EXHIBIT 10.1
$27,657,000
CSBI CAPITAL TRUST I
11 3/4% TRUST SUBORDINATED CAPITAL INCOME SECURITIES, SERIES A
PURCHASE AGREEMENT
July 10, 1997
XXXXXX BROTHERS INC.,
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The institutions listed on Schedule 1 hereto (collectively, the
"Sellers") propose to sell to you (the "Purchaser") $27,657,000 aggregate
liquidation amount of 11 3/4% Trust Subordinated Capital Income Securities,
Series A (liquidation amount $1,000 per Security) (the "Capital Securities") of
CSBI Capital Trust I, a Delaware statutory business trust (the "Trust"),
guaranteed (the "Guarantee"; together with the Capital Securities, the
"Securities") by Commerce Security Bancorp, Inc., a Delaware corporation (the
"Company") to the extent set forth in the Capital Securities Guarantee Agreement
(the "Guarantee Agreement") between the Company and The Wilmington Trust
Company, as guarantee trustee (the "Guarantee Trustee") in favor of the Holders
(as defined therein). The Company is the owner of all of the beneficial
ownership interests represented by common securities (the "Common Securities")
of the Trust. Concurrently with the issuance of the Capital Securities and the
Company's purchase of all of the Common Securities, the Trust invested the
proceeds of each thereof in the Company's Junior Subordinated Debentures due
June 6, 2027 (the "Junior Subordinated Debentures") issued pursuant to the
Indenture (the "Indenture") between the Company and The Wilmington Trust
Company, as indenture trustee (the "Indenture Trustee").
The Securities will be offered without being registered under the
Securities Act of 1933, as amended (the "Securities Act"), in reliance on
exemptions therefrom.
In connection with the sale of the Securities, the Trust and the
Company have prepared a final Offering Memorandum (together with Appendix A
thereto and the documents incorporated or deemed to be incorporated by reference
therein, the "Offering Memorandum") setting forth, among other things, a
description of the terms of the Securities, the terms of the offering, a
description of the Company and the Trust and relevant information concerning the
Sellers. Prior to the purchase of the Securities by the Purchaser on the
Closing Date, the Company and the Sellers shall take such actions as may be
necessary to amend the Securities, the Junior Subordinated Debentures, the Trust
and any related instruments so as to conform the terms thereof to those set
forth in the Offering Memorandum.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND THE
TRUST. The Company and the Trust, jointly and severally, represent and warrant
to, and agree with, the Purchaser that as of the date hereof:
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(a) The Offering Memorandum does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that
the representations and warranties set forth in this Section 1(a) do
not apply to statements or omissions in the Offering Memorandum based
upon information furnished to the Company or the Trust in writing by
or on behalf of the Purchaser expressly for use therein.
(b) The Company and each of its subsidiaries (which term shall
include only those subsidiaries (as defined in Section 15) which
constitute "significant subsidiaries" within the meaning of Rule 12b-2
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation, have all corporate power and authority
necessary to own or hold their respective properties and to conduct
the businesses in which they are engaged and are duly qualified to do
business and in good standing as foreign corporations in each
jurisdiction in which their respective ownership or lease of property
or the conduct of their respective businesses requires such
qualification, except where the failure to be so qualified and in good
standing could not reasonably be expected to have a material adverse
effect on the financial condition, results of operations, business or
business prospects of the Company and its subsidiaries taken as a
whole (a "Material Adverse Effect"). Eldorado Bank is the only
subsidiary of the Company which constitutes a "significant subsidiary"
within the meaning of Rule 12b-2.
(c) The Company has an authorized capitalization as set forth in
the Offering Memorandum, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and conform in all material respects to
the description thereof contained in the Offering Memorandum; and all
of the issued shares of capital stock of each subsidiary of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims.
(d) The Trust has been duly created and is validly existing as a
statutory business trust in good standing under the Business Trust Act
of the State of Delaware (the "Delaware Business Trust Act") with the
trust power and authority to own its property and conduct its business
as described in the Offering Memorandum, and has conducted and will
conduct no business other than the transactions contemplated by this
Agreement or as otherwise described in the Offering Memorandum; the
Trust is not a party to or bound by any agreement or instrument other
than this Agreement, the Declaration of Trust (the "Declaration")
among the Company, as sponsor, the individuals named as administrative
or regular trustees therein (the "Regular Trustees"), The Wilmington
Trust Company, as property trustee (the "Property Trustee") and The
Wilmington Trust Company, as Delaware trustee (the "Delaware Trustee";
and together with the Property Trustee and the Regular
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Trustees, the "Trustees"), the Registration Rights Agreement (the
"Registration Rights Agreement") to be entered into among the Company,
the Trust and the Purchaser as described in the Offering Memorandum,
and the agreements and instruments contemplated by the Declaration and
described in the Offering Memorandum; the Trust has no liabilities or
obligations other than those arising out of the transactions
contemplated by this Agreement and the Declaration and described in
the Offering Memorandum; and the Trust is not a party to or subject to
any action, suit or proceeding of any nature.
(e) The Declaration has been duly authorized and, assuming due
authorization, execution and delivery of the Declaration by the
Delaware Trustee, is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing, and at the Closing
Date (as defined in Section 5 hereof) will conform in all material
respects to all statements relating thereto in the Offering
Memorandum.
(f) The Capital Securities and the Common Securities have been
duly authorized and validly issued and are fully paid and non-
assessable and at the Closing Date will conform in all material
respects to the descriptions of the Capital Securities and the Common
Securities contained in the Offering Memorandum.
(g) The Guarantee Agreement, the Indenture and the Junior
Subordinated Debentures have been duly authorized and delivered by the
Company and constitute valid and legally binding obligations of the
Company enforceable against the Company in accordance with their
respective terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or
at law) and an implied covenant of good faith and fair dealing; and
the Indenture, the Junior Subordinated Debentures and the Guarantee
will at the Closing Date conform in all material respects to the
descriptions thereof contained in the Offering Memorandum.
(h) This Agreement has been duly authorized, executed and
delivered by each of the Trust and the Company and the Registration
Rights Agreement has been duly authorized by each of the Trust and the
Company and at or prior to the Closing Date will be duly delivered and
executed by each of the Trust and the Company.
(i) The execution, delivery and performance of this Agreement,
the Declaration and the Registration Rights Agreement by the Trust,
the issuance of the Common Securities and the Capital Securities by
the Trust, the purchase of the Junior Subordinated Debentures by the
Trust from the Company, the distribution of the Junior Subordinated
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Debentures upon the liquidation of the Trust in the circumstances
contemplated by the Declaration and described in the Offering
Memorandum, the consummation by the Trust of the transactions
contemplated herein and in the Declaration and the performance by the
Trust of its obligations hereunder and thereunder (the "Trust
Transactions"), did not and will not, as the case may be, conflict
with or result in a violation of any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Trust or any of its assets; and except for such
consents, approvals, authorizations, registrations or qualifications
as may be required under applicable state securities laws in
connection with the purchase and distribution of the Capital
Securities by the Purchaser, no consent, approval, authorization or
order of or filing or registration with, any such court or
governmental agency or body was or is required, as the case may be,
for the Trust Transactions.
(j) The execution, delivery and performance of this Agreement,
the Guarantee Agreement, the Indenture and the Registration Rights
Agreement by the Company, the issuance of the Junior Subordinated
Debentures by the Company, the purchase of the Common Securities by
the Company from the Trust, the consummation by the Company of the
transactions contemplated herein and therein and the performance by
the Company of its obligations hereunder and thereunder (the "Company
Transactions") did not and will not, as the case may be, conflict with
or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the properties
or assets of the Company or any of its subsidiaries is subject other
than such conflicts, breaches and violations as would not, either
individually or in the aggregate, have a Material Adverse Effect, nor
will such actions result in any violation of the provisions of the
charter or by-laws of the Company or any of its subsidiaries or any
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company, any of its
subsidiaries or any of their properties or assets; and except for such
consents, approvals, authorizations, registrations or qualifications
as may be required under applicable state securities laws in
connection with the purchase and distribution of the Capital
Securities by the Purchaser, no consent, approval, authorization or
order of, or filing or registration with, any such court or
governmental agency or body was or is required, as the case may be,
for the Company Transactions.
(k) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest quarterly financial statements
included in the Offering Memorandum any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree that, either individually or in
the aggregate, reasonably could be expected to have a Material Adverse
Effect, otherwise than as set forth or contemplated in the Offering
Memorandum; and, since such date, there has not been any material
change
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in the capital stock or long-term debt of the Company or any of
its subsidiaries otherwise than as set forth or contemplated in the
Offering Memorandum; and, since such date, there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries otherwise than as set
forth or contemplated in the Offering Memorandum.
(l) The financial statements (including the related notes and
supporting schedules) included in the Offering Memorandum present
fairly the financial condition and results of operations of the
entities purported to be shown thereby, at the dates and for the
periods indicated, and have been prepared in all material respects in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved except as otherwise
disclosed therein; and the pro forma financial information included in
the Offering Memorandum has been prepared in all material respects in
accordance with the requirements of Regulation S-X promulgated by the
Securities and Exchange Commission (the "Commission") and contains all
adjustments necessary for a fair presentation of the information set
forth therein.
(m) Price Waterhouse LLP, who have certified certain financial
statements of the Company, whose report is included in the Offering
Memorandum and who have delivered the initial letter referred to in
Section 8(e) hereof, are independent public accountants as required by
the Securities Act and the rules and regulations of the Commission
thereunder during the periods covered by the financial statements on
which they reported contained in the Offering Memorandum.
(n) There are no legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which
any property or asset of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries would, either individually or in the aggregate, have a
Material Adverse Effect; and to the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others.
(o) Since the date as of which information is given in the
Offering Memorandum through the date hereof, and except as may
otherwise be disclosed in the Offering Memorandum, neither the Company
or any of its subsidiaries nor the Trust has (i) issued or granted any
securities, (ii) incurred any liability or obligation, direct or
contingent, other than liabilities and obligations which were incurred
in the ordinary course of business, (iii) entered into any transaction
not in the ordinary course of business or (iv) in the case of the
Company, declared or paid any dividend on its capital stock, except
for dividends payable in the ordinary course on the Series B Preferred
Stock (as defined in the Offering Memorandum) in accordance with the
terms thereof.
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(p) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default in any
respect, and no event has occurred which, with notice or lapse of time
or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any
material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is bound
or to which any of its properties or assets is subject, other than
such defaults as would not, either individually or in the aggregate,
have a Material Adverse Effect, or (iii) is in violation in any
material respect of any law, ordinance, governmental rule, regulation
or court decree to which it or its properties or assets may be subject
or has failed to obtain any license, permit, certificate, franchise or
other governmental authorization or permit necessary to the ownership
of its properties or assets or to the conduct of its business, other
then such violations and failures as would not, either individually or
in the aggregate, have a Material Adverse Effect.
(q) Neither the Company nor any of its subsidiaries nor the
Trust is an "investment company" within the meaning of such term under
the Investment Company Act of 1940, as amended (the "Investment
Company Act") and the rules and regulations of the Commission
thereunder.
(r) The Company is duly registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended (the "BHC
Act"); and the deposit accounts of each of depository institution
subsidiary of the Company are insured by the Federal Deposit Insurance
Corporation ("FDIC") to the fullest extent permitted by law and the
rules and regulations of the FDIC, and no proceedings for the
termination of such insurance are pending or, to the Company's
knowledge, threatened.
(s) The Company and each of its subsidiaries are in compliance
with all laws administered by and regulations of the Board of
Governors of the Federal Reserve System, the FDIC and any other
federal or state bank regulatory authority with jurisdiction over the
Company or any of its subsidiaries (the "Bank Regulatory
Authorities"), other than where such failures to comply would not,
individually or in the aggregate, have a Material Adverse Effect.
Except as may be described in the Offering Memorandum, neither the
Company nor any of its subsidiaries is a party to any written
agreement or memorandum of understanding with, or a party to any
commitment letter or similar undertaking to, or is subject to any
order or directive by, or is a recipient of any extraordinary
supervisory letter from, or has adopted any board resolutions at the
request of, any Bank Regulatory Authority which restricts materially
the conduct of its business, or in any manner relates to its capital
adequacy, its credit policies or its management, nor have any of them
been advised by any Bank Regulatory Authority that it is contemplating
issuing or requesting (or is considering the appropriateness of
issuing or requesting) any such order, decree, agreement, memorandum
of understanding, extraordinary supervisory letter, commitment letter
or similar submission, or any such board resolutions.
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(t) Neither the Company nor any of its affiliates (as defined in
Rule 501(b) of Regulation D under the Securities Act, an "Affiliate")
has directly, or through any agent, (i) sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect of, any
security (as defined in the Securities Act) which is or will be
integrated with the sale of the Capital Securities in a manner that
would require the registration under the Securities Act of the
Securities or (ii) engaged in any form of general solicitation or
general advertising in connection with the offering of the Securities
(as those terms are used in Regulation D under the Securities Act), or
in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act.
(u) Except as set forth in the Offering Memorandum, there are no
relationships or transactions between the Company and its subsidiaries
on the one hand and any of the Sellers and their respective affiliates
on the other that would be material to the holders of the Capital
Securities, and the descriptions of such relationships and
transactions set forth in the Offering Memorandum are fair and
accurate summaries of the terms thereof in all material respects.
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLERS. Each
Seller severally represents, warrants and agrees that:
(a) The Offering Memorandum does not contain any untrue
statement of a material fact relating to the identity of such Seller
or its ownership of the Capital Securities (collectively, the "Seller
Information") or omit to state a material fact relating to such Seller
Information necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(b) Such Seller has duly authorized, executed and delivered this
Agreement.
(c) Such Seller has, and immediately prior to the Closing Date
such Seller will have, good and valid title to the Capital Securities
to be sold by such Seller hereunder on such date, free and clear of
all liens, encumbrances, equities or claims; and upon delivery of such
Capital Securities and full payment therefor pursuant hereto, good and
valid title to such Capital Securities, free and clear of all liens,
encumbrances, equities or claims, will pass to the Purchaser.
(d) Such Seller has full right, power and authority to enter
into this Agreement; the execution, delivery and performance of this
Agreement by such Seller and the consummation by such Seller of the
transactions contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such Seller
is a party or by which such Seller is bound or to which any of the
property or assets of such Seller is subject, other than such
conflicts, breaches and violations as would not, either individually
or in the aggregate, adversely
8
affect in any material respect such Seller's ability to perform its
obligations under this Agreement on a timely basis, nor will such
actions result in any material violation of the provisions of the
charter or by-laws of such Seller or the articles of partnership of
such Seller or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over such
Seller or the property or assets of such Seller; and, no consent,
approval, authorization or order of, or filing or registration with,
any such court or governmental agency or body is required for the
execution, delivery and performance of this Agreement by such Seller
and the consummation by such Seller of the transactions contemplated
hereby.
(e) Such Seller is not prompted to sell the Capital Securities
being sold by such Seller hereunder by any information concerning any
change, or any development involving a prospective change, that,
individually or in the aggregate, reasonably could be expected to have
a Material Adverse Effect, which information is not set forth in the
Offering Memorandum.
3. PURCHASE OF THE CAPITAL SECURITIES BY THE PURCHASER. On the basis
of the representations and warranties herein contained, and subject to the terms
and conditions herein set forth, each Seller hereby agrees, severally and not
jointly, to sell the liquidation amount of Capital Securities set opposite its
name in Schedule 1 hereto to the Purchaser and the Purchaser agrees to purchase
the liquidation amount of the Capital Securities set opposite that Seller's name
in Schedule 1 hereto, at a purchase price of 100% of the liquidation amount
thereof plus accrued and unpaid distributions thereon from June 30, 1997.
As compensation to the Purchaser for its commitment hereunder, each
Seller agrees to pay the Purchaser the commission set forth in Schedule 1
opposite each Seller's name. For convenience purposes, the Purchaser may offset
such amounts against the amounts payable in respect of the purchase price for
such Capital Securities pursuant to the preceding paragraph.
The Sellers shall not be obligated to deliver any of the Capital
Securities, except upon full payment for all of the Capital Securities to be
purchased as hereinafter provided.
4. OFFERING AND RESALE OF THE CAPITAL SECURITIES BY THE PURCHASER.
The Purchaser has advised the Company and the Sellers that it proposes to offer
the Capital Securities for resale upon the terms and conditions set forth in
this Agreement and in the Offering Memorandum. The Purchaser hereby represents
and warrants to, and agrees with, the Company and the Sellers that it (i) is
purchasing the Capital Securities pursuant to a private sale exempt from
registration under the Securities Act, (ii) will not solicit offers for, or
offer or sell, the Capital Securities by means of any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Securities Act) or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act, and (iii) will solicit offers
for the Capital Securities only from, and will offer, sell or deliver the
Capital Securities, as part of the offering contemplated by the Offering
Memorandum, only to (1) persons whom it reasonably believes to be qualified
institutional buyers ("Qualified Institutional Buyers") as defined
9
in Rule 144A under the Securities Act, as such rule may be amended from time
to time ("Rule 144A") or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to the Purchaser that each such account
is a Qualified Institutional Buyer, to whom notice has been given that such
sale or delivery is being made in reliance on Rule 144A or (2) institutional
accredited investors ("Accredited Investors") as defined in Rule 501(a)(1)(2),
(3) or (7) under Regulation D who execute letters of representation in the form
included as Appendix A to the Offering Memorandum.
5. DELIVERY OF AND PAYMENT FOR THE CAPITAL SECURITIES. (a) Payment
of the purchase price for, and delivery of, the Capital Securities shall be made
at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx, New York, New York or at such
other place as shall be agreed upon by the Company and you, at 9:30 a.m. (New
York time), on July 15, 1997 or at such other time or date as you and the
Company shall determine (such date and time of payment and delivery being herein
called the "Closing Date").
(b) On the Closing Date, payment shall be made to the Sellers in
same-day funds by wire transfer to such account or accounts as the Sellers shall
specify prior to the Closing Date or by such means as the parties hereto shall
agree prior to the Closing Date against delivery to you of the certificates
evidencing the Capital Securities. Upon delivery, the Capital Securities shall
be registered in such names and in such denominations as the Purchaser shall
request in writing not less than two full business days prior to the Closing
Date. For the purpose of expediting the checking and packaging of certificates
evidencing the Capital Securities, the Company and the Sellers agree to make
such certificates available for inspection at least 24 hours prior to the
Closing Date.
6. FURTHER AGREEMENTS OF THE COMPANY AND THE TRUST. Each of the
Company and the Trust agrees:
(a) To furnish to you, without charge, as many copies of the
Offering Memorandum and any supplements and amendments thereto as you
may reasonably request.
(b) Prior to making any amendment or supplement to the Offering
Memorandum, the Company shall furnish a copy thereof to the Purchaser
and counsel to the Purchaser and will not effect any such amendment or
supplement to which the Purchaser shall reasonably object.
(c) If, at any time prior to the date on which all of the
Capital Securities purchased hereunder shall have been sold by the
Purchaser, any event shall occur or condition exist as a result of
which it is necessary, in the opinion of counsel for the Purchaser or
counsel for the Company and the Trust, to amend or supplement the
Offering Memorandum in order that the Offering Memorandum will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein not
misleading in light of the circumstances existing at the time it is
delivered to a purchaser, or if it is necessary to amend or supplement
the Offering Memorandum to comply with applicable law, to promptly
prepare such amendment or supplement as may be
10
necessary to correct such untrue statement or omission or so that the
Offering Memorandum, as so amended or supplemented, will comply with
applicable law and to furnish you such number of copies as you may
reasonably request; PROVIDED, HOWEVER, that expense of preparing and
delivering any such amendment or supplement shall be borne (i) prior
to the date on which the Company shall file its Annual Report on
Form 10-K or Form 10-KSB for the year ended December 31, 1997 with the
Securities and Exchange Commission, by the Company, and (ii)
thereafter, by the Purchaser.
(d) So long as the Capital Securities are outstanding and are
"Restricted Securities" within the meaning of Rule 144(a)(3) under the
Securities Act, to furnish to holders of the Capital Securities and
prospective purchasers of Capital Securities designated by such
holders, upon request of such holders or such prospective purchasers,
the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act, unless at the time of such request the
Company is subject to and in compliance with Section 13 or 15(d) of
the Exchange Act.
(e) For a period of three years following the date of the
Offering Memorandum, to furnish to the Purchaser copies of all
materials furnished by the Company to its shareholders and all public
reports and all reports and financial statements furnished by each of
the Company and the Trust to the principal national securities
exchange, if any, upon which the Capital Securities or any other
securities of the Company may be listed pursuant to requirements of or
agreements with such exchange or to the Commission pursuant to the
Exchange Act or any rule or regulation of the Commission thereunder.
(f) Promptly from time to time to take such action as the
Purchaser may reasonably request to qualify the Capital Securities,
the Guarantee Agreement and the Junior Subordinated Debenture for
offering and sale under the securities laws of such jurisdictions as
the Purchaser may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the
Capital Securities; provided, however, that the Company shall not be
required to register or qualify as a foreign corporation or take any
action which would subject it to the service of process in suits,
other than as to matters relating to the offer and sale of the Capital
Securities, in any jurisdiction where it is not now so subject.
(g) Not to offer, sell, contract to sell or otherwise dispose of
any additional securities of the Trust or the Company substantially
similar to the Capital Securities or any securities convertible into
or exchangeable for or that represent the right to receive any such
similar securities, without the consent (which consent shall not be
unreasonably withheld) of the Purchaser during the period beginning
from the date of this Agreement and continuing to and including the
earlier of (i) the termination of trading restrictions on the Capital
Securities, as communicated to the Company by the Purchaser, and
(ii) 90 days following the Closing Date.
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(h) Not to, and to cause its affiliates not to, solicit any
offer to buy or offer to sell the Capital Securities by means of any
form of general solicitation or general advertising (as those terms
are used in Regulation D under the Securities Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the
Securities Act.
(i) Not to, and to cause its affiliates not to, sell, offer for
sale or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in the Securities Act) in a transaction that
could be integrated with the sale of the Capital Securities in a
manner that would require the registration under the Securities Act of
the Capital Securities.
(j) To take such steps as shall be reasonably necessary to
ensure that neither the Company or any subsidiary of the Company nor
the Trust shall become an "investment company" within the meaning of
such term under the Investment Company Act and the rules and
regulations of the Commission thereunder.
7. EXPENSES. The Company agrees to pay (a) the costs incident to the
preparation and printing of the Offering Memorandum and any amendments or
supplements thereto; (b) the costs of distributing the Offering Memorandum and
any amendments or supplements thereto; (c) the fees and expenses of the Property
Trustee (as defined in the Declaration); and (d) all other costs and expenses
incident to the performance of the obligations of the Company and the Trust. The
Company shall reimburse the Purchaser on the Closing Date for the reasonable
fees and expenses of its counsel in connection with the transactions
contemplated hereby in an amount up to $50,000 plus one-half of any such fees
and expenses in excess thereof.
8. CONDITIONS TO THE PURCHASER'S OBLIGATIONS. The obligations of the
Purchaser hereunder are subject to the accuracy, when made and on the Closing
Date, of the representations and warranties of the Company, the Trust and the
Sellers contained herein, to the performance in all material respects by the
Company, the Trust and the Sellers of their respective obligations hereunder,
and to each of the following additional terms and conditions:
(a) The Purchaser shall not have discovered and disclosed to the
Company, the Trust and the Sellers on or prior to the Closing Date
that the Offering Memorandum or any amendment or supplement thereto
contains any untrue statement of a fact which, in the opinion of
Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Purchaser, is material or
omits to state any fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
(b) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the
Indenture, the Junior Subordinated Debentures, the Guarantee
Agreement, the Capital Securities, the Common Securities, the Offering
Memorandum, and all other legal matters relating to this
12
Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all respects to counsel for the Purchaser, and the
Company, the Trust and the Sellers shall have furnished to such
counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
(c) Xxxxxx, XxXxxxxxx & Fish, LLP shall have furnished to the
Purchaser their written opinion, as counsel to the Company and the
Trust, addressed to the Purchaser and dated the Closing Date, in form
and substance satisfactory to the Purchaser, to the effect set forth
in Exhibit A hereto.
(d) Xxxxxxxx, Xxxxxx & Finger shall have furnished to the
Purchaser their written opinion, on certain matters of Delaware law
relating to the organization of the Trust and the validity of the
Capital Securities, addressed to the Purchaser and dated the Closing
Date, in form and substance satisfactory to the Purchaser, to the
effect set forth in Exhibit B hereto and to such further effect as
counsel to the Purchaser may reasonably request.
(e) You shall have received (A) the Consent of Independent
Auditors dated the date of the Offering Memorandum, in form and
substance satisfactory to you, from KPMG Peat Marwick LLP, independent
auditors for Eldorado Bancorp and (B) letters, dated the date hereof
and the Closing Date in form and substance satisfactory to you, from
Price Waterhouse LLP, independent auditors for the Company, containing
statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to (i) the
financial statements and (ii) certain financial information (as of a
date after, or for a period beginning on or after, January 1, 1996),
in each case contained or incorporated by reference in the Offering
Memorandum as identified by you.
(f) The Company and the Trust shall have furnished to the
Purchaser a certificate, dated the Closing Date, of the President and
Chief Executive Officer of the Company and its chief financial officer
stating that:
(i) The representations, warranties and agreements of the
Company and the Trust in Section 1 are true and correct as of the
Closing Date and the Company has complied in all material
respects with all its agreements contained herein; and
(ii) They have carefully examined the Offering Memorandum
and, in their opinion the Offering Memorandum, as of its date and
as of the Closing Date, did not include any untrue statement of a
material fact and did not omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
13
(g) Each Seller shall have furnished to the Purchaser on the
Closing Date a certificate, dated such Closing Date, signed by an
authorized senior officer of such Seller, stating that the
representations and warranties of such Seller contained herein are
true and correct as of such Closing Date and that such Seller has
complied in all material respects with all agreements contained herein
to be performed by such Seller at or prior to such Closing Date.
(h) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market shall have been
suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having jurisdiction,
(ii) a banking moratorium shall have been declared by Federal or New
York or California state authorities, (iii) the United States shall
have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the United
States or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the
United States shall be such) as to make it, in the judgment of the
Purchaser, impracticable or inadvisable to proceed with the offering
or delivery of the Capital Securities on the terms and in the manner
contemplated in the Offering Memorandum.
(i) The Purchaser shall have received on or prior to the
Closing Date the Registration Rights Agreement executed by the Company
and the Trust.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Purchaser.
9. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company and the Trust, jointly and severally, shall indemnify
and hold harmless the Purchaser, each Seller, and their respective officers and
employees and each person, if any, who controls the Purchaser or a Seller within
the meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Capital Securities), to which the Purchaser or a Seller
or such officers, employees or controlling persons may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in the Offering Memorandum or
in any amendment or supplement thereto or in any other offering materials
prepared by or on behalf of the Company and used with the Company's consent in
connection with the offering and sale of the Capital Securities hereunder, or
(B) in any blue sky application or other document prepared
14
or executed by the Company or the Trust (or based upon any written
information furnished by the Company or the Trust) specifically for the
purpose of qualifying any or all of the Capital Securities under the
securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "Blue Sky Application"),
or (ii) the omission or alleged omission to state in the Offering Memorandum
or in any amendment or supplement thereto, in any such offering materials or
in any Blue Sky Application any material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall
reimburse the Purchaser, each Seller, and their respective officers,
employees and controlling persons promptly upon demand for any legal or other
expenses reasonably incurred by the Purchaser or a Seller, or their
respective officers, employees or controlling persons in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; PROVIDED,
HOWEVER, that the Company and the Trust shall not be liable to indemnify the
Purchaser, a Seller, or any officers or employees or controlling persons in
any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged
untrue statement or omission or alleged omission made in the Offering
Memorandum or in any such amendment or supplement or in any Blue Sky
Application in reliance upon and in conformity with the written information
furnished to the Company or the Trust by or on behalf of the Purchaser
specifically for inclusion therein and described in Section 9(e). The
foregoing indemnity agreement is in addition to any liability which the
Company and the Trust may otherwise have to the Purchaser or to any officer,
employee or controlling person of the Purchaser. Notwithstanding any other
provision of this Agreement, the foregoing indemnity agreement with respect
to the Offering Memorandum shall not be available to the Purchaser if the
Company has complied in full with its obligations under Section 6(c) and a
copy of a supplement or amendment to the Offering Memorandum furnished by the
Company to the Purchaser was not sent or given by or on behalf of the
Purchaser to the person asserting such losses, claims, damages or liabilities
at or prior to the written confirmation of the sale of the Capital Securities
to such person, if such supplement or amendment would have cured the defect
giving rise to such loss, claim damage or liability.
(b) The Purchaser shall indemnify and hold harmless the Company, each
of the Sellers, each of their respective officers and employees, each of their
respective directors, the Trustee and each trustee thereof, and each person, if
any, who controls the Company or the Trust within the meaning of the Securities
Act, from and against any loss, claim, damage or liability, joint or several, or
any action in respect thereof, to which the Company, a Seller, any such
director, employee or officer, the Trust or any such trustee or any controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in the Offering Memorandum or in any amendment or supplement
thereto, or (B) in any Blue Sky Application or (ii) the omission or alleged
omission to state in the Offering Memorandum or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be stated
therein or necessary to make the statements therein not misleading, but in each
case only to the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
the written information furnished to the Company, the Trust or a Seller by or on
behalf of the Purchaser specifically for inclusion therein and described in
Section 9(e), and shall reimburse the Company, each Seller and any such
director, employee or officer, or the Trust or any such trustee, or controlling
person, for any legal or other expenses
15
reasonably incurred by the Company or any such director, employee or officer,
or the Trust or any such trustee, or any controlling person in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which the
Purchaser may otherwise have to the Company, a Seller or any such director,
employee or officer, or the Trust or any such trustee, or any controlling
person.
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 9, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 9 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 9.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in the
reasonable judgment of such counsel it is advisable for such indemnified party
to employ separate counsel or (iii) the indemnifying party has failed to assume
the defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties, which firm shall be designated in writing (A) by the Purchaser, if the
indemnified parties under this Section 9 consist of, or include the Purchaser or
any of its officers, employees or controlling persons, or (B) by the Company, if
the indemnified parties under this Section consist of the Company, the Trust or
any of their respective directors, officers, trustees, employees or controlling
persons. No indemnifying party shall (i) without the prior written consent of
the indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of
16
which indemnification or contribution may be sought hereunder (whether or not
the indemnified parties are actual or potential parties to such claim or
action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment of the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss of liability by reason of such settlement or
judgment.
(d) If the indemnification provided for in this Section 9 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 9(a) or 9(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits (A)
received by the Company and the Trust, (B) the Sellers and (C) the Purchaser,
respectively, from the offering of the Capital Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company, the
Trust, the Sellers and the Purchaser, respectively, with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company, the Trust and
the Sellers on the one hand and the Purchaser on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Capital Securities purchased under this Agreement
(before deducting expenses) received by the Sellers on the one hand, and the
total underwriting commissions received by the Purchaser with respect to the
Capital Securities purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of the Capital
Securities under this Agreement. For purposes of the foregoing sentences solely
as between the Company and the Trust, on the one hand, and the Sellers, on the
other, the Company shall be responsible for all contributions required to be
made by the Sellers hereunder. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company, the Trust, the Sellers or the Purchaser, the intent of
the parties and their relative knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, the Trust, the
Sellers and the Purchaser agree that it would not be just and equitable if
contributions pursuant to this Section 9(d) were to be determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 9(d) shall be
deemed to include, for purposes of this Section 9(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 9(d), neither the Purchaser nor any of the Sellers
shall be required to contribute any amount in excess of the amount by which, in
the case of the Purchaser, the total price at which the Capital Securities were
resold by the Purchaser or, in the case of each of the
17
Sellers, the gross proceeds received by such Seller from the sale of Capital
Securities pursuant to this Agreement not immediately reinvested in other
securities of the Company, exceeds the amount of any damages which the
Purchaser or such Seller has otherwise paid or become liable to pay by reason
of any untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
(e) The Purchaser confirms that the statements with respect to the
offering of the Capital Securities set forth in the bottom paragraph on the
cover page of, and under the caption "Plan of Distribution" in, the Offering
Memorandum are correct and constitute the only information furnished in writing
to the Company or the Trust by or on behalf of the Purchaser specifically for
inclusion in the Offering Memorandum.
10. TERMINATION. The obligations of the Purchaser hereunder may be
terminated by it by notice given to and received by the Company or the Trust
prior to delivery of and payment for the Capital Securities if, prior to that
time, any of the events described in Section 8(h) shall have occurred or if the
Purchaser shall decline to purchase the Capital Securities for any reason
permitted under this Agreement.
11. REIMBURSEMENT OF PURCHASER'S EXPENSES. If (a) the Sellers shall
fail to tender the Capital Securities for delivery to the Purchaser for any
reason, or (b) the Purchaser shall decline to purchase the Capital Securities
for any reason permitted under this Agreement, the Company shall reimburse the
Purchaser for the reasonable fees and expenses of its counsel and for such other
out-of-pocket expenses as shall have been reasonably incurred by them in
connection with this Agreement and the proposed purchase of the Capital
Securities, and upon demand the Company shall pay the full amount thereof to the
Purchaser: provided, however, that in the circumstances described in clause (b)
of this sentence, (x) the Company's aggregate reimbursement obligation shall not
exceed $50,000, and (y) neither the Company nor any Seller shall be liable to
the Purchaser for damages on account of loss of anticipated profits or other
consequential damages arising out of the purchase of the Capital Securities.
12. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Purchaser, shall be delivered or sent by mail,
telex or facsimile transmission to Xxxxxx Brothers Inc., Three World
Financial Center, New York, New York 10285, Attention: Syndicate
Department (Fax: 000-000-0000);
(b) if to the Company or the Trust shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company
set forth in the Offering Memorandum, Attention: Chief Financial
Officer (Fax: 000-000-0000); and
(c) if to any Seller, shall be delivered or sent by mail, telex
or facsimile transmission to such Seller at the address set forth on
Schedule 1 hereto.
18
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon the Purchaser, the Company,
the Trust, the Sellers and their respective successors. This Agreement and
the terms and provisions hereof are for the sole benefit of only those
persons, except that (A) the representations, warranties, indemnities and
agreements of the Company, the Trust and the Sellers contained in this
Agreement shall also be deemed to be for the benefit of the officers and
employees of the Purchaser and the person or persons, if any, who control the
Purchaser within the meaning of Section 15 of the Securities Act and (B) the
indemnity agreement of the Purchaser contained in Section 9(b) of this
Agreement shall be deemed to be for the benefit of directors, officers and
employees of the Company, the Trust and the Sellers and any person
controlling the Company, the Trust or Sellers within the meaning of Section
15 of the Securities Act. Nothing in this Agreement is intended or shall be
construed to give any person, other than the persons referred to in this
Section 13, any legal or equitable right, remedy or claim under or in respect
of this Agreement or any provision contained herein.
14. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company, the Trust, the Sellers and the
Purchaser contained in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Capital Securities and shall remain in full force and effect,
regardless of any investigation made by or on behalf of any of them or any
person controlling any of them.
15. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY". For
purposes of this Agreement, (a) "business day" means any day on which the New
York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and regulations of the Commission
under the Act.
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF NEW YORK.
17. COUNTERPARTS AND DELIVERY. This Agreement may be executed in one
or more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument. Any party to this
Agreement may deliver an executed copy of this Agreement to one or more of the
parties hereto by facsimile transmission of the signature page hereof as
executed by such party, and any party that elects to so deliver this Agreement
agrees to provide an original signature page to any other party hereto upon
request.
18. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
If the foregoing correctly sets forth the agreement among the Company,
the Trust, the Sellers and the Purchaser, please indicate your acceptance in the
space provided for that purpose below.
Very truly yours,
COMMERCE SECURITY BANCORP, INC.
By:
--------------
Title:
CSBI CAPITAL TRUST I
By:
--------------
REGULAR TRUSTEE
MADISON DEARBORN CAPITAL PARTNERS II,
L.P.
By: Madison Dearborn Partners II, L.P.,
its general partner
By: Madison Dearborn Partners, Inc., its
general partner
By:
--------------
Name:
Title:
OLYMPUS GROWTH FUND II, L.P.
By: OGP II, L.P., its general partner
By: Xxxxxx, L.L.C., its general partner
By:
--------------
Name: Xxxxx X. Xxxxxx
Title: Member
20
OLYMPUS EXECUTIVE FUND, L.P.
By: OEF, L.P., its general partner
By: Xxxxxx, L.L.C., its general partner
By:
--------------
Name: Xxxxx X. Xxxxxx
Title: Member
DARTMOUTH CAPITAL GROUP, L.P.
By: Dartmouth Capital Group, Inc.,
its general partner
By:
--------------
Name: Xxxxxx X. Xxxxxx
Title: President
21
Accepted:
XXXXXX BROTHERS INC.
By
--------------
SCHEDULE 1
Liquidation Amount of Purchaser's
Sellers Capital Securities Commission
------- ------------------- -------------
Madison Dearborn Capital
Partners II, L.P. . . . . . . . $11,617,000 $378,034.50
Three First Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Olympus Growth Fund II, L.P. . . . . 11,501,000 374,254.15
Metro Center
Xxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Olympus Executive Fund, L.P. . . . . 116,000 3,780.34
Metro Center
Xxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Dartmouth Capital Group, L.P.. . . . 4,423,000 143,931.01
c/o Commerce Security Bancorp, Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
------------------ -------------
Total . . . . . . . . . . . . $27,657,000 $900,000.00
EXHIBIT A
FORM OF OPINION OF XXXXXX, XXXXXXXXX & FISH, LLP,
COMPANY COUNSEL TO BE DELIVERED
PURSUANT TO SECTION 8(c)
(i) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing under
the laws of their respective jurisdictions of incorporation, are duly
qualified to do business and are in good standing as foreign corporations in
each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification (other
than those jurisdictions in which the failure to so qualify would not have a
material adverse effect on the Company or the Company and its subsidiaries
taken as a whole), and have all power and authority necessary to own or hold
their respective properties and conduct the businesses in which they are
engaged as described in the Offering Memorandum.
(ii) Each of the Purchase Agreement and the Registration Rights
Agreement has been duly authorized, executed and delivered by the Company and
has been duly executed and delivered by the Trust.
(iii) The Indenture has been duly authorized, executed, and delivered
by the Company and, when duly authorized, executed and delivered by the
Indenture Trustee, will constitute a valid and legally binding obligation of the
Company, enforceable against the Company, in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and implied covenant of good faith and fair dealing.
(iv) The Junior Subordinated Debentures have been duly authorized,
executed and delivered by the Company and constitute valid and legally binding
obligations of the Company enforceable against the Company in accordance with
their terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
(v) The Guarantee Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding obligation
of the Company, enforceable against the Company in accordance with its terms
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(vi) The Declaration has been duly authorized, executed and delivered
by the Company.
A-1
(vii) The execution, delivery and performance of the Purchase
Agreement, the Declaration, the Indenture, the Junior Subordinated Debentures
and the Guarantee Agreement (collectively, the "Transaction Documents") by the
Company and the Trust, as applicable, does not and will not, as the case may be,
constitute a material breach of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument known
to us to which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor will such
actions result in any violation of the provisions of the character or by-laws of
the Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their respective properties or
assets, the effects of which breach, violation or default would be material to
the Company and its subsidiaries taken as a whole.
(viii) The Company has an authorized capitalization as set forth in
the Offering Memorandum; all of the outstanding shares of capital stock of each
significant subsidiary (as such term is defined in Rule 12b-2 under the Exchange
Act) have been duly authorized and validly issued and are fully paid and non-
assessable; except as disclosed in the Offering Memorandum, all such shares are,
to the best of such counsel's knowledge, owned by the Company (except for
directors' qualifying shares, if any) free and clear of any pledge, lien,
security interest, charge, claim, equitable right or encumbrance of any kind.
(ix) No consent, approval, authorization, order, registration or
qualification of or which any Federal or California governmental agency or body
or any Delaware governmental agency or body acting pursuant to the Delaware
General Corporation Law or, to our knowledge, any Federal or California court or
any Delaware court acting pursuant to the Delaware General Corporation Law was
or is required for the issue and sale by the Trust of the Capital Securities,
the issuance by the Company of the Junior Subordinated Debentures, the issuance
of the Guarantee Agreement by the Company and the compliance by the Company and
Trust with all of the provisions of the Purchase Agreement, except for such
consents approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the purchase
and distribution of the Capital Securities by the Purchaser.
(x) The statements made in the Offering Memorandum under the captions
"Description of the Junior Subordinated Debentures", "The Trust", "Description
of the Capital Securities", "Description of the Guarantee" and "Relationship
Among the Capital Securities, the Junior Subordinated Debentures and the
Guarantee", insofar as such statements purport to constitute summaries of the
terms of the Capital Securities, the Junior Subordinated Debentures and the
Guarantee, constitute accurate summaries of the terms of the Capital Securities,
the Junior Subordinated Debentures and the Guarantee in all material respects,
and the statements in the Offering Memorandum under the caption "Certain United
States Federal Income Tax Consequences" are accurate in all material respects
and fairly summarize the matters referred to therein, and the opinion of Xxxxxx,
XxXxxxxxx & Fish, LLP, set forth therein is hereby confirmed.
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(xi) All descriptions in the Offering Memorandum of contracts and
other documents to which the Company or its subsidiaries are a party and which
are material to the holders of the Capital Securities are accurate in all
material respects.
(xii) Except as set forth in the Offering Memorandum, to our
knowledge there are no relationships or transactions between the Company and its
subsidiaries on the one hand and any of the Sellers and their respective
affiliates on the other that are material to the holders of the Capital
Securities, and the descriptions of such relationships and transactions set
forth in the Offering Memorandum are fair and accurate summaries of the terms
thereof in all material respects.
(xiii) To the best of our knowledge and other than as set forth in
the Offering Memorandum, there are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a party or to which any
property of the Company or any of its subsidiaries is subject, which, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
consolidated financial position, shareholders' equity or results of operations
of the Company and its subsidiaries; and to the best of our knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(xiv) Neither the Company nor the Trust is required to be registered
as an "investment company" under the 1940 Act.
(xv) The Company is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended (the "BHC Act"); and the
deposit accounts of Eldorado Bank are insured by the FDIC to the fullest extent
permitted by law and the rules and regulations of the FDIC, and to the best of
our knowledge no proceedings for the termination of such insurance are pending
or threatened.
(xvi) To the best of our knowledge, neither the Company nor any of
its subsidiaries is a party to any written agreement or memorandum of
understanding with, or a party to any commitment letter or similar undertaking
to, or is subject to any order or directive by, or is a recipient of any
extraordinary supervisory letter from, or has adopted any board resolutions at
the request of, any Bank Regulatory Authority which restricts materially the
conduct of its business, or in any manner relates to its capital adequacy, its
credit policies or its management, nor have any of them been advised by any Bank
Regulatory Authority that it is contemplating issuing or requesting (or is
considering the appropriateness of issuing or requesting) any such order,
decree, agreement, memorandum of understanding, extraordinary supervisory
letter, commitment letter or similar submission, or any such board resolutions.
(xvii) No registration of the Capital Securities, the Guarantee or
the Junior Subordinated Debentures under the Act, and no qualification of the
Declaration, the Guarantee or the Indenture under the Trust Indenture Act is
required for the offer and sale of the Securities by the Sellers to the
Purchaser or the initial reoffer and resale of the Securities by the Purchaser
solely in the manner contemplated by the Offering Memorandum.
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We have not independently verified the accuracy, completeness or
fairness of the statements made or included in the Offering Memorandum or in the
documents incorporated by reference therein (the "Exchange Act Documents") and
take no responsibility therefor, except as and to the extent set forth in
paragraphs (x), (xi) and (xii) above. In the course of the preparation by the
Company of the Offering Memorandum, we participated in conferences with certain
officers and employees of the Company, with representatives of Price Waterhouse
LLP and KPMG Peat Marwick LLP and with counsel to the Purchaser. Based on our
examination of the Offering Memorandum and the Exchange Act Documents, our
investigations made in connection with the preparation of the Offering
Memorandum and our participation in the conferences referred to above, we have
no reason to believe that the Offering Memorandum (including the Exchange Act
Documents) contains any untrue statement of a material fact or omits to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
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EXHIBIT B
FORM OF OPINION OF XXXXXXXX XXXXXX & FINGER
SPECIAL DELAWARE COUNSEL TO THE COMPANY AND
THE TRUST TO BE DELIVERED PURSUANT TO SECTION 8(d)
(i) The Trust has been duly created and is validly existing in good standing
as a business trust under the Delaware Trust Act with the business trust
power and authority to own property and to conduct its business as described
in the Offering Memorandum and to enter into and perform its obligations
under each of the Purchase Agreement, the Capital Securities, the Common
Securities and the Declaration;
(ii) The Common Securities have been duly authorized by the
Declaration and are validly issued and (subject to the terms of the Declaration)
fully paid undivided beneficial interests in the assets of the Trust (such
counsel may note that the Holders of Common Securities will be subject to the
withholding provisions of Section 10.4 of the Declaration, will be required to
make payment or provide indemnity or security as set forth in the Declaration
and will be liable for the debts and obligations of the Trust to the extent
provided in Section [9.1(b)] of the Declaration); under the Delaware Trust Act
and the Declaration the issuance of the Common Securities is not subject to
preemptive or other similar rights.
(iii) The Capital Securities have been duly authorized by the
Declaration and validly issued and (subject to the terms of the Declaration) are
fully paid and non-assessable undivided beneficial interests in the Trust; the
Holders of the Capital Securities are entitled to the benefits of the
Declaration (subject to the limitations set forth in clause (v) below) and are
entitled to the same limitation of personal liability under Delaware law as
extended to stockholders of private corporations for profit (such counsel may
note that the Holders of Capital Securities will be subject to the withholding
provisions of Section [10.4] of the Declaration and will be required to make
payment or provide indemnity or security as set forth in the Declaration).
(iv) All necessary trust action has been taken to duly authorize the
execution and delivery by the Trust of the Purchase Agreement and the
performance of its obligations thereunder.
(v) Assuming the Declaration has been duly authorized by the Company
and has been duly executed and delivered by the Company and the Regular
Trustees, and assuming due authorization, execution and delivery of the
Declaration by the Property Trustee and the Delaware Trustee, the Declaration
constitutes a valid and binding obligation of the Company and the Regular
Trustees, enforceable against the Company and the Regular Trustees in accordance
with its terms, except to the extent that enforcement thereof may be limited by
(i) bankruptcy, insolvency, receivership, liquidation, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and remedies, (ii) general principles of equity
(regardless of whether considered and applied in
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a proceeding in equity or at law), and (iii) the effect of applicable public
policy on the enforceability of provisions relating to indemnification or
contribution.
(vi) The issuance and sale by the Trust of the Securities, the
purchase by the Trust of the Junior Subordinated Debentures, the execution,
delivery and performance by the Trust of the Purchase Agreement, the
consummation by the Trust of the transactions contemplated by the Purchase
Agreement and compliance by the Trust with its obligations thereunder (A) did
not and will not, as the case may be, violate (i) any of the provisions of the
Certificate of Trust or the Declaration or (ii) any applicable Delaware law or
administrative regulation, and (B) did not and do not require any filing with,
or authorization, approval, consent, license, order, registration, qualification
or decree of, any Delaware court or Delaware governmental authority or agency
(other that as may be required under the securities or blue sky laws of the
state of Delaware, as to which such counsel need express no opinion).
(vii) Assuming that the Trust derives no income from or connected
with services provided within the State of Delaware and has no assets,
activities (other than having a Delaware Trustee as required by the Delaware
Trust Act and the filing of documents with the Secretary of State of Delaware)
or employees in the State of Delaware, holders of the Capital Securities (other
than holders who reside or are domiciled in the State of Delaware) will have no
liability for income taxes imposed by the State of Delaware solely as a result
of their participation in the Trust, and the Trust will not be liable for any
income tax imposed by the State of Delaware.
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