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EXHIBIT 1.1
$______________*
SMAN CAPITAL TRUST I
STANDARD MANAGEMENT CORPORATION
____% PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER PREFERRED SECURITY)
UNDERWRITING AGREEMENT
_________, 2001
ADVEST, INC.
Xxxxxx, Xxxxx Xxxxx, Incorporated
As Representatives of the Several
Underwriters Named in Schedule I Hereto
c/o Advest, Inc.
Xxx Xxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
SMAN Capital Trust I (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C.
Section 3801 et seq.), and Standard Management Corporation, an Indiana
corporation (the "Company"), as depositor of the Trust and as guarantor, hereby
confirm their agreement with you and the several underwriters, on whose behalf
you have been duly authorized to act as their representatives (the
"Representatives"), as follows:
1. Introduction. Upon the terms and conditions set forth in this
Underwriting Agreement (this "Agreement"), the Trust agrees to, and the Company
agrees to cause the Trust to, issue and sell to the several underwriters
identified in Schedule I annexed hereto (the "Underwriters"), who are acting
severally and not jointly, an aggregate liquidation amount of $__________ (the
"Firm Securities") of the Trust's ___% preferred securities (the "Preferred
Securities"). The Trust also proposes to, and the Company also proposes to cause
the Trust to, issue and sell to the Underwriters, at the Underwriters' option,
up to an additional $__________ aggregate liquidation amount of Preferred
Securities (the
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* Plus an option to acquire up to an additional $__________ aggregate
liquidation amount of Preferred Securities from the Trust to cover
over-allotments.
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"Option Securities") in proportion to the amounts set forth opposite their
respective names in Schedule I hereto. The term "Preferred Securities" as used
herein, unless indicated otherwise, shall mean the Firm Securities and the
Option Securities.
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 __________, 2001 (the "Trust Agreement"), among the
Company, as depositor, and, together with the Trust, the "Offerors," and Bankers
Trust Company ("Trust Company"), a New York banking corporation, as property
trustee ("Property Trustee"), and Bankers Trust (Delaware) ("Trust Delaware"), a
Delaware banking corporation, as Delaware trustee ("Delaware Trustee"), 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 on a subordinated basis
and subject to certain limitations with respect to distributions and payments
upon liquidation, redemption or otherwise (the "Guarantee") pursuant to the
Guarantee Agreement to be dated as of __________, 2001 (the "Guarantee
Agreement"), between the Company and the Trust Company, as Trustee (the
"Guarantee Trustee"). The assets of the Trust will consist of ____% junior
subordinated deferrable interest debentures, due ______, 2031 (the "Junior
Subordinated Debentures") of the Company which will be issued under a Junior
Subordinated Indenture dated as of __________, 2001 (the "Indenture"), between
the Company and the Trust Company, as Trustee (the "Indenture Trustee"). Under
certain circumstances, the Junior Subordinated 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 Junior Subordinated Debentures.
2. Representations and Warranties. Each of the Offerors
represents and warrants to, and agrees with, each of the Underwriters as
follows:
(a) The Offerors have filed with the Securities and
Exchange Commission (the "Commission") a registration
statement on Form S-1 (No. 333-60886) and a related preliminary prospectus for
the registration of the Preferred Securities, the Guarantee and the Junior
Subordinated Debentures under the Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations thereunder (the "Securities Act
Regulations"). The Offerors have prepared and filed such amendments thereto, if
any, and such amended preliminary prospectuses, if any, as may have been
required to the date hereof, and will file such additional amendments thereto
and such amended prospectuses as may hereafter be required. The registration
statement has been declared effective under the Securities Act by the
Commission. The registration statement as amended at the time it became
effective (including the Prospectus (as defined below) and all information
deemed to be a part of the registration statement at the time it became
effective pursuant to Rule 430A(b) of the Securities Act Regulations) is
hereinafter called the "Registration Statement," except that, if the Company
files a post-effective amendment to such registration statement which becomes
effective prior to the Closing Date (as defined below), "Registration Statement"
shall refer to such registration statement as so amended. Each prospectus
included in the registration statement, or amendments thereof, before it became
effective under the Securities Act and any
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prospectus filed with the Commission by the Company with the consent of the
Underwriters pursuant to Rule 424(a) of the Securities Act Regulations
(including the documents incorporated by reference therein, if any) is
hereinafter called the "Preliminary Prospectus." The term "Prospectus" means the
final prospectus (including the documents incorporated by reference therein, if
any), as first filed with the Commission pursuant to paragraph (1) or (4) of
Rule 424(b) of the Securities Act Regulations. The Commission has not issued any
order preventing or suspending the use of any Preliminary Prospectus.
(b) The Company is duly incorporated and validly existing
as a corporation in good standing under the laws of the State of Indiana with
full power and authority (corporate and other) to own, lease, and operate its
properties and conduct its business as described in the Prospectus; the Company
has no subsidiaries except those described in the Registration Statement (each a
"Subsidiary"); the Company owns, directly or indirectly, beneficially and of
record all of the outstanding capital stock of each Subsidiary free and clear of
any claim, lien, encumbrance or security interest, except as described in the
Prospectus. The Company and each of its Subsidiaries is duly qualified to do
business and is in good standing as a foreign corporation in each jurisdiction
in which any of them own or lease properties, has an office, or in which the
business conducted by any of them make such qualification necessary, except
where the failure to so qualify would not have a material adverse effect on the
condition (financial or otherwise), business, prospects, assets, properties,
results of operations, or net worth of the Company and its Subsidiaries taken as
a whole ("Material Adverse Effect"); and to the knowledge of the Company or any
Subsidiary, no proceeding has been instituted in any jurisdiction revoking,
limiting or curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
(c) The Preferred Securities have been duly and validly
authorized 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 to the Underwriters against payment of the consideration
set forth herein, 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 (except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership, readjustment of
debt, moratorium, fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally or general equity principles (whether considered in
a proceeding in equity or at law)). The Trust Agreement has been duly authorized
and, when executed by the proper officers of the Trust and delivered by the
Trust, will have been duly executed and delivered by the Trust and, assuming due
authorization and execution of the Trust Agreement by each other party thereto,
will constitute the valid and legally binding instrument of the Trust,
enforceable in accordance with its terms (except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, receivership,
readjustment of debt, moratorium, fraudulent conveyance or similar laws relating
to or affecting creditors' rights generally or general equity principles
(whether considered in a proceeding in equity or at law)). The Junior
Subordinated Debentures have been duly and validly authorized for delivery by
the Company and, when duly authenticated in accordance with the terms of the
Indenture and delivered to the Trust against payment of the consideration set
forth herein, will
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constitute valid and legally binding obligations of the Company enforceable
against the Company in accordance with their terms (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium, fraudulent
conveyance or similar laws relating to or affecting creditors' rights generally
or general equity principles (whether considered in a proceeding in equity or at
law)) and entitled to the benefits provided by the Indenture. The Indenture has
been duly authorized and, when executed by the proper officers of the Company
and delivered by the Company, will have been duly executed and delivered by the
Company and, assuming due authorization and execution of the Indenture by each
other party thereto, will constitute the valid and legally binding instrument of
the Company, enforceable in accordance with its terms (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium, fraudulent
conveyance or similar laws relating to or affecting creditors' rights generally
or general equity principles (whether considered in a proceeding in equity or at
law)). The Guarantee Agreement has been duly authorized and, when executed by
the proper officers of the Company and delivered by the Company, will have been
duly executed and delivered by the Company and, assuming due authorization and
execution of the Guarantee by each other party thereto, will constitute the
valid and legally binding instrument of the Company, enforceable in accordance
with its terms (except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, receivership, readjustment of debt,
moratorium, fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally or general equity principles (whether considered in
a proceeding in equity or at law)). The Trust Agreement, the Guarantee
Agreement, and the Indenture have been duly qualified under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"); and the Preferred
Securities, the Common Securities, the Trust Agreement, the Guarantee Agreement,
the Junior Subordinated Debentures and the Indenture conform in all material
respects to the descriptions thereof contained in the Registration Statement and
the Prospectus.
(d) Neither the Trust nor the Company or any Subsidiary,
is, or with the giving of notice or lapse of time or both will be, in violation
or breach of, or in default under, nor will the execution or delivery of, or the
performance and consummation of the transactions contemplated by this Agreement
(including the offer, sale, or delivery of the Preferred Securities), conflict
with, or result in a violation or breach of, or constitute a default under, any
provision of the organization documents of the Trust or the Articles of
Incorporation (as amended or restated), Bylaws (as amended or restated) of the
Company, or other governing documents of the Trust, the Company or any
Subsidiary, or of any provision of any agreement, contract, mortgage, deed of
trust, lease, loan agreement, indenture, note, bond, or other evidence of
indebtedness, or other material agreement or instrument to which the Trust, the
Company or any Subsidiary is a party or by which any of them is bound or to
which any of their properties is subject, nor will the performance by the
Offerors of their obligations hereunder violate any rule, regulation, order, or
decree, applicable to the Trust, the Company or any Subsidiary of any court or
any regulatory body, administrative agency, or other governmental body having
jurisdiction over the Trust, the Company or any Subsidiary or any of their
respective properties, or any order of any court or governmental agency or
authority entered in any proceeding to which the Trust, the Company or any
Subsidiary was or is now a party or by which it is
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bound, except those, if any, described in the Prospectus or which are not
material to the Company and the Trust taken as a whole. No consent, approval,
filing, authorization, registration, qualification, or order, including with or
by any insurance regulatory agency, is required for the execution, delivery, and
performance of this Agreement or the consummation of the transactions
contemplated by this Agreement, other than such that have been obtained or made,
except for compliance with the Securities Act, the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Blue Sky Laws applicable to the
public offering of the Preferred Securities by the Underwriters, the clearance
of such offering and the underwriting arrangements evidenced hereby with the
National Association of Securities Dealers, Inc. ("NASD"), and the listing of
the Preferred Securities on The Nasdaq Stock Market. This Agreement has been
duly authorized, executed and delivered by the Company and the Trust and
constitutes a valid and binding obligation of the Company and the Trust and
assuming due authorization and execution of this Agreement by the
Representatives is enforceable against the Company and the Trust in accordance
with its terms.
(e) Each Preliminary Prospectus complies in all material
respects with the requirements of the Securities Act and the Securities Act
Regulations. As of the effective date of the Registration Statement, and at all
times subsequent thereto up to the Closing Date or any Option Closing Date (as
defined below), the Registration Statement and the Prospectus, and any
amendments or supplements thereto, contained or will contain all material
statements that are required to be stated therein in accordance with the
Securities Act and the Securities Act Regulations and conformed or will conform
in all material respects to the requirements of the Securities Act and the
Securities Act Regulations, and neither the Registration Statement nor the
Prospectus, nor any amendment or supplement thereto included or will include any
untrue statement of a material fact or omitted or will 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;
provided, however, that no representation or warranty is made as to information
contained in or omitted from the Registration Statement, the Prospectus or any
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company and the Trust by or on behalf of the
Underwriters. The Company acknowledges that the only information relating to the
Underwriters furnished in writing to the Company by the Representatives
specifically for inclusion in the Registration Statement and Prospectus is the
information in the statements set forth in the fourth and sixth paragraphs under
the section "Underwriting" in any Preliminary Prospectus or the Prospectus.
(f) Ernst & Young LLP and KPMG Audit, which have audited,
reviewed, and expressed their opinion with respect to certain of the financial
statements and schedules filed with the Commission as a part of the Registration
Statement and included or to be included, as the case may be, in the Prospectus
and in the Registration Statement, and whose reports are included in the
Prospectus and the Registration Statement, are independent accountants as
required by the Securities Act and the Securities Act Regulations.
(g) The financial statements and schedules and the
related notes thereto included or to be included, as the case may be, in the
Registration Statement, the
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Preliminary Prospectus, and the Prospectus present fairly the financial position
of the entities purported to be shown thereby as of the respective dates of such
financial statements and schedules, and the results of operations and changes in
equity and in cash flows of the entities purported to be shown thereby for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles consistently applied throughout the periods involved,
except as may be disclosed in the Prospectus. All adjustments necessary for a
fair presentation of the results of such periods have been made. The Company had
an outstanding capitalization as set forth under the heading "Capitalization" in
the Prospectus as of the date indicated therein and there has been no material
change therein since such date except as disclosed in the Prospectus. The
financial, operating, and statistical information set forth in the Prospectus
under the headings "Prospectus Summary," "Standard Management Corporation
Selected Consolidated Financial Data," "Use of Proceeds," "Capitalization,"
"Management Discussion and Analysis of Financial Condition and Results of
Operations," "Business," and "Management" are fairly presented and prepared on a
basis consistent with the audited financial statements of the Company.
(h) There is no litigation or governmental proceeding,
action, or investigation pending or, to the knowledge of the Trust or the
Company, threatened, to which the Trust, the Company or any Subsidiary is or may
be a party or to which property owned or leased by the Company or any Subsidiary
is or may be subject, or related to environmental or discrimination matters,
which is required to be disclosed in the Registration Statement or the
Prospectus by the Securities Act or the Securities Act Regulations and is not so
disclosed, or which questions the validity of this Agreement or any action taken
or to be taken pursuant hereto.
(i) Either the Company or a Subsidiary, as the case may
be, has good and marketable title in fee simple to all items of real property
and good and marketable title to all the personal properties and assets
reflected as owned by the Company or a Subsidiary in the Prospectus (or
elsewhere in the Registration Statement), in each case clear of all liens,
mortgages, pledges, charges, or encumbrances of any kind or nature except those,
if any, reflected in the financial statements described above (or elsewhere in
the Registration Statement) or which are not material to the Company and its
Subsidiaries taken as a whole; all properties held or used by the Company or a
Subsidiary under leases, licenses, franchises or other agreements are held by
them under valid, existing, binding, and enforceable leases, franchises,
licenses, or other agreements with respect to which it is not in default, except
those, if any, which are not material to the Company or a Subsidiary taken as a
whole.
(j) Neither the Trust nor the Company or any 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, stabilization or manipulation, under the Exchange Act or otherwise,
of the price of the Preferred Securities.
(k) Except as reflected in or contemplated by the
Registration Statement, since the respective dates as of which information is
given in the Registration Statement and prior to the Closing Date and Option
Closing Date (as such terms are hereinafter defined):
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(i) neither the Company nor any Subsidiary has
or will have incurred any material liabilities or obligations, direct or
contingent, or entered into any material transaction not in the ordinary course
of business without the prior consent of the Representatives;
(ii) neither the Company nor any Subsidiary has
or will have paid or declared any dividend or other distribution with respect to
its capital stock and neither the Company nor any Subsidiary has or will be
delinquent in the payment of principal or interest on any outstanding debt
obligations; and
(iii) there has not been and will not be any
change in the capital stock or any material change in the indebtedness of the
Company or any Subsidiary (except as may result from the closing of the
transactions contemplated by this Agreement), or any adverse change in the
condition (financial or otherwise), or any development involving a prospective
adverse change in their respective businesses (resulting from litigation or
otherwise), prospects, properties, condition (financial or otherwise), net
worth, or results of operations which is material to the Company and its
Subsidiaries taken as a whole.
(l) There is no contract or other document, transaction,
or relationship required to be described in the Registration Statement, or to be
filed as an exhibit to the Registration Statement, by the Securities Act or by
the Securities Act Regulations that has not been described or filed as required.
(m) Except as disclosed in the Prospectus and except for
warrants granted to Fleet National Bank, there are no outstanding (i) securities
or obligations of the Company or any Subsidiary convertible into or exchangeable
for any capital stock of the Company or any Subsidiary, (ii) warrants, rights or
options to subscribe for or purchase from the Company or any Subsidiary any such
capital stock or any such convertible or exchangeable securities or obligations
or (iii) obligations of the Company or any Subsidiary to issue any shares of
capital stock, any such convertible or exchangeable securities or obligations,
or any such warrants, rights or options.
(n) All documents delivered or to be delivered by the
Offerors or any of their representatives in connection with the issuance and
sale of the Preferred Securities were on the dates on which they were delivered,
or will be on the dates on which they are to be delivered, true, complete, and
correct in all material respects.
(o) The Company and each Subsidiary have filed all
necessary federal and all state, local and foreign income and franchise tax
returns and paid all taxes shown as due thereon; and no tax deficiency has been
asserted or to the knowledge of the Company or any Subsidiary, threatened
against the Company or any Subsidiary that would have a Material Adverse Effect,
except as described in the Prospectus.
(p) The Company and each Subsidiary has filed, or has had
filed on its behalf, on a timely basis, all materials, reports, documents and
information, including, but not limited to annual reports and reports of
examination with each applicable insurance regulatory authority, board or
agency, which are required to be filed by it, except where the failure to have
timely filed such materials, reports, documents and information would not have a
Material Adverse Effect.
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(q) Neither the Trust nor the Company or any Subsidiary
has, directly or indirectly, at any time:
(i) made any unlawful contribution to any
candidate for political office, or failed to disclose any contribution in
violation of law; or
(ii) made any payment to any federal, state,
local, or foreign government officer or official, or other person charged with
similar public or quasi-public duties, other than payments required or permitted
by the laws of the United States or any jurisdiction thereof or applicable
foreign jurisdictions.
(r) The Company or a Subsidiary owns or possesses
adequate rights to use all patents, patent applications, trademarks, service
marks, trade names, trademark registrations, servicemark registrations,
copyrights, and licenses necessary for the conduct of the business of the
Company and the Subsidiaries or ownership of their respective properties, and
neither the Company nor any Subsidiary has received notice of conflict with the
asserted rights of others in respect thereof which has not been resolved.
(s) 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.
(t) The Company and each Subsidiary have and hold, and at
the Closing Date or Option Closing Date will have and hold, and are operating in
compliance with, and have fulfilled and performed all of their material
obligations with respect to, all permits, certificates, franchises, grants,
easements, consents, licenses, approvals, charters, registrations,
authorizations, and orders (collectively, "Permits") required under all laws,
rules, and regulations (including, without limitation, laws, rules and
regulations applicable to insurance companies and insurance holding companies)
in connection with their respective businesses, and all of such Permits are in
full force and effect; and there is no pending proceeding, and neither the
Company nor any Subsidiary has received notice of any threatened proceeding,
relating to the revocation or modification of any such Permits. To the knowledge
of the Company or any Subsidiary, no insurance regulatory agency or body has
issued any order or decree impairing, restricting or prohibiting the payment of
dividends by any of the Company's Subsidiaries to the Company. Neither the
Company nor any Subsidiary is (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 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
insurance, environmental protection, occupational safety and health, and equal
employment practices) heretofore or currently in effect, except such violation
that has been fully cured or satisfied without recourse or that is not
reasonably likely to have a Material Adverse Effect.
(u) Except as set forth in the Prospectus, no loss
experience has occurred that would require or make it necessary or appropriate
for the Company or any Subsidiary to change, alter, modify or amend the
Company's or any Subsidiary's methodology or assumption relating to losses.
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(v) All reinsurance treaties, contracts, agreements, and
arrangements to which the Company or any Subsidiary is a party and as to which
any of them reported recoverables, premiums due or other amounts in its
financial statements are in full force and effect, and neither the Company nor
any Subsidiary is in violation of, or in default in the performance, observance
or fulfillment of, any material obligation, agreement, covenant or condition
contained therein, which violation or default would, singularly or in the
aggregate, have a Material Adverse Effect. Neither the Company or any Subsidiary
has any reason to believe that any other party to such treaties, contracts,
agreements or arrangements will not or cannot perform in any material respect
its duties or obligations under such treaty, contract, agreement or arrangement,
except where the failure to perform would not have a Material Adverse Effect.
(w) The provisions of any employee pension benefit plan
("Pension Plan") as defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), in which the Company or any
Subsidiary is a participating employer are in substantial compliance with ERISA,
and neither the Company nor any Subsidiary is in material violation of ERISA.
The Company, each Subsidiary, or the plan sponsor thereof, as the case may be,
has duly and timely filed the reports required to be filed by ERISA in
connection with the maintenance of any Pension Plans in which the Company or any
Subsidiary is a participating employer, and to the knowledge of the Company or
any of its Subsidiary, no facts, including any "reportable event" as defined by
ERISA and the regulations thereunder, exist in connection with any Pension Plan
in which the Company or any Subsidiary is a participating employer which might
constitute grounds for the termination of such plan by the Pension Benefit
Guaranty Corporation or for the appointment by the appropriate U.S. District
Court of a trustee to administer any such plan. The provisions of any employee
benefit welfare plan, as defined in Section 3(1) of ERISA, in which the Company
or any Subsidiary is a participating employer, are in substantial compliance
with ERISA, and the Company, any Subsidiary, or the plan sponsor thereof, as the
case may be, has duly and timely filed the reports required to be filed by ERISA
in connection with the maintenance of any such plans.
(x) Neither the Company nor the Trust is an open-end
investment company, unit investment trust or face-amount certificate company
that is, or is required to be, registered under Section 8 of the Investment
Company Act of 1940, as amended, or subject to regulation under such Act.
(y) The Company is not aware of any threatened or pending
downgrading in the rating of any Subsidiary by A.M. Best Company, Inc.
(z) No material labor dispute exists with the Company's
or any Subsidiary's employees, and to the knowledge of the Company or any
Subsidiary, no such labor dispute is threatened. The Company has no knowledge of
any existing or threatened labor disturbance by the employees of any of its
principal agents, suppliers, contractors or customers that would have a Material
Adverse Effect.
(aa) Neither this Agreement nor any certificate, statement
or other document delivered or to be delivered by the Offerors or any Subsidiary
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material
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fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading.
Any certificate signed by any director or officer of the Company or the
Trust, as the case may be, and delivered to the Representatives or to counsel
for the Underwriters shall be deemed a representation and warranty of the
Company or the Trust, as the case may be, to the Underwriters as to the matters
covered thereby.
Any certificate delivered by the Company or the Trust, as the case may
be, to their respective counsel for purposes of enabling such counsel to render
an opinion pursuant to Section 8 will also be furnished to the Representatives
and counsel for the Underwriters and shall be deemed to be additional
representations and warranties to the Underwriters by the Company and the Trust
as to the matters covered thereby.
3. Purchase Sale and Delivery to Underwriters; Closing. On the
basis of the representations and warranties herein contained and subject to the
terms and conditions herein set forth, the Trust and the Company, as the case
may be, agree that the Trust will issue and sell to the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from the
Trust, the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule I at a purchase price of $__ per Firm Security.
Payment of the purchase price for, and delivery of, the Firm Securities
shall be made at the offices of Xxxxxx & Xxxxxx, 555 Twelfth Street, N.W.,
Washington, D.C., or at such other place as shall be agreed upon by the
Representatives, the Trust and the Company, at 9:00 A.M. Eastern Standard Time,
on the fourth business day (unless postponed in accordance with the provisions
of Section 14) following the date of this Agreement, or such other time not
later than ten (10) business days after such date as shall be agreed upon by the
Representatives, the Trust and the Company (such time and date of payment and
delivery being herein called the "Closing Date").
As compensation (the "Underwriting Commission") for the commitments of
the Underwriters contained in this Section 3, the Company hereby agrees to pay
to the Underwriters an amount equal to 4.0% of the public offering price of the
Preferred Securities. Such payment will be made on the Closing Date with respect
to the Firm Securities and on the Option Closing Date (as defined below) with
respect to the Option Securities.
Payment for the Firm Securities shall be made to the Trust by wire
transfer of immediately available funds, against delivery to the Underwriters of
the Firm Securities to be purchased by them. The Firm 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 of The Depository Trust Company (the "DTC") or in such names as
the Representatives may request in writing at least two business days before the
Closing Date. The Global Securities representing the Firm Securities shall be
made available for examination by the Representatives and counsel to the
Underwriters not later than 9:30 A.M. Eastern Standard Time on the last business
day prior to the Closing Date.
In addition, on the basis of the representations, warranties, and
agreements contained herein, but subject to the terms and conditions set forth
herein, the Trust hereby
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grants to the Underwriters an option to purchase, severally and not jointly,
from the Trust the Option Securities in the same proportion as the number of
Preferred Securities set forth opposite their names on Schedule I bears to the
total number of Firm Securities, at the same purchase price per Preferred
Security to be paid for the Firm Securities, for use solely in covering any
over-allotments made by the Underwriters in the sale and distribution of the
Firm Securities. The option granted hereunder may be exercised at any time (but
not more than once) within thirty (30) days after the date of this Agreement,
upon notice by the Representatives to the Trust which sets forth the aggregate
liquidation amount of Option Securities as to which the Underwriters are
exercising the option, and the time and place at which the certificate
representing the Option Securities will be delivered. Such time of delivery may
not be earlier than the Closing Date and herein is called the "Option Closing
Date." The Option Closing Date shall be determined by the Representatives, but
if at any time other than the Closing Date, shall not be earlier than three nor
later than five full business days after delivery of such notice to exercise.
Certificates for the Option Securities will be made available for inspection at
least 24 hours prior to the Option Closing Date at the offices of DTC, or its
designated custodian, or at such other location as specified by the
Representatives. The manner of payment for delivery of the Option Securities
shall be the same as for the Firm Securities as specified in this Section 3.
4. Representations and Warranties of the Underwriters. The
Representatives, on behalf of the Underwriters, represent and warrant to the
Company that the information set forth in the fourth and sixth paragraphs of the
section in the Prospectus entitled "Underwriting" was the only written
information furnished to the Company by and on behalf of any Underwriter
expressly for use in connection with the preparation of the Registration
Statement, and is correct and complete in all material respects and does not
include any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
5. Offering by the Underwriters. The Trust and the Company are
advised by the Representatives 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 deem
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 of the Preferred Securities is being made in
compliance with the applicable provisions of Rule 2810 of the NASD's Conduct
Rules.
6. Agreements of the Offerors. Each of the Offerors covenants and
agrees with each of the Underwriters that:
(a) If any information shall have been omitted from the
Registration Statement in reliance upon Rule 430A, the Company, at the earliest
possible time, will furnish the Representatives with copies of the Prospectus to
be filed by the Offerors with the Commission to comply with Rule 424(b) and Rule
430A under the Securities Act, and will file such Prospectus with the Commission
in compliance with such Rules. Upon compliance with such Rules, the Company will
so advise the Representatives promptly. The Company will advise the
Representatives and counsel to the Underwriters promptly of the issuance by the
Commission of any stop order suspending the effectiveness of the
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Registration Statement or of the institution of any proceedings for that
purpose, or of any notification received by the Company of the suspension of
qualification of the Preferred Securities for sale in any jurisdiction or the
initiation or threatening of any proceedings for that purpose, or of any
notification received by the Company of the suspension of qualification of the
Preferred Securities for sale in any jurisdiction or the initiation or
threatening of any proceedings for that purpose. The Company also will advise
the Representatives and counsel to the Underwriters promptly of any request of
the Commission for amendment or supplement of the Registration Statement, of any
Preliminary Prospectus, or of the Prospectus, or for additional information, and
the Offerors will not file any amendment or supplement to the Registration
Statement (either before or after it becomes effective), to any Preliminary
Prospectus, or to the Prospectus (including a prospectus filed pursuant to Rule
424(b)) if the Representatives have not been furnished with copies prior to such
filing or if the Representatives reasonably object to such filing.
(b) For the period during which a Prospectus relating to
the Preferred Securities is required to be delivered under the Securities Act,
the Offerors shall comply with all requirements imposed on them by the
Securities Act, as now and hereafter amended, and by the Securities Act
Regulations, as from time to time in force, so far as is necessary to permit the
continuance of sales or dealings in the Preferred Securities as contemplated by
the provisions hereof and the Prospectus. If any event occurs as a result of
which the Prospectus, including any subsequent amendment or supplement, would
include an untrue statement of a material fact, or would omit to state any
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, or if it becomes necessary at any time to amend the Prospectus,
including any amendment or supplement thereto, to comply with the Securities
Act, the Company promptly will advise the Representatives and counsel to the
Underwriters thereof and the Offerors will promptly prepare and file with the
Commission an amendment or supplement that will correct such statement or
omission or an amendment that will effect such compliance; and, if any
Underwriter is required to deliver a prospectus nine (9) months or more after
the effective date of the Registration Statement, the Company, upon request of
the Representatives but at the expense of such Underwriter, will prepare
promptly such prospectus or prospectuses as may be necessary to permit
compliance with the requirements of Section 10(a)(3) of the Securities Act.
(c) The Offerors will not, prior to the Option Closing
Date or thirty (30) days after the date of this Agreement, whichever occurs
first, without the prior consent of the Representatives, 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 under the Securities Act, except as
contemplated by the Prospectus.
(d) The Company will make generally available to its
security holders and the Representatives an earnings statement of the Company as
soon as practicable, but in no event later than fifteen (15) months after the
end of the Company's current fiscal quarter, covering a period of twelve (12)
consecutive calendar months beginning after the
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effective date of the Registration Statement, but beginning not later than four
(4) months after such effective date, which will satisfy the provisions of the
last subsection of Section 11(a) of the Securities Act and Rule 158 promulgated
thereunder.
(e) During such period as a prospectus is required by law
to be delivered in connection with sales by an underwriter or dealer, the
Company will furnish to the Representatives, at the expense of the Company,
copies of the Registration Statement, the Prospectus, any Preliminary
Prospectus, and all amendments and supplements to any such documents, in each
case as soon as available and in such quantities as the Representatives may
reasonably request, for the purposes contemplated by the Securities Act.
(f) The Offerors will use their best efforts to take or
cause to be taken in cooperation with the Representatives and counsel to the
Underwriters all actions required in qualifying or registering the Preferred
Securities for sale under the Blue Sky Laws of such jurisdictions as the
Representatives may reasonably designate, provided the Offerors shall not be
required to qualify generally as foreign corporations or as a dealer in
securities or to consent generally to the service of process under the law of
any such state (except with respect to the offering and sale of the Preferred
Securities), and will continue such qualifications or registrations in effect so
long as reasonably requested by the Representatives to effect the distribution
of the Preferred Securities (including, without limitation, compliance with all
undertakings given pursuant to such qualifications or registrations). In each
jurisdiction where any of the Preferred Securities shall have been qualified as
provided above, the Offerors will file such reports and statements as may be
required to continue such qualification for a period of not less than one (1)
year from the date of this Agreement.
(g) The Company will furnish to its security holders
annual reports containing financial statements audited by independent public
accountants. During the period ending three (3) years after the date of this
Agreement, (i) as soon as practicable after the end of the fiscal year, the
Company will furnish to each of the Representatives two copies of the annual
report of the Company containing the audited consolidated balance sheet of the
Company as of the close of such fiscal year and corresponding audited
consolidated statements of earnings, stockholders' equity and cash flows for the
year then ended, and (ii) the Company will file promptly and will make available
to each of the Representatives concurrently with the filing thereof copies of
all reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13, 14, or 15 of
the Exchange Act. During such three-year period, the Company also will make
available or furnish, as applicable, to the Representatives one copy of the
following:
(i) as soon as practicable after the filing
thereof, each other report, statement, or other document filed by the Company
with the Commission;
(ii) as soon as practicable after the filing
thereof, all reports, statements, other documents and financial statements
furnished by the Company to Nasdaq pursuant to requirements of or agreements
with Nasdaq; and
(iii) as soon as available, each report,
statement, or other document of the Company mailed to its stockholders.
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(h) The Offerors will use their best efforts to satisfy
or cause to be satisfied the conditions to the obligations of the Underwriters
in Section 8 hereof.
(i) The Offerors shall deliver the requisite notice of
issuance to the NASD and shall take all necessary or appropriate action within
their power to maintain the authorization for trading of the Preferred
Securities on The Nasdaq Stock Market for a period of at least thirty-six (36)
months after the date of this Agreement.
(j) The Trust shall comply in all respects with the
undertakings given by the Trust in connection with the qualification or
registration of the Preferred Securities for offering and sale under the Blue
Sky Laws.
(k) The Trust shall apply the proceeds from its sale of
the Preferred Securities, combined with the entire proceeds from the sale by the
Trust to the Company of the Trust's Common Securities, to purchase an equivalent
amount of Junior Subordinated Debentures. All the proceeds to be received by the
Company from the sale of the Junior Subordinated Debentures will be used in the
manner and for the purposes specified under the heading "Use of Proceeds" in the
Prospectus. The Offerors shall file, and make available or furnish, as
appropriate, to the Underwriters and counsel to the Underwriters copies of all
reports as may be required in accordance with Rule 463 under the Securities Act.
(l) Except for the sale of Preferred Securities pursuant
to this Agreement, neither the Company nor any Subsidiary shall, directly or
indirectly, offer, sell, contract to sell, issue, distribute, grant any option,
right, or warrant to purchase or otherwise dispose of any shares of the
Preferred Securities or substantially similar securities, in the open market or
otherwise, for a period of one hundred eighty (180) days after the later of the
effective date of the Registration Statement or the date of this Agreement,
without the express prior written consent of the Representatives.
7. Payment of Expenses and Fees
(a) Whether or not the transactions contemplated
hereunder are consummated, or if this Agreement is terminated for any reason,
the Company will pay or cause to be paid the costs, fees, and expenses incurred
in connection with the offering of the Preferred Securities as follows:
(i) All costs, fees, and expenses incurred in
connection with the performance of the obligations of the Company and the Trust
hereunder, including all fees and expenses of the Company's and the Trust's
accountants and counsel, all costs and expenses incurred in connection with the
preparation, printing, filing, and distribution (including delivery and shipping
costs) of the Registration Statement, each Preliminary Prospectus, and the
Prospectus (including all amendments and exhibits thereto and the financial
statements therein), and agreements and supplements provided for herein, this
Agreement and other underwriting documents, including various Underwriters'
letters, and the Preliminary and Supplemental Blue Sky Memoranda;
(ii) All filing and registration fees and
expenses, including the legal fees and disbursements of counsel (which shall be
capped at $2,500), incurred in connection with qualifying or registering all or
any part of the Preferred Securities, the
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Guarantee and the Junior Subordinated Debentures for offer and sale under the
Blue Sky Laws;
(iii) All fees and expenses of the Offerors'
registrar and transfer agent; all transfer taxes, if any, and all other fees and
expenses incurred in connection with the sale and delivery of the Preferred
Securities to the Underwriters;
(iv) The filing fees of the NASD and applicable
fees charged by Nasdaq for inclusion of the Preferred Securities for quotation
on The National Market System; and
(v) All other costs and expenses incident to the
performance of the Company's and the Trust's obligations hereunder which are not
otherwise provided for in this Section 7(a).
8. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters under this Agreement shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Trust set forth herein as of the Closing Date, and if applicable, as of the
Option Closing Date, as the case may be, to the accuracy of the statements of
the Offerors' directors and officers, to the performance by the Company and the
Trust of their obligations hereunder, and to the following additional
conditions, except to the extent expressly waived in writing by the
Representatives:
(a) The Registration Statement and all post-effective
amendments thereto shall have been declared effective by the Commission no later
than 5:30 p.m. Eastern Time, on the date of this Agreement, or such later time
as shall have been consented to by the Representatives, but in any event not
later than 5:30 p.m. Eastern Time on the third full business day following the
date hereof; if the Offerors omitted information from the Registration Statement
at the time it became effective in reliance on Rule 430A under the Securities
Act, the Prospectus shall have been filed with the Commission in compliance with
Rule 424(b) and Rule 430A under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement or any amendment or supplement
thereto shall have been issued; no proceeding for the issuance of such an order
shall have been initiated or shall be pending or, to the knowledge of the
Offerors or the Representatives, threatened or contemplated by the Commission;
and any request of the Commission for additional information (to be included in
the Registration Statement or the Prospectus or otherwise) shall have been
disclosed to the Representatives and complied with to the Representatives'
satisfaction.
(b) The Preferred Securities, the Guarantee and the
Junior Subordinated Debentures shall have been qualified or registered for sale,
or subject to an available exemption from such qualification or registration,
under the Blue Sky Laws of such jurisdictions as shall have been reasonably
specified by the Representatives and the offering contemplated by this Agreement
shall have been cleared by the NASD.
(c) Since the dates as of which information is given in
the Registration Statement:
(i) There shall not have been any material
adverse change, or any development involving a prospective material adverse
change, in the ability of the Company or any Subsidiary to conduct their
respective businesses (whether by reason of
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any court, legislative, other governmental action, order, decree, or otherwise),
or in the general affairs, condition (financial and otherwise), business,
prospects, properties, management, financial position or earnings, results of
operations, or net worth of the Company or any Subsidiary, whether or not
arising from transactions in the ordinary course of business; and
(ii) Neither the Company nor any Subsidiary shall
have sustained any loss or interference from any labor dispute, strike, fire,
flood, windstorm, accident, or other calamity (whether or not insured) or from
any court or governmental action, order, or decree; the effect of which on the
Company or any Subsidiary, in any such case described in clause (c)(i) or (ii)
above, is in the reasonable opinion of the Representatives so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Preferred Securities on the terms and in the
manner contemplated in the Registration Statement and the Prospectus.
(d) There shall have been furnished to the
Representatives on the Closing Date and the Option Closing Date, except as
otherwise expressly provided below:
(i) An opinion of Xxxxxxx X. Xxxxx, general
counsel to the Company, dated as of the Closing Date and any Option Closing
Date, in form and substance substantially in the form attached hereto as Exhibit
A-1;
(ii) An opinion of Xxxxx, Xxxxxxxx & Xxxxxxx,
LLP, counsel to the Company, dated as of the Closing Date and any Option Closing
Date, in form and substance substantially in the form attached hereto as Exhibit
A-2;
(iii) The favorable opinion, dated the Closing
Date and the Option Closing Date, of White & Case, counsel to the Trust Company,
substantially in the form attached hereto as Exhibit B;
(iv) The favorable opinion, dated the Closing
Date and the Option Closing Date, of Xxxxxxxx, Xxxxxx & Finger, special Delaware
counsel to the Company and the Trust, substantially to the effect and in the
form attached hereto as Exhibit C;
(v) The favorable opinion, dated the Closing
Date and the Option Closing Date, of Xxxxxxxx, Xxxxxx & Finger, special Delaware
counsel to Trust Delaware, substantially to the effect and in the form attached
hereto as Exhibit D; and
(vi) The favorable opinion, dated the Closing
Date and the Option Closing Date, of Xxxxxx & Xxxxxx, counsel to the
Underwriters, as to such matters as the Representatives shall reasonably
request.
In rendering such opinions specified in clause (d)(ii), (iii), (iv) or
(v) above, counsel may rely upon an opinion or opinions, each dated the Closing
Date or the Option Closing Date as the case may be, of other counsel retained by
them or the Company as to laws of any jurisdiction other than the United States
or the State of New York, provided that (A) such reliance is expressly
authorized by each opinion so relied upon and a copy of each such opinion is
delivered to the Representatives, and (B) counsel shall state in their opinion
that they believe that they and the Underwriters are justified in relying
thereon. In the case of the opinion specified in clause (i) above, such counsel
may
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assume that the laws of the State of New York are identical to the laws of the
State of Indiana in all respects material to the opinion being rendered by such
counsel, provided that such assumption is expressly disclosed in the opinion.
Insofar as such opinions involve factual matters, such counsel may rely, to the
extent such counsel deems proper, upon certificates of officers of the Company,
its Subsidiaries and the Trust and certificates of public officials.
(e) At the time this Agreement is executed and also on
the Closing Date and the Option Closing Date, as the case may be, there shall be
delivered to the Representatives a letter from each of Ernst & Young LLP and
KPMG Audit, the Company's independent accountants, the first letter from each of
the accountants to be dated the date of this Agreement, the second letter from
each of the accountants to be dated the Closing Date, and the third letter from
each of the accountants to be dated the Option Closing Date, if any, which shall
be in form and substance reasonably satisfactory to the Representatives and
shall contain information as of a date within five days of the date of such
letter. There shall not have been any change set forth in any letter referred to
in this subsection (e) that makes it impracticable or inadvisable in the
judgment of the Representatives to proceed with the public offering or purchase
of the Preferred Securities as contemplated hereby.
(f) On the Closing Date and on the Option Closing Date, a
certificate signed by the Chairman of the Board, the President, a Vice Chairman
of the Board or any Executive or Senior Vice President and the principal
financial or accounting officer of the Company, dated the Closing Date or the
Option Closing Date, as the case may be, to the effect that the signers of such
certificate have carefully examined the Registration Statement and this
Agreement and that:
(i) The representations and warranties of the
Offerors in this Agreement are true and correct in all material respects on and
as of the Closing Date or the Option Closing Date, as the case may be, with the
same effect as if made on the Closing Date or the Option Closing Date, as the
case may be, and the Offerors have complied in all material respects with all
the agreements and satisfied in all material respects all the conditions on its
part to be performed or satisfied at or prior to the Closing Date or the Option
Closing Date, as the case may be;
(ii) The Commission has not issued an order
preventing or suspending the use of the Prospectus or any Preliminary Prospectus
or any amendment thereto; no stop order suspending the effectiveness of the
Registration Statement has been issued; and, to the knowledge of the respective
signatories, no proceeding for that purpose has been instituted or is pending or
contemplated under the Securities Act;
(iii) Each of the respective signatories of the
certificate has carefully examined the Registration Statement, the Prospectus,
and any amendments or supplements thereto, and such documents contain all
material statements and information required to be made therein, and neither the
Registration Statement nor any amendment or supplement thereto includes any
untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein not misleading
and, since the date on which the Registration Statement was initially filed, no
event has occurred that was required to be set forth in an amended or
supplemented
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prospectus or in an amendment to the Registration Statement that has not been so
set forth; provided, however, that no representation need be made as to
information contained in or omitted from the Registration Statement or any
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company and the Trust by or on behalf of any
Underwriter through the Representatives; and
(iv) Since the date on which the Registration
Statement was initially filed with the Commission, there has not been any
material adverse change or a development involving a prospective material
adverse change in the business, properties, financial condition, or earnings of
the Company and its Subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as disclosed in the
Registration Statement as heretofore amended or (but only if the Representatives
expressly consent thereto in writing) as disclosed in an amendment or supplement
thereto filed with the Commission and delivered to the Representatives after the
execution of this Agreement; since such date and except as so disclosed or in
the ordinary course of business, neither the Company nor any Subsidiary has
incurred any liability or obligation, direct or indirect, or entered into any
transaction that is material to the Company or such Subsidiary, as the case may
be, not contemplated in the Prospectus; since such date and except as so
disclosed there has not been any change in the outstanding capital stock of the
Company, or any change that is material to the Company and its Subsidiaries
taken as a whole in the short-term debt or long-term debt of the Company or any
Subsidiary; since such date and except as so disclosed, neither the Company nor
any of its Subsidiaries have incurred any material contingent obligations, and
no material litigation is pending or, to their knowledge, threatened against the
Company or any Subsidiary; and, since such date and except as so disclosed,
neither the Company nor any of its Subsidiaries have sustained any material loss
or interference from any strike, fire, flood, windstorm, accident or other
calamity (whether or not insured) or from any court or governmental action,
order, or decree.
(g) No downgrading in the rating accorded any debt
securities of the Company by any "nationally recognized statistical rating
organization" (as that term is defined by the Securities Exchange Commission for
the purposes of Rule 436(g)(2) under the Securities Act) shall have occurred, or
any public announcement that any such organization has under surveillance or
review their ratings of any debt securities of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating), and if, in any such
case, the effect thereof in the reasonable judgment of the Representatives makes
it impracticable or inadvisable to proceed with the offering of the Preferred
Securities.
(h) Prior to the Closing Date and any Option Closing
Date, the Company shall have furnished to the Representatives such further
information, certificates and documents as the Representatives may reasonably
request in connection with the offering of the Preferred Securities.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice from the Representatives to the Company at any
time without liability on the part of any Underwriter, including the
Representatives, or the Company, except for expenses to be
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paid by the Company pursuant to Section 7 hereof or reimbursed by the Company
pursuant to Section 9 and except to the extent provided in Section 11.
9. Reimbursement of Underwriters' Expenses. If the sale of the
Preferred Securities to the Underwriters on the Closing Date is not consummated
because the offering is terminated or indefinitely suspended by the Company or
by the Representatives for any reason permitted by this Agreement, other than
the Underwriters' inability to legally act as Underwriter, the Company will
reimburse the Underwriters for the Underwriters' reasonable out-of-pocket
expenses, including fees and disbursements of their counsel, that shall have
been incurred by the Underwriters in connection with the proposed purchase and
sale of the Preferred Securities, with such reimbursement not to exceed the
lesser of $80,000 or the Underwriters' actual costs. Any such termination or
suspension shall be without liability of any party to the other except that the
provisions of this Section 9, and Sections 7 and 11 shall remain effective and
shall apply.
10. Maintain Effectiveness of Registration Statement. The
Representatives and the Company will use their respective best efforts to
prevent the issuance of any stop order or other such order suspending the
effectiveness of the Registration Statement and, if such stop order is issued,
to obtain the lifting thereof as soon as possible.
11. Indemnification and Contribution.
(a) The Offerors agree to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter within
the meaning of the Securities Act or the Exchange Act, against any losses,
claims, damages, expenses, liabilities, or actions in respect thereof
("Claims"), joint or several, to which such Underwriter or each such controlling
person may become subject under the Securities Act, the Exchange Act, the
Securities Act Regulations, Blue Sky Laws or other federal or state statutory
laws or regulations, at common law or otherwise (including payments made in
settlement of any litigation, if such settlement is effected with the written
consent of the Company, which consent shall not be unreasonably withheld),
insofar as such Claims arise out of or are based upon the inaccuracy or breach
of any representation, warranty, or covenant of the Company or the Trust
contained in this Agreement, any untrue statement or alleged untrue statement of
any material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto, or in any
application filed under any Blue Sky Law or other document executed by the
Offerors for that purpose or based upon written information furnished by the
Offerors and filed in any state or other jurisdiction to qualify or register any
or all of the Preferred Securities under the securities laws thereof (any such
document, application, or information being hereinafter called a "Blue Sky
Application"), or arise out of or are based upon the omission or alleged
omission to state in any of the foregoing a material fact required to be stated
therein or necessary to make the statements therein not misleading. The Company
agrees to reimburse each Underwriter and each such controlling person promptly
for any legal fees or other expenses incurred by such Underwriter or any such
controlling person in connection with investigating or defending any such Claim
or appearing as a third-party witness in connection with any such Claim;
provided, however, that the Company will not be liable in any such case to the
extent that:
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(i) Any such Claim arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto or in any Blue Sky
Application in reliance upon and in conformity with the written information
furnished by or on behalf of the Underwriters to the Offerors expressly for use
therein pursuant to Section 4 of this Agreement; or
(ii) Such statement or omission was contained or
made in any Preliminary Prospectus and corrected in the Prospectus and (1) any
such Claim suffered or incurred by any Underwriter (or any person who controls
such Underwriter) resulted from an action, claim, or suit by any person who
purchased Preferred Securities that are the subject thereof from such
Underwriter in the offering of the Preferred Securities, and (2) such
Underwriter failed to deliver a copy of the Prospectus (as then amended if the
Offerors shall have amended the Prospectus) to such person at or prior to the
confirmation of the sale of such Preferred Securities in any case where such
delivery is required by the Securities Act, unless such failure was due to
failure by the Company and the Trust to provide copies of the Prospectus (as so
amended) to the Underwriter as required by this Agreement.
(b) Each Underwriter severally, but not jointly, agrees
to indemnify and hold harmless the Offerors, each of their directors, each of
their officers who sign the Registration Statement, and each person who controls
the Company or the Trust within the meaning of the Securities Act, against any
Claim to which the Offerors, or any such director, officer, or controlling
person may become subject under the Securities Act, the Exchange Act, the
Securities Act Regulations, Blue Sky Laws, or other federal or state statutory
laws or regulations, at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Underwriter and the Representatives, which consent shall not be unreasonably
withheld), insofar as such Claim arises out of or is based upon any untrue or
alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto, or in any Blue Sky Application, or arises out of or is based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, or in any Blue Sky Application, in reliance
upon and in conformity with the written information furnished by or on behalf of
such Underwriter to the Offerors pursuant to Section 4 of this Agreement. Each
Underwriter will severally reimburse any legal fees or other expenses reasonably
incurred by the Offerors, or any such director, officer, or controlling person
in connection with investigating or defending any such Claim, and from any and
all Claims resulting from failure of such Underwriter to deliver a copy of the
Prospectus, if the person asserting such Claim purchased Preferred Securities
from such Underwriter and a copy of the Prospectus (as then amended if the
Offerors shall have amended the Prospectus) was not sent or given by or on
behalf of such Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the Preferred
Securities to such person, and if the Prospectus (as so amended) would have
cured the defect giving rise to such Claim
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(unless such failure was due to a failure by the Company and the Trust to
provide sufficient copies of the Prospectuses (as so amended) to each
Underwriter).
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) of this Section 11 of notice of the commencement of any
action in respect of a Claim, such indemnified party will, if a Claim in respect
thereof is to be made against an indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement thereof. In case
any such action is brought against any indemnified party, and such indemnified
party notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in and, to the extent that it
may wish, jointly with all other indemnifying parties, similarly notified,
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to the indemnified party and/or other indemnified parties
that are different from or additional to those available to the indemnifying
party, the indemnified party or parties shall have the right to select separate
counsel to assume such legal defenses and to otherwise participate in the
defense of such action on behalf of such indemnified party or parties.
(d) Upon receipt of notice from the indemnifying party to
such indemnified party of the indemnifying party's election to assume the
defense of such action and upon approval by the indemnified party of counsel
selected by the indemnifying party, the indemnifying party will not be liable to
such indemnified party under subsection (a) or (b) of this Section 11 for any
legal fees or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless:
(i) the indemnified party shall have employed
separate counsel in connection with the assumption of legal defenses in
accordance with the proviso to the last sentence of subsection (c) of this
Section 11 (it being understood, however, that the indemnified party shall not
be liable for the legal fees and expenses of more than one separate counsel
(plus local counsel), approved by the Representatives if one or more of the
Underwriters or their controlling persons are the indemnified parties); or
(ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after the indemnified party's
notice to the indemnifying party of commencement of the action;
(e) If the indemnification provided for in this Section
11 is unavailable to an indemnified party or is insufficient to hold harmless an
indemnified party under subsection (a) or (b) of this Section 11 in respect of
any Claim referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall, subject, to the limitations
hereinafter set forth, contribute to the amount paid or payable by such
indemnified party as a result of such Claim:
(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 offering of the Preferred Securities; or
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(ii) if the allocation provided by clause (e)(i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (e)(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 or omissions that resulted
in such Claim, as well as any other relevant equitable considerations.
The respective relative benefits received by the Offerors on the one hand and
the Underwriters on the other hand shall be deemed to be in such proportion that
the Underwriters are responsible for that portion of a Claim represented by the
percentage that the amount of the Underwriting Commission bears to the public
offering price of the Preferred Securities, and the Company (including the
Company's directors, officers, and controlling persons) is responsible for the
remaining portion of such Claim.
The relative fault of the Offerors on the one hand and the Underwriters on the
other hand shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Offerors on the one hand or the Underwriters on the other hand and the parties'
relative intent, knowledge, access to information, and opportunity to correct or
prevent such untrue statement or omission. The amount paid or payable by a party
as a result of the Claims referred to above shall be deemed to include, subject
to the limitations set forth in subsections (c) and (d) of this Section 11, any
legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim.
(f) The Offerors and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this Section 11 were
determined by pro rata or per capita allocation or by any other method or
allocation that does not take into account the equitable considerations referred
to in subsection (e) of this Section 11. Notwithstanding the other provisions of
this Section 11, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Preferred Securities
underwritten by it and distributed to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligation to contribute
pursuant to this Section 11 are several in proportion to their respective
underwriting commitments and not joint.
(g) The obligations of the Company, the Trust and the
Underwriters under this Section 11 shall be in addition to any liability that
the Company, the Trust or the Underwriters may otherwise have.
12. Default of Underwriters. It shall be a condition to this
Agreement and to the obligations of the Trust to sell and deliver the Preferred
Securities hereunder, and to the obligations of each Underwriter to purchase the
Preferred Securities in the manner described herein, that, except as hereinafter
provided in this Section 12, each of the Underwriters (except a defaulting
Underwriter) shall purchase and pay for all the Preferred Securities agreed to
be purchased by such Underwriter hereunder upon tender
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to the Representatives of all such Preferred Securities in accordance with the
terms hereof. If any Underwriter or Underwriters default in its or their
obligations to purchase Preferred Securities hereunder on either the Closing
Date or the Option Closing Date and the aggregate number of Preferred Securities
that such defaulting Underwriter or Underwriters agreed but failed to purchase
does not exceed ten percent (10%) of the liquidation amount of Preferred
Securities the Underwriters are obligated to purchase on such Closing Date, the
Representatives may make arrangements for the purchase of such Preferred
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date or Option Closing Date the
nondefaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Preferred Securities such
defaulting Underwriters agreed but failed to purchase on such Closing Date or
Option Closing Date. If any Underwriter or Underwriters so default and the
liquidation amount of Preferred Securities with respect to which such default or
defaults occur is greater than the above percentage and arrangements
satisfactory to the Representatives for the purchase of such Preferred
Securities by other persons are not made within forty-eight (48) hours after
such default, this Agreement will terminate without liability on the part of any
nondefaulting Underwriter or the Company, except to the extent provided in
Section 11.
If Preferred Securities to which a default relates are to be purchased
by the nondefaulting Underwriters or by another party or parties, the
Representatives or the Company shall have the right to postpone the Closing Date
or Option Closing Date, as the case may be, for not more than seven (7) business
days in order that the necessary changes, if any, in the Registration Statement,
Prospectus, and any other documents, as well as any other arrangements, may be
effected. As used in this Agreement, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 12. Nothing herein will
relieve a defaulting Underwriter from liability for its default.
13. Effective Date. This Agreement shall become effective
immediately on the date hereof.
14. Termination. Without limiting the right to terminate this
Agreement pursuant to any other provision hereof, this Agreement may be
terminated by the Representatives prior to the Closing Date and the option from
the Company and the Trust referred to in Section 3, if exercised, may be
canceled by the Representatives at any time prior to the Option Closing Date,
if:
(a) The Offerors shall have failed, refused, or been
unable, at or prior to the Closing Date or Option Closing Date, as the case may
be, to perform any agreement, in all material respects, on its part to be
performed hereunder;
(b) Any other condition to the obligations of the
Underwriters hereunder is not fulfilled; or
(c) In the Representatives' reasonable judgment, payment
for and delivery of the Preferred Securities is rendered impracticable or
inadvisable because:
(i) Additional governmental restrictions, not in
force and effect on the date hereof, shall have been imposed upon trading in
securities generally or minimum or maximum prices shall have been generally
established on any national
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securities exchange or over-the-counter market, or trading in securities
generally shall have suspended on any national securities exchange or on The
Nasdaq Stock Market, or a general banking moratorium shall have been established
by federal or state authorities;
(ii) Any event shall have occurred or shall exist
that makes untrue or incorrect in any material respect any statement or
information contained in the Registration Statement or that is not reflected in
the Registration Statement but should be reflected therein to make the
statements or information contained therein not misleading in any material
respect; or
(iii) Any outbreak or escalation of major
hostilities or other national or international calamity or any substantial
change in political, financial or economic conditions shall have occurred or
shall have accelerated to such extent, in the Representatives' reasonable
judgment, as to have a material adverse effect on the general securities market
or make it impracticable or inadvisable to proceed with completion of the sale
and payment for the Preferred Securities as provided in this Agreement.
Any termination pursuant to this Section 14 shall be without liability
on the part of any Underwriter to the Company or the Trust or on the part of the
Company or the Trust to any Underwriter (except for expenses to be paid by the
Company pursuant to Section 7 or reimbursed by the Company pursuant to Section 9
and except as to indemnification and contribution to the extent provided in
Section 11).
15. Representations and Indemnities to Survive Delivery. The
respective indemnity and contribution agreements of the Company and the
Underwriters, and the representations, warranties, covenants, other statements
of the Offerors and of their directors and officers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter, the Offerors, or any
of its or their partners, officers, directors, or any controlling person, as the
case may be, and will survive delivery of and payment for the Preferred
Securities sold hereunder. The respective indemnity and contribution agreements
of the Company and the Underwriters, the provisions of Section 7(a) and Section
9 of this Agreement, and the representations and warranties of the Offerors will
survive the termination or cancellation of this Agreement.
16. Notices. All communications hereunder shall be in writing and,
if sent to the Representatives, will be mailed, delivered, or telecopied (with
receipt confirmed) to The Representatives, c/o Advest, Inc., at Xxx Xxxxxxxxxxx
Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxx X. Xxxxx,
Managing Director (Fax No. (000) 000-0000) with a copy to Xxxx X. Xxxxxxxx,
Xxxxxx & Xxxxxx, 000 Xxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, (Fax No.
(000) 000-0000); and if sent to the Company or the Trust will be mailed,
delivered, or telecopied (with receipt confirmed) to Standard Management
Corporation, 00000 Xxxxx Xxxxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000,
Attention: Xxxxxxx X. Xxxxx, Executive Vice President and General Counsel (Fax
No. (000) 000-0000) with a copy to Xxx X. Klapper, Smith, Xxxxxxxx & Xxxxxxx,
LLP, 0000 Xxxxxxxxx Xxxxxx, X.X. Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000 (Fax No.
(000) 000-0000).
17. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors or assigns, and
to the benefit of the
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directors and officers (and their personal representatives) and controlling
persons referred to in Section 11, and no other person shall acquire or have any
right or obligation hereunder. The terms "successors or assigns," as used in
this Agreement, shall not include any purchaser of the Preferred Securities from
any Underwriter merely by reason of such purchase.
18. Partial Unenforceability. If any section, subsection, clause,
or provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, subsection, clause, or provision hereof.
19. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
20. Entire Agreement. This Agreement embodies the entire agreement
among the parties hereto with respect to the transactions contemplated herein,
and other than the Letter of Intent between the Company and Advest, Inc., there
have not been and are no agreements among the parties with respect to such
transactions other than as set forth or provided for herein.
21. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed counterparts hereof,
whereupon it will become a binding agreement among the Company, the Trust and
the Underwriters, including the Representatives, in accordance with its terms.
Very truly yours,
STANDARD MANAGEMENT CORPORATION
BY:
-----------------------------------------
TITLE:
--------------------------------------
SMAN CAPITAL TRUST I
BY: STANDARD MANAGEMENT
CORPORATION
AS DEPOSITOR
BY:
-----------------------------------------
TITLE:
--------------------------------------
ADVEST, INC.
XXXXXX, XXXXX XXXXX,
INCORPORATED
As representatives of the several
Underwriters listed in Schedule I.
BY: ADVEST, INC
BY:
-----------------------------------------
TITLE:
--------------------------------------
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SMAN CAPITAL TRUST I
STANDARD MANAGEMENT CORPORATION
SCHEDULE I
Liquidation Amount of
Firm Securities to be
Name of Underwriter Purchased
------------------- ---------------------
Advest, Inc. .....................................................................$__________
Xxxxxx, Xxxxx Xxxxx, Incorporated.................................................$__________
Aggregate Liquidation Amount......................................................$__________
===========
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EXHIBIT A-1
The opinion of general counsel to the Company to be delivered pursuant to
Section 8(d)(i) of the Underwriting Agreement shall be substantially to the
effect that:
1. The Company is a corporation existing and in good standing
under the laws of the State of Indiana, with requisite corporate power and
authority to own its properties and conduct its business as described in the
Registration Statement, except for such power and authority the absence of which
would not have a material adverse effect on the Company.
2. Each Subsidiary of the Company has been duly incorporated or
organized and is validly existing as a corporation in good standing under the
laws of the jurisdiction of organization, with full corporate power and
authority to own, lease, and operate its properties and conduct its business as
described in the Registration Statement; the Company and each Subsidiary are
qualified to do 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 properties, has an office, or in which business is conducted and
such qualification is required, except where the failure to so qualify would not
have a material adverse effect on the Company and its Subsidiaries as a whole.
3. The Company has full corporate power and authority to execute,
deliver, and perform the Underwriting Agreement; the Underwriting Agreement has
been duly authorized, executed and delivered by the Company, and constitutes a
legal, valid, and binding obligation of the Company and is enforceable against
each of the Company and the Trust in accordance with its terms.
4. The Trust 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 that such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation, fraudulent conveyance and transfer or other similar
laws and by the general principles of equity.
5. 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 that such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation, fraudulent conveyance and transfer or other similar
laws and by the general principles of equity.
6. The Indenture has been duly authorized, executed and delivered
by the Company, and is a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except that such enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium,
liquidation, fraudulent conveyance and transfer or other similar laws and by the
general principles of equity.
7. The Junior Subordinated 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 in accordance with the
Underwriting Agreement,
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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 that such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium, liquidation, fraudulent conveyance and transfer or
other similar laws and by the general principles of equity.
8. The Registration Statement and the Prospectus and any
amendment or supplement thereto made by the Company prior to the Closing Date or
any Option Closing Date (other than the financial statements and financial and
statistical data included therein, as to which no opinion need be rendered),
when it or they became effective or were filed with the Commission, as the case
may be, and in each case at the Closing Date or any Option Closing Date,
complied as to form in all material respects with the requirements of the
Securities Act, the Trust Indenture Act and the applicable rules and regulations
under said acts.
9. Such counsel knows of no material legal or governmental
proceedings pending to which the Company or any Subsidiary is a party or of
which any property of the Company or any Subsidiary is the subject which would
materially adversely affect the consummation of the transactions contemplated in
this Agreement, the Indenture or the Preferred Securities; and such counsel
knows of no such proceedings which are threatened or contemplated by
governmental authorities or threatened by others.
10. 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.
11. 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 this Agreement, the Trust
Agreement, the Guarantee Agreement, and the Indenture or the issuance and sale
of the Preferred Securities or the consummation by the Company of the other
transactions contemplated by this Agreement, the Trust Agreement, the Guarantee
Agreement, or the Indenture, except such as have been obtained under the
Securities Act, the Exchange 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 and sale of the Preferred Securities (as to which such counsel
need express no opinion).
12. The execution and delivery of this Agreement, the Trust
Agreement, the Guarantee Agreement, and the Indenture, the issue and sale of the
Preferred Securities and the Junior Subordinated Debentures, the compliance by
the Company with the provisions of the Junior Subordinated Debentures, the
Indenture and this Agreement and the consummation of the transactions herein and
therein contemplated will not conflict with or constitute a breach of, or
default under, the articles of incorporation or by-laws of the Company or a
breach or default under any contract, indenture, mortgage, loan agreement, note,
lease or other instrument known to such counsel to which either the Company or
any Subsidiary is a party or by which any of them or any of their respective
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properties may be bound except for such breaches as would not have a material
adverse effect on the Company and its Subsidiaries considered as one enterprise,
nor will such action result in a violation on the part of the Company or any
Subsidiary of any applicable law or regulation or of any administrative,
regulatory or court decree known to such counsel.
4
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EXHIBIT A-2
The opinion of special counsel to the Company to be delivered pursuant to
Section 8(d)(ii) of the Underwriting Agreement shall be substantially to the
effect that:
1. The Indenture has been duly qualified under the Trust
Indenture Act, and assuming such Indenture is duly authorized and executed by
the Company, is a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except that such enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium,
liquidation, fraudulent conveyance and transfer or other similar laws and by the
general principles of equity.
2. The Trust is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in Investment
Company Act of 1940, as amended.
3. The statements set forth in the Registration Statement under
the captions "Description of Preferred Securities," "Description of Junior
Subordinated Debentures," "Description of Guarantee" and "Relationship Among the
Preferred Securities, the Junior Subordinated 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.
4. The statements of law or legal conclusions and opinions set
forth in the Registration Statement under the caption "Certain Federal Income
Tax Consequences," subject to the assumptions and conditions described therein,
fairly and accurately summarize such counsel's opinion.
5. The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion and, to such
counsel's knowledge and information, no stop order suspending the effectiveness
of the Registration Statement has been issued under the Securities Act and no
proceedings therefor have been initiated or threatened by the Commission.
6. The Registration Statement and the Prospectus and any
amendment or supplement thereto made by the Company prior to the Closing Date or
any Option Closing Date (other than the financial statements and financial and
statistical data included therein, as to which no opinion need be rendered),
when it or they became effective or were filed with the Commission, as the case
may be, and in each case at the Closing Date or any Option Closing Date,
complied as to form in all material respects with the requirements of the
Securities Act, the Trust Indenture Act and the applicable rules and regulations
under said acts.
[Counsel will furnish a separate 10b-5 letter on the date of this opinion]
32
EXHIBIT B
The opinion of counsel to the Trust Company and Trust Delaware to be delivered
pursuant to Section 8(d)(ii) of the Underwriting Agreement shall be
substantially to the effect that:
1. The Trust Company is duly incorporated and is validly existing
in good standing as a banking corporation with trust powers under the laws of
the State of New York.
2. The Indenture Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Indenture, and has taken
all necessary corporate action to authorize the execution, delivery and
performance by it of the Indenture.
3. The Guarantee Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Guarantee Agreement, and
has taken all necessary corporate action to authorize the execution, delivery
and performance by it of the Guarantee Agreement.
4. The Property Trustee has the requisite power and authority to
execute and deliver the Trust Agreement, and has taken all necessary corporate
action to authorize the execution and delivery of the Trust Agreement.
5. Each of the Indenture and the Guarantee Agreement has been
duly executed and delivered by the Indenture Trustee and the Guarantee Trustee,
respectively, and constitutes a legal, valid and binding obligation of the
Indenture Trustee and the Guarantee Trustee, respectively, enforceable against
the Indenture Trustee and the Guarantee Trustee, respectively in accordance with
its respective terms, except that certain payment obligations may be enforceable
solely against the assets of the Trust and except that such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium, liquidation,
fraudulent conveyance and transfer or other similar laws affecting the
enforcement of creditors' rights generally, and by general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing (regardless of whether such enforceability is considered
in a proceeding in equity or at law), and by the effect of applicable public
policy on the enforceability of provisions relating to indemnification or
contribution.
6. The Junior Subordinated Debentures delivered on the date
hereof have been duly authenticated by the Indenture Trustee in accordance with
the terms of the Indenture.
33
EXHIBIT C
The opinion of counsel, as special Delaware counsel to the Company and the Trust
to be delivered pursuant to Section 8(d)(iii) 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 Business Trust Act, 12 Del.
C. Section 3801 et seq. (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 trust power and authority to own its property and to its conduct its
business, all as described in the Prospectus.
3. The Trust Agreement constitutes a valid and binding obligation
of the Company and the Property Trustee and the Delaware Trustee, and is
enforceable against the Company and the Property Trustee and the Delaware
Trustee, in accordance with its terms.
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 are duly and validly issued and, subject to the
qualifications set forth herein, fully paid and nonassessable undivided
beneficial interests in the assets of the Trust and are entitled to the benefits
of the Trust Agreement. The Holders, as beneficial owners of the Trust, will be
entitled to the same limitations of personal liability extended to stockholders
of private corporations for profit organized under the General Corporation Law
of the State of Delaware. 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.
7. Under the Delaware Act and the Trust Agreement, the issuance
of the Preferred Securities and Common Securities is not subject to preemptive
rights.
34
8. The Common Securities have been duly authorized by the Trust
Agreement and are duly and validly issued undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement.
9. The issuance and sale by the Trust of the Preferred Securities
and Common Securities, the purchase by the Trust of the Junior Subordinated
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.
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EXHIBIT D
The opinion of counsel, as Special Delaware counsel to Trust Delaware to be
delivered pursuant to Section 8(d) (iv) of the Underwriting Agreement shall be
substantially to the effect that:
1. Trust Delaware is duly incorporated and is validly existing in
good standing as a banking corporation with trust powers under the laws of the
State of Delaware.
2. Trust Delaware has the requisite power and authority to
execute and deliver the Trust Agreement, and has taken all necessary corporate
action to authorize the execution and delivery of the Trust Agreement.
