NPB Capital Trust II
(a Delaware business trust)
Preferred Securities
% Cumulative Trust Preferred Securities
(Liquidation Amount $25 per Preferred Security)
FORM OF UNDERWRITING AGREEMENT
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August , 2002
XXXXXX XXXXXXXXXX XXXXX LLC
ADVEST, INC.
as Representatives (the "Representatives")
of the Several Underwriters
Named in Schedule I hereto
c/o Janney Xxxxxxxxxx Xxxxx LLC
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Ladies and Gentlemen:
NPB Capital Trust II (the "Trust"), a statutory business trust
organized under the Business Trust Act of the State of Delaware (the "Delaware
Act"), and National Penn Bancshares, Inc., a Pennsylvania business corporation
(the "Company"), as depositor of the Trust and as guarantor (the Trust and the
Company are referred to together as the "Offerors"), hereby confirm their
agreement with Xxxxxx Xxxxxxxxxx Xxxxx LLC and Advest, Inc. who are the
Representatives of the several Underwriters named in Schedule I hereto (together
the "Underwriters"), with respect to the issue and sale by the Trust and the
purchase by the Underwriters of 2,200,000 (the "Initial Securities") of the
Trust's __% Cumulative Trust Preferred Securities having an aggregate
liquidation amount of $55,000,000. The Trust and the Company also propose to
issue and sell to the Underwriters, at the Underwriters' option, up to 330,000
Preferred Securities having an additional aggregate liquidation amount of up to
$8,250,000 (the "Option Securities") as set forth herein. The term "Preferred
Securities" as used herein, unless indicated otherwise, shall mean the Initial
Securities and the Option Securities. If the Representatives are the only firms
named in Schedule I hereto, then the terms "Underwriters" and "Representatives,"
as used herein, shall each be deemed to refer to such firms.
The Preferred Securities and the Common Securities (as defined
herein) are to be issued pursuant to the terms of an Amended and Restated Trust
Agreement, to be dated as of the Closing Time (as defined in Section 2 hereof)
(the "Trust Agreement"), among the Company, as depositor, Christiana Bank &
Trust Company (the "Trust Company"), a Delaware banking corporation, as property
trustee (the "Property Trustee") and as Delaware trustee (the "Delaware
Trustee"), and Xxxxxx X. Xxxxx, an individual, and Xxxx X. Xxxxxx, an individual
(the "Administrative Trustees" and, together with the Property Trustee and the
Delaware Trustee, the "Trustees") and the holders from time to time of undivided
interests in the assets of the Trust. The Preferred Securities will be
guaranteed by the Company to the extent provided in the Guarantee Agreement, to
be dated as of the Closing Time (the "Guarantee Agreement"), between the Company
and the Trust Company, as trustee (the "Guarantee Trustee"), with respect to
distributions and payments upon liquidation, redemption and otherwise. The
assets of the Trust will consist of __% subordinated debentures due September
30, 2032 (the "Debentures") of the Company, which will be issued under the
Indenture to be dated as of the Closing Time (the "Indenture"), between the
Company and the Trust Company, as trustee (the "Indenture Trustee"). Under
certain circumstances, the Debentures will be distributable to the holders of
undivided beneficial interests in the assets of the Trust. The entire proceeds
from the sale of the Preferred Securities will be combined with the entire
proceeds from the sale by the Trust to the Company of the Trust's common
securities (the "Common Securities") and will be used by the Trust to purchase
an equivalent amount of the Debentures.
The initial public offering price for the Preferred
Securities, the purchase price to be paid by the Underwriters for the Preferred
Securities, the commission per Preferred Security to be paid by the Company to
the Underwriters and the distribution rate to be paid on the Preferred
Securities shall be agreed upon by the Company and the Underwriters, and such
agreement shall be set forth in a separate written instrument substantially in
the form of Exhibit A hereto (the "Price Determination Agreement"). The Price
Determination Agreement may take the form of an exchange of any standard form of
written telecommunication between the Company and the Underwriters and shall
specify such applicable information as is indicated in Exhibit A hereto. The
offering of the Preferred Securities will be governed by this Agreement, as
supplemented by the Price Determination Agreement. From and after the date of
the execution and delivery of the Price Determination Agreement, this Agreement
shall be deemed to incorporate, and all references herein to "this Agreement"
shall be deemed to include, the Price Determination Agreement.
The Offerors have prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(File Nos. 333-97361 and 333-97361-01) covering the registration of the
Preferred Securities, the Guarantee and the Debentures under the Securities Act
of 1933, as amended (the "1933 Act"), including the related preliminary
prospectus or prospectuses, and, if such registration statement has not become
effective, the Company will prepare and file, prior to the effective date of
such registration statement, an amendment to such registration statement,
including a final prospectus except that if, at any time the registration
statement becomes effective, any information shall have been omitted therefrom
in reliance upon Rule 430A of the rules and regulations of the Commission under
the 1933 Act ("Rule 430A"), then the Offerors will prepare, and file or transmit
for filing with the Commission in accordance with Rule 430A and Rule 424(b) of
the rules and regulations of the Commission under the 1933 Act ("Rule 424(b)"),
copies of an amended prospectus, or if required by Rule 430A, a post-effective
amendment to the registration statement (including an amended prospectus)
containing all information so omitted. Each prospectus used before the time such
registration statement becomes effective is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto and the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, at the time it becomes effective, is herein called the
"Registration Statement," and the prospectus, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, included in the Registration Statement at the time it becomes effective
(and including all information deemed to be part of the Registration Statement
at the time it becomes effective pursuant to Rule 430A) is herein called the
"Prospectus," except that, if any revised prospectus provided to the
Underwriters by the Company for use in connection with the Offering differs from
the prospectus included in the Registration Statement at the time it becomes
effective (whether or not such prospectus is required to be filed pursuant to
Rule 424(b)), the term "Prospectus" shall refer to such revised prospectus from
and after the time it is first furnished to the Underwriters for such use.
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The Company understands that the Underwriters propose to make
a public offering of the Preferred Securities (the "Offering") as soon as
possible after the Registration Statement becomes effective. The Representatives
may assemble and manage a selling group of broker-dealers that are members of
the National Association of Securities Dealers, Inc. ("NASD") to participate in
the solicitation of purchase orders for the Preferred Securities.
Section 1. Representations and Warranties.
(a) The Offerors jointly and severally represent and warrant
to and agree with the Underwriters that:
(i) The Company meets the requirements for use of Form
S-3 under the 1933 Act and, when the Registration Statement on
such form shall become effective and at all times subsequent
thereto up to the Closing Time referred to below (and, with
respect to the Option Securities, up to the Option Closing
Date referred to below), (A) the Registration Statement and
any amendments and supplements thereto will comply in all
material respects with the requirements of the 1933 Act and
the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"); (B) neither the Registration
Statement nor any amendment or supplement thereto will 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 light of the circumstances
under which they were made, not misleading; and (C) neither
the Prospectus nor any amendment or supplement thereto will
include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading, except that this
representation and warranty does not apply to statements or
omissions made in reliance upon and in conformity with
information furnished in writing to the Offerors by the
Underwriters expressly for use in the Registration Statement
or the Prospectus, or any information contained in any Form
T-1, which is an exhibit to the Registration Statement. The
statements contained under the caption "Underwriting" in the
Prospectus constitute the only information furnished to the
Offerors in writing by the Underwriters expressly for use in
the Registration Statement or the Prospectus.
(ii) The documents incorporated by reference in the
Prospectus pursuant to Item 12 of Form S-3 under the 1933 Act,
at the time they were filed with the Commission, complied in
all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the
rules and regulations of the Commission thereunder (the "1934
Act Regulations") and, when read together and with the other
information in the Prospectus, at the time the Registration
Statement becomes effective and at all times subsequent
thereto up to the Closing Time, will not contain an 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 not misleading, in each case after
excluding any statement that does not constitute a part of the
Registration Statement or the Prospectus pursuant to Rule 412
of the 1933 Act Regulations.
(iii) The Company has not distributed and will not
distribute any offering material in connection with the
Offering other than the Registration Statement, the Prospectus
and other material if any, reviewed by the Representatives
and, permitted by the 1933 Act.
(iv) Xxxxx Xxxxxxxx LLP, which certified the audited
financial statements included or incorporated by reference in
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the Registration Statement and the Prospectus, are independent
public accountants as required by the 1933 Act and the 1933
Act Regulations and the 1934 Act and the 1934 Act Regulations.
(v) No stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act, and to the
Company's knowledge, no proceedings for that purpose have been
instituted or are pending or are threatened by the Commission,
and any request on the part of the Commission for additional
information has been complied with;
(vi) The consolidated financial statements, audited and
unaudited (including the notes thereto), included or
incorporated by reference in the Registration Statement
present fairly the consolidated financial position of the
Company and its subsidiaries as of the dates indicated and the
consolidated results of operations and cash flows of the
Company and its subsidiaries for the periods specified. Such
financial statements have been prepared in conformity with
accounting principles generally accepted in the United States
of America applied on a consistent basis throughout the
periods involved, and comply in all material respects with
applicable accounting requirements of Title 12 of the Code of
Federal Regulations, Regulation S-X of the Commission. The
financial statement schedules, if any, included in the
Registration Statement present fairly the information required
to be stated therein. The selected financial, pro forma and
statistical data included in the Prospectus are accurate in
all material respects and present fairly the information shown
therein and have been compiled on a basis consistent with that
of the audited and unaudited consolidated financial statements
included or incorporated by reference in the Registration
Statement.
(vii) The Company is a corporation duly organized,
validly existing and duly subsisting under the laws of the
Commonwealth of Pennsylvania with corporate power and
authority under such laws to own, lease and operate its
properties and conduct its business as described in the
Prospectus. Each direct and indirect subsidiary of the Company
is an entity duly organized as a corporation or a banking
association, validly existing and in good standing under the
laws of its respective jurisdiction of organization with
corporate or other power and authority under such laws to own,
lease and operate its properties and conduct its business.
Except for the Banks (as defined below), the Company and each
of its direct and indirect subsidiaries is duly qualified to
transact business as a foreign corporation and is in good
standing in each other jurisdiction in which it owns or leases
property of a nature, or transacts business of a type, that
would make such qualification necessary, except to the extent
that the failure to so qualify or be in good standing could
not have a material adverse effect on the condition (financial
or otherwise), earnings, business affairs, assets or business
prospects of the Company and its subsidiaries, considered as
one enterprise (a "Material Adverse Effect").
(viii) The Company is duly registered with the Board of
Governors of the Federal Reserve System as a bank holding
company under the Bank Holding Company Act of 1956, as
amended; each subsidiary of the Company that conducts business
as a bank is duly authorized to conduct such business in each
jurisdiction in which such business is currently conducted;
and the deposit accounts of National Penn Bank and Panasia
Bank, National Association (each, a "Bank" and collectively
the "Banks") are insured by the Bank Insurance Fund or the
Savings Association Insurance Fund of the Federal Deposit
Insurance Corporation (the "FDIC") up to the maximum allowable
limits thereof and, no proceedings for the termination or
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revocation of such insurance are pending or threatened.
(ix) National Penn Bank is a national bank duly
organized, validly existing and in good standing under the
federal laws of the United States of America with corporate
power and authority under such laws to own, lease and operate
its properties and conduct its business; Panasia Bank,
National Association is a national bank duly organized,
validly existing and in good standing under the federal laws
of the United States of America with corporate power and
authority under such laws to own, lease and operate its
properties and conduct its business; each Bank is duly
qualified to transact business as a foreign corporation and is
in good standing in each other jurisdiction in which it owns
or leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except to
the extent that the failure to so qualify or be in good
standing could not have a Material Adverse Effect. All of the
outstanding shares of capital stock of each Bank and each of
the Company's other subsidiaries have been duly authorized and
validly issued and are fully paid and non-assessable and are
owned by the Company directly or indirectly, free and clear of
any pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind.
(x) Except for National Penn Bank and NPB Delaware, Inc.,
the Company does not have any "significant subsidiaries" as
defined in Rule 1-02 of Regulation S-X of the Commission.
(xi) The Company had, at the date indicated, a duly
authorized and outstanding capitalization as set forth in the
Prospectus under the caption "Capitalization." The Preferred
Securities, Common Securities, Debentures and Guarantee
conform in all material respects to the description thereof
contained or incorporated by reference in the Prospectus,
including without limitation, as set forth under the captions
"Description of the Trust," "Description of the Preferred
Securities," "Description of the Debentures," "Description of
Guarantee" and such description conforms in all material
respects to the rights set forth in the instruments defining
the same.
(xii) This Agreement has been duly authorized, executed
and delivered by the Offerors and, when duly executed by the
Representatives for the Underwriters, will constitute the
valid and binding agreement of the Offerors enforceable
against the Offerors in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
or affecting creditors' rights generally or by general
equitable principles. The Guarantee Agreement, the Debentures,
the Trust Agreement and the Indenture have each been duly
authorized and, when duly executed and delivered by the
Company and, in the case of the Guarantee, by the Guarantee
Trustee, in the case of the Trust Agreement, by the Trustees,
and in the case of the Indenture, by the Indenture Trustee,
will constitute the valid and legally binding obligations of
the Company enforceable against the Company in accordance with
their respective terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditors' rights generally or general equitable principles.
The Debentures are entitled to the benefits of the Indenture,
and the Guarantee Agreement, the Debentures, the Trust
Agreement and the Indenture conform in all material respects
to the descriptions thereof in the Prospectus. The Trust
Agreement, the Guarantee Agreement and the Indenture have been
duly qualified under the Trust Indenture Act of 1939, as
amended (the "TIA").
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(xiii) The Trust has been duly created and is validly
existing as a statutory business trust in good standing under
the Delaware Act with the power and authority to own, lease
and operate its properties and conduct its business as
described in the Prospectus. The Trust has conducted no
business to date, and it will conduct no business in the
future that would be inconsistent with the description of the
Trust set forth in the Prospectus. The Trust is not a party to
or bound by any agreement or instrument other than this
Agreement, the Trust Agreement and the agreements and
instruments contemplated by the Trust Agreement or described
in the Prospectus; the Trust has no liabilities or obligations
other than those arising out of the transactions contemplated
by this Agreement and the Trust Agreement and described in the
Prospectus; and the Trust is not a party to or subject to any
action, suit or proceeding of any nature.
(xiv) The Preferred Securities have been duly and validly
authorized by the Trust for issuance and sale to the
Underwriters pursuant to this Agreement and, when executed and
authenticated in accordance with the terms of the Trust
Agreement and delivered by the Trust to the Underwriters
pursuant to this Agreement against payment of the
consideration set forth herein, will be validly issued, fully
paid and non-assessable and will constitute valid and legally
binding obligations of the Trust enforceable in accordance
with their terms and entitled to the benefits provided by the
Trust Agreement. The Preferred Securities conform in all
material respects to the description thereof in the
Prospectus, and such description conforms in all material
respects to the rights set forth in the instruments defining
the same; the holders of the Preferred Securities will be
entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware;
and the issuance of the Preferred Securities is not subject to
any preemptive or other similar rights.
(xv) The Common Securities have been duly and validly
authorized by the Trust and, upon delivery by the Trust to the
Company against payment therefor as described in the
Prospectus, will be duly and validly issued and fully paid
undivided beneficial interests in the assets of the Trust and
will conform in all material respects to the description
thereof in the Prospectus, and such description conforms in
all material respects to the rights set forth in the
instruments defining the same; the issuance of the Common
Securities is not subject to any preemptive or other similar
rights; and at the Closing Time, all of the issued and
outstanding Common Securities of the Trust will be directly
owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(xvi) The issuance and sale of the Preferred Securities
and the Common Securities by the Trust, the compliance by the
Trust with all of the provisions of this Agreement, the
purchase of the Debentures by the Trust, and the consummation
of the transactions herein contemplated will not conflict with
or result in a breach of any of the terms or provisions of, or
constitute a default under, the Trust Agreement or any statute
or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Trust or any of
its properties; and no consent, approval, authorization,
order, license, certificate, permit, registration or
qualification of or with any such court or other governmental
agency or body is required to be obtained by the Trust for the
issue and sale of the Preferred Securities and the Common
Securities by the Trust, the purchase of the Debentures by the
Trust or the consummation by the Trust of the transactions
contemplated by this Agreement and the Trust Agreement,
including without limitation such consents, approvals,
authorizations, licenses, certificates, permits, registrations
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or qualifications as may be required under the 1933 Act or the
1933 Act Regulations, the 1934 Act or the 1934 Act
Regulations, state securities laws or the TIA.
(xvii) The issuance by the Company of the Guarantee and
the Debentures, the compliance by the Company with all of the
provisions of this Agreement, the execution, delivery and
performance by the Company of the Trust Agreement, the
Debentures, the Guarantee Agreement and the Indenture, and the
consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute
a default under, any indenture, loan agreement, mortgage, deed
of trust or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries
is subject, nor will such action result in any violation of
the provisions of the articles of incorporation, charter or
by-laws of the Company or any of its subsidiaries or any
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Company, any of its subsidiaries or any of their respective
properties, except in any case for such conflicts, breaches,
defaults or violations that would not have a Material Adverse
Effect, and would not prohibit or otherwise adversely affect
the ability of the Company to complete the transactions
contemplated thereby; and no consent, approval, authorization,
order, license, certificate, permit, registration or
qualification of or with any such court or other governmental
agency or body is required for the issue of the Guarantee and
the Debentures or the consummation by the Company of the other
transactions contemplated by this Agreement, including without
limitation such consents, approvals, authorizations, licenses,
certificates, permits, registrations or qualifications as may
be required under the 1933 Act or the 1933 Act Regulations,
the 1934 Act or the 1934 Act Regulations, state securities
laws or the TIA.
(xviii) The Offerors have not engaged in any activity
that would result in the Company or Trust being, and after
giving effect to the Offering the Company or Trust 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 "Investment
Company Act"). None of the issued shares of capital stock of
the Company or any of its subsidiaries has been issued or is
owned or held in violation of any statutory or preemptive
rights of shareholders, and no person or entity (including any
holder of outstanding shares of capital stock of the Company
or its subsidiaries) has any statutory or preemptive or other
rights to subscribe for any of the Preferred Securities. None
of the capital stock of the Company has been issued in
violation of applicable federal or state securities laws.
(xix) All of the outstanding shares of capital stock of
the Company have been duly authorized and validly issued, are
fully paid and non-assessable, and are not subject to the
preemptive rights of any stockholder of the Company.
(xx) All of the issued and outstanding shares of capital
stock of each of the Company's direct or indirect subsidiaries
have been duly and validly authorized and issued and are fully
paid and nonassessable and are owned by the Company or one of
its wholly-owned subsidiaries free and clear of any security
interests, liens, pledges, claims or other encumbrances,
except where the failure to own such shares free and clear of
any security interests, liens, pledges, claims or other
encumbrances would not have a Material Adverse Effect.
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(xxi) Since the respective dates as of which information
is given in the Registration Statement and the Prospectus or
otherwise disclosed therein, and prior to the Closing Date and
Option Closing Date (as such terms are hereinafter defined),
(a) neither the Company nor any of its subsidiaries has
incurred any liabilities or obligations, direct or contingent,
or entered into any transactions, not in the ordinary course
of business, that are material to the Company and its
subsidiaries, (b) the Company has not purchased any of its
outstanding capital stock nor declared, made or paid on its
capital stock any dividend or distribution of any kind, other
than a cash dividend declared on June 26, 2002 and certain
shares of the Company's common stock purchased by the Company
pursuant to its stock repurchase program, (c) neither the
Company nor any of its subsidiaries has entered into any
transactions other than in the ordinary course of business,
that is material to the Company and its subsidiaries,
considered as one enterprise, (d) the Company has not
sustained any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, (e) neither the Company,
the Banks nor any other subsidiary has any material liability
of any nature, contingent or otherwise, except as set forth in
the Prospectus, (f) there has not been any change in the
capital stock, long-term debt or short-term debt of the
Company or any of its subsidiaries, and (g) there has not been
a Material Adverse Effect.
(xxii) The Trust is not in violation of the trust
certificate of the Trust and neither the Company, the Banks
nor any other subsidiary is in violation of any provision of
its articles of incorporation, charter or bylaws or in default
in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other agreement or
instrument to which it is a party or by which it may be bound
or to which any of its properties may be subject, except for
such defaults that, individually or in the aggregate, would
not have a Material Adverse Effect.
(xxiii) There is no action, suit, proceeding or inquiry
before or by any government, governmental instrumentality or
court, domestic or foreign, now pending or, to the knowledge
of the Company, threatened against the Company, the Banks or
any other subsidiary that is required to be disclosed in the
Prospectus or that could reasonably be expected to result in a
Material Adverse Effect, or that could reasonably be expected
materially and adversely to affect the properties or assets of
the Company and its subsidiaries, considered as one
enterprise, or that could reasonably be expected materially
and adversely to affect the consummation of the transactions
contemplated in this Agreement; all pending legal or
governmental proceedings to which the Company, the Banks or
any other subsidiary is a party that are not described in the
Prospectus, including ordinary routine litigation incidental
to its business, if decided in a manner adverse to the
Company, would not have a Material Adverse Effect, provided
however that the Company has given the Representatives notice
of such litigation.
(xxiv) There are no material contracts or documents of a
character required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described and filed as
required.
(xxv) Each of the Company and its direct and indirect
subsidiaries, including the Banks, has good and marketable
title to all properties and assets reflected in the
consolidated financial statements or as described in the
Prospectus as owned by it, free and clear of all liens,
charges, encumbrances or restrictions, except such as (a) are
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described in the consolidated financial statements or the
Prospectus or (b) are neither material in amount nor
materially significant in relation to the business of the
Company and its subsidiaries, considered as one enterprise;
all of the leases and subleases material to the business of
the Company and its subsidiaries, considered as one enterprise
are in full force and effect, and neither the Company, the
Banks nor any other subsidiary has any notice of any material
claim that has been asserted by anyone adverse to the rights
of the Company, the Banks or any other subsidiary under any
such lease or sublease or affecting or questioning the rights
of such corporation to the continued possession of the leased
or subleased premises under any such lease or sublease.
(xxvi) Each of the Company and its direct and indirect
subsidiaries, including each Bank, owns, possesses or has
obtained all material governmental licenses, permits,
certificates, consents, orders, approvals and other
authorizations necessary to own or lease, as the case may be,
and to operate its properties and to carry on its business as
presently conducted, and neither the Company, each Bank nor
any other subsidiary has received any notice of any
restriction upon, or any notice of proceedings relating to
revocation or modification of, any such licenses, permits,
certificates, consents, orders, approvals or authorizations.
(xxvii) The Trust and the Company and its subsidiaries
possess all material licenses, certificates, authorities or
permits issued by the appropriate state or federal regulatory
agencies or bodies necessary to conduct their businesses as
described in the Prospectus, and neither the Company nor its
subsidiaries have received any notice of proceedings relating
to the revocation or modification of any such license,
certificate, authority or permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling
or finding, would have a Material Adverse Effect. Neither the
Company nor any of its subsidiaries is party to or otherwise
the subject to any consent decree, consensual resolutions,
memorandum of understanding, written commitment or other
supervisory agreement with the Board of Governors of the
Federal Reserve System or any Federal Reserve Bank, the FDIC,
the Office of the Comptroller of the Currency, or any other
federal or state authority or agency responsible for the
supervision, regulation or insurance of depository
institutions or their holding companies.
(xxviii) The Company does not require any consent,
approval, authorization, order or declaration of or from, or
registration, qualification or filing with, any court or
governmental agency or body in connection with the sale of the
Preferred Securities or the consummation of the transactions
contemplated by this Agreement, except the registration of the
Preferred Securities, the Guarantee and the Debentures under
the Act (which, if the Registration Statement is not effective
as of the time of execution hereof, shall be obtained as
provided in this Agreement) and such as may be required by the
NASD, Nasdaq Stock Market's National Market (the "Nasdaq
National Market") or under state securities or blue sky laws
in connection with the offer, sale and distribution of the
Preferred Securities by the Underwriters, including the
listing of the Preferred Securities on the Nasdaq National
Market.
(xxix) No labor problem with the employees of the
Company, the Banks or any other subsidiary exists or, to the
best knowledge of the Company, is imminent that could
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Company and its subsidiaries, considered as one
enterprise, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its, the
Banks' or any other subsidiary's principal suppliers,
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contractors or customers that could reasonably be expected to
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Company and its subsidiaries, considered as one
enterprise.
(xxx) Except as disclosed in the Prospectus, there are no
persons with registration or other similar rights to have any
securities of the Company registered pursuant to the
Registration Statement or otherwise registered by the Company
under the 1933 Act.
(xxxi) Except as disclosed in the Prospectus, the Company
and its direct and indirect subsidiaries, including the Banks,
own or possess all patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets or
other unpatented and/or unpatentable proprietary or
confidential information systems or procedures), trademarks,
service marks and trade names (collectively, "patent and
proprietary rights") currently employed by them in connection
with the business now operated by them except where the
failure to own, possess or acquire such patent and proprietary
rights would not have a Material Adverse Effect. Neither the
Company, the Banks nor any other subsidiary has received any
notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any
patent or proprietary rights, and which infringement or
conflict (if the subject of any unfavorable decision, rule and
refinement, singly or in the aggregate) could reasonably be
expected to have a Material Adverse Effect.
(xxxii) The Company and each subsidiary of the Company
have filed all federal, state, local, foreign income,
franchise or other tax returns required to be filed and have
made timely payments of all taxes, related assessments, fines
or penalties due and payable, and no material deficiency has
been asserted with respect thereto by any taxing authorities.
All tax liabilities have been adequately provided for in the
consolidated financial statements of the Company and the
Company has provided the Representatives with notice of any
pending audits of the Company or any of it subsidiaries by any
taxing authorities.
(xxxiii) The Preferred Securities have been approved for
listing on the Nasdaq National Market.
(xxxiv) The Company has filed with the NASD all documents
and notices required by the NASD of companies that have issued
securities that are traded on the Nasdaq National Market.
(xxxv) Neither the Company nor any of its subsidiaries
have: (i) issued any securities within the last 18 months
(except for notes to evidence bank loans or other liabilities
in the ordinary course of business, shares of the Company's
common stock issued under the Company's dividend reinvestment
plan, stock option plans, employee stock purchase plan, and
other stock-based benefit plans, or as described in the
Prospectus); (ii) had any dealings with respect to sales of
securities within the 12 months prior to the date hereof with
any member of the NASD, or any person related to or associated
with such member, other than discussions and meetings relating
to the Offering and purchases and sales of U.S. government and
agency and other securities in the ordinary course of
business; or (iii) engaged any intermediary other than the
Underwriters in connection with the Offering and no person is
being compensated in any manner for such services.
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(xxxvi) Neither the Trust, the Company, the Banks nor any
other subsidiary has taken or will take, directly or
indirectly, any action designed to cause or result in, or
which has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation, under the 1934
Act or otherwise, of the price of the Preferred Securities.
(xxxvii) Neither the Company, the Banks nor any other
subsidiary is or has been (by virtue of any action, omission
to act, contract to which it is a party or by which it is
bound, or any occurrence or state of facts whatsoever) in
violation of any applicable foreign, federal, state, municipal
or local statutes, laws, ordinances, rules, regulations and/or
orders issued pursuant to foreign, federal, state, municipal
or local statutes, laws, ordinances, rules, or regulations
(including those relating to any aspect of banking, bank
holding companies, consumer credit, truth-in-lending, usury,
currency transaction reporting, environmental protection,
occupational safety and health and equal employment practices)
heretofore or currently in effect, except such violations that
have been fully cured or satisfied without recourse or that in
the aggregate will not have a Material Adverse Effect.
(xxxviii) Each of the Company and its subsidiaries makes
and keeps accurate books and records reflecting its assets and
maintains internal accounting controls which provide
reasonable assurance that (a) transactions are executed in
accordance with management's authorization, (b) transactions
are recorded as necessary to permit preparation of the
Company's consolidated financial statements in accordance with
accounting principles generally accepted in the United States
of America and to maintain accountability for the assets of
the Company, (c) access to the assets of the Company and each
of its subsidiaries is permitted only in accordance with
management's authorization, and (d) the recorded
accountability for assets of the Company and each of its
subsidiaries is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences.
(xxxix) The Company has no off-balance sheet interests or
investments other than those in which it holds a less than 5%
interest.
(xl) The Company has not relied upon the Representatives,
Underwriters or legal counsel for the Representatives and
Underwriters for any legal, tax or accounting advice in
connection with the Offering.
(xli) The Company and each subsidiary have in place and
effective such policies of insurance, with limits of liability
in such amounts, as are normal and prudent in the ordinary
scope of business similar to that of the Company and such
subsidiary in the respective jurisdiction in which they
conduct business.
(xlii) The form of certificate used to evidence the
Preferred Securities complies in all material respects with
all applicable statutory requirements, with any applicable
requirements of the charter and by-laws of the Company and the
requirements of the Nasdaq National Market;
(xliii) None of the Company's securities nor any deposit
instruments of the Banks have ever been, or currently are,
rated by any "nationally recognized statistical rating
organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the 1933 Act Regulations.
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(xliv) Neither the Company, the Banks nor any other
subsidiary has any agreement or understanding or any other
arrangement with any person (a) concerning the future
acquisition by the Company or the Bank of a controlling
interest in any entity or (b) concerning the future
acquisition by any person of a controlling interest in the
Company, the Banks or any other subsidiary, in either case
that is required by the 1933 Act or the 1933 Act Regulations
to be disclosed by the Company that is not disclosed in the
Prospectus.
(b) Any certificate signed by any authorized officer of the
Company or a Bank and delivered to the Underwriters or to counsel for the
Underwriters pursuant to this Agreement shall be deemed a representation and
warranty by the Company to the Underwriters as to the matters covered thereby.
Section 2. Sale and Delivery to the Underwriters; Closing.
(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Trust
agrees to sell to the Underwriters, and the Underwriters agrees to purchase from
the Trust, the Initial Securities at the purchase price and terms set forth
herein and in the Price Determination Agreement.
In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Trust hereby grants an option to the Underwriters to purchase the
Option Securities in accordance with the terms set forth herein and in the Price
Determination Agreement. The option hereby granted will expire at 9:00 p.m. on
the 30th day after the date the Registration Statement is declared effective by
the Commission (or at 9:00 p.m. on the next business day following the 30th day
if such 30th day is not a business day) and may be exercised, solely 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
Representatives to the Company setting forth the number of Option Securities as
to which Underwriters are exercising the option and the time, date and place of
payment and delivery for the Option Securities. Such time and date of delivery
(the "Option Closing Date") shall be determined by the Representatives but shall
not be later than five full business days after the exercise of said option, nor
in any event prior to Closing Time, as hereinafter defined, nor earlier than the
second business day after the date on which the notice of the exercise of the
option shall have been given.
(b) Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Drinker
Xxxxxx & Xxxxx LLP ("Drinker Xxxxxx"), One Xxxxx Square, 18th & Cherry Streets,
Philadelphia, Pennsylvania 19103, or at such other place as shall be agreed upon
by the Company and the Representatives, at 9:30 a.m. on the third full business
day after the effective date of the Registration Statement, or at such other
time not earlier than three nor more than ten full business days thereafter as
the Representatives and the Company shall determine (such date and time of
payment and delivery being herein called the "Closing Time"). In addition, in
the event that any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price for, and delivery of certificates
for, such Option Securities shall be made at the above-mentioned office of
Drinker Xxxxxx, or at such other place as shall be agreed upon by the Company
and the Representatives, on the Option Closing Date as specified in the notice
from the Representatives to the Company. Payment for the Initial Securities and
the Option Securities, if any, shall be made to the Company by wire transfer of
immediately available funds, against delivery to the Representatives for the
account of the Underwriters of Preferred Securities to be purchased by it.
(c) The Preferred Securities shall be issued in the form of
one or more fully registered global securities (the "Global Securities") in
book-entry form in such denominations and registered in the name of the nominee
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of The Depository Trust Company ("DTC") or in such names as the Representatives
may request in writing at least one business day before the Closing Date or the
Option Closing Date, as the case may be. The Global Securities representing the
Initial Securities or the Option Securities to be purchased will be made
available for examination by the Representatives and counsel to the
Representatives and Underwriters not later than 10:00 a.m. on the business day
prior to the Closing Time or the Option Closing Date, as the case may be.
Section 3. Certain Covenants of the Offerors. Each of the
Offerors covenants jointly and severally with the Underwriters as follows:
(a) The Offerors will use their best efforts to cause the
Registration Statement to become effective and will notify the Underwriters
immediately, and confirm the notice in writing, (i) when the Registration
Statement, or any post-effective amendment to the Registration Statement, shall
have become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request of the Commission to amend the Registration
Statement or amend or supplement the Prospectus or for additional information
and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Preferred Securities for offering or sale in any
jurisdiction, or of the institution or threatening of any proceedings for any of
such purposes. The Offerors will use every reasonable effort to prevent the
issuance of any such stop order or of any order preventing or suspending such
use and, if any such order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) The Company will not file with the Commission the
Prospectus or the amendment referred to in Section 3(a) hereof, any amendment or
supplement to the Prospectus or any amendment to the Registration Statement
unless the Underwriters have received a reasonable period of time to review any
such proposed amendment or supplement and consented to the filing thereof and
will use its best efforts to cause any such amendment to the Registration
Statement to be declared effective as promptly as possible. Upon the reasonable
request of the Underwriters or counsel for the Underwriters, the Company will
promptly prepare and file with the Commission, in accordance with the rules and
regulations of the Commission, any amendments to the Registration Statement or
amendments or supplements to the Prospectus that may be necessary or advisable
in connection with the distribution of the Preferred Securities by the
Underwriters and will use its best efforts to cause any such amendment to the
Registration Statement to be declared effective as promptly as possible. If
required, the Company will file any amendment or supplement to the Prospectus
with the Commission in the manner and within the time period required by Rule
424(b). The Company will advise the Underwriters, promptly after receiving
notice thereof, of the time when the Registration Statement or any amendment
thereto has been filed or declared effective or the Prospectus or any amendment
or supplement thereto has been filed and will provide evidence to the
Underwriters of each such filing or effectiveness.
(c) The Offerors will not at any time file or make any
amendment to the Registration Statement or, if the Offerors have elected to rely
upon Rule 430A, any amendment or supplement to the Prospectus (including
documents incorporated by reference into the Registration Statement or the
Prospectus) of which the Underwriters shall not previously have been advised and
furnished a copy, or to which the Underwriters or counsel for the Underwriters
shall reasonably object.
(d) The Offerors have furnished or will furnish to the
Underwriters as many signed and conformed copies of the Registration Statement
as originally filed and of each amendment thereto, whether filed before or after
the Registration Statement becomes effective, copies of all exhibits and
documents filed therewith (including documents incorporated by reference into
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the Prospectus pursuant to Item 12 of Form S-3 under the 1933 Act) and signed
copies of all consents and certificates of experts as the Underwriters may
reasonably request.
(e) The Offerors will deliver or cause to be delivered to the
Underwriters, without charge, from time to time until the effective date of the
Registration Statement, as many copies of each preliminary prospectus as the
Underwriters may reasonably request, and the Offerors hereby consent to the use
of such copies for purposes permitted by the 1933 Act. The Offerors will deliver
or cause to be delivered to the Underwriters, without charge, as soon as the
Registration Statement shall have become effective (or, if the Offerors have
elected to rely upon Rule 430A, as soon as practicable after the Price
Determination Agreement has been executed and delivered) and thereafter from
time to time as requested by the Underwriters during the period when the
Prospectus is required to be delivered under the 1933 Act, such number of copies
of the Prospectus (as supplemented or amended) as the Underwriters may
reasonably request.
(f) The Offerors will endeavor, in cooperation with the
Underwriters, to qualify the Preferred Securities and Debentures for offering
and sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Underwriter may designate (with the
prior approval of the Offerors), and will maintain such qualifications in effect
for as long as may be required for the distribution of the Preferred Securities,
except that neither of the Offerors shall be required in connection therewith to
qualify as a foreign corporation or to execute a general consent to service of
process in any state or other jurisdiction. The Offerors will file such
statements and reports as may be required by the laws of each jurisdiction in
which the Preferred Securities have been qualified as above provided.
(g) The Company will comply with the 1933 Act and the 1933 Act
Regulations, and the 1934 Act and the 1934 Act Regulations, so as to permit the
completion of the distribution of the Preferred Securities as contemplated in
this Agreement and in the Prospectus. If, at any time when a prospectus is
required by the 1933 Act to be delivered in connection with sales of the
Preferred Securities, any event shall occur or condition exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Underwriters
or counsel for the Offerors, to amend the Registration Statement or amend or
supplement the Prospectus in order that 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 not misleading, in light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary to amend the Registration Statement or amend or supplement
the Prospectus in order to comply with the requirements of the 1933 Act or the
1933 Act Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(b) hereof, such amendment or supplement as may
be necessary to correct such untrue statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements and will
furnish without charge to each of the Underwriters and dealers as many copies of
such amended and supplemented Prospectus as may from time to time be reasonably
requested.
(h) The Company will make generally available (within the
meaning of Rule 158 of the 1933 Act Regulations ("Rule 158")) to the holders of
the Preferred Securities and the Underwriters as soon as practicable, but not
later than 90 days after the close of the period covered thereby if such quarter
is the last fiscal quarter of the Company's fiscal year and in all other cases
not later than 45 days after the close of the period covered thereby, an
earnings statement of the Company and its subsidiaries (in form complying with
the provisions of Rule 158) covering a period of at least 12 months beginning
after the effective date of the Registration Statement but not later than the
first day of the Company's fiscal quarter next following such effective date.
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(i) The Trust shall apply the entire proceeds from its sale of
the Preferred Securities, combined with the entire proceeds from the issuance by
the Trust to the Company of the Trust's Common Securities, to purchase an
equivalent amount of Debentures from the Company. The Company and the Bank will
use the net proceeds received by them from the sale of the Debentures in the
manner specified in the Prospectus under the caption "Use of Proceeds."
(j) The Offerors, during the period when a prospectus is
required by the 1933 Act to be delivered in connection with sales of Preferred
Securities, will file promptly all documents required to be filed with the
Commission pursuant to Section 13 or 14 of the 1934 Act subsequent to the time
the Registration Statement becomes effective.
(k) For a period of five years after the Closing Time, the
Company will furnish to the Underwriters copies of all annual reports, quarterly
reports and current reports filed by the Company with the Commission and such
other documents, reports, proxy statements and communication (financial or
otherwise) as shall be furnished by the Company to its shareholders generally.
(l) The Company will provide to the holders of the Preferred
Securities annual reports containing financial statements audited by the
Company's independent auditors and, provided the Company continues to be subject
to the 1934 Act, upon written request, the Company's annual reports on Form
10-K.
(m) The Offerors will take such action as may be necessary to
comply with the rules and regulations of the Nasdaq National Market in respect
of the Offering of the Preferred Securities.
(n) The Company shall pay (as provided in Section 4(a)(vi))
the legal fees and related filing fees of Drinker Xxxxxx & Xxxxx LLP, counsel to
the Underwriters, to prepare one or more "blue sky" surveys (each, a "Blue Sky
Survey") for use in connection with the Offering of the Preferred Securities as
contemplated by the Prospectus and a copy of such Blue Sky Survey or surveys
shall be delivered to each of the Company and the Underwriters.
(o) If, at the time the Registration Statement becomes
effective, any information shall have been omitted therefrom in reliance upon
Rule 430A, then the Offerors will prepare, and file or transmit for filing with
the Commission in accordance with Rule 430A and Rule 424(b), copies of an
amended Prospectus or, if required by Rule 430A, a post-effective amendment to
the Registration Statement (including an amended Prospectus) containing all
information so omitted.
(p) The Company will, at its expense, subsequent to the
issuance of the Preferred Securities, prepare and distribute to the Underwriters
and counsel to the Underwriters copies of the documents used in connection with
the issuance of the Preferred Securities.
(q) The Offerors will not, prior to the Option Closing Date or
thirty (30) days after the date of this Agreement, whichever occurs first, incur
any material liability or obligation, direct or contingent, or enter into any
material transaction, other than in the ordinary course of business, or any
transaction with a related party which is required to be disclosed in the
Prospectus pursuant to Item 404 of Regulation S-K of the Commission, except as
contemplated by the Prospectus.
(r) Neither the Company nor the Trust shall enter into any
contractual agreement with respect to the distribution of the Preferred
Securities except for the arrangements with the Underwriters.
(s) During a period of thirty (30) days from the date of the
Prospectus, neither the Trust nor the Company will, without the prior written
consent of the Underwriters, (i) other than any Preferred Securities to be sold
-15-
hereunder, directly or indirectly, offer, sell, offer to sell, or otherwise
dispose of any Preferred Securities, any other beneficial interests in the
assets of the Trust, or any preferred securities or other securities of the
Trust or the Company that are substantially similar to the Preferred Securities,
including any guarantee of such securities or (ii) enter into any swap or other
agreement or any transaction that transfers, in whole or in part, the economic
consequences of ownership of the Preferred Securities whether any such swap or
other agreement is to be settled by delivery of shares of Preferred Securities,
other securities, cash or otherwise.
Section 4. Payment of Expenses.
(a) The Offerors jointly and severally will pay and bear all
costs and expenses incident to the performance of its and the Trust's
obligations under this Agreement (except for the fees and disbursements of
counsel for the Underwriters other than those fees permitted under Section
4(a)(vi)), including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits), as
originally filed and as amended, all amendments thereto, all preliminary
prospectuses, the Prospectus and any amendments or supplements thereto, and the
cost of furnishing copies thereof to the Underwriters, (ii) the preparation,
printing and distribution of this Agreement, the Preferred Securities and the
Blue Sky Survey, (iii) the issuance and delivery of the Preferred Securities to
the Underwriters, including any transfer taxes payable upon the sale of the
Preferred Securities to the Underwriters, (iv) the fees and disbursements of the
Company's counsel and accountants, (v) Commission and Nasdaq National Market
filing fees, (vi) fees and disbursements of Drinker Xxxxxx & Xxxxx LLP in
connection with the Blue Sky Survey (not to exceed $20,000), (vii) the
qualification of the Preferred Securities and Debentures under the applicable
securities laws in accordance with Section 3(f) hereof, (viii) any filing fee
for review of the Offering by the NASD, (ix) the fees and expenses of the
Indenture Trustee, including the fees and disbursements of counsel for the
Indenture Trustee, in connection with the Indenture and the Debentures; (x) the
fees and expenses of the Property Trustee, Delaware Trustee and Guarantee
Trustee, including the fees and disbursements of counsel for the Property
Trustee, Delaware Trustee and Guarantee Trustee, in connection with the Trust
Agreement, the Certificate of Trust and the Guarantee Agreement, (xi) the costs
of settlement in same day funds, if desired by the Company, and (xii) all other
costs incident to the performance of the Offerors' obligations hereunder.
(b) If (i) the Company abandons or terminates the Offering, or
(ii) this Agreement is terminated by the Representatives in accordance with the
provisions of Section 5 or 9(a), the Company shall reimburse the Representatives
and Underwriters for their reasonable out-of-pocket accountable expenses
actually incurred, as set forth in this Section 4, and the reasonable fees and
disbursements of counsel for the Representatives and Underwriters, not to exceed
$100,000 and, in the case of fees and expenses covered by, Section 4(a)(vi), not
to exceed an additional $20,000.
Section 5. Conditions of Underwriters' Obligations. The
obligations of the Underwriters to purchase and pay for the Preferred Securities
that it has agreed to purchase pursuant to this Agreement are subject to the
accuracy of the representations and warranties of the Offerors contained herein
or in certificates of the officers or trustees of the Offerors or any subsidiary
delivered pursuant to the provisions hereof, to the execution of the Price
Determination Agreement no later than 5:30 p.m. on the first business day
following the date hereof, or at such later time as the Representatives may
agree in writing (in the Representatives' sole discretion), to the performance
by the Offerors of their respective obligations hereunder and to the following
further conditions:
(a) The Registration Statement shall have become effective not
later than 4:00 p.m. on the first business day following the date hereof, or at
such later time or on such later date as the Representatives may agree to in
writing; at the Closing Time, no stop order suspending the effectiveness of the
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Registration Statement shall have been issued under the 1933 Act and no
proceedings for that purpose shall be pending or, to the Representatives'
knowledge or the knowledge of the Offerors, shall be contemplated 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 for the
Representatives. If the Offerors have elected to rely upon Rule 430A, a
prospectus containing the information required by Rule 430A shall have been
filed with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A).
(b) At the Closing Time, the Underwriters shall have received:
(i) The favorable opinion, dated as of the Closing Time,
of Xxxxxxxxx, Xxxxxxx, Xxxxxx & Xxxxxxx, P.C. ("Xxxxxxxxx,
Xxxxxxx"), counsel for the Company, in form and substance
reasonably satisfactory to counsel for the Underwriters,
substantially in the form set forth in Exhibit B. Such counsel
shall state in such opinion that Drinker Xxxxxx shall be
entitled to rely thereon in rendering its opinion contemplated
by Section 5(b)(iv) hereof.
(ii) The favorable opinion, dated as of the Closing Time,
of Xxxxxxxx, Xxxxxx & Xxxxxx, P.A. ("Xxxxxxxx, Xxxxxx")
special Delaware counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriters,
substantially in the form set forth in Exhibit C. Such counsel
shall state in such opinion that Drinker Xxxxxx shall be
entitled to rely thereon in rendering its opinion contemplated
by Section 5(b)(iv) hereof.
(iii) The favorable opinion, dated as of the Closing
Time, of Xxxxxxxx, Xxxxxx, counsel for the Trust Company, in
form and substance satisfactory to counsel for the
Underwriters, substantially in the form set forth in Exhibit
D. Such counsel shall state in such opinion that Drinker
Xxxxxx shall be entitled to rely thereon in rendering its
opinion contemplated by Section 5(b)(iv) hereof.
(iv) The favorable opinion, dated as of the Closing Time,
of Drinker Xxxxxx, counsel for the Underwriters, in form and
substance satisfactory to the Underwriters. The Offerors shall
have furnished Drinker Xxxxxx with such documents as they
request for purposes of enabling it to render such opinion.
In giving such opinions, such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the federal law of the
United States of America or the laws of Delaware in the case of Xxxxxxxx,
Xxxxxx, upon opinions of other counsel, who shall be counsel satisfactory to
counsel for the Underwriters, in which case the opinion shall state that such
counsel believes that it, the Underwriters and the Underwriters' counsel are
entitled to so rely upon the opinions of such other counsel. Such counsel may
also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers or
trustees of the Company, the Banks and the Trust and certificates of public
officials.
(c) At the Closing Time and again at the Option Closing Date,
(i) the Registration Statement and the Prospectus, as they may then be amended
or supplemented, shall contain all statements that are required to be stated
therein under the 1933 Act and the 1933 Act Regulations and shall conform in all
material respects to the requirements of the 1933 Act and the 1933 Act
Regulations, the Offerors shall have complied in all material respects with Rule
430A (if they shall have elected to rely thereon), and neither the Registration
Statement nor the Prospectus, as they may then be amended or supplemented, shall
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; (ii) there shall not have been, since the respective dates as of
-17-
which information is given in the Registration Statement, a Material Adverse
Effect, whether or not arising in the ordinary course of business; (iii) no
action, suit or proceeding at law or in equity shall be pending or, to the
knowledge of the Offerors, threatened against the Company or any subsidiary or
the Trust that would be required to be set forth in the Prospectus that is not
set forth therein, and no proceedings shall be pending or, to the knowledge of
the Offerors, threatened against either of the Offerors or any subsidiary of the
Company before or by any federal, state or other commission, board or
administrative agency wherein an unfavorable decision, ruling or finding would
have a Material Adverse Effect, other than as set forth in the Prospectus; (iv)
each of the Offerors shall have complied, in all material respects, with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to the Closing Time or Option Closing Date, as applicable; (v) the
other representations and warranties of the Offerors set forth in Section l(a)
hereof shall be accurate in all material respects as though expressly made at
and as of the Closing Time or Option Closing Date, as applicable; and (vi) no
stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceeding for that purpose been initiated or, to the best
knowledge of the Offerors, threatened by the Commission. At the Closing Time,
the Representatives shall have received a certificate of the Chairman of the
Board or the President and the Chief Financial Officer of the Company, dated as
of the Closing Time, to such effect.
(d) At the time that this Agreement is executed by the
Company, the Representatives shall have received from Xxxxx Xxxxxxxx LLP a
letter or letters, dated such date, in form and substance satisfactory to the
Representatives, confirming that they are independent certified public
accountants with respect to the Company within the meaning of the 1933 Act and
the 1933 Act Regulations and the 1934 Act and 1934 Act Regulations, and stating
in effect that, with respect to the Company:
(i) in their opinion, the consolidated financial
statements as of December 31, 2001 and 2000, and for each of
the years in the three year period ended December 31, 2001
included or incorporated by reference in the Registration
Statement and the Prospectus and covered by their opinions
included therein comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act
and the 1933 Act Regulations, and the 1934 Act and the 1934
Act Regulations;
(ii) on the basis of procedures (but not an audit in
accordance with accounting standards generally accepted in the
United States of America) specified by the American Institute
of Certified Public Accountants for a review of interim
financial information as described in SAS No. 71, Interim
Financial Information, including a reading of the latest
available unaudited interim consolidated financial statements
of the Company, a reading of the minutes of all meetings of
the Board of Directors of the Company and National Penn Bank
and NPB Delaware, Inc. and of the Audit and Executive
Committees of the Board of Directors of the Company, and
National Penn Bank, inquiries of certain officials of the
Company and its subsidiaries responsible for financial and
accounting matters, and such other inquiries and procedures as
may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited interim consolidated financial
information included or incorporated by reference in the
Prospectus, if any, do not comply as to form in all
material respects with applicable accounting requirements
of the 1933 Act, or are not presented in conformity with
accounting principles generally accepted in the United
States of America applied on a basis consistent with that
of the audited financial statements included in the
Prospectus;
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(B) at a specified date not more than three business
days prior to the date of this Agreement, there was any
increase in total borrowings, including Federal Home Loan
Bank advances of the Company and its consolidated
subsidiaries or any decrease in total assets, total
deposits or stockholders' equity of the Company and its
consolidated subsidiaries, any increase in the number of
outstanding shares of capital stock of the Company and
its consolidated subsidiaries or any increase or decrease
in the allowance for loan losses of the Company and its
consolidated subsidiaries, in each case as compared with
amounts shown in the financial statements at June 30,
2002 included in the Registration Statement, except in
all cases for changes, increases or decreases that the
Registration Statement discloses have occurred or may
occur; or
(C) for the period from June 30, 2002 to a specified
date not more than three business days prior to the date
of this Agreement, there was any decrease in consolidated
net interest income, non-interest income, net income or
net income per share diluted or any increase in the
consolidated provision for loan losses, in each case as
compared with a period of comparable length in the
preceding year, except in all cases for changes,
increases or decreases that the Registration Statement
discloses have occurred or may occur; and
(iii) in addition to the procedures referred to in clause
(ii) above, they have performed other specified procedures,
not constituting an audit, with respect to certain amounts,
percentages, numerical data and financial information
appearing in the Registration Statement (including the
Selected Consolidated Financial Data) (having compared such
items with, and except as provided in an appendix to such
letter or letters have found such items to be in agreement
with, the financial statements of the Company or general
accounting records of the Company, as applicable, which are
subject to the Company's internal accounting controls or other
data and schedules prepared by the Company from such records).
(e) At the Closing Time, the Representatives shall have
received from Xxxxx Xxxxxxxx LLP a letter, in form and substance satisfactory to
the Representatives and dated as of the Closing Time, reaffirming the statements
made in the letter(s) furnished pursuant to Section 5(d) hereof, except that the
inquiries specified in Section 5(d) hereof shall be made based upon the latest
available unaudited interim consolidated financial statements and the specified
date referred to shall be a date not more than three days prior to the Closing
Time.
(f) At the Closing Time, counsel for the Representatives shall
have been furnished with all such documents, certificates and opinions as they
may request for the purpose of enabling them to pass upon the issuance and sale
of the Preferred Securities as contemplated in this Agreement and the matters
referred to in Section 5(c) hereof and in order to evidence the accuracy and
completeness of any of the representations, warranties or statements of the
Offerors, the performance of any of the covenants of the Offerors or the
fulfillment of any of the conditions herein contained; and all proceedings taken
by the Company at or prior to the Closing Time in connection with the
authorization, issuance and sale of the Preferred Securities and the Debentures
as contemplated in this Agreement shall be satisfactory in form and substance to
the Representatives and to counsel for the Representatives.
(g) The Company shall have paid, or made arrangements
satisfactory to the Underwriters for the payment of, all such expenses as may be
required by Section 4 hereof.
-19-
(h) In the event the Underwriters exercise the option provided
in Section 2 hereof to purchase all or any portion of the Option Securities, the
obligations of the Underwriters to purchase the Option Securities that it has
agreed to purchase shall be subject to the receipt by the Representatives on the
Option Closing Date of:
(i) A certificate, dated the Option Closing Date, of the
Chairman of the Board or the President and the Chief Financial
Officer of the Company confirming that the certificate
delivered at the Closing Time pursuant to Section 5(c) hereof
remains true as of the Option Closing Date;
(ii) The favorable opinion of Xxxxxxxxx, Xxxxxxx, counsel
for the Company, addressed to the Underwriters and dated the
Option Closing Date, in form satisfactory to counsel to the
Underwriters, relating to the Option Securities and otherwise
to the same effect as the opinion required by Section 5(b)(i)
hereof;
(iii) The favorable opinion of Xxxxxxxx, Xxxxxx, special
Delaware counsel for the Offerors, addressed to the
Underwriters and dated the Option Closing Date, in form
satisfactory to counsel to the Underwriters, relating to the
Option Securities and otherwise to the same effect as the
opinion required by Section 5(b)(ii) hereof;
(iv) The favorable opinion of Xxxxxxxx, Xxxxxx, counsel
for the Trust Company, addressed to the Underwriters and dated
the Option Closing Date, in form satisfactory to counsel to
the Underwriters, relating to the Option Securities and
otherwise to the same effect as the opinion required by
Section 5(b)(iii) hereof;
(v) The favorable opinion of Drinker Xxxxxx, counsel to
the Underwriters, dated the Option Closing Date, relating to
the Option Securities and otherwise to the same effect as the
opinion required by Section 5(b)(iv) hereof; and
(vi) A letter from Xxxxx Xxxxxxxx LLP addressed to the
Underwriters and dated the Option Closing Date, in form and
substance satisfactory to the Underwriters and substantially
the same in form and substance as the letter(s) furnished to
the Underwriters pursuant to Section 5(e) hereof.
(i) The Preferred Securities, the Guarantee and the Debentures
shall have been qualified or registered for sale, or subject to an available
exemption from such qualification or registration, under the "blue sky" or
securities laws of such jurisdictions as shall have been reasonably specified by
the Representatives in accordance with Section 3(f), and the Offering
contemplated by this Agreement shall have been cleared by the NASD.
If any of the conditions specified in this Section 5 shall not
have been fulfilled when and as required by this Agreement, this Agreement may
be terminated by the Representatives on notice to the Offerors 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 of this Agreement.
Notwithstanding any such termination, the provisions of Sections 4, 6, 7, 10 and
12 of this Agreement shall remain in effect.
Section 6. Indemnification.
(a) The Offerors jointly and severally agree to indemnify and
hold harmless the Underwriters, each officer, director, employee, agent and
legal counsel of the Underwriters, and each person, if any, who controls the
Underwriters within the meaning of Section 15 of the 1933 Act or Section 20(a)
-20-
of the 1934 Act, against any loss, liability, claim, damage and expense
whatsoever (which shall include, but not be limited to, amounts incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim or investigation whatsoever and any and all amounts
paid in settlement of any claim or litigation, provided such settlement is
entered into with the consent of the Offerors as provided herein), as and when
incurred, arising out of, based upon or in connection with (i) any untrue
statement or alleged untrue statement of a material fact or any omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, contained in (A) any
preliminary prospectus, the Registration Statement or the Prospectus (as from
time to time amended and supplemented), or any amendment or supplement thereto
or in any document incorporated by reference therein or required to be delivered
with any preliminary prospectus or the Prospectus or (B) in any application or
other document or communication (collectively called an "application") executed
by or on behalf of the Company or the Trust or based upon written information
furnished by or on behalf of the Company or the Trust filed in any jurisdiction
in order to qualify the Preferred Securities under the "blue sky" or securities
laws thereof or filed with the Commission, the NASD or any securities exchange,
unless such statement or omission or alleged statement or omission was made in
reliance upon and in conformity with written information concerning the
Underwriters, this Agreement or the compensation of the Underwriters furnished
to the Offerors by or on behalf of the Underwriters expressly for inclusion in
any preliminary prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or in any application, as the case may be, or
(ii) any breach of any representation, warranty, covenant or agreement of the
Offerors contained in this Agreement. For purposes of this section, the term
"expense" shall include, but not be limited to, counsel fees and costs, court
costs, out-of-pocket costs and compensation for the time spent by any of the
Underwriters' directors, officers, employees and counsel according to his or her
normal hourly billing rates. The indemnification provisions shall also extend to
all directors, officers, employees, agents, legal counsel and controlling
persons of each affiliate of the Underwriters.
(b) Each of the Underwriters severally but not jointly agrees
to indemnify and hold harmless each of the Offerors, each of their directors or
trustees, each officer who signed the Registration Statement, and each person,
if any, who controls the Offerors within the meaning of Section 15 of the 1933
Act or Section 20(a) of the 1934 Act, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
above, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in any preliminary prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or any application in reliance upon and in conformity with written
information about the Underwriters, this Agreement or the compensation of the
Underwriters, furnished to either of the Offerors by the Underwriters expressly
for inclusion in such preliminary prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or in any application.
(c) An indemnified party shall give prompt notice to each
indemnifying party if any action, suit, proceeding or investigation is commenced
in respect of which indemnity may be sought hereunder, but failure to notify an
indemnifying party shall not relieve the indemnifying party from its obligations
to indemnify hereunder, except to the extent that the indemnifying party has
been prejudiced in any material respect by such failure. If it so elects within
a reasonable time after receipt of such notice, an indemnifying party may assume
the defense of such action, including the employment of counsel satisfactory to
the indemnified parties and the payment of all expenses of the indemnified party
in connection with such action. Such indemnified party or parties shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such indemnified party or
parties unless the employment of such counsel shall have been authorized in
writing by the indemnifying party in connection with the defense of such action
or the indemnifying party shall not have promptly employed counsel satisfactory
to such indemnified party or parties or such indemnified party or parties shall
have reasonably concluded that there may be one or more legal defenses available
-21-
to it or them or to other indemnified parties that are different from or
additional to those available to one or more of the indemnifying parties, in any
of which events such fees and expenses shall be borne by the indemnifying party
and the indemnifying party shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties. The Offerors shall be
jointly and severally liable for any settlement of any claim against the
Underwriters (or any of its directors, officers, employees, agents, legal
counsel or controlling persons) made without the written consent of the
Underwriters, which consent shall not be unreasonably withheld. The Offerors
shall not, without the written consent of the Underwriters, settle or compromise
any claim against the Underwriters (or any of its directors, officers,
employees, agents, legal counsel or controlling persons) based upon
circumstances giving rise to an indemnification claim against the Offerors
hereunder unless such settlement or compromise provides that the Underwriters
and the other indemnified parties shall be unconditionally and irrevocably
released from all liability in respect to such claim.
(d) In order to provide for just and equitable contribution,
if a claim for indemnification pursuant to these indemnification provisions is
made but it is found in a final judgment by a court that such indemnification
may not be enforced in such case, even though the express provisions hereof
provide for indemnification in such case, then the Offerors, on the one hand,
and the Underwriters, on the other hand, shall contribute to the amount paid or
payable by such indemnified persons as a result of such loss, liability, claim,
damage and expense (i) in such proportion as is appropriate to reflect the
relative benefits received by the Offerors, on the one hand, and the
Underwriters, on the other hand, from the underwriting, or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Offerors, on the one
hand, and the Underwriters, on the other hand, in connection with the
statements, acts or omissions which resulted in such loss, liability, claim,
damage and expense, and any other relevant equitable considerations. No person
found liable for a fraudulent misrepresentation or omission shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation or omission. Notwithstanding the foregoing, the Underwriters
shall not be obligated to contribute any amount hereunder that exceeds the
amount of the underwriting commission paid to the Underwriters with respect to
the Preferred Securities purchased by the Underwriters.
(e) The indemnity and contribution agreements contained herein
are in addition to any liability which the Offerors may otherwise have to the
Underwriters. For purposes of Section 6(a) and 6(b) hereof, the statements
contained under the caption "Underwriting" in the Prospectus constitute the only
information furnished to the Offerors in writing by the Underwriters expressly
for use in the Registration Statement or the Prospectus.
(f) Neither termination nor completion of the engagement of
the Underwriters nor any investigation made by or on behalf of the Underwriters
shall affect the indemnification obligations of the Offerors or the Underwriters
hereunder, which shall remain and continue to be operative and in full force and
effect.
Section 7. Representations, Warranties and Agreements to
Survive Delivery. The representations, warranties, indemnities, agreements and
other statements of the Offerors or their officers or trustees set forth in or
made pursuant to this Agreement will remain operative and in full force and
effect regardless of any investigation made by or on behalf of the Offerors or
the Underwriters or any controlling person and will survive delivery of and
payment for the Preferred Securities.
Section 8. Offering by the Underwriters. The Offerors are
advised by the Underwriters that the Underwriters propose to make a public
offering of the Preferred Securities, on the terms and conditions set forth in
the Registration Statement from time to time as and when the Underwriters deems
-22-
advisable after the Registration Statement becomes effective. Because the NASD
is expected to view the Preferred Securities as interests in a direct
participation program, the Offering is being made in compliance with the
applicable provisions of Rule 2810 of the NASD's Conduct Rules.
Section 9. Termination of Agreement.
(a) The Representatives may terminate this Agreement, by
notice to the Offerors, at any time at or prior to the Closing Time (i) if there
has been, since the respective dates as of which information is given in the
Registration Statement, a Material Adverse Effect on the Company, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
outbreak or escalation of existing hostilities or other national or
international calamity or crisis (including without limitation resulting from
terrorist activities), the effect of which on the financial markets of the
United States is such as to make it, in the Representatives' judgment,
impracticable to market the Preferred Securities or enforce contracts for the
sale of the Preferred Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the NASD,
or if trading generally on the Nasdaq National Market or in the over-the-counter
market has been suspended, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices for securities have been required, by such
exchange or by order of the Commission, the NASD or any other governmental
authority with appropriate jurisdiction over such matters, or (iv) if a banking
moratorium has been declared by any federal, Pennsylvania or New York authority,
or (v) if there shall have been such material and substantial change in the
market for securities in general or in political, financial or economic
conditions as in the Representatives' sole judgment makes it inadvisable to
proceed with the offering, sale and delivery of the Preferred Securities on the
terms contemplated by the Prospectus, (vi) if the Representatives reasonably
determines (which determination shall be in good faith) that there has not been
satisfactory disclosure of all relevant financial information relating to the
Offerors in the Offerors' disclosure documents and that the sale of the
Preferred Securities is inadvisable given such disclosures, or (vii) if the
Price Determination Agreement has not been executed by all the parties hereto
prior to 5:30 p.m. on the first business day following the date of this
Agreement.
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party,
except to the extent provided in Section 4 hereof. Notwithstanding any such
termination, the provisions of Sections 4, 6, 7, 10 and 12 hereof shall remain
in effect.
Section 10. Notices. All notices, requests and demands to or
upon a party hereto, to be effective, shall be in writing and shall be sent by
certified or registered mail, return receipt requested, by personal delivery
against receipt, by overnight courier or by facsimile and, unless otherwise
expressly provided herein, shall be deemed to have been validly given or if
delivered immediately when delivered against receipt, one business day after
deposit in the mail, postage prepaid, or with an overnight courier or, in the
case of facsimile notice, when receipt is electronically shown, addressed as
follows:
If to the Underwriters:
Xxxxxx Xxxxxxxxxx Xxxxx LLC
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Managing Director
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with a copy to:
Drinker Xxxxxx & Xxxxx LLP
One Xxxxx Square
18th & Cherry Streets
Philadelphia, Pennsylvania 19103
Attention: Xxxxxxx X. Xxxxxxx, Esq.
If to the Company or the Trust:
National Penn Bancshares, Inc.
Philadelphia & Reading Avenues
Boyertown, Pennsylvania 19512
Attention: Xxxxx X. Xxxxxxx
Chairman, President and CEO
with a copy to:
Xxxxxxxxx, Xxxxxxx, Xxxxxx & Xxxxxxx, P.C.
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: X. Xxxxxxxx Xxxxxxxxx, Esq. or
Xxx X. Xxxxxxx, Esq.
Section 11. Parties. This Agreement is made solely for the
benefit of the Underwriters, and the officers, directors, employees, agents and
legal counsel of the Underwriters specified in Section 6 hereof, the Trust and
the Company and, to the extent expressed, any person controlling the Trust, the
Company or the Underwriters, and the directors of the Company, or trustees of
the Trust, their respective officers who have signed the Registration Statement,
and their respective executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any purchaser, as
such purchaser, from the Underwriters of the Preferred Securities.
Section 12. Arbitration. Any claims, controversies, demands,
disputes or differences between or among the parties hereto or any persons bound
hereby arising out of, or by virtue of, or in connection with, or otherwise
relating to this Agreement shall be submitted to and settled by arbitration
conducted in Pennsylvania before three arbitrators, each of whom shall be
knowledgeable in the field of securities law and investment banking. Such
arbitrators shall be required to apply the contractual provisions hereof in
deciding any matter submitted to them and shall not have any authority, by
reason of this Agreement or otherwise, to render a decision that is contrary to
the mutual intent of the parties as set forth in this Agreement. Such
arbitration shall be conducted in accordance with the rules then obtaining of
the American Arbitration Association. The parties hereto agree to share equally
the responsibility for all fees of the arbitrators, abide by any decision
rendered as final and binding and waive the right to appeal the decision or
otherwise submit the dispute to a court of law for a jury or non-jury trial. The
parties hereto specifically agree that neither party may appeal or subject the
award or decision of any such arbitrator to appeal or review in any court of law
or in equity or in any other tribunal, arbitration system or otherwise. Judgment
upon any award granted by such arbitrator may be enforced in any court having
jurisdiction thereof. Discovery shall be allowed pursuant to the intendment of
the United States Federal Rules of Civil Procedure and as the arbitrators
determine appropriate under the circumstances.
-24-
Section 13. Governing Law and Time. This Agreement shall be
governed by the laws of the Commonwealth of Pennsylvania. Specified times of the
day refer to Eastern Time.
Section 14. Counterparts. This Agreement may be executed in
one or more counterparts, and when a counterpart has been executed by each
party, all such counterparts taken together shall constitute one and the same
agreement.
-25-
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company, the Trust and the
Underwriters in accordance with its terms.
Very truly yours,
NPB CAPITAL TRUST II
By: National Penn Bancshares, Inc., as Depositor
By:
---------------------------------------------
NATIONAL PENN BANCSHARES, INC.
By:
---------------------------------------------
Confirmed and accepted as of the date first above written:
Acting severally on behalf of themselves and the several
Underwriters named in Schedule I hereto
By: XXXXXX XXXXXXXXXX XXXXX LLC
By:
----------------------------------------
By: ADVEST, INC.
By:
---------------------------------------
-26-
EXHIBIT A
NPB Capital Trust II
(a Delaware business trust)
Preferred Securities
% Cumulative Trust Preferred Securities
(Liquidation Amount $25 per Preferred Security)
PRICE DETERMINATION AGREEMENT
-----------------------------
August , 2002
XXXXXX XXXXXXXXXX XXXXX LLC
ADVEST, INC.
as Representatives (the "Representatives")
of the Several Underwriters
Named in Schedule I of the Underwriting
Agreement
c/o Janney Xxxxxxxxxx Xxxxx LLC
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement, dated the date hereof
(the "Underwriting Agreement"), among NPB Capital Trust II, a Delaware business
trust (the "Trust"), National Penn Bancshares, Inc., a Pennsylvania corporation
(the "Company" and, together with the Trust, the "Offerors"), and Xxxxxx
Xxxxxxxxxx Xxxxx LLC and Advest, Inc. who are the Representatives of the several
Underwriters named in Schedule I of the Underwriting Agreement (together the
"Underwriters"). The Underwriting Agreement provides for the purchase by the
Underwriters from the Trust, subject to the terms and conditions set forth
therein, of 2,200,000 of the Trust's __% Cumulative Trust Preferred Securities
having an aggregate liquidation amount of $55,000,000 (the "Preferred
Securities"), subject to the Underwriters' option to purchase up to 330,000
Preferred Securities having an additional aggregate liquidation amount of up to
$8,250,000 (to cover over-allotments, if any). This Agreement is the Price
Determination Agreement referred to in the Underwriting Agreement.
Pursuant to Section 2 of the Underwriting Agreement, the Offerors agree
with the Underwriters as follows:
-27-
1. The public offering price per Preferred Security shall be $25.
2. The purchase price for the Preferred Securities to be paid by the
Underwriters shall be $25 per Preferred Security.
3. The commission per Preferred Security to be paid by the Company to
the Underwriters for its commitment hereunder shall be $ per Preferred Security.
4. The distribution rate on the Preferred Securities shall be % per
annum.
The Offerors represent and warrant to the Underwriters that the
representations and warranties of the Offerors set forth in Section 1(a) of the
Underwriting Agreement are accurate as though expressly made at and as of the
date hereof.
This Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.
If the foregoing is in accordance with the understanding of the
Underwriters of the agreement between the Underwriters and the Offerors, please
sign and return to the Company a counterpart hereof, whereupon this instrument,
along with all counterparts and together with the Underwriting Agreement, shall
be a binding agreement between the Underwriters and the Offerors in accordance
with its terms and the terms of the Underwriting Agreement.
-28-
Very truly yours,
NPB CAPITAL TRUST II
By: National Penn Bancshares, Inc., as Depositor
By:
----------------------------------------------
NATIONAL PENN BANCSHARES, INC.,
By:
----------------------------------------------
Confirmed and accepted as of the date first above written:
Acting severally on behalf of themselves and the several
Underwriters named in Schedule I hereto
By: XXXXXX XXXXXXXXXX XXXXX LLC
By:
----------------------------------------
By: ADVEST, INC.
By:
---------------------------------------
-29-
EXHIBIT B
The opinion of counsel to the Company to be delivered pursuant to
Section 5(b)(i) of the Underwriting Agreement shall be substantially to the
effect that:
1. The Company is a corporation duly organized, validly existing and
duly subsisting under the laws of the Commonwealth of Pennsylvania with
corporate power and authority under such laws to own, lease and operate its
properties and conduct its business as described in the Prospectus. Each direct
and indirect subsidiary of the Company is an entity duly organized as a
corporation or a banking association, validly existing and duly subsisting under
the laws of its respective jurisdiction of organization with corporate or other
power and authority under such laws to own, lease and operate its properties and
conduct its business.
2. The Company is duly registered with the Board of Governors of the
Federal Reserve System as a bank holding company under the Bank Holding Company
Act of 1956, as amended; each subsidiary of the Company that conducts business
as a bank is duly authorized to conduct such business in each jurisdiction in
which such business is currently conducted; and the deposit accounts of National
Penn Bank and Panasia Bank, National Association (each, a "Bank" and
collectively the "Banks") are insured by the Bank Insurance Fund or the Savings
Association Insurance Fund of the Federal Deposit Insurance Corporation (the
"FDIC") up to the maximum allowable limits thereof, and to such counsel's
knowledge no proceedings for the termination or revocation of such insurance are
pending or threatened.
3. National Penn Bank is a national bank duly organized, validly
existing and duly subsisting under the federal laws of the United States of
America with corporate power and authority under such laws to own, lease and
operate its properties and conduct its business; Panasia Bank, National
Association is a national bank duly organized, validly existing and duly
subsisting under the federal laws of the United States of America with corporate
power and authority under such laws to own, lease and operate its properties and
conduct its business; each Bank is duly qualified to transact business as a
foreign corporation and is in good standing in each other jurisdiction in which
it owns or leases property of a nature, or transacts business of a type, that
would make such qualification necessary, except to the extent that the failure
to so qualify or be in good standing would not have a Material Adverse Effect.
4. The Company and each of its direct and indirect subsidiaries (other
than the Banks) are duly qualified to transact business as foreign corporations
under the corporation laws of each jurisdiction in which the Company or such
subsidiary, as the case may be, owns or leases property of a nature, has an
office or transacts business of a type that would make such qualification
necessary, except where the failure so to qualify would not have a Material
Adverse Effect.
5. All of the issued and outstanding shares of capital stock of each of
the Company's direct or indirect subsidiaries have been duly and validly
authorized and issued and are fully paid and nonassessable and, to such
counsel's knowledge, are owned by the Company or one of its wholly-owned
subsidiaries free and clear of any security interests, liens, pledges, claims or
other encumbrances, except where the failure to own such shares free and clear
of any security interests, liens, pledges, claims or other encumbrances would
not have a Material Adverse Effect.
6. The Company had, at the date indicated, a duly authorized and
outstanding capitalization as set forth in the Prospectus under the caption
"Capitalization." The Preferred Securities, Common Securities, the Debentures
and Guarantee conform in all material respects to the description thereof
contained or incorporated by reference in the Prospectus, including without
limitation, as set forth under the captions "Description of the Trust,"
-30-
"Description of the Preferred Securities," "Description of the Debentures,"
"Description of Guarantee" and such description conforms in all material
respects to the rights set forth in the instruments defining the same.
7. The Company has full corporate power and authority to execute,
deliver and perform the Underwriting Agreement, the Trust Agreement, the
Guarantee Agreement and the Indenture (the "Operative Documents") and to issue
and perform its obligations under the Debentures as contemplated by the
Prospectus; the Underwriting Agreement has been duly authorized, executed and
delivered by the Company, and, assuming the due authorization, execution and
delivery thereof by the Trust and the Underwriters, the Underwriting Agreement
constitutes a legal, valid, and binding obligation of each of the Company and
the Trust, enforceable against each of the Company and the Trust in accordance
with its terms, except as enforceability of the Underwriting Agreement may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or affecting creditors' rights generally and by general
equity principles (whether considered in a proceeding in equity or at law).
8. The Underwriting Agreement is a legal, valid and binding obligation
of the Trust enforceable against it in accordance with its terms.
9. The Trust Agreement has been duly authorized, executed and delivered
by the Company and the Administrative Trustees and is a valid and binding
obligation of the Company and the Administrative Trustees enforceable against
the Company and the Administrative Trustees in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting creditors'
rights generally and by general equity principles (whether considered in a
proceeding in equity or at law).
10. The Guarantee Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting creditors'
rights generally and by general equity principles (whether considered in a
proceeding in equity or at law).
11. The Indenture has been duly authorized, executed and delivered by
the Company, has been duly qualified under the Trust Indenture Act and is a
valid and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or affecting creditors' rights generally and by general equity
principles (whether considered in a proceeding in equity or at law).
12. The Debentures have been duly authorized, executed and delivered by
the Company and, when duly authenticated in accordance with the Indenture and
delivered and paid for as contemplated by the Prospectus, will be valid and
binding obligations of the Company, entitled to the benefits of the Indenture
and enforceable against the Company in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting creditors'
rights generally and by general equity principles (whether considered in a
proceeding in equity or at law).
13. Neither the Company nor the Trust is, and following the issuance of
the Preferred Securities and the consummation of the transactions contemplated
by the Operative Documents and the application of the proceeds therefrom as
described in the Prospectus, neither the Company nor the Trust will be, an
"investment company" or an entity "controlled" by an "investment company," as
such terms are defined in the Investment Company Act.
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14. The statements set forth in the Registration Statement under the
captions "Description of the Preferred Securities," "Description of the
Debentures," "Description of the Guarantee" and "Relationship Among the
Preferred Securities, the Debentures and the Guarantee," insofar as they purport
to describe the provisions of the laws referred to therein, fairly summarize the
legal matters described therein.
15. The statements of law or legal conclusions and opinions set forth
in the Registration Statement under the caption "Federal Income Tax
Consequences," subject to the assumptions and conditions described therein,
constitute such counsel's opinion.
16. The Registration Statement was declared effective under the 1933
Act as of the date and time specified in such opinion, any required filing of
the Prospectus or any supplement thereto pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule 424(b) and, to such
counsel's knowledge and information, no stop order suspending the effectiveness
of the Registration Statement has been issued under the 1933 Act and no
proceedings therefor have been initiated or threatened by the Commission.
17. The Registration Statement (including the information required by
Rule 430A, if applicable) and the Prospectus and any amendment or supplement
thereto (except for the financial statements and other financial and statistical
data included therein or omitted therefrom, as to which such counsel need
express no opinion), as of their respective effective or issue dates, complied
as to form in all material respects with the applicable requirements of the 1933
Act and the 1933 Act Regulations.
18. The documents incorporated by reference in the Prospectus (except
for the financial statements and other financial or statistical data included
therein or omitted therefrom, as to which such counsel expresses no opinion, and
except to the extent that any statement therein is modified or superseded in the
Prospectus), as of the dates they were filed with the Commission, complied as to
form in all material respects with the applicable requirements of the 1934 Act
and the 1934 Act Regulations.
19. Such counsel knows of no governmental or material legal proceedings
pending to which the Company or any direct or indirect subsidiary is a party or
of which any property of the Company or any direct or indirect subsidiary is the
subject that are required to be disclosed in the Registration Statement or that
would affect the consummation of the transactions contemplated in the
Underwriting Agreement or the Indenture; and such counsel knows of no such
proceedings that are threatened or contemplated by governmental authorities or
threatened by others.
20. Such counsel knows of no contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to be described in the
Registration Statement or to be filed as exhibits thereto other than those
described therein or filed or incorporated by reference as exhibits thereto, and
such instruments as are summarized in the Registration Statement are fairly
summarized in all material respects.
21. No approval, authorization, consent, registration, qualification or
other order of any public board or body is required in connection with the
execution and delivery of the Operative Documents or the issuance and sale of
the Preferred Securities and the Debentures or the consummation by the Company
of the other transactions contemplated by the Operative Documents, except such
as have been obtained under the 1933 Act, the 1934 Act and the Trust Indenture
Act or such as may be required under the blue sky or securities laws of various
states in connection with the Offering.
22. To such counsel's knowledge, each of the Company, National Penn
Bank, Panasia Bank, N.A. and each other direct or indirect subsidiary of the
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Company has all material licenses, permits and other governmental authorizations
currently required for the conduct of its business as presently conducted.
23. The execution and delivery of the Operative Documents, the issue
and sale of the Preferred Securities and the Debentures, the compliance by the
Company with the provisions of the Preferred Securities, the Debentures, the
Operative Documents and the consummation of the transactions therein
contemplated will not conflict with or constitute a breach of, or default under,
(a) the articles of incorporation, charter or by-laws of the Company or any
direct or indirect subsidiary or (b) any contract, indenture, mortgage, loan
agreement, note, lease or other instrument known to such counsel to which either
the Company or any direct or indirect subsidiary is a party or by which any of
them or any of their respective properties may be bound except for such breaches
as would not have a Material Adverse Effect, nor will such action result in a
violation on the part of the Company or any direct or indirect subsidiary of any
applicable law or regulation or of any administrative, regulatory or court
decree.
24. The Guarantee Agreement and the Indenture constitute the legal,
valid and binding obligations of the Trust Company enforceable against the Trust
Company in accordance with their respective terms, except as enforcement thereof
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, receivership or similar laws relating to the enforcement of
creditors' rights generally, and by general principles of equity (whether
considered in a proceeding in equity or at law).
In giving such opinion, such counsel may rely upon the opinion
of Xxxxxxx, Xxxxxx & Xxxxxx, P.A. ("Xxxxxxxx, Xxxxxx"), counsel for the Trust
Company, delivered as provided in Exhibit D to the Underwriting Agreement as if
that opinion were addressed to such counsel, and the additional opinion of
Xxxxxxxx, Xxxxxx that the Guarantee Agreement and the Indenture have been duly
executed and delivered by the Trust Company. Such counsel shall state in its
opinion that it believes that it, the Underwriters and Underwriters' counsel are
entitled to so rely upon the aforesaid opinions of Xxxxxxxx, Xxxxxx.
25. Counsel will supplementally provide a written statement that such
counsel has participated in the preparation of the Registration Statement and
the Prospectus and has reviewed the documents incorporated by reference in the
Prospectus, and no facts have come to the attention of such counsel to lead it
to believe (a) that the Registration Statement (including the information
required by Rule 430A, if applicable) or any amendment thereto (except for the
financial statements and other financial or statistical data included therein or
omitted therefrom, as to which such counsel need not comment), at the time the
Registration Statement or any such amendment 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, in light of
the circumstances under which they were made, not misleading or (b) that the
Prospectus or any amendment or supplement thereto (except for the financial
statements and other financial or statistical data included therein or omitted
therefrom, as to which such counsel need not comment), at the time the
Prospectus was issued, or at the Closing Time, included or includes an untrue
statement of a material fact or omitted 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 or (c) that the
documents incorporated by reference in the Prospectus (except for the financial
statements and other financial or statistical data contained therein or omitted
therefrom, as to which such counsel need not comment, and except to the extent
that any statement therein is modified or superseded in the Prospectus), as of
the dates they were filed with the Commission, 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, in the light of the
circumstances under which they were made, not misleading.
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EXHIBIT C
The opinion of special Delaware counsel to the Company and the Trust to
be delivered pursuant to Section 5(b)(ii) of the Underwriting Agreement shall be
substantially to the effect that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Act and all filings required
under the laws of the State of Delaware with respect to the creation and valid
existence of the Trust as a business trust have been made.
2. Under the Delaware Act and the Trust Agreement, the Trust has the
requisite power and authority to (i) own its properties and conduct its
business, all as described in the Prospectus, (ii) execute and deliver, and to
perform its obligations under, the Operative Documents to which it is a party,
(iii) purchase and hold the Debentures.
3. The Trust Agreement constitutes a valid and binding obligation of
the Company and the Trustees and is enforceable against the Company and the
Trustees in accordance with its terms, except as such enforceability may be
limited by (i) bankruptcy, insolvency, receivership, liquidation, fraudulent
transfer, reorganization, moratorium and other similar laws relating to or
affecting the rights and remedies of creditors generally, (ii) general
principles of equity (regardless of whether considered and applied in a
proceeding in equity or at law) and (iii) considerations of public policy or the
effect of applicable law relating to fiduciary duties.
4. Under the Delaware Act and the Trust Agreement, the Trust has the
trust power and authority to execute and deliver, and to perform its obligations
under, the Underwriting Agreement and to issue and perform its obligations under
the Preferred Securities and the Common Securities.
5. Under the Delaware Act and the Trust Agreement, the execution and
delivery by the Trust of the Underwriting Agreement, and the performance by the
Trust of its obligations thereunder, have been duly authorized by all necessary
trust action on the part of the Trust.
6. The Preferred Securities have been duly authorized by the Trust
Agreement and, when issued, executed, authenticated and delivered in accordance
with the terms of the Trust Agreement against payment therefor as set forth in
the Underwriting Agreement, will be duly and validly issued and, subject to the
qualifications set forth in this paragraph 6, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust. The Preferred
Securities are entitled to the full benefits of the Trust Agreement. The holders
of the Preferred Securities, as beneficial owners of the Trust, will be entitled
to the same limitations of personal liability as are extended to stockholders of
private corporations for profit organized under the General Corporation Law of
the State of Delaware; provided that such counsel need express no opinion with
respect to the liability of any holder of the Preferred Securities who is, was
or may become a named Trustee of the Trust. We note that the Holders may be
obligated, pursuant to the Trust Agreement, (i) to provide indemnity and/or
security in connection with and pay taxes or governmental charges arising from
transfers or exchanges of Preferred Securities Certificates and the issuance of
replacement Preferred Securities Certificates, and (ii) to provide security or
indemnity in connection with requests of or directions to the Property Trustee
to exercise its rights and powers under the Trust Agreement and (iii) for the
debts and obligations of the Trust to the extent provided in the Expense
Agreement.
7. The Common Securities have been duly authorized for issuance by the
Trust and, when issued, executed and delivered to the Company against payment
therefor in accordance with the terms of the Trust Agreement, will be duly and
validly issued and, subject to the qualifications set forth in this paragraph 7,
fully paid undivided beneficial interests in the assets of the Trust entitled to
the benefits of the Trust Agreement (subject to the limitations set forth in
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paragraph 3 above). We note that the Holders may be obligated, pursuant to the
Trust Agreement, (i) to provide indemnity and/or security in connection with and
pay taxes or governmental charges arising from transfers or exchanges of Common
Securities Certificates and the issuance of replacement Common Securities
Certificates, and (ii) to provide security or indemnity in connection with
requests of or directions to the Property Trustee to exercise its rights and
powers under the Trust Agreement and (iii) for the debts and obligations of the
Trust to the extent provided in the Expense Agreement.
8. Under the Delaware Act and the Trust Agreement, the issuance of the
Preferred Securities and the Common Securities is not subject to any preemptive
or similar rights.
9. The issuance and sale by the Trust of the Preferred Securities and
Common Securities, the purchase by the Trust of the Debentures, the execution,
delivery and performance by the Trust of the Underwriting Agreement, the
consummation by the Trust of the transactions contemplated by the Underwriting
Agreement and the compliance by the Trust with its obligations thereunder will
not violate (i) any of the provisions of the Certificate of Trust or the Trust
Agreement or (ii) any applicable Delaware law or administrative regulation.
10. No authorization, approval, consent or order of any Delaware court
or Delaware governmental authority or Delaware agency is required to be obtained
by the Trust solely in connection with of the issuance and sale of the Preferred
Securities and the Common Securities or the performance by the Trust of its
obligations under the Operative Documents to which it is a party.
11. Assuming that the Trust derives no income from or in connection
with sources within the State of Delaware and has no assets, activities (other
than maintaining the Delaware Trustee and the filing of documents with the
Secretary of State of the State of Delaware) or employees in the State of
Delaware, and the Trust will be a grantor trust under the Internal Revenue Code
of 1986, as amended, the holders of the Preferred Securities (other than those
holders of Preferred Securities who reside or are domiciled in the State of
Delaware) will have no liability for income taxes imposed by the State of
Delaware solely as a result of their participation in the Trust, and the Trust
will not be liable for any income tax imposed by the State of Delaware.
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EXHIBIT D
The opinion of counsel to the Trust Company to be delivered pursuant to
Section 5(b)(iii) of the Underwriting Agreement shall be substantially to the
effect that:
1. The Trust Company is a Delaware banking corporation, duly
incorporated, organized, validly existing and in good standing under the laws of
the State of Delaware, with all necessary power and authority to execute and
deliver, and to carry out and perform its obligations under, the Indenture, the
Trust Agreement and the Guarantee Agreement.
2. The Trust Agreement, Guarantee Agreement and the Indenture have been
duly executed and delivered by the Trust Company and the Trust Agreement
constitutes the legal, valid and binding obligations of the Trust Company
enforceable against the Trust Company in accordance with its terms, except as
enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, receivership or similar laws relating
to the enforcement of creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).
3. The execution, delivery and performance of the Trust Agreement, the
Guarantee Agreement and the Indenture by the Trust Company does not conflict
with or constitute a breach of the certificate of incorporation or by-laws of
the Trust Company.
4. No consent, approval or authorization of, or registration with or
notice to any governmental authority or agency of the State of Delaware or the
United States of America governing the trust powers of the Trust Company is
required for the execution, delivery or performance by the Trust Company of the
Trust Agreement, the Guarantee Agreement and the Indenture.
5. The Debentures delivered on the date hereof have been duly
authenticated by the Indenture Trustee in accordance with the terms of the
Indenture.
6. The Trust Company has taken all necessary corporate action to
authorize the execution, delivery and performance by it of the Trust Agreement,
the Indenture and the Guarantee Agreement.
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SCHEDULE I
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Total Number of Preferred Number of Option Securities to be
Underwriter Securities to be Purchase Purchased if Maximum Option Exercised
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Xxxxxx Xxxxxxxxxx Xxxxx LLC
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Advest, Inc.
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