Document:

Eleventh Amendment to the Amended & Restated Credit Agreement, dated 01/30/2004

 EXHIBIT 10.3 
  
 AGREEMENT AND ELEVENTH AMENDMENT, dated as of January 27, 2004 (this “Eleventh Amendment”), among FIBERNET
OPERATIONS, INC., a Delaware corporation (“FiberNet”), DEVNET L.L.C., a Delaware limited liability company (“Devnet” and, together with FiberNet, the “Borrowers”), and the financial institutions
party to the Credit Agreement (as defined below) as lenders (collectively, the “Lenders”), to the AMENDED AND RESTATED CREDIT AGREEMENT, dated as of February 9, 2001 (the “CreditAgreement”), among the
Borrowers, the Lenders, DEUTSCHE BANK AG NEW YORK BRANCH (“DBAG”), as administrative agent for the Lenders (in such capacity, the “Administrative Agent”), TD SECURITIES (USA) INC. (“TD”), as
syndication agent for the Lenders (in such capacity, the “Syndication Agent”), and WACHOVIA INVESTORS, INC., as documentation agent for the Lenders (in such capacity, the “Documentation Agent”). 
  
 RECITALS 
  
 WHEREAS, the Borrowers wish to make certain amendments to the Credit Agreement which are more particularly described herein.

  
 AGREEMENT 
  
 NOW, THEREFORE, in consideration of the promises and the mutual agreements
herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows: 
  
 ARTICLE I. 
 DEFINITIONS 
  
 Capitalized terms used but not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement. 
  
 ARTICLE II. 
 AMENDMENTS

  
 Section 2.01 Definitions. 
  
 (a) The following defined terms are added to Section
1.1 of the Credit Agreement in their proper alphabetical order: 
  
 “Gateway Asset Purchase Agreement” means the Asset Purchase Agreement, dated as of December 31, 2003 among gateway.realty.newjersey.llc, FiberNet Telecom Group, Inc. and Local Fiber, LLC. 
  
 “Gateway Transaction Equity” means the issuance on or after
January 27, 2004 but on or prior to March 26, 2004 of common stock by the Parent, which common stock shall be valued at not less than $8,000,000.00 and which shall result in Net Proceeds of not less than $7,360,000.00. 

 (b) the definition of “Equity Financing Fee” is deleted in its entirety.

  
 Section 2.02 Prepayments Due to Issuance of Debt or
Equity. 
  
 (a) Section 2.5.B.(iii)(a)
of the Credit Agreement is amended by (i) replacing the words “Seventh Amendment” in the fifth line thereof with the words “Eleventh Amendment” and (ii) deleting the table therein in its entirety and replacing it with the
following table: 
  

			
	 Date of Reduction

	  	 Aggregate Reduction
 (Expressed as a
 Percentage)

	 03/31/2004
	  	2.00%
	 06/30/2004
	  	2.00%
	 9/30/2004
	  	2.00%
	 12/31/2004
	  	2.00%
	 03/31/2005
	  	10.00%
	 06/30/2005
	  	10.00%
	 9/30/2005
	  	10.00%
	 12/31/2005
	  	10.00%
	 03/31/2006
	  	12.00%
	 06/30/2006
	  	12.00%
	 9/30/2006
	  	12.00%
	 12/31/2006
	  	12.00%
	 Maturity Date
	  	 4.00% or any greater
 amount
remaining

  
 (b)
Section 2.5.B.(iii)(d) of the Credit Agreement is amended by (i) deleting the word “and” which appears immediately before clause (xi), (ii) adding a comma (“,”) immediately before clause (xi) and (iii) adding the following
clauses (xii) and (xiii) immediately prior to the words “in each case to prepay the Loans or permanently reduce the Commitments hereunder”: 
  
 “, (xii) up to $4,142,541.34 of the aggregate amount of such Net Proceeds received in respect of the Gateway Transaction Equity and
(xiii) fifty percent (50%) of the Net Proceeds in respect of any Gateway Transaction Equity in excess of $5,520,000.00” 
  

 2 

 Section 2.5D(iii) of the Credit Agreement shall be amended by adding to the last sentence thereof
a proviso (to appear immediately after the words “each such type of Loan”) as follows: 
  
 “, provided that mandatory prepayments of Loans made with the Net Proceeds of the Gateway Transaction Equity in an amount up to $1,377,458.66 shall
be made in direct order of maturity (assuming for such purpose that such Loans mature in the order in which the commitments in respect thereof are required to be reduced pursuant to Section 2.5.B.(iii)(a)” 
  

	Section	2.03 Use of Proceeds. 

  
 Section 5.12 of the Credit Agreement is amended by adding “City, New Jersey” immediately following the word “New York” and
prior to the word “Chicago” (i) in the eighth line thereof and (ii) in the fifteenth line thereof. 
  
 Section 2.04 Adjustments to Financial Covenants. 
  
 (a) Section 6.6.A. of the Credit Agreement is amended by deleting the table at the end thereof in its entirety and replacing it
with the following table: 
  

			
	 Date

	  	 Minimum Consolidated
 Revenue
 (in Dollars)

	 September 30, 2002
	  	27,095,700
	 December 31, 2002
	  	24,818,600
	 March 31, 2003
	  	23,211,600
	 June 30, 2003
	  	22,695,200
	 September 30, 2003
	  	24,538,700
	 December 31, 2003
	  	26,103,900
	 March 31, 2004
	  	26,798,800
	 June 30, 2004
	  	27,457,600
	 September 30, 2004
	  	27,855,600
	 December 31, 2004
	  	28,799,500
	 March 31, 2005
	  	30,246,100
	 June 30, 2005
	  	31,922,000

  

 3 

			
	 September 30, 2005
	  	33,830,100
	 December 31, 2005
	  	35,960,400
	 March 31, 2006
	  	38,415,100
	 June 30, 2006
	  	41,250,600
	 September 30, 2006
	  	44,467,100
	 December 31, 2006
	  	48,064,500

  
 (b)
Section 6.6.B. of the Credit Agreement is amended by deleting the table at the end thereof in its entirety and replacing it with the following table: 
  

			
	 Date

	  	 Minimum Consolidated
EBITDA
 (in Dollars)

	 September 30, 2002
	  	1,359,100
	 December 31, 2002
	  	1,805,000
	 March 31, 2003
	  	1,174,800
	 June 30, 2003
	  	31,600
	 September 30, 2003
	  	1,474,500
	 December 31, 2003
	  	1,769,500
	 March 31, 2004
	  	1,944,300
	 June 30, 2004
	  	1,900,200
	 September 30, 2004
	  	1,776,800
	 December 31, 2004
	  	2,945,300
	 March 31, 2005
	  	3,713,100
	 June 30, 2005
	  	4,652,400
	 September 30, 2005
	  	5,767,100

  

 4 

			
	 December 31, 2005
	  	7,047,600
	 March 31, 2006
	  	8,528,100
	 June 30, 2006
	  	10,243,800
	 September 30, 2006
	  	12,194,400
	 December 31, 2006
	  	14,379,400

  
 (c)
Section 6.6.C. of the Credit Agreement is amended by deleting the table at the end thereof in its entirety and replacing it with the following table: 
  

			
	 Date

	  	Maximum Cumulative
Consolidated Capital
Expenditures
From September 30, 2002
(In Dollars)

	 September 30, 2002
	  	550,000
	 December 31, 2002
	  	1,650,000
	 March 31, 2003
	  	3,186,700
	 June 30, 2003
	  	4,262,500
	 September 30, 2003
	  	5,404,300
	 December 31, 2003
	  	3,329,200
	 March 31, 2004
	  	4,390,300
	 June 30, 2004
	  	5,368,400
	 September 30, 2004
	  	6,213,500
	 December 31, 2004
	  	7,060,200
	 March 31, 2005
	  	8,036,600
	 June 30, 2005
	  	9,013,000
	 September 30, 2005
	  	9,989,300

  

 5 

			
	 December 31, 2005
	  	10,965,700
	 March 31, 2006
	  	12,283,200
	 June 30, 2006
	  	13,600,600
	 September 30, 2006
	  	14,918,100
	 December 31, 2006
	  	16,235,600

  
 (d)
Section 6.6.D. of the Credit Agreement is amended by deleting the table at the end thereof in its entirety and replacing it with the following table: 
  

			
	 Date

	  	 Consolidated Leverage Ratio

	 December 31, 2003
	  	12.00 to 1.00
	 March 31, 2004
	  	11.50 to 1.00
	 June 30, 2004
	  	11.50 to 1.00
	 September 30, 2004
	  	11.30 to 1.00
	 December 31, 2004
	  	7.10 to 1.00
	 March 31, 2005
	  	5.20 to 1.00
	 June 30, 2005
	  	3.75 to 1.00
	 September 30, 2005
	  	2.75 to 1.00
	 December 31, 2005
	  	2.00 to 1.00
	 March 31, 2006
	  	2.00 to 1.00
	 June 30, 2006
	  	2.00 to 1.00
	 September 30, 2006
	  	2.00 to 1.00
	 December 31, 2006
	  	2.00 to 1.00

  

 6 

 (e) Section 6.6.E. of the Credit Agreement is amended by deleting the table at the
end thereof in its entirety and replacing it with the following table: 
  

			
	 Date

	  	 Consolidated Interest
Coverage Ratio

	 December 31, 2003
	  	1.50 to 1.00
	 March 31, 2004
	  	1.50 to 1.00
	 June 30, 2004
	  	1.50 to 1.00
	 September 30, 2004
	  	1.50 to 1.00
	 December 31, 2004
	  	2.30 to 1.00
	 March 31, 2005
	  	2.95 to 1.00
	 June 30, 2005
	  	3.85 to 1.00
	 September 30, 2005
	  	5.10 to 1.00
	 December 31, 2005
	  	6.90 to 1.00
	 March 31, 2006
	  	8.00 to 1.00
	 June 30, 2006
	  	8.00 to 1.00
	 September 30, 2006
	  	8.00 to 1.00
	 December 31, 2006
	  	8.00 to 1.00

  
 (f)
Section 6.6.F. of the Credit Agreement is amended by deleting the table at the end thereof in its entirety and replacing it with the following table: 
  

			
	 Date

	  	 Consolidated Fixed Charge
Coverage Ratio

	 December 31, 2003
	  	0.90 to 1.00
	 March 31, 2004
	  	0.40 to 1.00

  

 7 

			
	 June 30, 2004
	  	0.40 to 1.00
	 September 30, 2004
	  	0.40 to 1.00
	 December 31, 2004
	  	0.71 to 1.00
	 March 31, 2005
	  	0.58 to 1.00
	 June 30, 2005
	  	0.57 to 1.00
	 September 30, 2005
	  	0.59 to 1.00
	 December 31, 2005
	  	0.62 to 1.00
	 March 31, 2006
	  	0.71 to 1.00
	 June 30, 2006
	  	0.85 to 1.00
	 September 30, 2006
	  	1.01 to 1.00
	 December 31, 2006
	  	1.18 to 1.00

  
 Section 2.05
Gateway Acquisition. 
  
 Section 6.7 of the Credit
Agreement is amended by (a) deleting the word “or” that appears at the end of clause (ii) thereof, (b) deleting the period (“.”) at the end of clause (iii) thereof and replacing such period (“.”) with “; or”
and (c) inserting a new clause (iv) immediately thereafter which shall read as follows: 
  
 “(iv) Parent and Local Fiber may enter into and consummate the acquisition contemplated by the Gateway Asset Purchase Agreement.” 
  
 Section 2.06 Nature of Business. 
  
 Section 6.15 of the Credit Agreement is amended by adding “, New Jersey” immediately following the words
“New York City” and prior to the word “Chicago” in the fifth line thereof. 
  
 ARTICLE III. 
 MISCELLANEOUS 
  
 Section 3.01 Execution of this Eleventh Amendment; Effectiveness. 
  
 This Eleventh Amendment is executed and shall be construed as an amendment to
the Credit Agreement, and, as provided in the Credit Agreement, this Eleventh Amendment forms a part thereof. This Eleventh Amendment shall be effective only upon (i) the execution of the 
  

 8 

 Gateway Asset Purchase Agreement and the delivery of such fully executed document to the Administrative Agent and (ii)
the repricing of the warrants referred to in Section 3.08 hereof, provided that, notwithstanding such effectiveness, in the event that (x) the transactions contemplated by the Gateway Asset Purchase Agreement to occur at Closing (as defined
therein) have not been consummated by March 26, 2004 and (y) the Parent shall not have issued the Gateway Transaction Equity by March 26, 2004, then this Eleventh Amendment shall be void and all of the amendments set forth above shall have no
further effect. 
  
 Section 3.02 Representations and
Warranties. 
  
 The Borrowers hereby represent and warrant to
the Administrative Agent and the Lenders that (a) all consents, approvals and authorizations necessary for the Borrowers’ execution, delivery and performance of this Eleventh Amendment have been obtained or made and (b) this Eleventh Amendment
has been duly executed and delivered by the Borrowers and constitutes a legal, valid and binding obligation of each Borrower, enforceable against such Borrower in accordance with its terms. 
  
 Section 3.03 Waiver. 
  
 This Eleventh Amendment is made in amendment and modification of, but not
extinguishment of, the obligations set forth in the Credit Agreement and the other Loan Documents and, except as specifically modified pursuant to the terms of this Eleventh Amendment, the terms and conditions of the Credit Agreement and the other
Loan Documents remain in full force and effect. Nothing herein shall limit in any way the rights and remedies of the Administrative Agent and the Lenders under the Credit Agreement and the other Loan Documents. The execution and delivery by the
Lenders of this Eleventh Amendment shall not constitute a waiver, forbearance or other indulgence with respect to any Potential Event of Default or Event of Default now existing or hereafter arising. 
  
 Section 3.04 Counterparts; Integration; Effectiveness. 
  
 This Eleventh Amendment may be executed in counterparts (and by different
parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Eleventh Amendment and any agreements referred to herein constitute the entire
contract among the parties hereto relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. In addition to the requirements set forth above in
Section 3.01, this Eleventh Amendment shall become effective when it shall have been executed by each of the Borrowers and each of the Lenders, and thereafter shall be binding upon and inure to the benefit of the parties hereto and, subject
to and in accordance with Section 9.16 of the Credit Agreement, their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Eleventh Amendment by telecopy shall be as effective as delivery of a
manually executed counterpart of this Eleventh Amendment. 
  

 9 

 Section 3.05 Severability. 
  
 Any provision of this Eleventh Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality or enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction. 
  
 Section 3.06 Governing Law. 
  
 This Eleventh Amendment shall be construed in accordance with and governed by the laws of the State of New York without regard to the conflicts of law provisions thereof, other than Sections 5-1401 and 5-1402 of the General Obligations Law
of the State of New York. 
  
 Section 3.07 Headings.

  
 Article and Section headings used herein are for convenience
of reference only, are not part of this Eleventh Amendment and shall not affect the construction of, or be taken into consideration in interpreting, this Eleventh Amendment. 
  
 Section 3.08 Eleventh Amendment Fee. 
  
 The Borrower agrees to reprice a total of 379,230 shares of the warrants dated October 30, 2002 and November 11, 2002 and
held by the Lenders to $0.001 upon execution of this Eleventh Amendment in connection with the transactions contemplated herein. 
  
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 
  
  

 10 

 IN WITNESS WHEREOF, the parties hereto have caused this Eleventh Amendment to be duly executed by their
respective authorized officers as of the day and year first above written. 
  

			
	FIBERNET OPERATIONS, INC.
		
	By:	 	 
	 	 	

	 Name:
 Title:
	 	 

  
  

			
	DEVNET L.L.C.
		
	By:	 	 
	 	 	

	 Name:
 Title:
	 	 

  
  
  
 [SIGNATURES CONTINUED ON NEXT PAGE] 

			
	 DEUTSCHE BANK AG NEW YORK
 BRANCH, as a
Lender

		
	By:	 	 
	 	 	

	 Name:
 Title:
	 	 
		
	By:	 	 
	 	 	

	 Name:
 Title:
	 	 

  
  

			
	WACHOVIA INVESTORS, INC., as a Lender
		
	By:	 	 
	 	 	

	 Name:
 Title:
	 	 

  
  

			
	IBM CREDIT LLC, as a Lender
		
	By:	 	 
	 	 	

	 Name:
 Title:PURCHASE AGREEMENT

 Exhibit 10.5 

  
 THE PANTRY, INC. 
 (a Delaware corporation) 
  
 5,000,000 Shares of Common Stock 
  
 PURCHASE AGREEMENT 
  
 Dated:
January 22, 2004 
  

 Table of Contents 
  

							
	 	  	 	 	 	  	Page

	 PURCHASE AGREEMENT
	  	1
		
	     SECTION 1. Representations and Warranties
	  	3
	 	  	(a) Representations and Warranties by the Company	  	3
	 	  	      (i)	 	Compliance with Registration Requirements	  	3
	 	  	      (ii)	 	Incorporated Documents	  	4
	 	  	      (iii)	 	Independent Accountants	  	4
	 	  	      (iv)	 	Financial Statements	  	4
	 	  	      (v)	 	No Material Adverse Change in Business	  	5
	 	  	      (vi)	 	Good Standing of the Company	  	5
	 	  	      (vii)	 	Good Standing of Subsidiaries	  	5
	 	  	      (viii)	 	Capitalization	  	6
	 	  	      (ix)	 	Authorization of Agreement	  	6
	 	  	      (x)	 	Description of Securities	  	6
	 	  	      (xi)	 	Absence of Defaults and Conflicts	  	6
	 	  	      (xii)	 	Absence of Labor Disputes	  	7
	 	  	      (xiii)	 	Absence of Proceedings	  	7
	 	  	      (xiv)	 	Accuracy of Exhibits	  	7
	 	  	      (xv)	 	Possession of Intellectual Property	  	8
	 	  	      (xvi)	 	Absence of Further Requirements	  	8
	 	  	      (xvii)	 	Possession of Licenses and Permits	  	8
	 	  	      (xviii)	 	Title to Property	  	9
	 	  	      (xix)	 	Investment Company Act	  	9
	 	  	      (xx)	 	Environmental Laws	  	9
	 	  	      (xxi)	 	Registration Rights	  	10
	 	  	      (xxii)	 	Stabilization or Manipulation	  	10
	 	  	      (xxiii)	 	Accounting Controls and Disclosure Controls	  	10
	 	  	      (xxiv)	 	Tax Returns	  	10
	 	  	      (xxv)	 	Suppliers	  	11
	 	  	(b) Representations and Warranties by the Selling Shareholders	  	11
	 	  	      (i)	 	Accurate Disclosure	  	11
	 	  	      (ii)	 	Authorization of this Agreement	  	11
	 	  	      (iii)	 	Authorization of Power of Attorney and Custody Agreement	  	11
	 	  	      (iv)	 	Noncontravention	  	12
	 	  	      (v)	 	Certificates Suitable for Transfer	  	12
	 	  	      (vi)	 	Valid Title	  	13
	 	  	      (vii)	 	Delivery of Securities	  	13
	 	  	      (viii)	 	Absence of Manipulation	  	13

  

 - i - 

							
	 	  	      (ix)	  	Absence of Further Requirements	  	13
	 	  	      (x)	  	No Association with NASD	  	14
	 	  	      (xi)	  	Due Organization	  	14
	 	  	(c) Officer’s Certificates	  	14
		
	     SECTION 2. Sale and Delivery to Underwriters; Closing
	  	14
	 	  	(a) Initial Securities	  	14
	 	  	(b) Option Securities	  	14
	 	  	(c) Payment	  	15
	 	  	(d) Denominations; Registration	  	16
		
	     SECTION 3. Covenants of the Company
	  	16
	 	  	(a) Compliance with Securities Regulations and Commission Requests	  	16
	 	  	(b) Filing of Amendments	  	16
	 	  	(c) Delivery of Registration Statements	  	16
	 	  	(d) Delivery of Prospectuses	  	17
	 	  	(e) Continued Compliance with Securities Laws	  	17
	 	  	(f) Blue Sky Qualifications	  	17
	 	  	(g) Rule 158	  	18
	 	  	(h) Listing	  	18
	 	  	(i) Restriction on Sale of Securities	  	18
	 	  	(j) Reporting Requirements	  	18
		
	     SECTION 4. Payment of Expenses
	  	19
	 	  	(a) Expenses	  	19
	 	  	(b) Expenses of the Selling Shareholders	  	19
	 	  	(c) Termination of Agreement	  	19
	 	  	(d) Allocation of Expenses	  	19
		
	     SECTION 5. Conditions of Underwriters’ Obligations
	  	20
	 	  	(a) Effectiveness of Registration Statement	  	20
	 	  	(b) Opinion of Counsel for Company	  	20
	 	  	(c) Opinion of Counsel for the Selling Shareholders	  	20
	 	  	(d) Opinion of Counsel for Underwriters	  	20
	 	  	(e) Officer’s Certificates	  	21
	 	  	(f) Certificate of Selling Shareholders	  	21
	 	  	(g) Accountants’ Comfort Letters	  	21
	 	  	(h) Bring-down Comfort Letters	  	22
	 	  	(i) Listing	  	22
	 	  	(j) No Objection	  	22
	 	  	(k) Lock-up Agreements	  	22
	 	  	(l) Maintenance of Rating	  	22
	 	  	(m) Conditions to Purchase of Option Securities	  	22
	 	  	(n) Additional Documents	  	23
	 	  	(o) Termination of Agreement	  	23

  

 - ii - 

							
	     SECTION 6. Indemnification
	  	24
	 	  	(a) Indemnification of Underwriters	  	24
	 	  	(b) Indemnification of Company, Directors and Officers and Selling Shareholders	  	25
	 	  	(c) Actions against Parties; Notification	  	25
	 	  	(d) Settlement without Consent if Failure to Reimburse	  	26
	 	  	(e) Other Agreements with Respect to Indemnification	  	26
		
	     SECTION 7. Contribution
	  	26
		
	     SECTION 8. Representations, Warranties and Agreements to Survive Delivery
	  	28
		
	     SECTION 9. Termination of Agreement
	  	28
	 	  	(a) Termination; General	  	28
	 	  	(b) Liabilities	  	29
		
	     SECTION 10. Default by One or More of the Underwriters
	  	29
		
	     SECTION 11. Default by one or more of the Selling Shareholders
	  	30
		
	     SECTION 12. Tax Disclosure
	  	30
		
	     SECTION 13. Notices
	  	30
		
	     SECTION 14. Parties
	  	31
		
	     SECTION 15. Governing Law and Time
	  	31
		
	     SECTION 16. Counterparts
	  	31
		
	     SECTION 17. Effect of Headings
	  	31
			
	 	  	SCHEDULES	  	 
	 	  	            Schedule A - List of Underwriters	  	Sch A-1
	 	  	            Schedule B - Selling Stockholders	  	Sch B-1
	 	  	            Schedule C - Pricing Information	  	Sch C-1
	 	  	            Schedule D - List of Persons Subject to Lock-up	  	Sch D-1
			
	 	  	EXHIBITS	  	 
	 	  	            Exhibit A Form of Opinion of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P.	  	A-1
	 	  	            Exhibit B Form of Opinion of Bingham McCutchen LLP	  	B-1
	 	  	            Exhibit C Form of Opinion of Leath, Bouch & Crawford	  	C-1
	 	  	            Exhibit D Form of Opinion of Smith Hulsey & Busey	  	D-1
	 	  	            Exhibit E Form of Lock-up Letter	  	E-1
				
	 	  	ANNEXES	  	 	  	 
	 	  	            Annex A - Form of Comfort Letter of Deloitte & Touche LLP (The Pantry)	  	 
	 	  	            Annex B - Form of Comfort Letter of Deloitte & Touche LLP (Golden Gallon)	  	 

  

 - iii - 

 THE PANTRY, INC. 
  

(a Delaware corporation) 
  
 5,000,000 Shares of Common Stock 
  
 (Par Value $.01 Per Share) 
  
 PURCHASE AGREEMENT 
  
 January 22, 2004 
  
 MERRILL LYNCH & CO. 
 Merrill Lynch, Pierce, Fenner & Smith 
                     Incorporated 
 Goldman, Sachs & Co. 
 William Blair & Company, L.L.C. 
 Jefferies & Company, Inc. 
 Morgan Keegan & Company, Inc. 
     as Representatives of the
several Underwriters 
 c/o Merrill Lynch & Co. 
 Merrill Lynch, Pierce, Fenner & Smith 
                     Incorporated 
 North Tower 
 World Financial Center 
 New York, New York 10080 
  
 Ladies and Gentlemen: 
  
 The Pantry, Inc., a Delaware corporation (the “Company”), and the persons listed in Schedule B hereto (the
“Selling Shareholders”), confirm their respective agreements with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) and each of the other Underwriters named in Schedule A hereto
(collectively, the “Underwriters”, which term shall also include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom Merrill Lynch and Goldman, Sachs & Co. are acting as representatives (in such
capacity, the “Representatives”), with respect to the sale by the Selling Shareholders, acting severally and not jointly, and the purchase by the Underwriters, acting severally and not jointly, of the respective numbers of shares of Common
Stock, par value $.01 per share, of the Company (“Common Stock”) set forth in Schedules A and B hereto, and with respect to the grant by the Selling Shareholders to the Underwriters, acting severally and not jointly, of the option
described 
  

 - 1 - 

 
in Section 2(b) hereof to purchase all or any part of 750,000 additional shares of Common Stock to cover overallotments, if any. The aforesaid 5,000,000
shares of Common Stock (the “Initial Securities”) to be purchased by the Underwriters and all or any part of the 750,000 shares of Common Stock subject to the option described in Section 2(b) hereof (the “Option Securities”) are
hereinafter called, collectively, the “Securities”. 
  
 The Company and the Selling Shareholders understand that the Underwriters propose to make a public offering of the Securities as soon as the Representatives deem advisable after this Agreement has been executed and delivered. 
  
 The Company has filed with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3 (No. 333-111035) covering the registration of the Securities under the Securities Act of 1933, as amended (the “1933 Act”), including the related preliminary prospectus or
prospectuses. Promptly after execution and delivery of this Agreement, the Company will prepare and file a prospectus in accordance with the provisions of Rule 430A (“Rule 430A”) of the rules and regulations of the Commission under the
1933 Act (the “1933 Act Regulations”) and paragraph (b) of Rule 424 (“Rule 424(b)”) of the 1933 Act Regulations. The information included in such prospectus that was omitted from such registration statement at the time it became
effective but that is deemed to be part of such registration statement at the time it became effective pursuant to paragraph (b) of Rule 430A is referred to as “Rule 430A Information.” Each prospectus used before such registration
statement became effective, and any prospectus that omitted the Rule 430A Information, that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a “preliminary prospectus.” Such
registration statement, including the exhibits thereto and schedules thereto at the time it became effective, and including the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at such time and the Rule
430A Information, is herein called the “Registration Statement.” Any registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the “Rule 462(b) Registration Statement,” and after
such filing the term “Registration Statement” shall include the Rule 462(b) Registration Statement. The final prospectus in the form first furnished to the Underwriters for use in connection with the offering of the Securities, including
the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at the time of the execution of this Agreement, is herein called the “Prospectus.” For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus or the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system (“EDGAR”). 
  
 All references in this
Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” in the Registration Statement, any preliminary prospectus or the Prospectus (or other references of like
import) shall be deemed to mean and include all such financial statements and schedules and other information which is incorporated by reference in the Registration Statement, any preliminary prospectus or the 

  

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Prospectus, as the case may be; and all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus
or the Prospectus shall be deemed to mean and include the filing of any document under the Securities Exchange Act of 1934 (the “1934 Act”) which is incorporated by reference in the Registration Statement, such preliminary prospectus or
the Prospectus, as the case may be. 
  
 SECTION 1.
Representations and Warranties. 
  
 (a) Representations
and Warranties by the Company. The Company represents and warrants to each Underwriter as of the date hereof (with such representations and warranties being made as of the date hereof), as of the Closing Time referred to in Section 2(c) hereof
(with such representations and warranties being made as of the Closing Time), and as of each Date of Delivery (if any) referred to in Section 2(b) hereof (with such representations and warranties being made as of each such Date of Delivery), and
agrees with each Underwriter, as follows: 
  
 (i)
Compliance with Registration Requirements. The Company meets the requirements for use of Form S-3 under the 1933 Act. Each of the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendment thereto has
become effective under the 1933 Act and no stop order suspending the effectiveness of the Registration Statement, any Rule 462(b) Registration Statement or any post-effective amendment thereto has been issued under the 1933 Act and no proceedings
for that purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part of the Commission for additional information has been complied with. At the respective times
the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto became effective and at the Closing Time (and, if any Option Securities are purchased, at the Date of Delivery), the Registration Statement,
the Rule 462(b) Registration Statement and any amendments and supplements thereto complied and will comply in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. Neither the Prospectus nor any amendments or supplements thereto (including any prospectus
wrapper), at the time the Prospectus or any such amendment or supplement was issued and at the Closing Time (and, if any Option Securities are purchased, at the Date of Delivery), included or will include an untrue statement of a material fact or
omitted or will 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 in this subsection shall not apply to
statements in or omissions from the Registration Statement or Prospectus made in reliance upon and in conformity with information furnished to the Company in writing (1) by any Underwriter through Merrill Lynch expressly for use in the Registration
Statement or Prospectus or (2) by any Selling Shareholder expressly for use in response to Item 7 of Form S-3 in the Registration Statement or Prospectus. 
  

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 Each preliminary prospectus and the prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all material respects with the 1933 Act Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T. 
  
 (ii) Incorporated Documents. The documents
incorporated or deemed to be incorporated by reference in the Registration Statement and the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will comply in all material
respects with the requirements of the 1934 Act and the rules and regulations of the Commission thereunder (the “1934 Act Regulations”) and, when read together with the other information in the Prospectus, at the time the Registration
Statement became effective, at the time the Prospectus was issued and at the Closing Time (and, if any Option Securities are purchased, at the Date of Delivery), did not and will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein not misleading. 
  
 (iii) Independent Accountants. The accountants who certified the financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required by the 1933 Act and the 1933 Act Regulations. Deloitte & Touche LLP has not provided to the Company or its subsidiaries any non-audit services, the provision of which is
prohibited by applicable law or accounting standards. 
  
 (iv) Financial Statements. The historical financial statements of the Company included and incorporated by reference in the Registration Statement and the Prospectus, together with the related schedules and notes, present fairly the
financial position of the Company and its consolidated subsidiaries at the dates indicated and the statements of operations, shareholders’ equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; said
financial statements have been prepared in conformity with United States generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods involved. To the Company’s knowledge, the historical
financial statements of the Golden Gallon Group, together with the related schedules and notes, incorporated by reference in the Registration Statement and the Prospectus, present fairly the financial position of the Golden Gallon Group at the dates
indicated and the statements of income, Royal Ahold stated invested equity and cash flows of the Golden Gallon Group for the periods specified; said financial statements have been prepared in conformity with United States GAAP applied on a
consistent basis throughout the periods involved. 
  

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 The selected historical financial data and the summary historical financial information
included in the Registration Statement and the Prospectus present fairly the information shown therein and have been compiled on a basis consistent with that of the audited financial statements included in the Registration Statement and the
Prospectus. The pro forma financial statements and pro forma financial information of the Company, its subsidiaries and entities acquired by the Company or its subsidiaries and the related notes thereto, included and incorporated by reference in the
Registration Statement and the Prospectus, present fairly the information shown therein, have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements and pro forma financial
information and have been properly compiled on the bases described therein, and the Company believes that the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein. All financial statements and pro forma financial statements required to be included in the Registration Statement and the Prospectus pursuant to the 1933 Act, the 1933 Act Regulations and
Regulation S-X have been included in the Registration Statement and the Prospectus. 
  
 (v) No Material Adverse Change in Business. Since the respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A) there has been no material adverse change in the condition (financial or otherwise), earnings, business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the Company and its subsidiaries considered as one enterprise, and (C) there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its
capital stock. 
  
 (vi) Good Standing of the
Company. The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Delaware and has 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; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in 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 where the failure so to qualify or to be in good standing would not result in a Material Adverse Effect. 
  
 (vii) Good Standing of Subsidiaries. Each subsidiary
of the Company (each a “Subsidiary” and, collectively, the “Subsidiaries”) has been duly organized and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties 

  

 - 5 - 

 
and to conduct its business as described in the Prospectus and is duly qualified as a foreign corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not result in a Material Adverse
Effect; except as otherwise disclosed in the Registration Statement, all of the issued and outstanding capital stock of each such Subsidiary has been duly authorized and validly issued, is fully paid and non-assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity (except for restrictions on transfer imposed by federal or state securities laws); none of the outstanding shares of
capital stock of any Subsidiary was issued in violation of the preemptive rights of any securityholder of such Subsidiary. The only subsidiaries of the Company are Kangaroo, Inc., a Georgia corporation, and R&H Maxxon, Inc., a South Carolina
corporation. 
  
 (viii) Capitalization.
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” (except for subsequent issuances, if any, pursuant to
reservations, agreements or employee benefit plans referred to in the Prospectus or pursuant to the exercise of convertible securities or options referred to in the Prospectus). The shares of issued and outstanding capital stock of the Company,
including the Securities to be purchased by the Underwriters from the Selling Shareholders, have been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company, including
the Securities to be purchased by the Underwriters from the Selling Shareholders, was issued in violation of the preemptive or other similar rights of any securityholder of the Company; to the Company’s knowledge, the sale of shares of Common
Stock by the Selling Shareholders to the Underwriters will not trigger any co-sale or tag-along rights or other similar rights of any other securityholder of the Company. 
  
 (ix) Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by
the Company. 
  
 (x) Description of
Securities. The Common Stock conforms to all statements relating thereto contained in the Prospectus and such description conforms to the rights set forth in the instruments defining the same; no holder of the Securities will be subject to
personal liability solely by reason of being such a holder. 
  
 (xi) Absence of Defaults and Conflicts. Neither the Company nor any of its subsidiaries is in violation of its charter or by-laws or in default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by 

  

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which it or any of them may be bound, or to which any of the property or assets of the Company or any subsidiary is subject (collectively, “Agreements
and Instruments”) except for such violations or defaults that would not result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein and in the
Registration Statement (including the sale of the Securities by the Selling Shareholders) and compliance by the Company with its obligations hereunder have been duly authorized by all necessary corporate action and do not and will not, whether with
or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance
(“Lien”) upon any property or assets of the Company or any subsidiary pursuant to, or require any consent under or permit any third party to terminate, any of the Agreements and Instruments, except for such breaches, defaults, Repayment
Events, Liens, consents or terminations that would not result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the charter or by-laws of the Company or any subsidiary or any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any subsidiary or any of their assets, properties or operations. As used herein, a
“Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any subsidiary. 
  
 (xii) Absence of Labor Disputes. No labor dispute with the employees of the Company or any subsidiary exists or, to the knowledge of the Company, is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or any subsidiary’s principal suppliers or vendors, which, in either case, may reasonably be expected to result in a Material Adverse Effect. 
  
 (xiii) Absence of Proceedings. There is no action,
suit, proceeding, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any subsidiary, which is
required to be disclosed in the Registration Statement (other than as disclosed therein), or which would result in a Material Adverse Effect, or which would materially and adversely affect the consummation of the transactions contemplated in this
Agreement or the performance by the Company of its obligations hereunder; the aggregate of all pending legal or governmental proceedings to which the Company or any subsidiary is a party or of which any of their respective property or assets is the
subject which are not described in the Registration Statement, including ordinary routine litigation incidental to the business, would not result in a Material Adverse Effect. 
  

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 (xiv) Accuracy of Exhibits. There are no contracts or documents which are required
under the 1933 Act or the 1934 Act or the rules and regulations thereunder to be described in the Registration Statement or the Prospectus or the documents incorporated by reference therein or to be filed as exhibits thereto which have not been so
described and filed as required. 
  
 (xv)
Possession of Intellectual Property. The Company and its subsidiaries own or possess, have the right to use or can acquire adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the
business now operated by them, except where the failure to own, possess, have the right to use or have the ability to acquire any such Intellectual Property would not have a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company or any of its subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the
aggregate, would result in a Material Adverse Effect. 
  
 (xvi) Absence of Further Requirements. No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the
performance by the Company of its obligations hereunder, in connection with the offering or sale of the Securities hereunder by the Selling Shareholders or the consummation of the transactions contemplated by this Agreement, except such as have been
already obtained under the 1933 Act or the 1933 Act Regulations or as may be required by state securities laws. 
  
 (xvii) Possession of Licenses and Permits. The Company and its subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, “Governmental Licenses”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, except where the failure to
possess such Governmental Licenses would not have a Material Adverse Effect; the Company and its subsidiaries are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not, singly
or in the aggregate, have a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except where the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force
and effect would not have a Material Adverse Effect; and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would result in a Material Adverse Effect. 
  

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 (xviii) Title to Property. The Company and its subsidiaries have good and
marketable title to all real property owned by the Company and its subsidiaries and good title to all other properties owned by them, in each case, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except such as (a) are described in the Prospectus or (b) do not, singly or in the aggregate, affect the value of such property, do not interfere with the use made and proposed to be made of such property by the Company or
any of its subsidiaries and would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect; and all of the leases and subleases material to the business of the Company and its subsidiaries, considered as
one enterprise, and under which the Company or any of its subsidiaries holds properties described in the Prospectus, are in full force and effect, and neither the Company nor any subsidiary has any notice of any claim of any sort that has been
asserted by anyone adverse to the rights of the Company or any subsidiary under any of the leases or subleases mentioned above, or affecting or questioning the rights of the Company or such subsidiary to the continued possession of the leased or
subleased premises under any such lease or sublease, except for such claims which would not, singly or in the aggregate, result in a Material Adverse Effect. 
  

(xix) Investment Company Act. The Company is not, and following the sale of the Securities as herein contemplated will not be,
an “investment company” or an entity “controlled” by an “investment company” as such terms are defined in the Investment Company Act of 1940, as amended (the “1940 Act”). 
  
 (xx) Environmental Laws. Except as described in the
Registration Statement or except as would not, singly or in the aggregate, result in a Material Adverse Effect, (A) neither the Company nor any of its subsidiaries is in violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products (collectively, “Hazardous Materials”) or to the manufacture, processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, “Environmental Laws”), (B) the Company and its subsidiaries have all permits, licenses, authorizations and approvals required under any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no pending or, to the Company’s knowledge, threatened administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or 

  

 - 9 - 

 
violation, investigation or proceedings relating to any Environmental Law against the Company or any of its subsidiaries and (D) there are no events, facts
or circumstances that might reasonably be expected to form the basis of any order, decree, plan or agreement requiring clean-up or remediation, or any action, suit or proceeding by any private party or governmental body or agency, against or
affecting the Company or any of its subsidiaries relating to any Hazardous Materials or any Environmental Laws. 
  
 (xxi) Registration Rights. There are no persons with registration rights or other similar rights to have any securities (1)
registered pursuant to the Registration Statement (except for rights which have been complied with or waived) or (2) otherwise registered by the Company under the 1933 Act (except as described in the Prospectus). 
  
 (xxii) Stabilization or Manipulation. Neither the
Company nor any of its executive officers, directors or, to its knowledge, controlling persons has taken, directly or indirectly, any action designed to cause or to result in, or that has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of any security of the Company to facilitate the sale of the Securities. 
  
 (xxiii) Accounting Controls and Disclosure Controls. The Company and its subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements
in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and its consolidated subsidiaries employ disclosure controls and procedures that are designed to ensure that information required to
be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated
to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate to allow timely decisions regarding disclosure. 
  
 (xxiv) Tax Returns. The Company and its subsidiaries
have filed all federal, state, local and foreign tax returns that are required to have been filed by them pursuant to applicable foreign, federal, state, local or other law or have duly requested extensions thereof, except insofar as the failure to
file such returns or request such extensions would not reasonably be expected to result in a Material Adverse Effect, and has paid all taxes due pursuant to such returns or pursuant to any assessment received by the Company and its Subsidiaries,
except for such taxes or assessments, if any, as are being contested in good faith and as to which adequate reserves have been provided or where the failure to 

  

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pay would not reasonably be expected to result in a Material Adverse Effect. The charges, accruals and reserves on the books of the Company in respect of any
income and corporation tax liability of the Company and each subsidiary for any years not finally determined are adequate to meet any assessments or re-assessments for additional income tax for any years not finally determined, except to the extent
of any inadequacy that would not reasonably be expected to result in a Material Adverse Effect. 
  
 (xxv) Suppliers. To the Company’s knowledge, no supplier of merchandise or gasoline to the Company or any of its subsidiaries
has ceased shipments of merchandise to the Company or indicated to the Company or an executive officer of the Company an interest in decreasing or ceasing its sales to the Company or otherwise materially modifying its relationship with the Company,
other than in the normal and ordinary course of business consistent with past practices between the Company and such supplier. 
  
 (b) Representations and Warranties by the Selling Shareholders. Each Selling Shareholder severally represents and warrants to each Underwriter with
respect to himself or itself as of the date hereof (with such representations and warranties being made as of the date hereof), as of the Closing Time (with such representations and warranties being made as of the Closing Time), and, if the Selling
Shareholder is selling Option Securities on a Date of Delivery, as of each such Date of Delivery (with such representations and warranties being made as of each such Date of Delivery), and agrees with each Underwriter, as follows: 
  
 (i) Accurate Disclosure. Such Selling Shareholder has
reviewed and is familiar with the Registration Statement and the Prospectus and neither the Prospectus nor any amendments or supplements thereto (including any prospectus wrapper) 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, provided, however, that with respect to each Selling Shareholder (other than Peter J. Sodini (the
“CEO Selling Shareholder”)) this representation shall be limited to information provided by such Selling Shareholder in writing expressly for use in the Registration Statement or Prospectus or any amendments or supplements thereto.

  
 (ii) Authorization of this Agreement.
Such Selling Shareholder has the full right, power and authority to enter into this Agreement and to sell, transfer and deliver the Securities to be sold by such Selling Shareholder hereunder. This Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Shareholder. 
  
 (iii) Authorization of Power of Attorney and Custody Agreement. Such Selling Shareholder has the full right, power and authority to enter into a Power of Attorney and Custody Agreement. The Power of Attorney and Custody Agreement, in
the form heretofore furnished to the Representatives (the “Power of Attorney and Custody Agreement”), has been duly authorized, executed and delivered by such Selling Shareholder and is the valid and binding agreement of such Selling
Shareholder. The 

  

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Custodian is authorized to deliver the Securities to be sold by such Selling Shareholder hereunder. Each Attorney-in-Fact named in the Power of Attorney and
Custody Agreement of such Selling Shareholder is authorized to execute and deliver this Agreement and any certificates that may be required pursuant to this Agreement on behalf of such Selling Shareholder, to sell, assign and transfer to the
Underwriters the Securities to be sold by such Selling Shareholder hereunder, to determine the purchase price to be paid by the Underwriters to such Selling Shareholder, to authorize the delivery of the Securities to be sold by such Selling
Shareholder hereunder, and otherwise to act on behalf of such Selling Shareholder in connection with this Agreement. 
  
 (iv) Noncontravention. The execution and delivery of this Agreement and the Power of Attorney and Custody Agreement and the sale
and delivery of the Securities to be sold by such Selling Shareholder and the consummation of the transactions contemplated herein and compliance by such Selling Shareholder with its obligations hereunder do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or constitute a breach of, or default under, or result in the creation or imposition of any tax, lien, charge or encumbrance upon the Securities to be sold by such Selling Shareholder or
any property or assets of such Selling Shareholder pursuant to any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, license, lease or other agreement or instrument to which such Selling Shareholder is a party or by which
such Selling Shareholder may be bound, or to which any of the property or assets of such Selling Shareholder is subject, nor will such action result in any violation of the provisions of the charter or by-laws or other organizational instrument of
such Selling Shareholder, if applicable, or any applicable treaty, law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over such Selling
Shareholder or any of its properties. Such Selling Shareholder has no registration rights with respect to the Registration Statement other than rights which have been complied with by the Company or waived by such Selling Shareholder. 
  
 (v) Certificates Suitable for Transfer. The
Securities to be sold by such Selling Shareholder pursuant to this Agreement are certificated securities in registered form and are not held in any securities account or by or through any securities intermediary within the meaning of the Uniform
Commercial Code as in effect in the State of New York (the “UCC”). Certificates for all of the Securities to be sold by such Selling Shareholder pursuant to this Agreement, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank with signatures guaranteed, have been placed in custody with Wachovia Bank, N.A. (the “Custodian”) with irrevocable conditional instructions to deliver such Securities to the
Underwriters pursuant to this Agreement. 
  
 (vi)
Valid Title. Such Selling Shareholder has, and at the Closing Time will have, valid title to the Securities to be sold by such Selling Shareholder, free and clear of 

  

 - 12 - 

 
all security interests, claims, liens, equities or other encumbrances, and has the legal right and power, and all authorization and approval required by law,
to sell, transfer and deliver the Securities to be sold by such Selling Shareholder or a valid security entitlement in respect of such Securities. 
  
 (vii) Delivery of Securities. Upon payment of the purchase price for the Securities to be sold by such Selling Shareholder pursuant
to this Agreement, delivery of such Securities, as directed by the Underwriters, to Cede & Co. (“Cede”) or such other nominee as may be designated by The Depository Trust Company (“DTC”), registration of such Securities in
the name of Cede or such other nominee, and the crediting of such Securities on the books of DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has “notice” of any “adverse claim,”
within the meaning of Section 8-105 of the UCC, to such Securities), (A) DTC shall be a “protected purchaser,” within the meaning of Section 8-303 of the UCC, of such Securities and will acquire its interest in the Securities (including,
without limitation, all rights that such Selling Shareholder had or has the power to transfer in such Securities) free and clear of any adverse claim within the meaning of Section 8-102 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such Securities and (C) no action (whether framed in conversion, replevin, constructive trust, equitable lien, or other theory) based on any “adverse claim”, within the
meaning of Section 8-102 of the UCC, to such Securities may be asserted against the Underwriters with respect to such security entitlement. 
  
 (viii) Absence of Manipulation. Such Selling Shareholder has not taken, and will not take, directly or indirectly, any action which
is designed to or which has constituted or which would reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities. 
  
 (ix) Absence of Further Requirements. No filing with,
or consent, approval, authorization, order, registration, qualification or decree of, any court or governmental authority or agency, domestic or foreign, is necessary or required for the performance by each Selling Shareholder of its obligations
hereunder or in the Power of Attorney and Custody Agreement, or in connection with the sale and delivery of the Securities hereunder or the consummation of the transactions contemplated by this Agreement, except such as may have previously been made
or obtained under the 1933 Act or the 1933 Act Regulations or state securities laws and except for any filings which may be required after the date hereof pursuant to Sections 13 and 16 of the 1934 Act. 
  
 (x) No Association with NASD. Neither such Selling
Shareholder nor any of his, her or its affiliates (within the meaning of NASD Conduct Rule 2720(b)(1)(a)) directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, or is an associated
person of (within the meaning of Article I, Section 1(q) of the By-laws of the National Association of Securities Dealers, Inc.), any member firm of the National Association of Securities Dealers, Inc. 
  

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 (xi) Due Organization. Each Selling Shareholder that is an entity has been duly
organized and is validly existing as a corporation, partnership or limited liability company in good standing in the jurisdiction of its organization. 
  
 (c) Officer’s Certificates. Any certificate signed by any officer of the Company or any of its subsidiaries delivered to the Representatives
or to counsel for the Underwriters shall be deemed a representation and warranty by the Company to each Underwriter as to the matters covered thereby, and any certificate signed by or on behalf of a Selling Shareholder as such and delivered to the
Representatives or to counsel for the Underwriters shall be deemed a representation and warranty by such Selling Shareholder to the Underwriters as to the matters covered thereby. 
  
 SECTION 2. Sale and Delivery to Underwriters; Closing. 
  
 (a) Initial Securities. On the basis of the representations and warranties herein contained and subject to the terms
and conditions herein set forth, each Selling Shareholder, severally and not jointly, agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from each Selling Shareholder,
at the price per share set forth in Schedule C, that proportion of the number of Initial Securities set forth in Schedule B opposite the name of such Selling Shareholder, as the case may be, which the number of Initial Securities set forth in
Schedule A opposite the name of such Underwriter, plus any additional number of Initial Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof, bears to the total number of Initial
Securities, subject, in each case, to such adjustments among the Underwriters as the Representatives in their sole discretion shall make to eliminate any sales or purchases of fractional securities. 
  
 (b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and conditions herein set forth, the Selling Shareholders, acting severally and not jointly, hereby grant an option to the Underwriters, severally and not jointly, to purchase
up to an additional 750,000 shares of Common Stock, as set forth in Schedule B, at the price per share set forth in Schedule C, less an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted will expire 30 days after the date hereof and may be exercised in whole or in part from time to time on one or more occasions only for the purpose of covering
overallotments which may be made in connection with the offering and distribution of the Initial Securities upon notice by the Representatives to the Selling Shareholders setting forth the number of Option Securities as to which the several
Underwriters are then exercising the option and the time and date of payment and delivery for such Option Securities. Any such time and date of delivery (a “Date of Delivery”) shall be determined by the 

  

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Representatives, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the Option Securities, each of the Underwriters, acting severally and not jointly, agrees to purchase from each Selling Shareholder, at the price per share set forth in
Schedule C, that proportion of the number of Option Securities being sold by such Selling Shareholder which the number of Initial Securities set forth in Schedule A opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as the Representatives in their discretion shall make to eliminate any sales or purchases of fractional shares. If less than all of the Option Securities are to be sold, Option Securities will be
sold by the Selling Shareholders on a pro rata basis in accordance with the number of Option Securities set forth in Schedule B. 
  
 (c) Payment. Payment of the purchase price for, and delivery of certificates for, the Initial Securities shall be made at the offices of Fried,
Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York 10004, or at such other place as shall be agreed upon by the Representatives, the Company and the Selling Shareholders, at 9:00 A.M. (Eastern time) on the third (fourth,
if the pricing occurs after 4:30 P.M. (Eastern Time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10), or such other time not later than ten business days after such date as
shall be agreed upon by the Representatives, the Company and the Selling Shareholders (such time and date of payment and delivery being herein called “Closing Time”). 
  
 In addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the
purchase price for, and delivery of certificates for, such Option Securities shall be made at the above-mentioned offices, or at such other place as shall be agreed upon by the Representatives, the Company and the Selling Shareholders, on each Date
of Delivery as specified in the notice from the Representatives to the Company and the Selling Shareholders. 
  
 Payment shall be made to the Selling Shareholders by wire transfer of immediately available funds to a bank account designated by the Selling Shareholders
(with one bank account being designated by Freeman Spogli & Co. and one bank account being designated by the Custodian) against delivery to the Representatives for the respective accounts of the Underwriters of certificates for the Securities to
be purchased by them. It is understood that each Underwriter has authorized the Representatives, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if
any, which it has agreed to purchase. Merrill Lynch, individually and not as representative of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option Securities, if any, to
be purchased by any Underwriter whose funds have not been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not relieve such Underwriter from its obligations hereunder. 
  

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 (d) Denominations; Registration. Certificates for the Initial Securities and the Option
Securities, if any, shall be in such denominations and registered in such names as the Representatives may request in writing at least two full business days before the Closing Time or the relevant Date of Delivery, as the case may be. The
certificates for the Initial Securities and the Option Securities, if any, will be made available for examination and packaging by the Representatives in The City of New York not later than 10:00 A.M. (Eastern time) on the business day prior to the
Closing Time or the relevant Date of Delivery, as the case may be. 
  
 SECTION 3. Covenants of the Company. The Company covenants with each Underwriter as follows: 
  
 (a) Compliance with Securities Regulations and Commission Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A, and will notify the Representatives immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any supplement to the Prospectus or any
amended Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or any
document incorporated by reference therein or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes. The Company will promptly effect the
filings necessary pursuant to Rule 424(b) and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that
it was not, it will promptly file such prospectus. The Company will make every reasonable effort to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment. 

 
 (b) Filing of Amendments. The Company will give
the Representatives notice of its intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b)) or any amendment, supplement or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing
or use, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall object. 
  
 (c) Delivery of Registration Statements. The Company has furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration Statement as originally filed and of each amendment thereto 

  

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(including exhibits filed therewith or incorporated by reference therein and documents incorporated or deemed to be incorporated by reference therein) and
signed copies of all consents and certificates of experts, and will also deliver to the Representatives, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T. 
  
 (d) Delivery
of Prospectuses. The Company has delivered to each Underwriter, without charge, as many copies of each preliminary prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to each Underwriter, without charge, during the period when the Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T. 
  
 (e) Continued Compliance with Securities Laws. The Company will comply with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act Regulations so as to permit the completion of the
distribution of the Securities as contemplated in this Agreement and in the Prospectus. If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Securities, any event shall occur or condition shall
exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue
statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in
the opinion of such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file
with the Commission, subject to Section 3(b), such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish
to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably request. 
  
 (f) Blue Sky Qualifications. The Company will use its best efforts, in cooperation with the Underwriters, to qualify the Securities
for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) 

  

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as the Representatives may designate and to maintain such qualifications in effect for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration Statement; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In each jurisdiction in which the Securities have been so
qualified, the Company will file such statements and reports as may be required by the laws of such jurisdiction to continue such qualification in effect for a period of not less than one year from the effective date of the Registration Statement
and any Rule 462(b) Registration Statement. 
  
 (g) Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as practicable an earnings statement for the purposes of, and to
provide the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act. 
  
 (h) Listing. The Company will use its best efforts to maintain the quotation of the Common Stock (including the Securities) on the
Nasdaq National Market. 
  
 (i) Restriction on
Sale of Securities. During a period of 90 days from the date of the Prospectus, the Company will not, without the prior written consent of Merrill Lynch, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any share of Common Stock or any securities convertible into or exercisable or exchangeable for Common
Stock or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not
apply to (A) the Securities to be sold hereunder, (B) any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Prospectus, (C)
any shares of Common Stock issued or options to purchase Common Stock granted pursuant to existing employee benefit plans of the Company referred to in the Prospectus or (D) any shares of Common Stock issued pursuant to any non-employee director
stock plan or dividend reinvestment plan. 
  
 (j)
Reporting Requirements. The Company, during the period when the Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the
time periods required by the 1934 Act and the rules and regulations of the Commission thereunder. 
  

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 SECTION 4. Payment of Expenses. (a) Expenses. The Company will pay all expenses incident to
the performance of its obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and of each amendment thereto, (ii) the
printing and delivery to the Underwriters of this Agreement, any Agreement among Underwriters and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the Securities, (iii) the preparation
and delivery of the certificates for the Securities to the Underwriters, (iv) the fees and disbursements of the Company’s counsel, accountants and other advisors, (v) the qualification of the Securities under securities laws in accordance with
the provisions of Section 3(f) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto,
(vi) the printing and delivery to the Underwriters of copies of each preliminary prospectus and of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (viii) the fees and expenses of any transfer agent or registrar for the Securities, (ix) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in
connection with the marketing of the Securities, including without limitation, the Company’s expenses associated with the production of road show slides and graphics, travel and lodging expenses of the representatives and officers of the
Company and the cost of aircraft and other transportation chartered in connection with the road show, (x) the filing fees incident to, and the reasonable fees and disbursements of counsel to the Underwriters in connection with, the review by the
NASD of the terms of the sale of the Securities, and (xi) the fees and expenses incurred in connection with the quotation of the Securities on the Nasdaq National Market. 
  
 (b) Expenses of the Selling Shareholders. The Selling Shareholders, severally but not jointly, will pay all expenses
incident to the performance of their respective obligations under, and the consummation of the transactions contemplated by this Agreement, including (i) any stamp duties, capital duties and stock transfer taxes, if any, payable upon the sale of the
Securities to the Underwriters, and their transfer between the Underwriters pursuant to an agreement between such Underwriters, and (ii) the fees and disbursements of their respective counsel and other advisors (unless the Company is otherwise
required to or agrees to pay such expenses). 
  
 (c)
Termination of Agreement. If this Agreement is terminated by the Representatives in accordance with the provisions of Section 5 or Section 9(a)(i) hereof, the Company shall reimburse the Underwriters for all of their reasonable out-of-pocket
expenses incurred, including the reasonable fees and disbursements of counsel for the Underwriters. 
  

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 (d) Allocation of Expenses. The provisions of this Section shall not affect any agreement that the
Company and any Selling Shareholder may make for the sharing of costs and expenses. 
  
 SECTION 5. Conditions of Underwriters’ Obligations. The obligations of the several Underwriters hereunder are subject to the accuracy of the representations and warranties of the Company and the Selling
Shareholders contained in Section 1 hereof or in certificates of any officer of the Company or any subsidiary of the Company or on behalf of any Selling Shareholder delivered pursuant to the provisions hereof, to the performance by the Company and
the Selling Shareholders of their respective covenants and other obligations hereunder, and to the following further conditions: 
  
 (a) Effectiveness of Registration Statement. The Registration Statement, including any Rule 462(b) Registration Statement, has
become effective and at Closing Time no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of
the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters. A prospectus containing the Rule 430A Information shall have been filed with the Commission in accordance with
Rule 424(b) (or a post-effective amendment providing such information shall have been filed and declared effective in accordance with the requirements of Rule 430A). 
  
 (b) Opinion of Counsel for Company. At Closing Time, the Representatives shall have received the
favorable opinions, dated as of Closing Time, of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P., counsel for the Company, Leath, Bouch & Crawford LLP, South Carolina counsel to the Company, and Smith Hulsey & Busey,
Florida counsel to the Company, in each case in form and substance reasonably satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters in the form set forth in Exhibits
A, C and D hereto and to such further effect as counsel to the Underwriters may reasonably request. Such counsel may state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of
officers of the Company and its subsidiaries and certificates of public officials. 
  
 (c) Opinion of Counsel for the Selling Shareholders. At Closing Time, the Representatives shall have received the favorable
opinion, dated as of Closing Time, of Bingham McCutchen LLP, counsel for the Selling Shareholders, in form and substance reasonably satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letter for each of
the other Underwriters in the form set forth in Exhibit B hereto and to such further effect as counsel to the Underwriters may reasonably request. Such counsel may state that, insofar as such opinion involves factual matters, they have relied, to
the extent they deem proper, upon certificates of the Selling Shareholders and certificates of public officials. 
  

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 (d) Opinion of Counsel for Underwriters. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters with
respect to the matters set forth in clauses (i), (iv), (v), (vi), (vii), and (xvi) of Exhibit A hereto and in clause (3) of Exhibit B hereto. In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of New York, the federal law of the United States and the General Corporation Law of the State of Delaware, upon the opinions of counsel satisfactory to the Representatives. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and its subsidiaries and certificates of public officials. 
  
 (e) Officers’ Certificates. At Closing Time,
there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus, any material adverse change in the condition (financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of Closing Time, to the effect that (i) there has been no such material adverse change, (ii) the representations and warranties in Section 1(a) hereof are true and correct
with the same force and effect as though expressly made at and as of Closing Time, (iii) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied under this Agreement at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or are contemplated by the Commission. 
  
 (f) Certificate of Selling Shareholders. At Closing
Time, the Representatives shall have received a certificate of an Attorney-in-Fact on behalf of each Selling Shareholder, dated as of Closing Time, to the effect that (i) the representations and warranties of such Selling Shareholder contained in
Section 1(b) hereof are true and correct in all respects with the same force and effect as though expressly made at and as of Closing Time and (ii) such Selling Shareholder has complied with all agreements and all conditions on its part to be
performed under this Agreement at or prior to Closing Time. 
  
 (g) Accountants’ Comfort Letters. At the time of the execution of this Agreement, the Representatives shall have received from Deloitte & Touche LLP letters 

  

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in the form of Annexes A-1 and A-2 hereto, in each case dated the date hereof, in form and substance satisfactory to the Representatives, together with
signed or reproduced copies of such letters for each of the other Underwriters containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial
statements and certain financial information contained in the Registration Statement and the Prospectus. 
  
 (h) Bring-down Comfort Letters At Closing Time, the Representatives shall have received letters from Deloitte & Touche LLP,
dated as of Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (g) of this Section, except that the specified date referred to shall be a date not more than three business days prior to
Closing Time. 
  
 (i) Listing. At Closing
Time, the Securities shall continue to be listed on the Nasdaq National Market. 
  
 (j) No Objection. The NASD has confirmed that it has not raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements. 
  
 (k)
Lock-up Agreements. At the date of this Agreement, the Representatives shall have received an agreement substantially in the form of Exhibit E hereto signed by the persons listed on Schedule D hereto. 
  
 (l) Maintenance of Rating. Since the execution of
this Agreement, there shall not have been any decrease in the rating of any of the Company’s securities by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the 1933 Act) or any
notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate the direction of the possible change. 
  
 (m) Conditions to Purchase of Option Securities. In the event that the Underwriters exercise their
option provided in Section 2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company and the Selling Shareholders contained herein and the statements in any certificates furnished by the
Company or any subsidiary of the Company and the Selling Shareholders hereunder shall be true and correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representatives shall have received: 
  
 (i) Officers’ Certificates. A certificate, dated
such Date of Delivery, of the President or a Vice President of the Company and of the chief financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to Section 5(e) hereof remains
true and correct as of such Date of Delivery. 
  

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 (ii) Certificate of Selling Shareholders. A certificate, dated such Date of
Delivery, of an Attorney-in-Fact on behalf of each Selling Shareholder confirming that the certificate delivered at Closing Time pursuant to Section 5(f) remains true and correct as of such Date of Delivery. 
  
 (iii) Opinion of Counsel for Company. The favorable
opinions of Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P., counsel for the Company, Leath, Bouch & Crawford LLP, South Carolina counsel to the Company, and Smith Hulsey & Busey, Florida counsel to the Company, in each
case in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by
Section 5(b) hereof. 
  
 (iv) Opinion of
Counsel for the Selling Shareholders. The favorable opinion of Bingham McCutchen LLP, counsel for the Selling Shareholders, in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(c) hereof. 
  
 (v) Opinion of Counsel for Underwriters. The favorable opinion of Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(d) hereof. 
  
 (vi) Bring-down Comfort Letter. A letter from
Deloitte & Touche LLP, in form and substance satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letters furnished to the Representatives pursuant to Section 5(g) hereof,
except that the “specified date” in the letter furnished pursuant to this paragraph shall be a date not more than five days prior to such Date of Delivery. 
  
 (n) Additional Documents. At Closing Time and at each Date of Delivery, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may require for the purpose of enabling them to pass upon the sale of the Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company and the Selling Shareholders in connection with the sale of the Securities as herein contemplated shall be satisfactory in form and
substance to the Representatives and counsel for the Underwriters. 
  

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 (o) Termination of Agreement. If any condition specified in this Section shall not
have been fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities, on a Date of Delivery which is after the Closing Time, the obligations of the several Underwriters to
purchase the relevant Option Securities, may be terminated by the Representatives by notice to the Company and the Selling Shareholders at any time at or prior to Closing Time or such Date of Delivery, as the case may be, and such termination shall
be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any such termination and remain in full force and effect. 
  
 SECTION 6. Indemnification. 
  
 (a) Indemnification of Underwriters. The Company and the Selling
Shareholders, severally and not jointly, agree to indemnify and hold harmless each Underwriter, its affiliates, as such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”), its selling agents and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows: 
  
 (i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the Rule 430A Information, 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 arising out of any untrue statement or alleged untrue statement of a material fact included in any 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; 
  
 (ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent
of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company; and 
  
 (iii) against any and all expense whatsoever, as incurred (including subject to Section 6(c) the fees and
disbursements of counsel chosen by Merrill Lynch), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above; 
  

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 provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or
expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through Merrill Lynch
expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430A Information and the Rule 434 Information, if applicable, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto);
provided, further, that the Company and the Selling Shareholders will not be liable to any Underwriter or any person controlling such Underwriter with respect to any such untrue statement or alleged untrue statement or omission or
alleged omission made in any preliminary prospectus to the extent that the Company shall sustain the burden of proving that any such loss, liability, claim, damage or expense resulted from the fact that the Underwriter sold securities to a person to
whom such Underwriter failed to send or give, at or prior to the written confirmation of the sale of such Securities, a copy of the Prospectus (as amended or supplemented) if the Company has previously furnished copies thereof to the Underwriter
(sufficiently in advance of the Closing Time to allow for distribution of the Prospectus in a timely manner) and complied with their obligations under Sections 3(b), 3(c) and 3(d) hereof and the loss, liability, claim, damage or expense of the
Underwriter resulted from an untrue statement or omission or alleged untrue statement or omission of a material fact contained in or omitted from such preliminary prospectus (as amended or supplemented) which was corrected in the Prospectus (as
amended or supplemented); provided, further, that the liability of any Selling Shareholder under this Section shall be limited to an amount not exceeding the proceeds received by such Selling Shareholder from the sale of Securities
hereunder (before deducting the underwriting discount and expenses). Notwithstanding the foregoing, the liability of any Selling Shareholder (other than the CEO Selling Shareholder) under this Section shall be limited to information furnished in
writing by such Selling Shareholder to the Company or the Underwriters expressly for use in the Registration Statement or any preliminary prospectus or the Prospectus. 
  
 (b) Indemnification of Company, Directors and Officers and Selling Shareholders. Each Underwriter severally agrees to
indemnify and hold harmless the Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and
each Selling Shareholder and each person, if any, who controls any Selling Shareholder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including the Rule
430A Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by such Underwriter through Merrill Lynch expressly for
use in the Registration Statement (or any amendment thereto) or such preliminary prospectus or the Prospectus (or any amendment or supplement thereto). 
  

 - 25 - 

 (c) Actions against Parties; Notification. Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement. In the case of parties indemnified pursuant
to Section 6(a) above, counsel to the indemnified parties shall be selected by Merrill Lynch, and, in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be selected by the Company and reasonably
acceptable to the Selling Shareholders. An indemnifying party may participate at its own expense in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party. The liability of the CEO Selling Shareholder under this Section 6 and with respect to his representation in Section 1(b)(i) herein shall be limited to an amount not exceeding the proceeds received by the CEO Selling Shareholder
from the sale of Securities hereunder (before deducting the underwriting discount and expenses). 
  
 (d) Settlement without Consent if Failure to Reimburse. If at any time an indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is entered
into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii)
such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement. 
  
 (e) Other Agreements with Respect to Indemnification. The provisions of this Section shall not affect any agreement among the Company and the
Selling Shareholders with respect to indemnification. 
  

 - 26 - 

 SECTION 7. Contribution. If the indemnification provided for in Section 6 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Selling Shareholders on the one hand and the
Underwriters on the other hand from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Company and the Selling Shareholders on the one hand and of the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. 
  
 The relative benefits received by the Company and the Selling Shareholders on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the
Company and the Selling Shareholders and the total underwriting discount received by the Underwriters, in each case as set forth on the cover of the Prospectus, bear to the aggregate public offering price of the Securities as set forth on such
cover. 
  
 The relative fault of the Company and the Selling
Shareholders 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 or the Selling Shareholders or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

  
 The Company, the Selling Shareholders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this Section 7. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission. 
  
 Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of any such untrue or alleged untrue
statement or omission or alleged omission. 
  

 - 27 - 

 No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act)
shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. 
  
 For purposes of this Section 7, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act and each Underwriter’s Affiliates and selling agents 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 or any Selling Shareholder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company or such Selling Shareholder, as the case may be. The
Underwriters’ respective obligations to contribute pursuant to this Section 7 are several in proportion to the number of Initial Securities set forth opposite their respective names in Schedule A hereto and not joint. 
  
 The provisions of this Section shall not affect any agreement among the
Company and the Selling Shareholders with respect to contribution. 
  
 SECTION 8. Representations, Warranties and Agreements to Survive Delivery. All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company or any of its subsidiaries or the
Selling Shareholders submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter,
its officers or directors or any person controlling the Company or any person controlling any Selling Shareholder, and shall survive delivery of the Securities to the Underwriters. 
  
 SECTION 9. Termination of Agreement. 
  
 (a) Termination; General. The Representatives may terminate this Agreement, by notice to the Company and the Selling
Shareholders, at any time at or prior to Closing Time (i) if there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus (exclusive of any supplement thereto), any
material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business,
or (ii) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representatives, impracticable or inadvisable to
market the Securities or to enforce contracts 

  

 - 28 - 

 
for the sale of the Securities, or (iii) if trading in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq
National Market, or if trading generally on the American Stock Exchange or the New York Stock Exchange or in the Nasdaq National Market has been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system or by order of the Commission, the National Association of Securities Dealers, Inc. or any other governmental authority, or (iv) a material disruption has occurred in
commercial banking or securities settlement or clearance services in the United States, or (v) if a banking moratorium has been declared by either Federal or New York authorities. 
  
 (b) Liabilities. If this Agreement is terminated pursuant to this Section, such termination shall be without
liability of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such termination and remain in full force and effect. 
  
 SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at Closing Time or a Date of Delivery to purchase the Securities which it or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representatives shall not have completed such arrangements within such 24-hour period, then: 
  
 (a) if the number of Defaulted Securities does not exceed 10% of the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or 
  
 (b) if the number of
Defaulted Securities exceeds 10% of the number of Securities to be purchased on such date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Underwriters to purchase and of the Selling
Shareholders to sell the Option Securities to be purchased and sold on such Date of Delivery shall terminate without liability on the part of any non-defaulting Underwriter. 
  
 No action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default.

  
 In the event of any such default which does not result in a
termination of this Agreement or, in the case of a Date of Delivery which is after the Closing Time, which does not result in a 

  

 - 29 - 

 
termination of the obligation of the Underwriters to purchase and the Selling Shareholders to sell the relevant Option Securities, as the case may be, either
(i) the Representatives or (ii) the Company and the Selling Shareholders, shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or arrangements. As used herein, the term “Underwriter” includes any person substituted for an Underwriter under this Section 10. 
  
 SECTION 11. Default by one or more of the Selling Shareholders. If a
Selling Shareholder shall fail at Closing Time or at a Date of Delivery to sell and deliver the number of Securities which such Selling Shareholder or Selling Shareholders are obligated to sell hereunder, and the remaining Selling Shareholders do
not exercise the right hereby granted to increase, pro rata or otherwise, the number of Securities to be sold by them hereunder to the total number to be sold by all Selling Shareholders as set forth in Schedule B hereto, then the Underwriters may,
at option of the Representatives, by notice from the Representatives to the Company and the non-defaulting Selling Shareholders, either (i) terminate this Agreement without any liability on the fault of any non-defaulting party except that the
provisions of Sections 1, 4, 6, 7 and 8 shall remain in full force and effect or (ii) elect to purchase the Securities which the non-defaulting Selling Shareholders have agreed to sell hereunder. No action taken pursuant to this Section 11 shall
relieve any Selling Shareholder so defaulting from liability, if any, in respect of such default. 
  
 In the event of a default by any Selling Shareholder as referred to in this Section 11, each of the Representatives, the Company and the non-defaulting
Selling Shareholders shall have the right to postpone Closing Time or Date of Delivery for a period not exceeding seven days in order to effect any required change in the Registration Statement or Prospectus or in any other documents or
arrangements. 
  
 SECTION 12. Tax Disclosure.
Notwithstanding any other provision of this Agreement, from the commencement of discussions with respect to the transactions contemplated hereby, the Company (and each employee, representative or other agent of the Company) may disclose to any and
all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations promulgated thereunder) of the transactions contemplated by this
Agreement and all materials of any kind (including opinions or other tax analyses) that are provided relating to such tax treatment and tax structure. 
  
 SECTION 13. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Underwriters shall be directed to the Representatives at 4 World Financial Center, New York, New York 10080, attention of Equity Capital Markets; with a copy to Fried, Frank,
Harris, Shriver & Jacobson, One New York Plaza, New York, New York 10004, attention of Valerie Ford Jacob, Esq.; notices to the Company shall be directed to it 

  

 - 30 - 

 
at The Pantry, Inc., 1801 Douglas Drive, Sanford, North Carolina 27330, attention of Dan Kelly, with a copy to Smith, Anderson, Blount, Dorsett, Mitchell
& Jernigan, LLP, 2500 Wachovia Capitol Center, Post Office Box 2611, Raleigh, North Carolina 27602-2611, attention of Carl N. Patterson; and notices to the Selling Shareholders shall be directed to them c/o Freeman Spogli & Co., 599
Lexington Avenue, 18th Floor, New York, NY 10022, attention of Todd Halloran, with a copy to Bingham McCutchen LLP,
399 Park Avenue, New York, New York 10020, attention of Ann Chamberlain and Roger Lustberg. 
  
 SECTION 14. Parties. This Agreement shall each inure to the benefit of and be binding upon the Underwriters, the Company and the Selling Shareholders and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters, the Company and the Selling Shareholders and their respective successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters, the Company and the Selling Shareholders and their respective successors, and said controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No purchaser of Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase. 
  
 SECTION 15. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME. 
  
 SECTION 16. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement. 
  
 SECTION 17. Effect of Headings. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the
construction hereof. 
  

 - 31 - 

 If the foregoing is in accordance with your understanding of our agreement, please sign and return to the
Company and the Attorneys-in-Fact for the Selling Shareholders a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the Underwriters, the Company and the Selling Shareholders in
accordance with its terms. 
  

			
	 Very truly yours,

	
	 THE PANTRY, INC.

		
	 By
	 	 /s/    Peter J. Sodini

	 	 	 Title: President and Chief Executive Officer

	
	 FS EQUITY PARTNERS III, L.P.

	 FS EQUITY PARTNERS IV, L.P.

	 FS EQUITY PARTNERS

	         INTERNATIONAL, L.P.

		
	 By
	 	 /s/    Todd W. Halloran

	 	 	 As Attorney-in-Fact

	
	 PETER J. SODINI

	 STEVEN J. FERREIRA

	 JOSEPH A. KROL

		
	 By
	 	 /s/    Peter J. Sodini

	 	 	 As Attorney-in-Fact

  

 - 32 - 

 CONFIRMED AND ACCEPTED, 
     as of the date first above written: 
  
 MERRILL LYNCH & CO. 
 MERRILL LYNCH, PIERCE, FENNER & SMITH 
 INCORPORATED 
 GOLDMAN, SACHS & CO. 
 WILLIAM BLAIR & COMPANY, L.L.C. 
 JEFFERIES & COMPANY, INC. 
 MORGAN KEEGAN & COMPANY, INC. 
  

			
	 By: MERRILL LYNCH, PIERCE, FENNER & SMITH
 INCORPORATED

		
	 By
	 	 /s/    Joel Revill

	 	 	Authorized Signatory

  
 For themselves and as Representatives
of the other Underwriters named in Schedule A hereto. 
  

 - 33 - 

 SCHEDULE A 
  

			
	 Name of Underwriters

	  	 Number of
 Initial
 Securities

	 Merrill Lynch, Pierce, Fenner & Smith
 Incorporated
	  	2,275,000
	 Goldman, Sachs & Co.
	  	1,365,000
	 William Blair & Company, L.L.C.
	  	455,000
	 Jefferies & Company, Inc.
	  	227,500
	 Morgan Keegan & Company, Inc.
	  	227,500
	 BB&T Capital Markets, a division of Scott & Stringfellow, Inc.
	  	75,000
	 Davenport & Company LLC
	  	75,000
	 C. L. King & Associates, Inc.
	  	75,000
	 McDonald Investments Inc., a KeyCorp Company
	  	75,000
	 Oppenheimer & Co. Inc.
	  	75,000
	 SunTrust Capital Markets, Inc.
	  	75,000
	 Total
	  	5,000,000
	 	  	

  

 - 1 - 

 SCHEDULE B 
  

					
	 	  	 Number of Initial
 Securities to be Sold

	  	 Maximum Number of Option
 Securities to Be Sold

	 FS Equity Partners III, L.P.
	  	3,241,784	  	470,474
	 FS Equity Partners IV, L.P.
	  	1,595,770	  	231,591
	 FS Equity Partners International, L.P.
	  	130,470	  	18,935
	 Peter J. Sodini
	  	25,199	  	20,000
	 Steven J. Ferreira
	  	3,493	  	5,000
	 Joseph A. Krol
	  	3,284	  	4,000
			
	 Total
	  	5,000,000	  	750,000

  

 - 2 - 

 SCHEDULE C 
  
 THE PANTRY, INC. 
 5,000,000 Shares of Common
Stock 
 (Par Value $.01 Per Share) 
  
 1. The initial public offering price per share for the Securities, determined as provided in Section 2, shall be $20.00. 
  
 2. The purchase price per share for the Securities to be paid by the several
Underwriters shall be $19.00, being an amount equal to the initial public offering price set forth above less $1.00 per share; provided that the purchase price per share for any Option Securities purchased upon the exercise of the overallotment
option described in Section 2(b) shall be reduced by an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial Securities but not payable on the Option Securities. 
  

 - 3 - 

 SCHEDULE D 
  
 LIST OF PERSONS AND ENTITIES SUBJECT TO LOCK-UP 
  
 FS Equity Partners III, L.P. 
 FS Equity Partners IV, L.P. 
 FS Equity Partners International L.P. 
  
 Todd Halloran 
 Jon Ralph 
 Charles Rullman 
 Peter Starrett 
 Hubert Yarbrough 
 Byron Allumbaugh 
 Paul Brunswick 
 Tom Murnane 
  
 Peter Sodini 
 Steve Ferreira 
 Joseph Krol 
 Dan Kelly 
 Dave Zaborski 
 Greg Tornberg 
  

 - 1 -

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