EXHIBIT 1.1
[FORM OF UNDERWRITING AGREEMENT]
$300,000,000
NATIONWIDE FINANCIAL SERVICES, INC.
__% SENIOR NOTES DUE 2027
UNDERWRITING AGREEMENT
----------------------
_________, 1997
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxx Xxxxxx Xxxxxxxx Inc.
X.X. Xxxxxx & Co.
Xxxxxxx Xxxxxxxx Inc
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, X.X. 00000.
Dear Sirs:
1. Introductory. Nationwide Financial Services, Inc., a Delaware
corporation ("Company"), proposes to issue and sell (the "Offering") to the
several Underwriters named in Schedule A hereto ("Underwriters") $300,000,000
principal amount of its ___% Senior Notes Due 2027 ("Offered Securities"). This
Underwriting Agreement, as amended, supplemented or modified from time to time
is referred to herein as "this Agreement." Credit Suisse First Boston
Corporation, Xxxxxx Xxxxxxx & Co. Incorporated, Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, Xxxx Xxxxxx Xxxxxxxx Inc., X.X. Xxxxxx & Co. and Salomon
Brothers Inc. are collectively referred to in this Agreement as the
"Representatives."
The Offered Securities are to be issued under an indenture, dated as
of March __, 1997 ("Indenture"), between the Company and Wilmington Trust
Company, as Trustee.
The Company hereby agrees with the several Underwriters as follows:
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-18531) relating to the
Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("Commission") and either (i) has
been declared effective under the Securities Act of 1933 ("Act") and is
not proposed to be amended or (ii) is proposed to be amended by amendment
or post-effective amendment. If such registration statement (the "initial
registration statement") has been declared effective, either (i) an
additional registration statement (the "additional registration
statement") relating to the Offered Securities may have been filed with
the Commission pursuant to Rule 462(b) ("Rule 462(b)") under the Act and,
if so filed, has become effective upon filing pursuant to such Rule and
the Offered Securities all have been duly registered under the Act
pursuant to the initial registration statement and, if applicable, the
additional registration statement or (ii) such an additional registration
statement is proposed to be filed with the Commission pursuant to Rule
462(b) and will become effective upon filing pursuant to such Rule and
upon such filing the Offered Securities will all have been duly
registered under the Act pursuant to the initial registration statement
and such additional registration statement. If the Company does not
propose to amend the initial registration statement or if an additional
registration statement has been filed and the Company does not propose to
amend it, and if any post-effective amendment to either such registration
statement has been filed with the Commission prior to the execution and
delivery of this Agreement, the most recent amendment (if any) to each
such registration statement has been declared effective by the Commission
or has become effective upon filing pursuant to Rule 462(c) ("Rule
462(c)") under the Act or, in the case of the additional registration
statement, Rule 462(b). For purposes of this Agreement, "Effective Time"
with respect to the initial registration statement or, if filed prior to
the execution and delivery of this Agreement, the additional registration
statement means (i) if the Company has advised the Representatives that
it does not propose to amend such registration statement, the date and
time as of which such registration statement, or the most recent post-
effective amendment thereto (if any) filed prior to the execution and
delivery of this Agreement, was declared effective by the Commission or
has become effective upon filing pursuant to Rule 462(c), or (ii) if the
Company has advised the Representatives that it proposes to file an
amendment or post-effective amendment to such registration statement, the
date and time as of which such registration statement, as amended by such
amendment or post-effective amendment, as the case may be, is declared
effective by the Commission. If an additional registration statement has
not been filed prior to the execution and delivery of this Agreement but
the Company has advised the Representatives that it proposes to file one,
"Effective Time" with respect to such additional registration statement
means the date and time as of which such registration statement is filed
and becomes effective pursuant to Rule 462(b). "Effective Date" with
respect to the initial registration statement or the additional
registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its Effective
Time, including all information contained in the additional registration
statement (if any) and deemed to be a part of the initial registration
statement as of the Effective Time of the
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additional registration statement pursuant to the General Instructions of
the Form on which it is filed and including all information (if any)
deemed to be a part of the initial registration statement as of its
Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act,
is hereinafter referred to as the "Initial Registration Statement". The
additional registration statement, as amended at its Effective Time,
including the contents of the initial registration statement incorporated
by reference therein and including all information (if any) deemed to be
a part of the additional registration statement as of its Effective Time
pursuant to Rule 430A(b), is hereinafter referred to as the "Additional
Registration Statement". The Initial Registration Statement and the
Additional Registration Statement are hereinafter referred to
collectively as the "Registration Statements" and individually as a
"Registration Statement". The form of prospectus relating to the Offered
Securities, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) ("Rule 424(b)") under the Act or (if no such
filing is required) as included in the Registration Statement, is
hereinafter referred to as the
"Prospectus". No document has been or will be prepared or distributed in
reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act, the Trust Indenture Act of 1939 ("Trust
Indenture Act") and the rules and regulations of the Commission ("Rules
and Regulations") and did not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) on the
Effective Date of the Additional Registration Statement (if any), each
Registration Statement conformed, or will conform, in all material
respects to the requirements of the Act, the Trust Indenture Act and the
Rules and Regulations and did not include, or will not include, any
untrue statement of a material fact and did not omit, or will not omit,
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and (iii) on the date of this
Agreement, the Initial Registration Statement and, if the Effective Time
of the Additional Registration Statement is prior to the execution and
delivery of this Agreement, the Additional Registration Statement each
conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included,
each Registration Statement and Prospectus will conform, in all material
respects to the requirements of the Act, the Trust Indenture Act and the
Rules and Regulations, and neither of such documents includes, or will
include, any untrue statement of a material fact or omits, or will omit,
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all material respects to the requirements of
the Act, the
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Trust Indenture Act and the Rules and Regulations, neither of such
documents will include any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and no
Additional Registration Statement has been or will be filed. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus based upon written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus; and the Company is
duly qualified to do business as a foreign corporation in good standing
in all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except to the
extent that the failure to so qualify or be in good standing would not
have a material adverse effect (i) on the condition, financial or
otherwise, business, properties or results of operations of the Company
and its subsidiaries taken as a whole, (ii) which affects the issuance or
validity of the Offered Securities or, (iii) which affects the
consummation of any of the transactions contemplated by this Agreement or
(iv) is otherwise material in the context of the sale of the Offered
Securities (a "Material Adverse Effect").
(d) Each subsidiary of the Company has been duly incorporated and is
an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and otherwise) to own its properties and conduct its business as
described in the Prospectus; and each subsidiary of the Company is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except to the extent
that the failure to so qualify would not have a Material Adverse Effect;
all of the issued and outstanding capital stock of each subsidiary of the
Company has been duly authorized and validly issued and is fully paid and
nonassessable and is owned (directly or through subsidiaries) by the
Company; and the capital stock of each subsidiary owned (directly or
through subsidiaries) by the Company is owned free from liens, claims,
encumbrances and defects.
(e) The Indenture has been duly authorized and, if the Effective
Time of a Registration Statement is prior to the execution and delivery
of this Agreement, has been or otherwise upon such Effective Time will be
duly qualified under the Trust Indenture Act with respect to the Offered
Securities registered thereby; the Offered Securities have been duly
authorized; and when the Offered Securities are delivered and paid for
pursuant to this Agreement on each Closing Date (as defined below), the
Indenture will have been duly executed and delivered, such Offered
Securities will have been duly executed, authenticated, issued and
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delivered and will conform to the description thereof contained in the
Prospectus and the Indenture and such Offered Securities will constitute
valid and legally binding obligations of the Company, enforceable in
accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(f) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or any Underwriter
for a brokerage commission, finder's fee or other like payment in
connection with the Offering.
(g) Except as set forth in the Intercompany Agreement, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the Company
to include such securities in the securities registered pursuant to a
Registration Statement or in any securities being registered pursuant to
any other registration statement filed by the Company under the Act.
(h) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement (which
shall include, for all purposes of this Agreement, the Special Dividend
(as defined in the Prospectus) and the other transactions described in
the "Recent History" section of the Prospectus (collectively, the
"Restructuring")) in connection with the issuance and sale of the Offered
Securities by the Company, except such as have been obtained under the
insurance laws of the State of Ohio (the "Ohio Insurance Laws"), the
insurance laws of the States of California and Michigan, the Act, the
Rules and Regulations, the by-laws of the National Association of
Securities Dealers, Inc. ("NASD") and the Trust Indenture Act and such as
may be required under foreign or state securities laws (including
insurance securities laws).
(i) This Agreement has been duly authorized, executed and delivered
by the Company and constitutes the valid and binding obligation of the
Company enforceable in accordance with its terms (except as may be
limited by bankruptcy, insolvency, fraudulent conveyance, reorganization
or similar laws affecting creditors' rights generally and by general
principles of equity, except that the remedies of specific performance
and injunctive and other forms of equitable relief are subject to the
discretion of the court before which any proceeding therefor may be
brought and except with respect to the obligations of the Company
regarding indemnification and contribution as provided in Section 7
below).
(j) The execution, delivery and performance of the Indenture and
this Agreement, and the issuance and sale of the Offered Securities and
compliance
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with the terms and provisions thereof and hereof will not result in a
breach or violation of any of the terms and provisions of, or constitute
a default under, any statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or any of
their properties, or any agreement or instrument to which the Company or
any such subsidiary is a party or by which the Company or any such
subsidiary is bound or to which any of the properties of the Company or
any such subsidiary is subject, or the amended and restated certificate
of incorporation or bylaws of the Company or the articles or amended
articles of incorporation and code of regulations or bylaws, as the case
may be, of any such subsidiary, in each case, except for such breaches,
violations or defaults as would not have a Material Adverse Effect, and
the Company has full power and authority to authorize, issue and sell the
Offered Securities as contemplated by the Indenture and this Agreement,
respectively.
(k) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and
all other properties and assets owned by them, in each case free from
liens, encumbrances, claims and defects, except where the failure to
possess such title would not have a Material Adverse Effect; and except
as disclosed in the Prospectus, the Company and its subsidiaries hold any
leased real or personal property under valid and enforceable leases,
except where the failure to hold such property under such leases would
not have a Material Adverse Effect.
(l) The Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, service marks, trade names and
other rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively, "intellectual
property rights") necessary to conduct the business now operated by them,
or presently employed by them, except where the failure to own or possess
such intellectual property rights or to have the right to acquire such
intellectual property rights on reasonable terms would not have a
Material Adverse Effect, and have not received any notice of infringement
of or conflict with asserted rights of others with respect to any
intellectual property rights (including, without limitation, "The Best of
America(R)" service xxxx) that, if determined adversely to the Company or
any of its subsidiaries, would individually or in the aggregate have a
Material Adverse Effect. Nationwide Life Insurance Company is the owner,
free and clear of any lien, claim or encumbrance of any kind, of the
service xxxx "The Best of America(R)", which is a registered federal
service xxxx.
(m) The Company and each of its subsidiaries hold all licenses,
certificates and permits from governmental authorities (including,
without limitation, insurance licenses from the Insurance Departments of
the various states in which the subsidiaries write insurance business
(the "Insurance Licenses")) which are necessary to the conduct of their
businesses, except where the failure to hold such licenses, certificates
or permits would not have a Material Adverse
6
Effect; the Company's insurance subsidiaries have fulfilled and performed
all obligations necessary to maintain their respective Insurance
Licenses, except where the failure to perform such obligations would not
have a Material Adverse Effect; and no event or events have occurred
which may be reasonably expected to result in any impairment,
modification, termination or revocation of such Insurance Licenses which
individually or in the aggregate would have a Material Adverse Effect.
(n) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, rule, regulation,
decision or order of any governmental agency or body or any court,
domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, "environmental laws"), owns or operates any
real property contaminated with any substance that is subject to any
environmental laws, is liable for any off-site disposal or contamination
pursuant to any environmental laws, or is subject to any claim relating
to any environmental laws, which violation, contamination, liability or
claim would individually or in the aggregate have a Material Adverse
Effect; and to the Company's knowledge, there is no pending investigation
which might lead to such a claim.
(o) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings (including, without limitation, any
proceeding to revoke or deny renewal of any Insurance License) against or
affecting the Company, any of its subsidiaries or any of their respective
properties that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect; and no such actions, suits or proceedings (including,
without limitation, any proceeding to revoke or deny renewal of any
Insurance License) are, to the Company's knowledge, threatened or
contemplated.
(p) The financial statements (other than the notes to the financial
statements) included in each Registration Statement and the Prospectus
present fairly, and the notes to the financial statements included in
each Registration Statement and the Prospectus present fairly in all
material respects, the financial position of the Company and its
consolidated subsidiaries as of the dates shown and their results of
operations and cash flows for the periods shown, and, except as otherwise
disclosed in the Prospectus as being prepared in accordance with the
Statutory Accounting Practices (as hereinafter defined), such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent basis;
and the schedules included in each Registration Statement present fairly
the information required to be stated therein; and the assumptions used
in preparing the pro forma financial statements included in each
Registration Statement and the Prospectus provide a reasonable basis for
presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect
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the proper application of those adjustments in the corresponding
historical financial statement amounts.
(q) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has
been no change, nor any development or event involving a prospective
change, which has had, or would reasonably be expected to have, a
Material Adverse Effect, and, except as disclosed in or contemplated by
the Prospectus, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(r) The Company is not and, after giving effect to the sale of the
Offered Securities and the application of the proceeds thereof as
described in the Prospectus, will not be, an "investment company" or an
entity "controlled" by an "investment company" required to be registered
under the Investment Company Act of 1940, as amended (the "1940 Act").
(s) Neither the Company nor any of its respective affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida Statutes.
(t) The statutory financial statements of each of the Company's
insurance subsidiaries, from which certain ratios and other statistical
data contained in the Registration Statement have been derived, have for
each relevant period been prepared in accordance with accounting
practices and procedures of the National Association of Insurance
Commissioners ("NAIC"), as prescribed or permitted by the Department of
Insurance of the State of Ohio (the "Statutory Accounting Practices");
and such accounting practices have been applied on a consistent basis
throughout the periods involved, except as disclosed therein.
(u) The Company has filed an application to list the Offered
Securities on the New York Stock Exchange ("NYSE") and has received
notification that such listing has been approved subject to notice of
issuance. The Offered Securities will be registered under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior or
concurrently with the effectiveness of the Registration Statement.
(v) All reserves and other liabilities reflected in lines 1, 2, 3,
4.1, 4.2, 5 and 7.1 of page 3 of the statutory annual statements of each
of the Company's insurance subsidiaries, filed with or submitted to the
Department of Insurance of the State of Ohio and any other state
department of insurance or similar regulatory authority for the year
ended December 31, 1996 (the "Reserve Liabilities"): (i) are computed in
all material respects in accordance with actuarial standards which have
been adopted by the Actuarial Standards Board, consistently applied and
are fairly stated, in accordance with sound actuarial principles; (ii)
are based in all material respects on actuarial assumptions which produce
reserves at least as great
8
as those called for in any contract provision as to reserve basis and
method, and are in accordance with all other contract provisions; (iii)
meet all material requirements of the insurance law and duly adopted
regulations, in effect at the valuation date, of the State of Ohio and
are at least as great as the minimum aggregate amounts required by the
insurance law and duly adopted regulations, in effect at the valuation
date, of the State of Ohio and any other states in which the Company's
insurance subsidiaries file an actuarial opinion; (iv) are computed on
the basis of assumptions consistent with those used in computing the
corresponding items in the annual statement of the preceding year end
(except as noted in the supporting memorandum); and (v) include
provisions for all actuarial reserves and related annual statement items
which are required under Ohio Insurance Laws to be established. Adequate
provision for all such Reserve Liabilities has been made in accordance
with Ohio Insurance Laws to cover the total amount of all reasonably
anticipated matured and unmatured benefits, claims and other liabilities
of the Company's insurance subsidiaries under all insurance policies and
annuity contracts under which the Company's insurance subsidiaries had
any liability (including, without limitation, any liability arising under
or as a result of any reinsurance, coinsurance or other similar
agreement) on the Closing Date.
(w) Each of the Company's insurance subsidiaries has duly and
validly filed or caused to be filed all material reports, statements,
documents, registrations, filings or submissions that were required by
applicable Laws (as defined below) to be filed; all such filings complied
with all applicable Laws in all material respects when filed, and no
material deficiencies have been asserted with respect to any such filings
which have not been satisfied. All outstanding insurance policies,
annuity contracts and assumption certificates issued by any of the
Company's insurance subsidiaries and now in force are, to the extent
required under applicable Laws, on forms approved by the insurance
regulatory authority of the jurisdiction where issued and utilize premium
rates which if required to be filed with or approved by insurance
regulatory authorities have been so filed or approved, except where the
failure to use approved forms or to file or have approved such premium
rates would not have a Material Adverse Effect, and the premiums charged
conform thereto, except where the failure to conform would not have a
Material Adverse Effect.
(x) Each of the Company's broker/dealer subsidiaries, where
applicable, is registered with the Commission and with each other
governmental authority with which it is required to register in order to
conduct its business as now conducted, and is in compliance with all
applicable United States federal, state, local or foreign statutes, laws,
ordinances, regulations, rules, codes, orders, permits, other
requirements or rules of law (collectively, the "Laws"), except where the
failure to comply would not have a Material Adverse Effect. The
Company's insurance and broker/dealer subsidiaries have filed all forms,
reports, statements and other documents required by Law to be filed by
them with the Commission, all other reports (periodic or otherwise) and
registration statements,
9
including, without limitation, in connection with sales of variable
annuity or variable life contracts, and all amendments and supplements to
all such reports and registration statements, and all such forms,
reports, statements and other documents did not at the time they were
filed (at the time they became effective and so long as they remain
effective in the case of registration statements and amendments thereto)
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading.
(y) Each of the separate accounts of the Company's insurance
subsidiaries that is required to be registered as an investment company
under the 1940 Act is so registered. All forms, reports, statements and
other documents required by Law to be filed with the Commission by or on
behalf of each of the separate accounts of the Company's insurance
subsidiaries, including, without limitation, all registration statements
and all amendments and supplements to all such registration statements,
in connection with sales of variable life insurance policies and variable
annuity contracts, have been so filed by or on behalf of such separate
accounts, and all such forms, reports, statements and other documents,
including, without limitation, those to be filed after the date hereof,
did not at the time they were filed (at the time they become effective
and so long as they remain effective in the case of registration
statements and amendments thereto), or will not at the time they are
filed (at the time they become effective and so long as they remain
effective in the case of registration statements and amendments thereto),
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make
the statement therein, in the light of the circumstances under which they
were made, not misleading.
(z) Except as set forth in the Prospectus, neither the Company nor
any of the Company's insurance subsidiaries is a party to any contract
with or other undertaking to, or is subject to any governmental order by,
or is a recipient of any presently applicable supervisory letter or other
written communication of any kind from, any governmental authority which
(i) has had a Material Adverse Effect, (ii) relates materially and
adversely to its reserve adequacy, or its investment or underwriting
practices or policies or its sales practices or policies, or (iii) would
reasonably be expected to have a Material Adverse Effect, nor has the
Company or any of the Company's insurance subsidiaries been notified by
any governmental authority that it is contemplating issuing or requesting
(or is considering the appropriateness of issuing or requesting) any such
governmental order, contract, undertaking, letter or other written
communication.
(aa) Except as set forth in the Prospectus, and with respect to all
insurance issued:
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(i) No outstanding insurance policy or annuity contract
issued or assumed by any of the Company's insurance subsidiaries
entitles the holder thereof or any other Person (as defined below)
to receive dividends, distributions or other benefits based on the
revenues or earnings of the Company or the Company's insurance
subsidiaries or any other individual, partnership, firm,
corporation, association, trust, unincorporated organization,
governmental authority or other entity, as well as any syndicate or
group that would be deemed to be a person under Section 13(d)(3) of
the Exchange Act (each, a "Person").
(ii) To the Company's and the Company's insurance
subsidiaries' knowledge, no other party to any reinsurance,
coinsurance or other similar agreement with any of the Company's
insurance subsidiaries is in default thereunder, except for such
defaults that would not reasonably be expected to have a Material
Adverse Effect.
(iii) Except as set forth in the Prospectus, all
advertising, promotional and sales materials and other marketing
practices used by the Company and/or the Company's insurance
subsidiaries, or, to the Company's knowledge, any agent of the
Company or the Company's insurance subsidiaries, have complied and
are currently in compliance with applicable Laws, except where the
failure to comply or be in compliance would not have a Material
Adverse Effect.
(iv) Each annuity contract issued by any of the Company's
insurance subsidiaries qualifies as an annuity contract under
Section 72 of the Internal Revenue Code of 1986, as amended through
the date hereof, except where the failure to so qualify would not
have a Material Adverse Effect.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject
to the terms and conditions herein set forth, the Company agrees to sell to
the Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Company, at a purchase price of ___% of the principal amount
thereof plus accrued interest from ___________________, if any, to the Closing
Date, the respective principal amounts of Offered Securities set forth
opposite the names of the Underwriters in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of one or more permanent global Securities in
definitive form (the "U.S. Firm Global Securities") deposited with the Trustee
as custodian for The Depository Trust Company ("DTC") and registered in the
name of Cede & Co., as nominee for DTC. Interests in any permanent global
Securities will be held only in book-entry form through DTC, except in the
limited circumstances described in the Prospectus. Payment for the Offered
Securities shall be made by the Underwriters in Federal (same day) funds by
official check or checks [or wire transfer to an account previously designated
to Credit Suisse First Boston Corporation ("CSFBC") by the Company at a bank
acceptable to
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CSFBC drawn to the order of the Company at the office of Xxxxx Xxxxxxxxxx,
1301 Avenue of the Americas, at 10 A.M., (New York time), on ________, 1997,
or at such other time not later than seven full business days thereafter as
CSFBC and the Company determine, such time being herein referred to as the
"Closing Date", against delivery to the Trustee as custodian for DTC of the
U.S. Firm Global Securities representing all of the Offered Securities. For
purposes of Rule 15c6-1 under the Exchange Act, the Closing Date (if later
than the otherwise applicable settlement date) shall be the settlement date
for payment of funds and delivery of securities for all the Offered Securities
sold pursuant to the Offering. The U.S. Firm Global Securities will be made
available for checking at the office of CSFBC at least 24 hours prior to the
Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance
with subparagraph (1) (or, if applicable and if consented to by CSFBC,
subparagraph (4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this
Agreement or (B) the fifteenth business day after the Effective Date of
the Initial Registration Statement.
The Company will advise CSFBC promptly of any such filing pursuant to
Rule 424(b). If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement and an
additional registration statement is necessary to register a portion of
the Offered Securities under the Act but the Effective Time thereof has
not occurred as of such execution and delivery, the Company will file the
additional registration statement or, if filed, will file a post-
effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 P.M., New York time, on
the date of this Agreement or, if earlier, on or prior to the time the
Prospectus is printed and distributed to any Underwriter, or will make
such filing at such later date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to amend
or supplement the initial or any additional registration statement as
filed or the related prospectus or the Initial Registration Statement,
the Additional Registration Statement (if any) or the Prospectus and will
not effect such amendment or supplementation without CSFBC's consent; and
the Company will also advise CSFBC promptly of the effectiveness of each
Registration Statement (if its Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or the Prospectus and of the
institution by the Commission of any stop order
12
proceedings in respect of a Registration Statement and will use its best
efforts to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time
to amend the Prospectus to comply with the Act, the Company will promptly
notify CSFBC of such event and will promptly prepare and file with the
Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery
of, any such amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
stockholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional
Registration Statement) which will satisfy the provisions of Section
11(a) of the Act. For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth fiscal
quarter following the fiscal quarter that includes such Effective Date,
except that, if such fourth fiscal quarter is the last quarter of the
Company's fiscal year, "Availability Date" means the 90th day after the
end of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives hard copies of
the Registration Statement (four of which will be signed and will include
all exhibits), copies of each XXXXX filing of each Registration Statement
(and confirmations for each XXXXX filing of each Registration Statement),
each preliminary prospectus relating to the Offered Securities, and, so
long as delivery of a prospectus relating to the Offered Securities is
required to be delivered under the Act in connection with sales by any
Underwriter or dealer, the Prospectus and all amendments and supplements
to such documents, in each case in such quantities as CSFBC requests.
The Prospectus shall be so furnished on the business day following the
later of the execution and delivery of this Agreement or the Effective
Time of the Initial Registration Statement. All other documents shall be
so furnished as soon as available. The Company will pay the expenses of
printing and distributing to the Underwriters all such documents.
(f) The Company will use its best efforts, in cooperation with the
Underwriters, to arrange for the qualification of the Offered Securities
for sale and the determination of their eligibility for investment under
the laws of such
13
jurisdictions as CSFBC designates and will continue such qualifications
in effect so long as required for the distribution; 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.
(g) During the period of three years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, (i) as soon as practicable after the end of each fiscal
year, a copy of its annual report to stockholders for such year, (ii) as
soon as available, a copy of each report and any definitive proxy
statement of the Company filed with the Commission under the Exchange Act
or mailed to stockholders, and (iii) from time to time, such other
information as shall be furnished by the Company to its stockholders
generally and as shall be reasonably requested by CSFBC.
(h) The Company will pay all expenses incident to the performance of
its obligations under this Agreement and will reimburse the Underwriters
(if and to the extent incurred by them) for any filing fees and other
reasonable expenses (including reasonable fees and disbursements of
counsel) incurred by them in connection with qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC
designates and the printing of memoranda relating thereto, for the filing
fee incident to the review by the NASD of the Offered Securities and
approval of the transactions contemplated hereby by the NASD for any
travel expenses of the Company's officers and employees and any other
expenses of the Company in connection with attending or hosting meetings
with prospective purchasers of the Offered Securities and for expenses
incurred in distributing preliminary prospectuses and the Prospectus
(including any amendments and supplements thereto) to the Underwriters.
(i) The Company will notify CSFBC of any material adverse change
affecting any of its representations, warranties, agreements and
indemnities herein at any time prior to payment to the Company on the
Closing Date.
(j) The Company will use the net proceeds received by it from the
sale of the Offered Securities in the manner specified in the Prospectus
under the caption "Use of Proceeds."
(k) The Company will use its best efforts to list the Offered
Securities on the NYSE subject to notice of issuance and to register the
Offered Securities under the Exchange Act.
(l) The Company shall comply with Section 517.075, Florida Statutes,
if prior to the completion of the distribution of the Offered Securities
it or any of its affiliates commences doing business with the government
of Cuba or with any
14
person or affiliate located in Cuba within the meaning of Section
517.075, Florida Statutes.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Offered Securities on
the Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the
statements of Company officers made pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement
to be filed shortly prior to such Effective Time), of KPMG Peat Marwick
LLP confirming that they are independent public accountants within the
meaning of the Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial statements and
schedules audited by them and included in the Registration
Statements comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) on the basis of a reading of the latest available
interim financial statements of the Company, inquiries of officials
of the Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(A) the unaudited financial statements included in the
Registration Statements do not comply as to form in all
material respects with the applicable accounting requirements
of the Act and the related published Rules and Regulations or
any material modifications should be made to such unaudited
financial statements for them to be in conformity with
generally accepted accounting principles;
(B) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more
than three business days prior to the date of this Agreement,
there was any change in the capital stock or any increase in
short-term indebtedness or long-term debt of the Company and
its consolidated subsidiaries, or, at the date of the latest
available balance sheet read
15
by such accountants, there was any decrease in total assets or
stockholder's equity as compared with amounts shown on the
latest balance sheet included in the Prospectus; or
(C) for the period from the closing date of the latest
income statement included in the Prospectus to the closing date
of the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period for the previous year and with the period
of corresponding length ended the date of the latest income
statement included in the Prospectus, in the total or per share
amounts total assets or net income or in the ratio of earnings
to fixed charges;
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iii) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Registration Statements (in each case
to the extent that such dollar amounts, percentages and other
financial information are derived from the general accounting
records of the Company and its subsidiaries subject to the internal
controls of the Company's accounting system or are derived directly
from such records by analysis or computation) with the results
obtained from inquiries, a reading of such general accounting
records and other procedures specified in such letter and have found
such dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise specified in
such letter; and
(iv) they have examined the statutory financial statements
of each of the Company's insurance subsidiaries, from which certain
ratios and other statistical data contained in the Registration
Statement have been derived, and in their opinion such statements,
with respect to each such insurance subsidiary, have for each
relevant period been prepared in accordance with accounting
practices prescribed or permitted by the appropriate Insurance
Department of the state of domicile of such subsidiary, except as
disclosed therein; and
(v) with respect to the pro forma financial information
included in the Registration Statement, they have performed the
procedures specified by the American Institute of Certified Public
Accountants Statement on Standards for Attestation Engagements No.
1, "Reporting on Pro Forma Financial Statements"; and
16
(vi) on the basis of the procedures referred to in clause
(v) above, inquiries of officials of the Company who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused
them to believe that the pro forma financial information and
statements included in the Registration Statements do not comply as
to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations or any material modifications should be made to such pro
forma financial information and statements for them to be in
accordance with such requirements and generally accepted accounting
principles.
For purposes of this subsection, (i) if the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement, "Registration Statements" shall mean the
initial registration statement as proposed to be amended by the amendment
or post-effective amendment to be filed shortly prior to its Effective
Time, (ii) if the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement but the Effective
Time of the Additional Registration is subsequent to such execution and
delivery, "Registration Statements" shall mean the Initial Registration
Statement and the additional registration statement as proposed to be
filed or as proposed to be amended by the post-effective amendment to be
filed shortly prior to its Effective Time, and (iii) "Prospectus" shall
mean the prospectus included in the Registration Statements.
(b) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such Effective
Time shall have occurred not later than 10:00 P.M., New York time, on the
date of this Agreement or such later date as shall have been consented to
by CSFBC. If the Effective Time of the Additional Registration Statement
(if any) is not prior to the execution and delivery of this Agreement,
such Effective Time shall have occurred not later than 10:00 P.M., New
York time, on the date of this Agreement or, if earlier, the time the
Prospectus is printed and distributed to any Underwriter, or shall have
occurred at such later date as shall have been consented to by CSFBC. If
the Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, the Prospectus shall have been
filed with the Commission in accordance with the Rules and Regulations
and Section 5(a) of this Agreement. Prior to such Closing Date, no stop
order suspending the effectiveness of a Registration Statement shall have
been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company or the Representatives,
shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company or its
subsidiaries which, in the reasonable
17
judgment of a majority in interest of the Underwriters including the
Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with the completion of the public offering or sale
of and payment for the Offered Securities; (ii) any downgrading in the
rating of any debt securities or preferred securities (including
preferred trust securities of any trust affiliated with the Company of
the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or
any public announcement that any such organization has under surveillance
or review its rating of any debt securities or preferred securities
(including preferred trust securities of any trust affiliated with the
Company) of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating) or any downgrading of the financial and
operating performance of the Company's insurance subsidiaries by A.M.
Best Company that results in the Company's insurance subsidiaries being
rated lower than A- (Excellent); (iii) any suspension or limitation of
trading in securities generally on the NYSE, or any setting of minimum
prices for trading on such exchange or system, or any suspension of
trading of any securities of the Company on any exchange or in the over-
the-counter market; (iv) any banking moratorium declared by U.S. Federal
or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of
war by Congress or any other substantial national or international
calamity or emergency if, in the judgment of a majority in interest of
the Underwriters including the Representatives, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P., special counsel
for the Company to the effect that:
(i) The Company is an existing corporation in good
standing under the laws of the state of its incorporation, with
power and authority (corporate and otherwise) to own its properties
and conduct its business as described in the Prospectus; the Company
is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease
of property or the conduct of its business requires such
qualification, except to the extent that the failure to so qualify
would not have a Material Adverse Effect;
(ii) The Indenture has been duly authorized, executed and
delivered and has been duly qualified under the Trust Indenture Act;
the Offered Securities delivered on such Closing Date have been duly
authorized, executed, authenticated, issued and delivered and
conform to the description thereof contained in the Prospectus; and
the Indenture and the Offered Securities delivered on such Closing
Date constitute valid and
18
legally binding obligations of the Company enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(iii) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is
required for the consummation by the Company of the transactions
contemplated by this Agreement in connection with the issuance or
sale of the Offered Securities by the Company, except such as have
been obtained and made under the General Corporation Law of
Delaware, the Ohio Insurance Laws, the insurance laws of the States
of California and Michigan, the Act, the Rules and Regulations, the
by-laws of the NASD, or the Trust Indenture Act and such as may be
required under foreign securities laws or state securities laws
(including insurance securities laws);
(iv) The execution, delivery and performance of the
Indenture and this Agreement and the issuance and sale of the
Offered Securities and compliance with the terms or provisions
thereof and hereof will not result in a breach or violation of any
of any of the terms and provisions of, or constitute a default
under, the amended and restated certificate of incorporation or
bylaws of the Company or the articles or amended articles of
incorporation and code of regulations or by-laws, as the case may
be, of any such subsidiary of the Company, and the Company has full
power and authority (corporate and otherwise) to authorize, issue
and sell the Offered Securities as contemplated by this Agreement;
(v) The Initial Registration Statement was declared
effective under the Act as of the date and time specified in such
opinion, the Additional Registration Statement (if any) was filed
and became effective under the Act as of the date and time (if
determinable) specified in such opinion, the Prospectus was filed
with the Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or was
included in the Initial Registration Statement or the Additional
Registration Statement (as the case may be) and, to the best
knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any part thereof has
been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the Act, and each Registration
Statement and the Prospectus, and each amendment or supplement
thereto, as of their respective effective or issue dates, complied
as to form in all material respects with the requirements of the
Act, the Rules and Regulations and the Trust Indenture Act; the
descriptions in the "Business-Regulation," "Management's Discussion
and Analysis of Financial Condition and Results of Operations -
Liquidity and Capital Resources," and "Business-Legal Proceedings"
in the Registration Statements and
19
Prospectus of statutes, legal and governmental proceedings and
contracts and other documents are accurate and fairly present the
information required to be shown; and such counsel does not know of
any legal or governmental proceedings required to be described in a
Registration Statement or the Prospectus which are not described as
required or any contracts or documents of a character required to be
described in a Registration Statement or the Prospectus or to be
filed as exhibits to a Registration Statement which are not
described and filed as required; it being understood that such
counsel need express no opinion as to the financial statements or
schedules or other financial and statistical data contained in the
Registration Statement or the Prospectus];
(vi) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the valid and binding
obligation of the Company enforceable in accordance with its terms
(except as may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization or similar laws affecting creditors'
rights generally, except that the remedies of specific performance
and injunctive and other forms of equitable relief are subject to
certain equitable defenses and the discretion of the court before
which any proceeding therefor may be brought, and except that no
opinion need be expressed with respect to the obligations of the
Company regarding indemnification and contribution as provided in
Section 7 below);
(vii) The statements in the Prospectus under the captions
"Description of Capital Stock" and "Description of Notes" insofar as
they purport to constitute a summary of the terms of the securities
therein described, and under the caption "Underwriting" (other than
statements based on information furnished by an Underwriter
expressly for use or incorporation by reference therein); insofar as
they purport to constitute summaries of the terms of the documents
referred to therein, and the statements in the Prospectus under
"Business - Regulation," "Management's Discussion and Analysis of
Financial Condition and Results of Financial Information - Liquidity
and Capital Resources," and "Business - Legal Proceedings" insofar
as they purport to constitute descriptions of laws, rules,
regulations or NAIC model laws, fairly summarize the terms of such
documents or fairly and accurately present the information disclosed
therein in all material respects;
(viii) The Company is not, and after giving effect to the
offering and sale of the Offered Securities and the application of
the proceeds thereof as described in the Prospectus, will not be an
"investment company" or an entity "controlled" by an "investment
company" as defined under the Investment Company Act of 1940; and
20
(ix) The Company has filed an application to list the
Offered Securities on the NYSE and has received notification that
such listing has been approved subject to notice of issuance and the
Offered Securities have been registered under the Exchange Act.
Such counsel also shall state that no facts have come to the attention of
such counsel that have caused it to believe that (except for financial
statements and schedules and other financial and statistical data, as
aforesaid) the Registration Statement and the Prospectus, at the time the
Registration Statement became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or that
the Prospectus, as amended or supplemented, if applicable (except for
financial statements and schedules and other financial and statistical data,
as aforesaid), contain, at the time distributed, 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.
In making the statement referred to in the preceding paragraph, such
counsel shall state that their opinion and the belief are based upon their
participation in the preparation of the Registration Statement and the
Prospectus and any amendments or supplements thereto and review and discussion
of the contents thereof, but are without independent check or verification
except as specified.
In rendering the foregoing opinions, such counsel may rely as to matters
of fact upon certificates of the officers of the Company and its subsidiaries,
as to matters involving good standing, authorization to do business and other
matters within their knowledge, upon certificates of public officials, and, as
to matters involving the application of laws of any jurisdiction other than
the State of New York or the United States, upon opinions of local counsel
which opinions shall state that they believe both you and they are justified
in relying upon such certificates and opinions.
(e) The Representatives shall have received an opinion, dated such
Closing Date, from W. Xxxxxx Xxxxx, general counsel to the Company to the
effect that:
(i) Each of the Company's subsidiaries is an existing
corporation in good standing under the laws of the state of its
incorporation, with power and authority (corporate and otherwise) to
own its properties and conducts its business as described in the
Prospectus; each of the Company and it's subsidiaries has been duly
incorporated and each of the Company's subsidiaries is an existing
corporation in good standing under the laws of the state of its
incorporation, with power and authority (corporate and otherwise) to
own its properties and conduct its business as described in the
Prospectus; and each of the Company's subsidiaries is duly qualified
to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or
the
21
conduct of its business requires such qualification, except to the
extent that the failure to so qualify would not have a Material
Adverse Effect; all of the issued and outstanding capital stock of
each subsidiary of the Company has been duly authorized and validly
issued, and is fully paid and nonassessable and is owned (directly
or through subsidiaries) by the Company; and all of the capital
stock of the subsidiaries is owned (directly or through
subsidiaries) by the Company; and the capital stock of each
subsidiary owned (directly or through subsidiaries) by the Company
is owned free from liens, claims, encumbrances and defects;
(ii) Except for the Intercompany Agreement, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file
a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act;
(iii) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is
required for the consummation by the Company of the transactions
contemplated by this Agreement in connection with the issuance or
sale of the Offered Securities by the Company, except such as have
been obtained and made under the General Corporation Law of
Delaware, the Ohio Insurance Laws, the insurance laws of the States
of California and Michigan, the Act, the Rules and Regulations, the
by-laws of the NASD, or the Trust Indenture Act and such as may be
required under foreign securities laws or state securities laws
(including insurance securities laws);
(iv) The execution, delivery and performance of the
Indenture and this Agreement and the issuance and sale of the
Offered Securities and compliance with the terms or provisions
thereof and hereof will not result in a breach or violation of any
of any of the terms and provisions of, or constitute a default
under, any statute, any rule, regulation or order of any
governmental agency or body or any court having jurisdiction over
the Company or any subsidiary of the Company or any of their
properties, or any agreement or instrument to which the Company or
any such subsidiary is a party or by which the Company or any such
subsidiary is bound or to which any of the properties of the Company
or any such subsidiary is subject; and
(v) The Company and each of its subsidiaries hold all
licenses, certificates and permits from all governmental authorities
(including, without limitation, Insurance Licenses) which are
necessary to the conduct of their respective businesses, except
where the failure to hold
22
such licenses, certificates or permits would not have a Material
Adverse Effect; the Company's insurance subsidiaries have fulfilled
and performed all obligations necessary to maintain their respective
Insurance Licenses, except where the failure to perform such
obligations would not have a Material Adverse Effect, and no event
or events have occurred which may be reasonably expected to result
in any impairment, modification, termination or revocation of such
Insurance Licenses which individually or the aggregate would have a
Material Adverse Effect.
(f) The Representatives shall have received from Xxxxx Xxxxxxxxxx,
counsel for the Underwriters, such opinion or opinions, dated such
Closing Date, with respect to the incorporation of the Company, the
validity of the Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them
to pass upon such matters. In rendering such opinion, Xxxxx Xxxxxxxxxx
may rely as to matters governed by the laws of the states in which such
counsel is not licensed to practice upon the opinions of local counsel.
(g) The Representatives shall have received a certificate, dated
such Closing Date, of the President or any Vice-President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that: the representations and warranties of the Company in this Agreement
are true and correct; the Company complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to such Closing Date; no stop order suspending the
effectiveness of any Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated by
the Commission; the Additional Registration Statement (if any) satisfying
the requirements of subparagraphs (1) and (3) of Rule 462(b) was filed
pursuant to Rule 462(b), including payment of the applicable filing fee
in accordance with Rule 111(a) or (b) under the Act, prior to the time
the Prospectus was printed and distributed to any Underwriter; and,
subsequent to the date of the most recent financial statements in the
Prospectus, there has been no change, nor any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries which has or could reasonably be expected to have a Material
Adverse Effect, except as set forth in or contemplated by the Prospectus
or as described in such certificate.
(h) The Representatives shall have received a letter, dated such
Closing Date, from KPMG Peat Marwick LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred
to in such subsection will be a date not more than three business days
prior to such Closing Date for the purposes of this subsection.
23
(i) The Offered Securities to be sold by the Company at the Closing Date
shall have been duly listed on the NYSE subject to notice of issuance and
shall have been registered under the Exchange Act.
(j) On or before the Closing Date, the Company shall have received
from the Ohio Insurance Department its consent and approval of those
transactions contemplated by the Restructuring requiring Ohio Insurance
Department approval.
(k) On or before the Closing Date, the Company shall have received
from the Staff of the Commission an exemptive order (or, with the
approval of the Representatives, which shall not be unreasonably
withheld, a no-action letter) in form and substance reasonably
satisfactory to the Representatives with respect to the non-applicability
of Section 17 of the 1940 Act and the rules and regulations promulgated
thereunder to the offering, sale and resale of the Offered Securities
contemplated by this Agreement to affiliates of the Company or to
affiliates of affiliates of the Company that are registered investment
companies. Such exemptive order (or, if applicable, no-action letter)
shall not have been withdrawn or amended in any manner by the Staff of
the Commission and shall be in full force and effect as of the Closing
Date.
The Company will furnish the Representatives with such conformed
copies of such opinions, certificates, letters and documents as the
Representatives may reasonably request. CSFBC may in its sole discretion
waive on behalf of the Underwriters compliance with any conditions to the
obligations of the Underwriters hereunder.
7. Indemnification and Contribution. (a) The Company will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company will not be liable in any such case (A) to
-------- -------
the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement in or omission or
alleged omission from any of such documents in reliance upon and in conformity
with written information furnished to the Company by any Underwriter through
the Representatives specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter consists of
the information described as such in subsection (b) below, or (B) with respect
to any preliminary prospectus to the extent that any such loss, claim, damage
or liability of such Underwriter results from the fact that such
24
Underwriter sold Offered Securities to a person who was not sent, at or prior
to the written confirmation of such sale, a copy of the Prospectus and the
loss, claim, damage or liability of such Underwriter results from an untrue
statement or omission of a material fact contained in the preliminary
prospectus that was corrected in the Prospectus.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being understood and
agreed that the only such information furnished by any Underwriter consists of
the following information in the Prospectus furnished on behalf of each
Underwriter: the last paragraph at the bottom of the cover page concerning the
terms of the offering by the Underwriters, the legend concerning over-
allotments and stabilizing on the inside front cover page and the first,
fifth, sixth, seventh, eighth, twelfth and fifteenth paragraphs and second
sentence of the eleventh paragraph under the caption "Underwriting."
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise
than under subsection (a) or (b) above. In case any such action is brought
against any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election to or assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such
25
settlement includes an unconditional release of such indemnified party from
all liability on any claims that are the subject matter of such action.
(d) If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages
or liabilities referred to in subsection (a) or (b) above (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other from the offering of
the Offered Securities or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the Underwriters on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering of the Offered
Securities (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters bear to
the total price to the public of the Offered Securities. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence
of this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Offered 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 such untrue
or alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions to each officer of the Company, to
each person, if any, who controls any Underwriter within the meaning of the
Act; and the obligations of the Underwriters under this Section shall be in
addition to any liability which the respective Underwriters may otherwise have
and shall extend, upon the same terms and conditions, to each director of the
Company, to each officer of the Company who has signed a Registration
26
Statement and to each person, if any, who controls the Company within the
meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on the Closing
Date and the aggregate principal amount of Offered Securities that such
defaulting Underwriter or Underwriters agreed but failed to purchase does not
exceed 10% of the total principal amount of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date, CSFBC may make
arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Offered Securities that such defaulting
Underwriters agreed but failed to purchase on such Closing Date. If any
Underwriter or Underwriters so default and the aggregate principal amount of
Offered Securities with respect to which such default or defaults occur
exceeds 10% of the total principal amount of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date and arrangements
satisfactory to CSFBC and the Company for the purchase of such Offered
Securities by other persons are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of any non-
defaulting Underwriter or the Company, except as provided in Section 9. As
used in this Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section. Nothing herein will relieve a
defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of
the Company and its officers and of the several Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made
by or on behalf of any Underwriter, the Company or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Offered Securities. If this Agreement
is terminated pursuant to Section 8 or if for any reason the purchase of the
Offered Securities by the Underwriters is not consummated, the Company shall
remain responsible for the expenses to be paid or reimbursed by it pursuant to
Section 5 and the respective obligations of the Company and the Underwriters
pursuant to Section 7 shall remain in effect, and if any Offered Securities
have been purchased hereunder, the representations and warranties in Section 2
and all obligations under Section 5 shall also remain in effect. If the
purchase of the Offered Securities by the Underwriters is not consummated for
any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause
(iii), (iv) or (v) of Section 6(c), the Company will reimburse the
Underwriters for all out-of-pocket expenses (including fees and disbursements
of counsel) reasonably incurred by them in connection with the offering of the
Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to the
27
Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3628, Attention: Investment Banking Department -
- Transactions Advisory Group, or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at Nationwide Financial Services,
Inc., Xxx Xxxxxxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000, Attention: President (with a
copy to the General Counsel); provided, however, that any notice to an
-------- -------
Underwriter pursuant to Section 7 will be mailed, delivered or telegraphed and
confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and
no other person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action
under this Agreement taken by the Representatives jointly or by CSFBC will be
binding upon all the Underwriters.
13. 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.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York
in any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
28
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement between the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
NATIONWIDE FINANCIAL SERVICES, INC.
By________________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written.
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxx Xxxxxx Xxxxxxxx Inc.
X.X. Xxxxxx & Co.
Salomon Brothers Inc
By Credit Suisse First Boston Corporation
By______________________________________
Name:
Title:
29
SCHEDULE A
UNDERWRITER PRINCIPAL
----------- AMOUNT OF
OFFERED SECURITIES
------------------
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx & Co. Incorporation..................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated.. ------------------
Xxxx Xxxxxx Xxxxxxxx Inc............................
X.X. Xxxxxx & Co.................................... ------------------
Salomon Brothers Inc................................
[$]_________________
------------------
Total..................................... $300,000,000
==================
30
