EXHIBIT 1.1
$---------
CONSECO, INC.
(an Indiana corporation)
[Title of Debt Securities to be Offered]
PURCHASE AGREEMENT
----------, ----
[Name(s) of Representative(s) of Underwriter(s)]
As Representatives of the several Underwriters
Dear Sirs:
Conseco, Inc., an Indiana corporation (the "Company"), confirms its
agreement with [insert name(s) of underwriter(s)] as representatives (in such
capacity, collectively, the "Representatives") of the several Underwriters named
in Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10), with
respect to the sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of the respective principal amounts set forth in
Schedule A of $_________ aggregate principal amount of the Company's [Title of
Debt Security to be Offered] (the "Debt Securities"), and with respect to the
grant by the Company to the Underwriters, acting severally and not jointly, of
the option described in Section 2(b) hereof to purchase all or any part of
$__________ aggregate principal amount of additional Debt Securities to cover
over-allotments, in each case except as may otherwise be provided in the Pricing
Agreement, as hereinafter defined. The aforesaid $________ aggregate principal
amount of Debt Securities (the "Initial Securities") to be purchased by the
Underwriters and all or any part of the $_________ aggregate principal amount of
additional Debt Securities subject to the over-allotment option described in
Section 2(b) hereof (the "Option Securities") are collectively referred to
herein as the "Securities". The Securities are to be issued pursuant to an
Indenture dated as of ______________ (the "Indenture") between the Company and
__________, as trustee (the "Trustee").
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representative(s) deem(s) advisable
after this Agreement has been
executed and delivered and the Indenture has been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act").
Prior to the purchase and public offering of the Securities by the
several Underwriters, the Company and the Representatives, acting on behalf of
the several Underwriters, shall enter into an agreement substantially in the
form of Exhibit A hereto (the "Pricing Agreement"). The Pricing Agreement may
take the form of an exchange of any standard form of written telecommunication
between the Company and the Representatives and shall specify such applicable
information as is indicated in Exhibit A hereto. The offering of the Securities
will be governed by this Agreement, as supplemented by the Pricing Agreement.
From and after the date of the execution and delivery of the Pricing Agreement,
this Agreement shall be deemed to incorporate the Pricing Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33-53095) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses, and
the offering thereof from time to time in accordance with Rule 415 of the rules
and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations") and the Company has filed such post-effective amendments thereto
as may be required prior to the execution of the Pricing Agreement. Such
registration statement, as so amended, has been declared effective by the
Commission. Such registration statement, as so amended, including the exhibits
and schedules thereto, if any, and the information, if any, deemed to be a part
thereof pursuant to Rule 430A(b) of the 1933 Act Regulations (the "Rule 430A
Information") or Rule 434(d) of the 1933 Act Regulations (the "Rule 434
Information"), is referred to herein as the "Registration Statement"; and the
final prospectus and the prospectus supplement relating to the offering of the
Securities, in the form first furnished to the Underwriters by the Company for
use in connection with the offering of the Securities, are collectively referred
to herein as the "Prospectus"; provided, however, that all references to the
"Registration Statement" and the "Prospectus" shall be deemed to include all
documents incorporated therein by reference pursuant to the Securities Exchange
Act of 1934, as amended (the "1934 Act"), prior to the execution of the
applicable Pricing Agreement; provided, further, that if the Company files a
registration statement with the Commission pursuant to Section 462(b) of the
1933 Act Regulations (the "Rule 462(b) Registration Statement"), then after such
filing, all references to "Registration Statement" shall be deemed to include
the Rule 462(b) Registration Statement; and provided, further, that if the
Company elects to rely upon Rule 434 of the 1933 Act Regulations, then all
references to "Prospectus" shall be deemed to include the final or preliminary
prospectus and the applicable term sheet or abbreviated term sheet (the "Term
Sheet"), as the case may be, in the form first furnished to the Underwriters by
the Company in reliance upon
2
Rule 434 of the 1933 Act Regulations, and all references in this Purchase
Agreement to the date of the Prospectus shall mean the date of the Term Sheet. A
"preliminary prospectus" shall be deemed to refer to any prospectus used before
the registration statement became effective and any prospectus that omitted, as
applicable, the Rule 430A Information, the Rule 434 Information or other
information to be included upon pricing in a form of prospectus filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations, that was used
after such effectiveness and prior to the execution and delivery of the
applicable Pricing Agreement. For purposes of this Agreement, all references to
the Registration Statement, any preliminary prospectus, the Prospectus or any
Term Sheet 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 ("XXXXX").
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
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 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 of the Company.
(a) The Company represents and warrants to each Underwriter, as of the
date hereof and as of the date of the Pricing Agreement (such later date being
hereinafter referred to as the "Representation Date"), that:
(i) The Company meets the requirements for use of Form S-3
under the 1933 Act. Each of the Registration Statement and any Rule 462(b)
Registration Statement has become effective under the 1933 Act, and at the time
of effectiveness and at the Representation Date, the Registration Statement and
any Rule 462(b) Registration Statement, the Prospectus and the Indenture
conformed and will conform in all material respects to the requirements of the
1933 Act and the 1933 Act Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act, and did not and will not
contain an untrue statement of a material fact and did not and will not omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus, at the time the
Registration Statement became effective (unless the term "Prospectus" refers to
a prospectus which has been provided to the Underwriters by the Company for
3
use in connection with the offering of the Securities which differs from the
Prospectus on file at the Commission at the time the Registration Statement
became effective, in which case at the time it is first provided to the
Underwriters for such use) and at the Representation Date and at the Closing
Time referred to in Section 2, did not and will not include an untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the representations and warranties
in this subsection shall not apply to statements contained in or omitted from
the Registration Statement or the Prospectus made in reliance upon, and in
conformity with, information furnished to the Company in writing by any
Underwriter expressly for use in the Registration Statement or the Prospectus.
(ii) The documents incorporated or deemed to be incorporated
by reference in the Registration Statement or the Prospectus pursuant to Item 12
of Form S-3 under the 1933 Act, at the time they were or hereafter are filed or
last amended, as the case may be, 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
at the time of filing or as of the time of any subsequent amendment, did 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, in
the light of the circumstances under which they were or are made, not
misleading; and any additional documents deemed to be incorporated by reference
in the Registration Statement or the Prospectus will, if and when they are filed
with the Commission, or when amended, as appropriate, comply in all material
respects with the requirements of the 1934 Act and the 1934 Act Regulations 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 after the date hereof; provided, however, (x) that the
representations and warranties in this subsection shall not apply to statements
contained in or omitted from the Registration Statement or the Prospectus made
in reliance upon, and in conformity with, information furnished to the Company
in writing by any Underwriter expressly for use in the Registration Statement or
the Prospectus and (y) for purposes of this subsection, there shall be excluded
any statements in such documents incorporated or to be incorporated by reference
deemed not to be incorporated by reference as provided in Rule 412 under the
1933 Act.
(iii) Coopers & Xxxxxxx, the accountants who certified the
financial statements and supporting schedules of the Company included or
incorporated by reference in the Registration Statement, are independent public
accountants with respect to the Company and its subsidiaries as required by the
1933 Act and the 1933 Act Regulations.
4
(iv) The financial statements of the Company included or
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 subsidiaries as of the dates indicated and the
results of their operations for the periods specified. Except as otherwise
stated in the Registration Statement, said financial statements have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis. The supporting schedules included or incorporated by
reference in the Registration Statement present fairly the information required
to be included therein. The ratios of earnings to fixed charges (including
preferred stock dividends) included in the Prospectus have been calculated in
compliance, in all material respects, with Item 503(d) of Regulation S-K of the
Commission. The selected financial data and the summary financial information
included in 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. [Include the following
sentence if pro forma financials are contained or incorporated by reference in
the Registration Statement -- The pro forma financial statements of the Company
and its subsidiaries and the related notes thereto included 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 have been properly compiled on the
bases described therein, and 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.]
(v) 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
prescribed or permitted by the National Association of Insurance Commissioners,
and with respect to each insurance subsidiary, the appropriate Insurance
Department of the state of domicile of such insurance subsidiary, and such
accounting practices have been applied on a consistent basis throughout the
periods involved, except as disclosed therein.
(vi) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, and except as otherwise
stated or contemplated therein, (A) there has been no material adverse change
and no development which will result in a prospective material adverse change in
the condition, financial or otherwise, or in the earnings or business affairs of
the Company and its subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, (B) there have been no transactions
entered into by the Company or any of its subsidiaries which are material to the
Company and its subsidiaries, considered as one enterprise, other than those
5
entered into in the ordinary course of business, and (C) except for regular
quarterly dividends, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(vii) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Indiana, with corporate
power and authority to own, lease and operate its properties and to conduct its
business as presently conducted and as described in the Prospectus or in the
Company's Annual Report filed on Form 10-K for the year ended December 31, ____;
and the Company 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 to so qualify or be in good
standing would not have a material adverse effect on the condition, financial or
otherwise, or the earnings or business affairs of the Company and its
subsidiaries, considered as one enterprise.
(viii) Each of the subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to own,
lease and operate its properties and to conduct its business as presently
conducted and as described in the Prospectus or in the Company's Annual Report
filed on Form 10-K for the year ended December 31, ____; 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 to so qualify or be in good standing would not have a material adverse
effect on the condition, financial or otherwise, or the earnings or business
affairs of the Company and its subsidiaries, considered as one enterprise; and
the outstanding shares of capital stock of each subsidiary of the Company have
been duly authorized and validly issued, are fully paid and nonassessable and
all such shares are owned by the Company or by a subsidiary of the Company,
except as set forth in a letter previously delivered by the Company to you.
(ix) The Company and each of its subsidiaries hold all
material licenses, certificates and permits from governmental authorities
(including, without limitation, insurance licenses from the insurance
departments of the various states where the subsidiaries write insurance
business (the "Insurance Licenses")) which are necessary to the conduct of their
businesses; the Company and its subsidiaries have fulfilled and performed all
material obligations necessary to maintain their respective Insurance Licenses,
and no event or events have occurred which may be reasonably expected to result
in the impairment, modification, termination or revocation of such Insurance
Licenses.
6
(x) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus under "Capitalization" (except for
subsequent issuances, if any, pursuant to stock option agreements or employee
benefit plans); all of the issued and outstanding shares of the Common Stock, no
par value, of the Company (the "Common Stock") have been duly authorized and
validly issued, and are fully paid and nonassessable; the Securities have been
duly authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth in the Pricing
Agreement, will be validly issued and fully paid and nonassessable; the
Securities conform to the provisions of the Articles of Incorporation of the
Company, as amended on the Closing Date (the "Amended Articles of
Incorporation") related thereto; the relative rights, preferences, interests and
powers of the Securities are as set forth in the Amended Articles of
Incorporation, and all such provisions are valid under the Indiana Business
Corporation Law; each of the Securities [Include the following language if the
Debt Securities to be offered are convertible into or redeemable for shares of
Common Stock of the Company -- and the Common Stock into which the Securities
are convertible or for which the Securities may be redeemed] conform(s) to all
statements relating thereto contained in the Prospectus; and the issuance of the
Securities is not subject to preemptive or other similar rights.
(xi) 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
material contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound, or to which any of the property or assets
of the Company or any of its subsidiaries is subject, or in violation of any
applicable law, administrative regulation or administrative or court order or
decree, which violation or default would, singly or in the aggregate, have a
material adverse effect on the condition, financial or otherwise, or the
earnings or business affairs of the Company and its subsidiaries, considered as
one enterprise; and the execution, delivery and performance of this Agreement
and the Pricing Agreement, and the consummation of the transactions contemplated
herein and therein, will not conflict with or constitute a breach of, or a
default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company or any of its subsidiaries
is a party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its subsidiaries is subject, except
for a conflict, breach, default, lien, charge or encumbrance which would not
have a material adverse effect on the condition, financial or otherwise, or the
earnings or business affairs of the Company and its subsidiaries
7
considered as one enterprise, nor will such action result in any violation or
the provisions of the charter or by-laws of the Company or any of its
subsidiaries or any applicable law, administrative regulation or administrative
or court decree.
(xii) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign (including, without
limitation, any proceeding to revoke or deny renewal of any Insurance Licenses),
now pending, or, to the best knowledge of the Company, threatened, against or
affecting the Company or any of its subsidiaries which is required to be
disclosed in the Registration Statement or the Prospectus, or which is
reasonably likely to result in any material adverse change in the condition,
financial or otherwise, or in the earnings or business affairs of the Company
and its subsidiaries, considered as one enterprise, or which would be reasonably
likely to materially and adversely affect a material portion of the properties
or assets thereof or which is reasonably likely to materially and adversely
affect the consummation of this Agreement; all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party or of
which any of their respective property or assets is the subject which are not
described in the Registration Statement or the Prospectus, including ordinary
routine litigation incidental to the business of the Company or any of its
subsidiaries, are, considered in the aggregate, not material; and there are no
contracts or documents of the Company or any of its subsidiaries which are
required to be filed as exhibits to the Registration Statement, or to be
incorporated by reference therein, by the 1933 Act, the 1933 Act Regulations,
the 1934 Act or the 1934 Act Regulations, which have not been so filed or
incorporated by reference.
(xiii) No authorization, approval or consent of any court or
governmental authority or agency is necessary in connection with the issuance
and sale of the Securities hereunder, [Include the following language if the
Debt Securities to be offered are convertible into or redeemable for shares of
Common Stock of the Company -- or the issuance of the Common Stock upon
conversion or redemption of the Securities,] or the consummation by the Company
of any other transactions contemplated hereby, except such as have been obtained
and made under the federal securities laws or state insurance laws and such as
may be required under state or foreign securities laws.
[Include the following two paragraphs if the Debt Securities to be
offered are convertible into or redeemable for shares of Common Stock of the
Company -- (xiv) The shares of Common Stock issuable upon conversion or at
redemption of the Securities have been duly and validly authorized and reserved
for issuance upon such conversion or redemption; such shares, when issued and
delivered upon such conversion or redemption in the manner provided for in the
Amended Articles of Incorporation governing the Securities, will be duly
authorized, validly issued, fully paid and nonassessable and free of any lien or
adverse claim; and
8
the issuance of such shares upon such conversion or redemption will not be
subject to preemptive or other similar rights.
(xv) The Securities and the Common Stock issuable upon
conversion or at redemption of the Securities conform in all material respects
to the respective statements relating thereto contained in the Prospectus and
the Registration Statement.]
(xvi) There are no holders of securities of the Company with
currently exercisable registration rights to have any securities registered as
part of the Registration Statement or included in the offering contemplated by
this Agreement.
(xvii) No order preventing or suspending the use of any
preliminary prospectus has been issued and no proceedings for that purpose are
pending, threatened, or, to the knowledge of the Company, contemplated by the
Commission; to the knowledge of the Company, no order suspending the offering of
the Securities in any jurisdiction designated by the Underwriters pursuant to
Section 3(f) of this Agreement has been issued and, to the knowledge of the
Company, no proceedings for that purpose have been instituted or threatened or
are contemplated, and any request of the Commission for additional information
(to be included in the Registration Statement or Prospectus or otherwise) has
been complied with.
(xviii) The Company has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement and the
Pricing Agreement and the Company has full corporate power and authority to
issue, sell and deliver the Securities.
(xix) The Company is not, and upon the issuance and sale of the
Securities as herein contemplated and the application of the net proceeds
therefrom as described in the Prospectus 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").
(b) Any certificate signed by an officer of the Company and delivered
to the Underwriters 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.
Section 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, the Company
agrees to sell to each Underwriter severally, and not jointly, and each
Underwriter agrees to purchase from the Company, at the price set forth in the
Pricing Agreement, the aggregate principal amount of the Initial Securities set
forth in Schedule A opposite the name of such Underwriter (except as otherwise
provided in the Pricing Agreement), plus any additional number of Initial
Securities
9
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(1) If the Company has elected not to rely upon Rule 430A
under the 1933 Act Regulations, the initial public offering price per
Security, the dividend rate, the call price (including related premium)
payable upon redemption, in each case, in respect of each Security, and
the purchase price per Security to be paid by the several Underwriters
for the Securities (collectively, the "Pricing Terms") have each been
determined and set forth in the Pricing Agreement, dated the date
hereof, and an amendment to the Registration Statement and the
Prospectus will be filed before the Registration Statement becomes
effective.
(2) If the Company has elected to rely upon Rule 430A under
the 1933 Act Regulations, the purchase price per Security to be paid by
the several Underwriters shall be an amount equal to the initial public
offering price per Security, less an amount per Security to be
determined by agreement between the Underwriters and the Company. The
Pricing Terms likewise shall be determined by agreement between the
Underwriters and the Company. The Pricing Terms, when so determined,
shall be set forth in the Pricing Agreement. In the event that such
Pricing Terms have not been agreed upon and the Pricing Agreement has
not been executed and delivered by the parties thereto by the close of
business on the fourth business day following the date of this
Agreement, this Agreement shall terminate forthwith, without liability
of any party to any other party, unless otherwise agreed to by the
Company and the Underwriters.
(b) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company hereby grants an option to the Underwriters, severally and not jointly,
to purchase from it up to an additional $_________ aggregate principal amount of
the Securities at the price per share set forth in the Pricing Agreement. The
option hereby granted will expire automatically at the close of business on the
30th calendar day after (i) later of the date the Registration Statement and any
Rule 462(b) Registration Statement becomes effective, if the Company has elected
not to rely upon Rule 430A under the 1933 Act Regulations, or (ii) the
Representation Date, if the Company has elected to rely upon Rule 430A under the
1933 Act Regulations, and may be exercised in whole or in part from time to time
only for the purpose of covering over-allotments which may be made in connection
with the offering and distribution of the Initial Securities upon notice by the
Underwriters to the Company 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 Underwriters but
shall not be later than seven full business days after the exercise of such
option, nor in any
10
event before the Closing Time, as hereinafter defined, unless otherwise agreed
upon by the Underwriters and the Company. If the option is exercised as to all
or any portion of the Option Securities, each of the Underwriters, acting
severally and not jointly, will purchase that proportion of the total number of
Option Securities then being purchased which the number of Debt Securities set
forth in Schedule A opposite the name of such Underwriter bears to the total
number of Initial Securities (except as otherwise provided in the Pricing
Agreement), subject in each case to such adjustments as the Underwriters in
their discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Delivery of certificates for the Initial Securities shall be made
at the offices of the Underwriters in New York, and payment of the purchase
price for the Initial Securities shall be made at the offices of [Name and
address of counsel for the Underwriters] or at such other place as shall be
agreed upon by the Underwriters and the Company, at 10:00 a.m. (New York time)
on the third business day after the date the Registration Statement becomes
effective (or, if the Company has elected to rely upon Rule 430A, the third full
business day after execution of the Pricing Agreement (or, if pricing of the
Securities occurs after 4:30 p.m. Eastern time, on the fourth full business day
thereafter)), or such other time not later than ten business days after such
date as shall be agreed upon by the Underwriters and the Company (such time and
date of payment and delivery being herein called the "Closing Time"). In
addition, if the Underwriters purchase any or all of the Option Securities,
payment of the purchase price and delivery of certificates for such Option
Securities shall be made at the offices of [Name and address of counsel for the
Underwriters] set forth above, or at such other place as shall be agreed upon by
the Underwriters and the Company, on each Date of Delivery as specified in the
relevant notice from the Underwriters to the Company. Payment for the Securities
purchased by the Underwriters shall be made to the Company by certified or
official bank check or checks, drawn in New York Clearing House funds or similar
next day funds, payable to the order of the Company, against delivery to the
respective accounts of the Underwriters of certificates for the Securities to be
purchased by it. Certificates for the Initial Securities and the Option
Securities shall be in such denominations and registered in such names as the
Underwriters may request in writing at least two full business days before the
Closing Time or any Date of Delivery, as the case may be. [Name of lead
Underwriter], 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 check has 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. The certificates for
the Initial Securities and the Option Securities, if any, will be made available
for examination and packaging by the Underwriters no later than 10:00 a.m. (New
11
York City time) on the last business day prior to the Closing Time or the Date
of Delivery, as the case may be.
Section 3. Covenants of the Company.
The Company covenants with each Underwriter as follows:
(a) The Company will comply with the requirements of Rule 430A of the
1933 Act Regulations and/or Rule 434 of the 1933 Act Regulations if and as
applicable, and will notify the Underwriters immediately, and confirm the notice
in writing, (i) of the effectiveness of any post-effective amendment to the
Registration Statement or the filing of any supplement or amendment to the
Prospectus, (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 for additional information,
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose and (v) of the issuance by any state securities commission or
other regulatory authority of any order suspending the qualification or the
exemption from qualification of the Securities or the Common Stock issuable upon
conversion or redemption of the Securities under state securities or Blue Sky
laws or the initiation of any proceedings for that purpose. The Company will
promptly effect the filings necessary pursuant to Rule 424 and will take such
steps as it deems necessary to ascertain promptly whether the Prospectus
transmitted for filing under Rule 424 was received for filing by the Commission
and, in the event that it was not, it will promptly file the Prospectus. The
Company will use its best efforts 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) The Company will give the Underwriters notice of its intention to
file or prepare any amendment to the Registration Statement (including any
post-effective amendment and any filing under Rule 462(b) of the 1933 Act
Regulations), any Term Sheet 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 (including any revised prospectus or Term Sheet
and preliminary prospectus which the Company proposes for use by the
Underwriters in connection with the offering of the Securities which differs
from the prospectus on file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised prospectus or Term
Sheet and preliminary prospectus is required to be filed pursuant to Rule 424(b)
under the 1933 Act Regulations), whether pursuant to the 1933 Act, the 1934 Act
or otherwise; will furnish the Underwriters with copies of any such Rule 462(b)
Registration Statement, Term Sheet, amendment, supplement or revision 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 Rule 462(b) Registration Statement, Term
Sheet, amendment, supplement or
12
revision to which the Underwriters or counsel for the
Underwriters shall object.
(c) The Company will deliver to the Underwriters and to counsel to the
Underwriters, without charge, signed copies of the Registration Statement as
originally filed and of each amendment thereto (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 Underwriters,
without charge, as many conformed copies of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) as the
Underwriters may reasonably request. If applicable, 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 XXXXX, except to the extent permitted by Regulation
S-T.
(d) The Company will deliver to each Underwriter, without charge, as
many copies of each preliminary prospectus as such Underwriter may reasonably
request, 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, from
time to time 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 reasonably may
request. If applicable, 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 XXXXX, except
to the extent permitted by Regulation S-T.
(e) If any event shall occur as a result of which it is necessary, in
the reasonable opinion of counsel for the Underwriters, to amend or supplement
the Prospectus in order to make the Prospectus not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, the
Company will forthwith amend or supplement the Prospectus (in form and substance
reasonably satisfactory to counsel for the Underwriters) so that, as so amended
or supplemented, the Prospectus will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time it is
delivered to a purchaser, not misleading, and the Company will furnish to the
Underwriters as many copies of such amendment or supplement as the Underwriters
may reasonably request.
(f) The Company will endeavor, in cooperation with the Underwriters, to
qualify the Securities [Including the following language if Debt Securities to
be offered are convertible into or redeemable for shares of Common Stock of the
Company -- and the Common Stock issuable upon conversion and redemption of the
13
Securities] for offering and sale under the applicable securities laws of such
states and other jurisdictions of the United States as the Underwriters may
designate (with a good faith intent at that time to offer or sell any such
securities in such jurisdiction); provided, however, that the Company shall not
be obligated to qualify as a foreign corporation or to execute a general consent
as to service of process in any jurisdiction in which it is not so qualified or
to make any undertakings with respect to the conduct of its business therein. In
each jurisdiction in which the Securities or such shares of Common Stock 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 so long as may be required in connection with the distribution of the
Securities and such Common Stock.
(g) The Company will make generally available to its security holders
as soon as practicable, but not later than 45 days after the close of the period
covered thereby, 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
(in form and in a manner complying with the provisions of Rule 158 under the
1933 Act Regulations) covering a twelve-month period beginning not later than
the first day of the Company's fiscal quarter next following the "effective
date" (as defined in said Rule 158) of the Registration Statement.
(h) The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the
Prospectus under "Use of Proceeds."
(i) If, at the time that the Registration Statement becomes effective,
any information shall have been omitted therefrom in reliance upon Rule 430A or
Rule 434 under the 1933 Act Regulations, then promptly following the execution
of the Pricing Agreement, the Company will prepare, and file or transmit for
filing with the Commission in accordance with such Rule 430A or Rule 434 and
Rule 424(b) under the 1933 Act Regulations, copies of an amended Prospectus, or
Term Sheet, or, if required by such Rule 430A, a post-effective amendment to the
Registration Statement (including an amended Prospectus), containing all
information so omitted.
(j) If the Company elects to rely upon Rule 462(b), the Company shall
both file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) and pay the applicable fees in accordance with Rule 111 of the
1933 Act Regulations by the earlier of (i) 10:00 p.m. Eastern time on the date
of the Pricing Agreement and (ii) the time confirmations are sent or given, as
specified by Rule 462(b)(2).
(k) The Company, during the period when the Prospectus is required to
be delivered under the 1933 Act, will promptly file all documents required to be
filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
1934 Act.
14
(l) For a period of one year after the Closing Time, the Company will
furnish to the Underwriters copies of all reports and communications delivered
to the Company's stockholders or to holders of the Securities as a class and
will also furnish copies of all reports (including exhibits) filed with the
Commission on Forms 8-K, 10-Q and 10-K, and all other reports and information
furnished to its stockholders generally, not later than the time such reports
are first furnished to such holders generally.
[Include the following paragraph if the Debt Securities to be offered
are to be listed on the New York Stock Exchange -- (m) The Company will use its
best efforts to effect the listing of the Securities [Include the following
language if the Debt Securities to be offered are convertible into or redeemable
for shares of Common Stock of the Company -- and the shares of Common Stock
issuable upon conversion or redemption] on the New York Stock Exchange and to
cause the Securities to be registered under the 1934 Act.]
[Include the following paragraph if the Debt Securities to be offered
are convertible into or redeemable for shares of Common Stock of the Company --
(n) The Company will reserve and keep available at all times, free of preemptive
or other similar rights and liens and adverse claims, sufficient shares of
Common Stock to satisfy any obligations to issue shares of Common Stock upon
conversion or redemption of all of the Securities outstanding from time to
time.]
(o) The Company will supply the Underwriters with copies of all
correspondence to and from, and all documents issued to and by, the Commission
in connection with the registration of the Securities under the 1933 Act.
Section 4. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement and the Pricing Agreement, including, without
limitation, expenses related to the following, if incurred: (i) the preparation,
delivery, printing and filing of the Registration Statement and Prospectus as
originally filed (including financial statements and exhibits) and of each
amendment thereto; (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, the Pricing Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale and delivery of the Securities; (iii) the preparation,
issuance 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 or agents (including transfer agents and
registrars); (v) the qualification of the Securities [Include the following
language if the Debt Securities to be offered are convertible into or redeemable
for shares of Common Stock of the Company -- and the shares of Common Stock
issuable upon conversion or redemption of the Securities] under securities laws
15
in accordance with the provisions of Section 3(f), including filing fees and the
fees and disbursements of counsel for the Underwriters in connection therewith
and in connection with the preparation of the Blue Sky Survey and any amendment
thereto; (vi) the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment thereto, of
each preliminary prospectus, any Term Sheet and of the Prospectus and any
amendments or supplements thereto; (vii) the printing and delivery to the
Underwriters of copies of the Blue Sky Survey; (viii) any fees payable in
connection with the rating of the Securities by nationally recognized
statistical rating organizations; (ix) the filing fees incident to, and the fees
and disbursements of counsel to the Underwriters in connection with, the review,
if any, by the National Association of Securities Dealers, Inc. (the "NASD") of
the terms of the sale of the Securities; (x) any fees payable to the Commission;
and (xi) the fees and expenses incurred in connection with the listing on the
New York Stock Exchange of the Securities [Include the following language if the
Debt Securities to be offered are convertible into or redeemable for shares of
Common Stock of the Company -- and the shares of Common Stock issuable upon
conversion or redemption of the Securities.]
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 out-of-pocket expenses, including
the fees and disbursements of ______________________________, counsel for the
Underwriters.
Section 5. Conditions of Underwriters' Obligations.
The obligations of the Underwriters hereunder are subject to the
accuracy of the representations and warranties of the Company herein contained
or in certificates of any officer of the Company or any subsidiary delivered
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder, and to the following further conditions:
(a) The Registration Statement, including any Rule 462(b) Registration
Statement, shall have become effective not later than 5:30 p.m., New York City
time, on the date hereof, and on the date hereof and at the Closing Time and any
Date of Delivery 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
satisfaction of counsel to the Underwriters. A prospectus containing information
relating to the description of the Securities, the specific method of
distribution and similar matters shall have been filed with the Commission in
accordance with Rule 424(b)(1), (2), (3), (4) or (5), as applicable (or any
required post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of Rule
16
430A), or, if the Company has elected to rely upon Rule 434 of the 1933 Act
Regulations, a Term Sheet including the Rule 434 Information shall have been
filed with the Commission in accordance with Rule 424(b)(7).
(b) At the Closing Time the Underwriters shall have
received:
(1) The favorable opinion, dated as of the Closing Time, of ,
General Counsel to the Company, in form and substance satisfactory to
counsel for the Underwriters, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Indiana; and the Company has the
corporate power under the laws of the State of Indiana and
under its charter to own, lease and operate its properties and
to conduct its business as described in the Registration
Statement and the Prospectus or in the Company's Annual Report
filed on Form 10-K for the year ended December 31, ____.
(ii) The Securities delivered at the Closing Time,
and all other outstanding securities of the Company have been
duly authorized and validly issued, are fully paid and
nonassessable and conform in all material respects to the
description thereof contained in the Prospectus; the Common
Stock and the Securities are each registered under the 1934
Act, and the Securities [Include the following language if the
Debt Securities to be offered are convertible into or
redeemable for shares of Common Stock of the Company -- and
the Common Stock issuable upon conversion or redemption of the
Securities] at the Closing Time have been authorized for
listing on the NYSE, upon official notice of issuance.
(iii) The issuance of the Securities is not subject
to preemptive or other similar rights arising by law. [Include
the following paragraph if the Debt Securities to be offered
are convertible into or redeemable for shares of Common Stock
of the Company -- (iv) The shares of Common Stock issuable
upon conversion or redemption of the Securities have been duly
authorized and validly reserved for issuance upon such
conversion or redemption, and such shares, when issued and
delivered upon such conversion or redemption in the manner
provided in the Amended Articles of Incorporation, will be
validly issued, fully paid and nonassessable and the issuance
of such shares upon such conversion or redemption will not be
subject to preemptive or other similar rights arising by law.]
17
(v) The Purchase Agreement and the Pricing
Agreement have been duly authorized, executed and delivered by
the Company and constitute valid and binding obligations of
the Company enforceable in accordance with their terms (except
(1) as may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization or similar laws affecting
creditors' rights generally and except that the remedies of
specific performance and injunctive and other forms of
equitable relief are subject to certain equitable defenses and
to the discretion of the court before which any proceeding
therefor may be brought and (2) that no opinion is given as to
the enforceability of the indemnity and contribution
provisions under the Purchase Agreement and the Pricing
Agreement).
(vi) The Securities and the Common Stock conform in
all material respects to the descriptions thereof contained in
the Prospectus and the Registration Statement.
(vii) The forms of certificates used to evidence the
Securities and the Common Stock comply with all applicable
statutory requirements, with any applicable requirements of
the Company's charter and by-laws, including the Amended
Articles of Incorporation, and with the requirements of the
New York Stock Exchange.
(viii) Each subsidiary has been duly incorporated and
is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation and has the
corporate power and authority to own, lease and operate its
properties and to conduct its business as presently conducted
and as described in the Registration Statement and the
Prospectus or in the Company's Annual Report filed on Form
10-K for the year ended December 31, ____. Nothing has come to
the attention of such counsel to lead such counsel to believe
that any subsidiary in not duly qualified as a foreign
corporation to transact business or is not in good standing in
each jurisdiction in which such qualification is required,
except where the failure to so qualify or be in good standing
would not have a material adverse effect on the condition,
financial or otherwise, or the earnings or business affairs of
the Company and its subsidiaries considered as one enterprise.
All of the issued and outstanding capital stock of each
subsidiary of the Company has been duly authorized and validly
issued, is fully paid and nonassessable, and all such shares
are owned by the Company or by a subsidiary of the Company,
except as set forth in a letter previously delivered by the
Company to you.
18
(ix) The Registration Statement, including any Rule
462(b) Registration Statement, is effective under the 1933
Act; any required filing of the Prospectus pursuant to Rule
424(b) has been made in the manner and within the time period
required by Rule 424(b); and no stop order suspending the
effectiveness of the Registration Statement has been issued
under the 1933 Act or proceedings therefor initiated, to such
counsel's best knowledge, or threatened by the Commission.
(x) The Registration Statement, including any Rule
462(b) Registration Statement, each of the incorporated
documents and the Prospectus, and each amendment or supplement
thereto (other than the financial statements or other
financial information or statistical data included therein and
each Trustee's Statement of Eligibility on Form T-1, as to
which no opinion need be rendered), as of their respective
effective or issue dates, or when amended, as appropriate,
complied as to form in all material respects with the
requirements of the 1933 Act or the 1934 Act and the Rules and
Regulations thereunder.
(xi) Each document filed pursuant to the 1934 Act
and incorporated by reference in the Prospectus, at the time
it was filed or last amended (other than financial statements
or other financial information or statistical data included
therein, as to which no opinion need be rendered), complied as
to form in all material respects to the requirements of the
1934 Act and the 1934 Regulations.
(xii) The information in the Prospectus under the
captions "Description of Securities" and "Certain Federal
Income Tax Considerations", to the extent that such
information involves matters of law, summaries of legal
matters, the Company's charter and bylaws or legal
proceedings, or legal conclusions, is correct in all material
respects.
(xiii) No authorization, approval or consent of any
court or governmental authority or agency is necessary in
connection with the issuance and sale of the Securities
hereunder [or the issuance of the Common Stock upon conversion
or redemption of the Securities] or the consummation by the
Company of any other transactions contemplated hereby, except
such as have been obtained and made under the federal
securities laws or state insurance laws and such as may be
required under the state or foreign securities laws.
(xiv) To the best knowledge of such counsel, there
are no statutes or regulations required to be described or
incorporated by reference in the Registration
19
Statement which are not described or incorporated by reference
as required and there are no legal or governmental proceedings
pending or threatened which are required to be disclosed or
incorporated by reference in the Registration Statement, other
than those disclosed or incorporated by reference therein.
(xv) To the best knowledge of such counsel, there
are no contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or
referred to or incorporated by reference in the Registration
Statement or to be filed as exhibits thereto other than those
described or referred to or incorporated by reference therein
or filed as exhibits thereto; the descriptions thereof or
references thereto are true and correct in all material
respects and, to the best knowledge of such counsel, no
default exists in the due performance or observance of any
material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument so described,
referred to or incorporated by reference or filed, which
default could have a material adverse effect on the Company
and its subsidiaries considered as one enterprise.
(xvi) To the best knowledge of such counsel, the
issuance and delivery of the Securities [Include the following
language if the Debt Securities to be offered are convertible
into or redeemable for shares of Common Stock of the Company
--and the Common Stock issuable upon conversion or redemption
of the Securities,] the execution and delivery of the Purchase
Agreement and the Pricing Agreement and the consummation of
the transactions contemplated therein, will not conflict with
or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its
subsidiaries pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its subsidiaries
is subject, except for a conflict, breach, default, lien,
charge or encumbrance which would not have a material adverse
effect on the condition, financial or otherwise, or the
earnings or business affairs of the Company and its
subsidiaries considered as one enterprise nor will such action
result in any violation of the provisions of the charter or
by-laws of the Company, or any material applicable law,
administrative regulation or administrative or court decree.
20
(xvii) The Company and its subsidiaries hold all
material licenses, certificates and permits from all
governmental authorities (including, without limitation, the
Insurance Licenses) which are necessary to the conduct of
their businesses; the Company and its subsidiaries have
fulfilled and performed all material obligations necessary to
maintain their respective Insurance Licenses, and no event or
events have occurred which may be reasonably expected to
result in the material impairment, modification, termination
or revocation of such Insurance Licenses.
(xviii) The Indenture has been duly authorized by the
Company and, at the Closing Time, will have been duly
qualified under the 1939 Act and duly executed and delivered
by the Company and will constitute a valid and binding
agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditor's rights generally or by general equitable
principles.
(xix) The Securities have been duly authorized and,
at the Closing Time, will have been duly executed by the
Company and, when authenticated in the manner provided for in
the Indenture and delivered against payment of the purchase
price therefor, will constitute valid and binding obligations
of the Company, enforceable against the Company in accordance
with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting creditor's
rights generally or by general equitable principles, and will
be in the form contemplated by, and entitled to the benefits
of, the Indenture.
(xx) The Securities and the Indenture will conform
in all material respects to the respective statements relating
thereto contained in the Prospectus and will be in
substantially the respective forms filed or incorporated by
reference, as the case may be, as exhibits to the Registration
Statement.
(xxi) Nothing has come to such counsel's attention
that would lead such counsel to believe that the Registration
Statement, including any information provided pursuant to Rule
430A or Rule 434 (except for financial statements or other
financial information or statistical data included or
incorporated by reference therein), at the time it became
effective, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading
21
or that the Prospectus at the Representation Date (except for
financial statements and other financial data included or
incorporated by reference therein), at the Representation Date
(unless the term "Prospectus" refers to a prospectus which has
been provided to the Underwriters by the Company for use in
connection with the offering of the Securities which differs
from the Prospectus on file at the Commission at the time the
Registration Statement becomes effective, in which case at the
time it is first provided to the Underwriters for such use) or
at the Closing Time, included an untrue statement of a
material fact or omitted 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.
(xxii) The Company is not an "investment company" or
an entity "controlled" by an "investment company," as such
terms are defined in the 0000 Xxx.
(3) The favorable opinion, dated as of the Closing Time, of
____________________, counsel for the Underwriters, with respect to the
validity of the Securities, the Registration Statement, the Prospectus
and other related matters as you 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, [Name of counsel for the Underwriters], may rely as to matters
governed by the laws of the State of Indiana upon the opinion referred
to in subsection (b)(1) above.
(c) At the Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
Registration Statement and the Prospectus, other than as stated or contemplated
in the Registration Statement or the Prospectus, any material adverse change or
any development which would result in any prospective material adverse change in
the condition, financial or otherwise, or in the earnings or business affairs of
the Company and its subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, and the Underwriters 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
the Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Section 1 are true and
correct with the same force and effect as though expressly made at and as of the
Closing Time, (iii) the Company has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to the
Closing Time, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the best of each such officer's
knowledge and information, no proceedings for that purpose have been initiated
or threatened by the Commission.
22
(d) At the time of the execution of this Agreement, the Representatives
shall have received from [Name of independent public accountants] a letter,
dated such date, in form and substance satisfactory to the Representatives, to
the effect that (i) they are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the 1933 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations; (ii) it is their opinion
that the financial statements and supporting schedules included or incorporated
by reference in the Registration Statement and covered by their opinions therein
comply with the applicable accounting requirements of the 1933 Act and the 1933
Act Regulations and the 1934 Act and the 1934 Act Regulations; (iii) based upon
limited procedures set forth in detail in such letter, nothing has come to their
attention which causes them to believe that (A) the unaudited financial
information of the Company and its subsidiaries included or incorporated by
reference in the Registration Statement do not comply as to form in all material
respects with the applicable accounting requirements of the 1933 Act, the 1933
Act Regulations, the 1934 Act and the 1934 Act Regulations or are not presented
in conformity with generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial statements included
in the Registration Statement, or (B) at the date of the latest available
balance sheet read by such accountants, or at a subsequent specified date not
more than five days prior to the date of this Agreement, there was any increase
in long-term debt for which the Company is directly liable or notes payable not
direct obligations of the Company or, at the date of the latest available
balance sheet read by such accountants, there was any decrease in total assets
or shareholders' 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 of 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 amounts of premiums
collected, net investment income, total revenues or earnings applicable to
common stock or net income, fully diluted, per common share except, in all cases
set forth in this clause (iii), for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are described in such
letter; (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 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, and such accounting practices have been
applied on a consistent basis throughout the periods involved, except as
disclosed therein; and (v) in addition to the
23
examination referred to in their opinions and the limited procedures refereed to
in clause (iii) above, they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages, ratios and
financial information that has been derived from the accounting and financial
records of the Company that are subject to internal accounting controls which
are included or incorporated by reference in the Registration Statement and
Prospectus and which are specified by the Underwriters, and have found such
amounts, percentages, ratios and financial information to be in agreement with
the relevant accounting and financial records of the Company and its
subsidiaries identified in such letter.
(e) At the Closing Time, the Underwriters shall have received from
[Name of independent public accountants] a letter, dated as of the Closing Time,
to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (d) of this Section, except that the specified date
referred to shall be a date not more than five days prior to the Closing Time
and, if the Company has elected to rely on Rule 430A under the 1933 Act
Regulations, to the further effect that they have carried out procedures as
specified in clause (iv) of subsection (d) of this Section with respect to
certain amounts, percentages and financial information specified by the
Underwriters and deemed to be a part of the Registration Statement pursuant to
Rule 430(A)(b) and have found such amounts, percentages and financial
information to be in agreement with the records specified in such clause (iv).
[Include the following paragraph if the Debt Securities to be offered
are to be listed on the New York Stock Exchange -- (f) At the Closing Time, the
Securities [Include the following language if the Debt Securities to be offered
are convertible into or redeemable for shares of Common Stock of the Company--
and the Common Stock issuable upon conversion or redemption of the Securities]
shall have been approved for listing on the New York Stock Exchange upon notice
of issuance.
(g) At the Closing Time, and at each Date of Delivery, if any, counsel
for the Underwriters shall have been furnished with such documents and opinions
as they may reasonably require with respect to unforeseen materially changed
circumstances since the date of this Agreement for the purpose of enabling them
to pass upon the issuance and sale of the Securities as herein contemplated; and
all proceedings taken by the Company in connection with the issuance and sale of
the Securities as herein contemplated shall be reasonably satisfactory in form
and substance to the Underwriters and counsel for the Underwriters.
(h) The NASD shall not have raised any objection with
respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(i) In the event that the Underwriters exercise their
option provided in Section 2(b) hereof to purchase all or any
24
portion of the Option Securities, the representations and warranties of the
Company contained herein and the statements in any certificates furnished by the
Company hereunder shall be true and correct as of, and as if made on, each Date
of Delivery, and at the relevant Date of Delivery, the Underwriters shall have
received:
(1) A certificate, dated such Date of Delivery, of the
president or a vice president of the Company and the chief financial or
chief accounting officer of the Company confirming that the certificate
delivered at the Closing Time pursuant to Section 5(c) hereof is true
and correct as of, and as if made on, such Date of Delivery.
(2) The favorable opinion of
, General Counsel for the Company, in form and
substance satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities and otherwise to the
same effect as the opinion required by Section 5(b)(1) hereof.
[(3) The favorable opinion of [_______________], counsel for
the Company, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities and otherwise to the same effect as the opinion required by
Section 5(b)(2) hereof.]
(4) The favorable opinion of ___________________, counsel for
the Underwriters, dated such Date of Delivery, relating to the Option
Securities and otherwise to the same effect as the opinion required by
Section 5(b)(3) hereof.
(5) A letter from [Name of independent public accountants] in
form and substance satisfactory to the Underwriters and dated such Date
of Delivery, substantially the same in form and substance as the letter
furnished to the Underwriters pursuant to Section 5(d) hereof, except
that the "specified date" in the letter furnished pursuant to this
Section 5(j)(5) shall be a date not more than five days prior to such
Date of Delivery.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time at or prior to the
Closing Time, and such termination shall be without liability of any party to
any other party except as provided in Section 4.
Section 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Underwriter
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:
25
(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 any Rule
430(A) Information or Rule 434 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
contained 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, if 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) hereof, the reasonable fees and
disbursements of counsel chosen by the underwriters), 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;
provided, however, that (A) the foregoing indemnity 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 expressly for use in the Registration Statement (or any amendment
thereto) or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto); and (B) the foregoing indemnity agreement with respect to
any preliminary prospectus shall not inure to the benefit of the Underwriter
from whom the person asserting any such losses, claims, damages or liabilities
purchased Securities, or any person controlling any Underwriter if a copy of the
Prospectus (as then amended or supplemented, if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
the Underwriters to such person if such is required by law at or prior to the
written confirmation of the sale of such Securities to such person and if the
Prospectus (as so amended or
26
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability.
(b) 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 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) 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 expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) 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
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of any such
action. If it so elects within a reasonable time after receipt of such notice,
an indemnifying party, jointly with any other indemnifying parties receiving
such notice, may assume the defense of such action with counsel chosen by it and
approved by the indemnified parties defendant in such action (which approval
shall not be unreasonably withheld), unless such indemnified parties reasonably
object to such assumption on the ground that there may be legal defenses
available to them which are different from or in addition to those available to
such indemnifying party. If an indemnifying party assumes the defense of such
action, the indemnifying parties shall not be liable for any fees and expenses
of counsel for the indemnified parties incurred thereafter in connection with
such action. In no event shall the indemnifying parties be liable for reasonable
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. An
indemnifying party shall not be liable for any settlement or any action or claim
effected without its consent, which consent shall not be unreasonably withheld.
27
Section 7. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 6 is for
any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, the Company and the Underwriters shall
contribute to the aggregate losses, liabilities, claims, damages and expenses of
the nature contemplated by said indemnity agreement incurred by the Company and
one or more of the Underwriters, as incurred, in such proportions that the
Underwriters are responsible for that portion represented by the percentage that
the underwriting discount appearing on the cover page of the Prospectus bears to
the initial public offering price of the Securities appearing thereon and the
Company is responsible for the balance; provided, however, that no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section, 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 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 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. The
Underwriters' respective obligations to contribute pursuant to this Section 7
are several, and not joint, in proportion to the number or aggregate principal
amount, as the case may be, of Initial Securities set forth opposite their
respective names in the applicable Pricing Agreement.
Section 8. Representations, Warranties and Agreements to
Survive Delivery.
All representations, warranties and agreements contained in this
Agreement and the Pricing Agreement, or contained in certificates of officers of
the Company 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 controlling person, or by or on behalf of the Company, and shall
survive delivery of and payment for the Securities to the Underwriters.
Section 9. Termination of Agreement.
(a) The Representatives may terminate this Agreement and the Pricing
Agreement, by notice to the Company, at any time at or prior to the Closing Time
(i) if there has been, since the date of this Agreement or since the respective
dates as of which information is given in the Registration Statement (except as
otherwise stated or contemplated therein at the date of the Pricing Agreement),
any material adverse change or any development which will result in a
prospective material adverse
28
change in the condition, financial or otherwise, or in the earnings or business
affairs 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 outbreak of hostilities or other calamity or crisis, or any
material worsening thereof, or any change or development involving a prospective
change in national or international political, financial or economic conditions,
the effect of which on the financial markets of the United States is such as to
make it, in the judgment of the Underwriters, impracticable to market the
Securities or to enforce contracts for the sale of the Securities, or (iii) if
trading in the Common Stock or any other security of the Company has been
suspended or limited by the Commission or the New York Stock Exchange, or if
trading generally on either the American Stock Exchange or the New York Stock
Exchange has been suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges of prices for securities have been required,
by either of said Exchanges or by order of the Commission, the NASD or any other
governmental authority, or (iv) if a banking moratorium has been declared by
Federal, New York or California authorities.
(b) If this Agreement and the Pricing Agreement are terminated pursuant
to this Section, such termination shall be without liability of any party to any
other party except as provided in Section 4, and provided, further, that
Sections 1, 6 and 7 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 to
purchase the Initial Securities which it or they are obligated to purchase under
this Agreement and the Pricing 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 Initial Securities, the non-defaulting Underwriters
shall be obligated 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 Initial Securities, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter.
29
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, either the Representatives or the Company shall have the
right to postpone the Closing Time 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.
Section 11. 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 c/o [name and address of lead Underwriter], with a copy to [Name
of counsel for the Underwriters], Attention: _____________; notices to the
Company shall be directed to it at 00000 Xxxxx Xxxxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxx 00000, Attention: General Counsel.
Section 12. Parties.
This Agreement and the Pricing Agreement shall each inure to the
benefit of and be binding upon the Underwriters and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement or the
Pricing Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters and the Company 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 the
Pricing Agreement or any provision herein or therein contained. This Agreement
and the Pricing Agreement and all conditions and provisions hereof and thereof
are intended to be for the sole and exclusive benefit of the Underwriters and
the Company 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 13. Governing Law and Time.
This Agreement and the Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed in said State. Unless otherwise set forth
herein, specified times of day refer to New York City time.
30
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, shall become a binding agreement
between the Underwriters and the Company in accordance with its terms.
Very truly yours,
CONSECO, INC.
By ________________________
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date first above written:
[Names of Representative(s) of Underwriter(s)]
By:
By _______________________________
Name:
Title:
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
31
SCHEDULE A
Aggregate
Principal
Amount of
Debt Securities
Name to be Purchased
---- ---------------
. . . . . . . . . . . . . . .
[Name(s) of Underwriter(s)]
---------
Total.................................... =========
32
EXHIBIT A
$--------
CONSECO, INC.
(an Indiana corporation)
[Title of Debt Securities to be Offered]
PRICING AGREEMENT
----------, ----
[Names of Representative(s) of Underwriter(s)]
Dear Sirs:
Reference is made to the Purchase Agreement dated ___________,
____ (the "Purchase Agreement") relating to the purchase by [insert name(s) of
other lead underwriter(s)], as representatives of the Underwriters named in
Schedule A thereto (the "Underwriters"), of the above $________ aggregate
principal amount of the Company's [title of Debt Security] (the "Securities"),
of Conseco, Inc., an Indiana corporation (the "Company").
Pursuant to Section 2 of the Purchase Agreement, the Company
agrees with each Underwriter as follows:
1. The initial public offering price of the Securities shall
be __% of the principal amount thereof, plus accrued interest, if any,
from the date of issuance.
2. The purchase price to be paid by the Underwriters
for the Securities shall be __% of the principal amount
thereof.
3. The interest rate on the Securities shall be __%
per annum.
4. [Include the terms of any optional or mandatory
redemption and other price-related terms.]
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along
with all counterparts, will become a binding agreement between the Underwriters
and the Company in accordance with its terms.
Very truly yours,
CONSECO, INC.
By: __________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
[Name(s) of Co-Representative(s) of Underwriter(s)]
BY
By_____________________________________
Authorized Signature
For themselves and as Representatives
of the other Underwriters
A-2
