such purpose shall have been instituted
or, to the best of the Company’s knowledge, threatened by the Commission;
19
(iii) the NASD shall have raised no objection to the fairness and reasonableness of the
underwriting terms and arrangements; and
(iv) no Prospectus, amendment to the Registration Statement or amendment or supplement
to the Prospectus shall have been filed to which ▇.▇. ▇▇▇▇▇▇▇ has reasonably objected in
writing.
(c) No Material Adverse Change. For the period from and after the date of this Agreement and
prior to the First Closing Date and, with respect to the Optional Shares, each Option Closing Date
in the judgment of the Representative there shall not have occurred any Material Adverse Change.
(d) Corporate Proceedings. All corporate proceedings and other legal matters in connection
with this Agreement, the Merger, the form of Registration Statement and the Prospectus, and the
registration, authorization, issue, sale and delivery of the Shares, shall have been reasonably
satisfactory to counsel to the Underwriters, and such counsel shall have been furnished with such
papers and information as they may reasonably have requested to enable them to pass upon the
matters referred to in this Section.
(e) Opinion of Counsel for the Company. On each of the First Closing Date and each Option
Closing Date, the Representative shall have received the opinion of ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
LLP, counsel for the Company, dated as of such Closing Date, the form of which is attached as
Exhibit B (and the Representative shall have received an additional three (3) conformed copies of
such counsel’s legal opinion for each of the several Underwriters).
(f) Opinion of Counsel for the Underwriters. On each of the First Closing Date and each
Option Closing Date, the Representative shall have received the opinion of Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ &
▇▇▇▇ llp, counsel for the Underwriters, in form and substance satisfactory to the
Underwriters, dated as of such Closing Date.
(g) Officers’ Certificate of the Company. On each of the First Closing Date and each Option
Closing Date, the Representative shall have received a written certificate executed by the Chief
Executive Officer of the Company and the Chief Financial Officer of the Company, dated as of such
Closing Date, to the effect set forth in subsection (b)(ii) of this Section 5, and further to the
effect that:
(i) they have reviewed the Registration Statement and Prospectus;
(ii) the Financial Statements and other financial information included in the
Registration Statement and Prospectus fairly present in all material respects the combined
financial conditions, results of operations and cash flows of the Company and Wilton as of,
and for the periods presented in the Registration Statement;
(iii) for the period from and after the date of this Agreement and prior to such
Closing Date, there has not occurred any Material Adverse Change;
(iv) the representations, warranties and covenants of the Company set forth in Section
1(A) of this Agreement are true and correct with the same force and effect as though
expressly made on and as of such Closing Date; and
(v) the Company has complied with all the agreements hereunder and satisfied all the
conditions on its part to be performed or satisfied hereunder at or prior to such Closing
Date.
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(h) Bring-down Comfort Letter. On each of the First Closing Date and each Option Closing
Date, the Representative shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent public or
certified public accountants for the Company, a letter dated such date, in form and substance
satisfactory to the Representative, to the effect that they reaffirm the statements made in the
letter furnished by them pursuant to subsection (a) of this Section 5, except that the specified
date referred to therein for the carrying out of procedures shall be no more than three (3)
business days prior to the First Closing Date or the applicable Option Closing Date, as the case
may be (and the Representative shall have received an additional three (3) conformed copies of such
accountants’ letter for each of the several Underwriters).
(i) Opinion of Counsel for the Selling Stockholders. On each of the First Closing Date and
each Option Closing Date, the Representative shall have received the opinion of (i) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
LLP, U.S. counsel for the Selling Stockholders, dated as of such Closing Date, the form of which is
attached as Exhibit C-1 (and the Representative shall have received an additional three (3)
conformed copies of such counsel’s legal opinion for each of the several Underwriters) and (ii)
three (3), Bahamian counsel for Patriot Partners, L.P., dated as of such Closing Date, the form of
which is attached as Exhibit C-2 (and the Representative shall have received an additional
three (3) conformed copies of such counsel’s legal opinion for each of the several Underwriters).
(j) Selling Stockholders’ Certificate. On each of the First Closing Date and each Option
Closing Date, the Representative shall receive a written certificate executed by the
Attorney-in-Fact of the Selling Stockholders or the Selling Stockholders, dated as of such Closing
Date, to the effect that:
(i) the representations, warranties and covenants of the Selling Stockholders set forth
in Section 1(B) of this Agreement are true and correct with the same force and effect as
though expressly made by the Selling Stockholders on and as of such Closing Date; and
(ii) the Selling Stockholders have complied with all the agreements and satisfied all
the conditions on their part to be performed or satisfied at or prior to such Closing Date.
(k) Selling Stockholders’ Documents. On the date hereof, the Company and the Selling
Stockholders shall have furnished for review by the Representative copies of the Powers of Attorney
and Custody Agreement executed by the applicable Selling Stockholders and such further information,
certificates and documents as the Representative may reasonably request.
(l) Lock-Up Agreement from Certain Securityholders of the Company. On or prior to the date
hereof the Representative shall have received the Lock-up Agreements referred to in Section
1(A)(oo).
(m) Nasdaq Listing Approval. The Shares shall have been approved for quotation on the Nasdaq
National Market, subject only to notice of issuance at or prior to the First Closing Date or the
applicable Option Closing Date, as the case may be.
(n) Guarantee of Selling Stockholders’ Obligations. CGI, the indirect and beneficial owner of
the Selling Stockholders, shall have provided the Underwriters with a guaranty with respect to all
the Selling Stockholders’ obligations hereunder, in form and substance satisfactory to the
Representative in its sole discretion. Such guaranty shall be accompanied by an opinion of counsel
to CGI, in form and substance satisfactory to the Representative in its sole discretion.
(o) Securitization Facility. On or before the First Closing Date, the Representative shall
have received a written certificate of the Company’s chief executive officer, dated as of the First
Closing Date, to the effect that:
21
(i)
all material documents relating to the proposed securitization facility described in the Prospectus (the “Securitization
Facility”) have been executed;
(ii) upon the consummation of this offering (which will be satisfied on the First
Closing Date), all conditions precedent to the closing of the Securitization Facility will
have been met and the Securitization Facility will be in full force and effect; and
(iii)
funds in an amount not less than $[ ] shall be available for draw under the
Securitization Facility on the First Closing Date.
(p) Additional Documents. On or before each of the First Closing Date and each Option Closing
Date, the Representative and counsel for the Underwriters shall have received such information,
documents, certificates and opinions as they may reasonably require for the purposes of enabling
them to pass upon the issuance and sale of the Offered Shares as contemplated herein, or in order
to evidence the accuracy of any of the representations and warranties, or the satisfaction of any
of the conditions or agreements, herein contained.
If any condition specified in this Section 5 is not satisfied when and as required to be
satisfied, this Agreement may be terminated by the Representative by notice to the Company and the
Selling Stockholders at any time on or prior to the First Closing Date and, with respect to the
Optional Shares, at any time prior to the applicable Option Closing Date, which termination shall
be without liability on the part of any party to any other party, except that Section 4, Section 6,
Section 8 and Section 9 shall at all times be effective and shall survive such termination.
Section 6. Reimbursement of Underwriters’ Expenses. If this Agreement is terminated by the
Representative pursuant to Section 5, Section 7 or Section 11, or if the sale to the
Underwriters of the Offered Shares on the First Closing Date is not consummated because of any
refusal, inability or failure on the part of the Company or any of the Selling Stockholders to
perform any agreement herein or to comply with any provision hereof, the Company agrees to
reimburse the Representative and the other Underwriters (or such Underwriters as have terminated
this Agreement with respect to themselves), severally, upon demand for all out-of-pocket expenses
that shall have been reasonably incurred by the Representative and the Underwriters in connection
with the proposed purchase and the offering and sale of the Offered Shares, including but not
limited to fees and disbursements of counsel, printing expenses, travel expenses, postage,
facsimile and telephone charges.
Section 7. Effectiveness of this Agreement. This Agreement shall not become effective until
the later of: (i) the execution of this Agreement by the parties hereto; and (ii) notification by
the Commission to the Company and the Representative of the effectiveness of the Registration
Statement under the Securities Act. Prior to such effectiveness, this Agreement may be terminated
by any party by notice to each of the other parties hereto, and any such termination shall be
without liability on the part of: (a) the Company or any of the Selling Stockholders to any
Underwriter, except that the Company and the Selling Stockholders shall be obligated to reimburse
the expenses of the Representative and the Underwriters pursuant to Sections 4 and 6 hereof; (b)
any Underwriter to the Company or any of the Selling Stockholders; or (c) any party hereto to any
other party except that the provisions of Section 8 and Section 9 shall at all times be effective
and shall survive such termination.
Section 8. Indemnification.
(a) Indemnification of the Underwriters by the Company. The Company agrees to indemnify,
defend and hold harmless each Underwriter, its officers and employees, and each person, if any, who
controls any Underwriter within the meaning of the Securities Act and the Exchange Act against any
loss, claim, damage, liability or expense, as incurred, to which such Underwriter or such
controlling person
22
may become subject, under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation (including in settlement of any litigation), insofar as such loss,
claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises
out of or is based: (i) upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, or any amendment thereto, including any information deemed
to be a part thereof pursuant to Rule 430A or Rule 497 under the Securities Act, or the omission or
alleged omission therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading; or (ii) upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Prospectus or the Prospectus (or any
amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading; (iii) any untrue statement or alleged untrue statement made by the
Company in Section 1 hereof; or (iv) any act or failure to act or any alleged act or failure to act
by any Underwriter in connection with, or relating in any manner to, the Offered Shares or the
offering contemplated hereby, and which is included as part of or referred to in any loss, claim,
damage, liability or action arising out of or based upon any matter covered by clause (i) or (ii)
above, provided, however, that the Company shall not be liable under this clause (iv) to the extent
that a court of competent jurisdiction shall have determined by a final judgment that such loss,
claim, damage, liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Underwriter through its bad faith or willful misconduct;
and to reimburse each Underwriter and each such controlling person for any and all expenses
(including, subject to the provisions of Section 8(d), the fees and disbursements of counsel
chosen by ▇. ▇. ▇▇▇▇▇▇▇) as such expenses are reasonably incurred by such
Underwriter or such controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or action; provided,
further, that the foregoing indemnity agreement shall not apply to any loss, claim, damage,
liability or expense to the extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by the Representative expressly for
use in the Registration Statement, the Preliminary Prospectus or the Prospectus (or any amendment
or supplement thereto), it being understood and agreed that the only such information furnished by
the Representative on behalf of the Underwriters to the Company consists of the information
described in subsection (c) below. The indemnity agreement set forth in this Section 8(a) shall be
in addition to any liabilities that the Company may otherwise have.
(b) Indemnification of the Underwriters by the Selling Stockholders. The Selling
Stockholders, jointly and severally, agree to indemnify, defend and hold harmless each Underwriter
and each other person specified in subsection (a) of this Section 8 from and against any loss,
damage, expense, liability or claim (including the reasonable cost of any investigation incurred in
connection therewith) any such Underwriter or any such other person may incur as specified in such
subsection, insofar as such loss, damage, expense, liability or claim arises out of or is based
upon (i) any of the matters specified in subsection (a) of this Section 8, (ii) any untrue
statement or alleged untrue statement made by the Selling Stockholders in Section 1(B) hereof or
(iii) any act or failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Shares or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage, liability or action arising
out of or based upon any matter covered by clause (i) or (ii) of Section 8(a) above, provided,
however, that the Selling Stockholders shall not be liable under this clause (iii) to the extent
that a court of competent jurisdiction shall have determined by a final judgment that such loss,
claim, damage, liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Underwriter through its bad faith or willful misconduct;
and to reimburse each Underwriter and each such controlling person for any and all expenses
(including the fees and disbursements of counsel chosen by ▇.▇. ▇▇▇▇▇▇▇) as such expenses are
reasonably incurred by such Underwriter or such controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim, damage, liability,
expense or action; provided, further, that the foregoing indemnity agreement shall not
23
apply to any loss, claim, damage, liability or expense to the extent, but only to the extent,
arising out of or based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with written information furnished to the
Company by the Representative expressly for use in the Registration Statement, the Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto), it being understood and
agreed that the only such information furnished by the Representative on behalf of the Underwriters
to the Company consists of the information described in subsection (b) below. The liability of the
Selling Stockholders pursuant to this Section 8(b) shall be limited to an amount equal to the
initial public offering price of the Offered Shares sold by the Selling Stockholders (as a group),
less the underwriting discount, as set forth on the front cover page of the Prospectus; provided
that there shall be no such limit on the liability of the Selling Stockholders pursuant to this
Section 8(b) for any loss, claim, damage, liability or expense related to the Selling Stockholders’
representations and warranties in Section 1(B) hereof. The indemnity agreement set forth in this
Section 8(c) shall be in addition to any liabilities that the Selling Stockholders may otherwise
have.
(c) Indemnification by the Underwriters. Each Underwriter agrees, severally and not jointly,
to indemnify, defend and hold harmless the Company, its directors, each of the Company’s officers
who signed the Registration Statement, the Selling Stockholders and each person, if any, who
controls the Company or the Selling Stockholders within the meaning of the Securities Act or the
Exchange Act, against any loss, claim, damage, liability or expense, as incurred, to which the
Company or any such director, officer, Selling Stockholder or controlling person may become
subject, under the Securities Act, the Exchange Act, or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of such Underwriter), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or
is based upon any untrue or alleged untrue statement of a material fact contained in the
Registration Statement, the Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto), or arises out of or is 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 the Registration Statement,
the Preliminary Prospectus, the Prospectus (or any amendment or supplement thereto), in reliance
upon and in conformity with written information furnished to the Company by the Representative
expressly for use therein; and to reimburse the Company or any such director, officer, Selling
Stockholder or controlling person for any legal and other expense reasonably incurred by the
Company or any such director, officer, Selling Stockholders or controlling person in connection
with investigating, defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action. The Company and each Selling Stockholder hereby acknowledge that the
only information that the Representative has furnished to the Company and the Selling Stockholders
expressly for use in the Registration Statement, the Preliminary Prospectus or the Prospectus (or
any amendment or supplement thereto) are the statements set forth in the table in the first
paragraph, third paragraph, the last sentence of the fifth paragraph, the twelfth paragraph, the
fifteenth paragraph and the twentieth paragraph under the caption “Underwriting” in the Prospectus.
The indemnity agreement set forth in this Section 8(c) shall be in addition to any liabilities
that each Underwriter may otherwise have.
(d) Notifications and Other Indemnification Procedures. Promptly after receipt by an
indemnified party under this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 8, notify the indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any liability which it may
have to any indemnified party for contribution or otherwise under the indemnity agreement contained
in this Section 8 or to the extent it is not prejudiced as a proximate result of such failure. In
case any such action is brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying
24
party, the indemnifying party will be entitled to participate in, and, to the extent that it
shall elect, jointly with all other indemnifying parties similarly notified, by written notice
delivered to the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall have reasonably
concluded that a conflict may arise between the positions of the indemnifying party and the
indemnified party in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defenses and to otherwise participate in the defense
of such action on behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of such indemnifying party’s election so to assume the
defense of such action and approval by the indemnified party of counsel, the indemnifying party
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
preceding sentence (it being understood, however, that the indemnifying party shall not be liable
for the expenses of more than one separate counsel (together with local counsel), approved by the
indemnifying party, representing the indemnified parties who are parties to such action) or (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, in each of which cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
(e) Settlements. The indemnifying party under this Section 8 shall not be liable for any
settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by Section 8(d) hereof, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its written consent if: (i)
such settlement is entered into more than thirty (30) days after receipt by such indemnifying party
of the aforesaid request; and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or threatened action,
suit or proceeding in respect of which any indemnified party is or could have been a party and
indemnity was or could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such action, suit or proceeding.
(f) Notwithstanding any other provision of this Section 8, no party shall be entitled to
indemnification under this Agreement in violation of Section 17(i) of the Investment Company Act.
Section 9. Contribution. If the indemnification provided for in Section 8 is for any reason
held to be unavailable to or otherwise insufficient to hold harmless an indemnified party in
respect of any losses, claims, damages, liabilities or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified
party, as incurred, as a result of any losses, claims, damages, liabilities or expenses referred to
therein: (i) in such proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other hand,
from the offering of the Offered Shares pursuant to this Agreement; or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in
25
such proportion as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company and the Selling Stockholders, on the
one hand, and the Underwriters, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand, in connection with the
offering of the Offered Shares pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the Offered Shares pursuant
to this Agreement (before deducting expenses) received by the Company and the Selling Stockholders,
and the total underwriting discount received by the Underwriters, in each case as set forth on the
front cover page of the Prospectus bear to the aggregate initial public offering price of the
Offered Shares as set forth on such cover. The relative fault of the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to information supplied by
the Company and the Selling Stockholders, on the one hand, or the Representative, on the other
hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include, subject to the limitations set forth in
Section 8(d), any legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim. The provisions set forth in Section 8(d) with
respect to notice of commencement of any action shall apply if a claim for contribution is to be
made under this Section 9; provided, however, that no additional notice shall be required with
respect to any action for which notice has been given under Section 8(d) for purposes of
indemnification.
The Company, the Selling Stockholders and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even
if the Underwriters were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred to in this Section
9.
Notwithstanding the provisions of this Section 9, no Underwriter shall be required to
contribute any amount in excess of the underwriting commissions received by such Underwriter in
connection with the Offered Shares underwritten by it and distributed to the public. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities 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 9 are
several, and not joint, in proportion to their respective underwriting commitments as set forth
opposite their names in Schedule A. For purposes of this Section 9, each officer and employee of
an Underwriter and each person, if any, who controls an Underwriter within the meaning of the
Securities Act or the Exchange Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company with the meaning of the Securities Act
or the Exchange Act shall have the same rights to contribution as the Company.
Notwithstanding any other provision of this Section 9, no party shall be entitled to
contribution under this Agreement in violation of Section 17(i) of the Investment Company Act.
Section 10. Default of One or More of the Several Underwriters. If, on the First Closing Date
or the applicable Option Closing Date, as the case may be, any one or more of the several
Underwriters shall fail or refuse to purchase Offered Shares that it or they are obligated to
purchase hereunder on such
26
date, and the aggregate number of Offered Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase does not exceed 10% of the aggregate number
of the Offered Shares to be purchased on such date, the Representative may make arrangements
satisfactory to the Company for the purchase of such Offered Shares by other persons, including any
of the Underwriters, but if no such arrangements are made by such Closing Date, the other
Underwriters shall be obligated, severally, in the proportions that the number of Firm Shares set
forth opposite their respective names on Schedule A bears to the aggregate number of Firm
Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other
proportions as may be specified by the Representative with the consent of the non-defaulting
Underwriters, to purchase the Offered Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase on such date. If, on the First Closing Date or the
applicable Option Closing Date, as the case may be, any one or more of the Underwriters shall fail
or refuse to purchase Offered Shares and the aggregate number of Offered Shares with respect to
which such default occurs exceeds 10% of the aggregate number of Offered Shares to be purchased on
such date, and arrangements satisfactory to the Representative and the Company for the purchase of
such Offered Shares are not made within 48 hours after such default, this Agreement shall terminate
without liability of any party to any other party except that the provisions of Section 4, Section
8 and Section 9 shall at all times be effective and shall survive such termination. In any such
case either the Representative or the Company shall have the right to postpone the First Closing
Date or the applicable Option Closing Date, as the case may be, but in no event for longer than
seven days in order that the required changes, if any, to the Registration Statement and the
Prospectus or any other documents or arrangements may be effected.
As used in this Agreement, the term “Underwriter” shall be deemed to include any person
substituted for a defaulting Underwriter under this Section 10. Any action taken under this
Section 10 shall not relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
Section 11. Termination of this Agreement. Prior to the First Closing Date, this Agreement
may be terminated by the Representative by notice given to the Company and the Selling Stockholders
if at any time: (i) trading or quotation in any of the Company’s securities shall have been
suspended or limited by the Commission or by the Nasdaq National Market, or trading in securities
generally on either the Nasdaq Stock Market or the New York Stock Exchange shall have been
suspended or limited, or minimum or maximum prices shall have been generally established on any of
such stock exchanges by the Commission or the NASD; (ii) a general banking moratorium shall have
been declared by any of federal, New York or Missouri authorities; (iii) there shall have occurred
any outbreak or escalation of national or international hostilities or any crisis or calamity, or
any change in the United States or international financial markets, or any substantial change or
development involving a prospective substantial change in United States’ or international
political, financial or economic conditions, as in the judgment of the Representative is material
and adverse and makes it impracticable to market the Offered Shares in the manner and on the terms
described in the Prospectus or to enforce contracts for the sale of securities; (iv) in the
judgment of the Representative there shall have occurred any Material Adverse Change; or (v) the
Company shall have sustained a loss by strike, fire, flood, earthquake, accident or other calamity
of such character as in the judgment of the Representative may interfere materially with the
conduct of the business and operations of the Company regardless of whether or not such loss shall
have been insured. Any termination pursuant to this Section 11 shall be without liability on the
part of: (a) the Company or any of the Selling Stockholders to any Underwriter, except that the
Company and the Selling Stockholders shall be obligated to reimburse the expenses of the
Representative and the Underwriters pursuant to Sections 4 and 6 hereof; (b) any Underwriter to the
Company or any of the Selling Stockholders; or (c) of any party hereto to any other party except
that the provisions of Section 8 and Section 9 shall at all times be effective and shall survive
such termination.
27
Section 12. Representations and Indemnities to Survive Delivery. The respective indemnities,
agreements, representations, warranties and other statements of the Company or its officers, of the
Selling Stockholders or its officers and the several Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter or the Company or any of its or their partners, officers or directors or
any controlling person, or the Selling Stockholders, as the case may be, and will survive delivery
of and payment for the Offered Shares sold hereunder and any termination of this Agreement.
28
Section 13. Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered
or telecopied and confirmed to the parties hereto as follows:
If to the Representative:
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: [ ]
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: [ ]
with a copy to:
Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ llp
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
If to the Company:
Patriot Capital Funding, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
If to the Selling Stockholders:
American Stock Transfer & Trust Company
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: [___]
Attention: [___]
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: [___]
Attention: [___]
with a copy to:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
29
Any party hereto may change the address for receipt of communications by giving written notice to
the others.
Section 14. Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto, including any substitute Underwriters pursuant to Section 10 hereof, and to the
benefit of the employees, officers and directors and controlling persons referred to in Section 8
and Section 9, and in each case their respective successors, and no other person will have any
right or obligation hereunder. The term “successors” shall not include any purchaser of the
Offered Shares as such from any of the Underwriters merely by reason of such purchase.
Section 15. 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.
Section 16. Governing Law Provisions. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made and to be performed
in such state. Any legal suit, action or proceeding arising out of or based upon this Agreement or
the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal
courts of the United States of America located in the Borough of Manhattan in the City of New York
or the courts of the State of New York in each case located in the Borough of Manhattan in the City
of New York (collectively, the “Specified Courts”), and each party irrevocably submits to the
exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a
judgment of any such court (a “Related Judgment”), as to which such jurisdiction is non-exclusive)
of such courts in any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such party’s address set forth above shall be effective service of process for
any suit, action or other proceeding brought in any such court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any suit, action or other proceeding
in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim
in any such court that any such suit, action or other proceeding brought in any such court has been
brought in an inconvenient forum. Each party not located in the United States irrevocably appoints
CT Corporation System, which currently maintains a New York City office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America, as its agent to receive service of process or other
legal summons for purposes of any such suit, action or proceeding that may be instituted in any
state or federal court in the Borough of Manhattan in the City of New York.
With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent
permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from
jurisdiction, service of process, attachment (both before and after judgment) and execution to
which it might otherwise be entitled in the Specified Courts, and with respect to any Related
Judgment, each party waives any such immunity in the Specified Courts or any other court of
competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or
in respect of any such Related Proceeding or Related Judgment, including, without limitation, any
immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.
30
Section 17. No Fiduciary Relationship. Each of the Company and each of the Selling
Stockholder acknowledges and agree that the relationship between itself and each of the
Underwriters is an arm’s-length commercial relationship that creates no fiduciary duty on the part
of any Underwriter and each party expressly disclaims any fiduciary relationship.
Section 18.
General Provisions. This Agreement constitutes the
entire agreement of the parties to this Agreement and supersede all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations with respect to the subject matter
hereof. This Agreement may be executed in two or more counterparts, each one of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived in writing by each
party whom the condition is meant to benefit. The Section headings herein are for the convenience
of the parties only and shall not affect the construction or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated business person who was
adequately represented by counsel during negotiations regarding the provisions hereof, including,
without limitation, the indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the parties hereto further
acknowledges that the provisions of Sections 8 and 9 hereto fairly allocate the risks in light of
the ability of the parties to investigate the Company, its affairs and its business in order to
assure that adequate disclosure has been made in the Registration Statement, the Preliminary
Prospectus and the Prospectus (and any amendments and supplements thereto), as required by the
Securities Act, Investment Company Act and the Exchange Act.
31
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to the Company and the Attorney-in-Fact for the Selling Stockholders the enclosed copies
hereof, whereupon this instrument, along with all counterparts hereof, shall become a binding
agreement among the Underwriters, the Company and the Selling Stockholders in accordance with its
terms.
| Very truly yours, | ||||
| PATRIOT CAPITAL FUNDING, INC. | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| WILTON FUNDING HOLDINGS, LLC | ||||
| By: | ||||
| Name: | ||||
| Title: Attorney-in-Fact | ||||
| PATRIOT PARTNERS, L.P. | ||||
| By: | ||||
| Name: | ||||
| Title: Attorney-in-Fact | ||||
32
The foregoing Underwriting Agreement is hereby confirmed and accepted by the Representative in
New York, New York as of the date first above written.
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
Acting as Representative of the
several Underwriters named in
the attached Schedule A.
Acting as Representative of the
several Underwriters named in
the attached Schedule A.
By:
|
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC. | |||
By: |
||||
| Name: | ||||
| Title: |
33
SCHEDULE A
| Underwriters | Number of Firm | |||
| Shares to be | ||||
| Purchased | ||||
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. |
||||
▇▇▇▇▇▇▇▇▇ & Company, Inc. |
||||
▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. |
||||
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Corp |
||||
Total |
||||
SCHEDULE B
| Selling Stockholder | Number of | Maximum | ||||||
| Firm Shares | Number of | |||||||
| to be Sold | Optional Shares | |||||||
| to be Sold | ||||||||
Wilton Funding Holdings, LLC |
||||||||
c/o Compass Group Investments, Inc. |
||||||||
Bayside Executive Park |
||||||||
West Bay Street and ▇▇▇▇▇ ▇▇▇▇ |
||||||||
▇.▇. ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ |
||||||||
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇ |
||||||||
Patriot Partners, L.P. |
||||||||
c/o Compass Group Investments, Inc. |
||||||||
Bayside Executive Park |
||||||||
West Bay Street and ▇▇▇▇▇ ▇▇▇▇ |
||||||||
▇.▇. ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ |
||||||||
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇ |
||||||||