Exhibit 99.1
Principal Financial Group, Inc.
Series A Non-Cumulative Perpetual Preferred Stock
(Ten-Year Initial Fixed Rate Period)
(Liquidation Preference Equivalent to $100 Per Share of
Series A Preferred Stock)
Series B Non-Cumulative Perpetual Preferred Stock
(Thirty-Year Initial Fixed Rate Period)
(Liquidation Preference Equivalent to $25 Per Share of
Series B Preferred Stock)
June 17, 2005
Xxxxxx Brothers Inc.
000 0xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Principal Financial Group, Inc., a Delaware corporation (the
"Company"), is today making the following issuances: (i) 3,000,000 shares of
preferred stock, each representing a share of Series A Non-Cumulative Perpetual
Preferred Stock (Ten-Year Initial Fixed Rate Period) (the "Series A Preferred
Stock") having a liquidation preference equivalent to $100 per share and (ii)
10,000,000 shares of preferred stock, each representing a share of Series B
Non-Cumulative Perpetual Preferred Stock (Thirty-Year Initial Fixed Rate Period)
(the "Series B Preferred Stock", and together with the Series A Preferred Stock,
the "Preferred Stock") having a liquidation preference equivalent to $25 per
share.
The certificate of designations, dated June 16, 2005, of the
Company relating to the Series A Preferred Stock (the "Series A Certificate of
Designations") and the certificate of designations, dated June 16, 2005, of the
Company relating to the Series B Preferred Stock (the "Series B Certificate of
Designations", and together with the Series A Certificate of Designations, the
"Certificates of Designations") each provides for the possible Remarketing (as
defined below) of the Preferred Stock, on one or more occasions, at the option
of the Company as contemplated in the Certificates of Designations. As used in
this (this "Agreement"), the term "Remarketed Securities"
means any share of Preferred Stock offered in a Remarketing; the term
"Remarketing Procedures" means the procedures specified in Section 4 of each of
the Certificates of Designations; and the term "Remarketing" means a remarketing
of the Remarketed Securities pursuant to the Remarketing Procedures.
In connection with any Remarketing, the Company will, to the
extent required under the Securities Act of 1933, as amended from time to time,
or any successor statute (the "Securities Act") and the rules and regulations as
promulgated from time to time thereunder or any successor statute to the
Securities Act (the "Rules"), in connection with Remarketings of Remarketed
Securities, prepare and file one or more
registration statements under the Securities Act with the Securities and
Exchange Commission (the "Commission") relating to Remarketed Securities, and
any necessary amendments thereto, and will prepare one or more prospectuses
(which may be preliminary or final) complying with the requirements of the
Securities Act, and any necessary supplements thereto, and setting forth or
including a description of the applicable terms of the Remarketed Securities,
the terms of the applicable Remarketing, a description of the Company and such
other information as may be required by the Securities Act.
Capitalized terms used and not defined in this Agreement shall
have the meanings set forth in the Certificates of Designations, as applicable.
Any reference in this Agreement to any registration statement or to any
preliminary prospectus or final prospectus (or any amendments or supplements to
any of the foregoing) shall be deemed to (i) refer to any such document as it
may at the time be amended or supplemented and (ii) include any document filed
under the Securities Exchange Act of 1934, as amended from time to time and the
rules and regulations promulgated from time to time thereunder, or any successor
statute (the "Exchange Act"), and at the time incorporated by reference therein.
Section 1. Appointment and Obligations of the Remarketing
Agent.
(a) The Company hereby appoints Xxxxxx Brothers Inc. as
exclusive remarketing agent (the "Remarketing Agent"), and Xxxxxx Brothers Inc.
accepts appointment as Remarketing Agent for the purpose of (i) remarketing
Remarketed Securities on behalf of the holders thereof and (ii) performing such
other duties as are assigned to the Remarketing Agent in the Remarketing
Procedures, all in accordance with and pursuant to the Remarketing Procedures.
(b) Upon delivery of notice to the Remarketing Agent by the
Company of the Company's election to conduct a Remarketing in conformity with
the requirements of the Remarketing Procedures, the Remarketing Agent agrees (i)
to use commercially reasonable efforts to remarket the Remarketed Securities
tendered or deemed tendered to the Remarketing Agent in any Remarketing, (ii) to
notify the Company of the new Fixed Rate, if any, established pursuant to any
Remarketing and (iii) to carry out such other duties as are assigned to the
Remarketing Agent in the Remarketing Procedures, all in accordance with the
provisions of the Remarketing Procedures.
(c) On any date during which a Remarketing is being conducted,
the Remarketing Agent shall use commercially reasonable efforts to remarket
Remarketed Securities tendered or deemed tendered for purchase at a price equal
to (i) $100 per share, with respect to the Series A Preferred Stock, or (ii) $25
per share, with respect to the Series B Preferred Stock.
(d) If, as a result of the Remarketing Agent's efforts
described in Section 1(c), the Remarketing Agent has determined on any date
during which a Remarketing is being conducted that it will be able to remarket
all Remarketed Securities tendered or deemed tendered for purchase at a price of
$100 per share, in the case of
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shares of the Series A Preferred Stock (the "Series A Remarketing Purchase
Price"), or $25 per share, in the case of shares of the Series B Preferred Stock
(the "Series B Remarketing Purchase Price"), in each case, prior to 4:00 P.M.,
New York City time, on such date (any such date of determination, a "Remarketing
Date"), the Remarketing Agent shall determine the Fixed Rate resulting from such
Remarketing and to be applicable to the next succeeding Fixed Rate Period, which
shall be the rate per annum (rounded to the nearest one-thousandth (0.01) of one
percent per annum) which the Remarketing Agent determines, in its sole judgment,
to be the lowest rate per annum, if any, that will enable it to remarket all
Remarketed Securities tendered or deemed tendered for Remarketing at the
Remarketing Purchase Price.
(e) If any holder of Preferred Stock submits a Notice of
Election to tender some or all of its shares of Preferred Stock in a Remarketing
and separately notifies the Remarketing Agent that such holder desires to
continue to hold a number of shares of Preferred Stock, but only if the Fixed
Rate determined by the applicable Remarketing is not less than a specified rate
per annum, the Remarketing Agent shall give priority to such holder's purchase
of such number of Remarketed Securities in the Remarketing, provided that the
new Fixed Rate is not less than such specified rate.
(f) By approximately 4:30 P.M., New York City time, on a
Remarketing Date, the Remarketing Agent shall advise (i) the Clearing Agency
Participant who will receive a credit for the shares of Preferred Stock on the
Clearing Agency's records, the Company and the Calculation Agent of any new
Fixed Rate established pursuant to the Remarketing and the number of Remarketed
Securities sold in the Remarketing, (ii) each purchaser of Remarketed Securities
(or the Clearing Agency Participant thereof) of such new Fixed Rate and the
number of Remarketed Securities such purchaser is to purchase and (iii) each
purchaser to give instructions to its Clearing Agency Participant to pay the
purchase price on the Remarketing Settlement Date in same day funds against
delivery of the Remarketed Securities purchased through the facilities of the
Clearing Agency Participant.
(g) If, by 4:00 P.M., New York City time, on the third
business day prior to the Remarketing Settlement Date applicable to the
Remarketing (such third business day, a "Remarketing Expiration Date") the
Remarketing Agent is unable to remarket all Remarketed Securities tendered or
deemed tendered for purchase at the Series A Remarketing Purchase Price or the
Series B Remarketing Purchase Price, as applicable, the Remarketing Agent shall,
by approximately 4:30 P.M., New York City time, on such date, advise the
Clearing Agency Participant, the Company and the Calculation Agent that the
Dividend Rate for the Series A Preferred Stock and/or the Series B Preferred
Stock, as applicable, for the next succeeding Dividend Period will be a Floating
Rate determined in accordance with the Series A Certificate of Designations
and/or the Series B Certificate of Designations, as applicable. In such case, no
shares of Series A Preferred Stock or Series B Preferred Stock, as applicable,
shall be sold in the Remarketing and each holder shall continue to hold its
respective shares at such Floating Rate.
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Section 2. Representations, Warranties and Agreements of the
Company.
(a) The Company represents, warrants and agrees, on and as of
the date hereof, that the representations and warranties made by the Company, as
applicable, in the underwriting agreement, dated June 14, 2005, among the
Company and Xxxxxx Brothers Inc., as representative of the underwriters named
therein (each an "Underwriter," and collectively, the "Underwriters") (the
"Underwriting Agreement"), relating to the Preferred Stock, are true, correct
and complete in all material respects, as if made on the date hereof.
(b) In addition, (i) on and as of the date of filing and of
effectiveness of the Registration Statement (as defined in paragraph (II)(A) of
this Section 2(b)) and on and as of the date of any amendment to the
Registration Statement, (ii) on and as of the date of any Final Prospectus (as
defined in paragraph (II)(A) of this Section 2(b)) and on and as of the date of
any supplement thereto distributed in connection with a Remarketing, (iii) on
and as of any Election Date, (iv) on and as of any Remarketing Date, and (v) on
and as of any Remarketing Settlement Date (to the extent applicable):
(I) the Company makes each of the representations and
warranties set forth in paragraphs (d) through (g), (j), (k), (m), (n)
and (p) through (x) of Section 1 of the Underwriting Agreement, except
that such representations, warranties and agreements, as made herein,
shall be deemed to have been amended and shall be read mutatis
mutandis, as follows:
(A) each reference to a Registration Statement,
Incorporated Documents, Basic Prospectus, Final Prospectus or Interim
Prospectus shall be deemed to refer to those terms as defined in
paragraph (II) of this Section 2(b);
(B) each reference to "Delivery Date" shall be deemed to
be to the Remarketing Settlement Date;
(C) each reference to PLIC shall be deemed to be to any
subsidiary of the Company, direct or indirect, that is an Insurance
Company and a "significant subsidiary" as such term is defined in Rule
405 of the Rules;
(D) each reference to the "issue" or "issue and sale" of
the Preferred Stock shall be deemed to include the Remarketing and the
Remarketed Securities; and
(II) the Company represents and warrants that:
(A) The Company meets the requirements for the use of
Form S-3 under the Securities Act and the Rules, and has prepared and
filed with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 for the registration of the
Remarketed Securities under the Securities Act, which Registration
Statement (as defined below) has become
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effective and no stop order suspending the effectiveness of the
Registration Statement has been issued under the Securities Act and no
proceedings for that purpose have been instituted or are pending or, to
its knowledge, are threatened by the Commission, and any request by the
Commission for additional information has been complied with. The
Registration Statement meets the requirements set forth in Rule
415(a)(1)(x) under the Securities Act and complies in all other
material respects with such rule. The Company proposes to file with the
Commission pursuant to Rule 424 under the Securities Act ("Rule 424") a
supplement to the form of prospectus included in the registration
statement relating to the remarketing of the Remarketed Securities and
the plan of distribution thereof and has previously advised you of all
further information (financial and other) with respect to the Company
to be set forth therein. The term "Registration Statement" means the
registration statement, as amended at the time of any Election Date,
including the exhibits thereto, financial statements, and all documents
incorporated therein by reference pursuant to Form S-3 (the
"Incorporated Documents"), and such prospectus as then amended,
including the Incorporated Documents, is hereinafter referred to as the
"Basic Prospectus"; and such supplemented form of prospectus, in the
form in which it shall be filed with the Commission pursuant to Rule
424 (including the Basic Prospectus as so supplemented), is hereinafter
called the "Final Prospectus". Any preliminary form of a Final
Prospectus which has heretofore been filed pursuant to Rule 424 is
hereinafter called the "Interim Prospectus". Any reference herein to
the Registration Statement, the Basic Prospectus, any Interim
Prospectus or the Final Prospectus shall be deemed to refer to and
include the Incorporated Documents which were filed under the
Securities Exchange Act, on or before the Election Date or the issue
date of the Basic Prospectus, any Interim Prospectus or the Final
Prospectus, as the case may be; and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, any Interim Prospectus or the Final
Prospectus shall be deemed to refer to and include the filing of any
Incorporated Documents under the Exchange Act after the date of this
Agreement or the issue date of the Basic Prospectus, any Interim
Prospectus or the Final Prospectus, as the case may be, and deemed to
be incorporated therein by reference. Copies of the Registration
Statement and each of the amendments thereto have been delivered by the
Company to you as the Remarketing Agent. The Commission has not issued
any order preventing or suspending the use of any Interim Prospectus.
(B) When the Final Prospectus is first filed with the
Commission pursuant to Rule 424, when, before such Remarketing
Settlement Date, any amendment to the Registration Statement becomes
effective, when, before such Remarketing Settlement Date, any
Incorporated Document is filed with the Commission, when any supplement
to the Final Prospectus is filed with the Commission and at such
Remarketing Settlement Date, the Registration Statement, the Final
Prospectus and any such amendment or supplement will comply in all
material respects with the applicable requirements of the Securities
Act and the Rules, and the Incorporated Documents will comply in all
material respects with the requirements of the Exchange Act, or the
Securities Act and the
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Rules, as applicable, and on the date it became effective, the
Registration Statement did not, and, on the date that any
post-effective amendment to the Registration Statement becomes
effective, the Registration Statement as amended by such post-effective
amendment did not or will not, as the case may be, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; on the date the Final Prospectus is filed with the
Commission pursuant to Rule 424 and on such Remarketing Settlement
Date, the Final Prospectus, as they may be amended or supplemented,
will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they are made,
not misleading; and on said dates, the Incorporated Documents will
comply in all material respects with the applicable provisions of the
Exchange Act, and, when read together with the Final Prospectus, or the
Final Prospectus as they may be then amended or supplemented, will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they
are made, not misleading; provided that the foregoing representations
and warranties in this paragraph B) shall not apply to statements or
omissions made in reliance upon and in conformity with written
information furnished to the Company by or through the Remarketing
Agent specifically for use in connection with the preparation of the
Registration Statement or the Final Prospectus, as they may be amended
or supplemented.
(C) The Remarketed Securities have been duly and validly
authorized and are fully paid and non-assessable and conform to the
descriptions thereof contained in the Final Prospectus.
(D) This Agreement has been duly authorized, executed and
delivered by the Company.
(E) Neither the Company nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements
included in the Final Prospectus, any material loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, otherwise than as set forth or
contemplated in the Final Prospectus, except for such losses or
interferences as would not have, individually or in the aggregate, a
material adverse effect on the general affairs, business, management,
financial position, surplus, reserves, stockholders' equity or results
of operations of the Company and its subsidiaries considered as a whole
("Material Adverse Effect"); and, since the respective dates as of
which information is given in the Registration Statement and the Final
Prospectus, there has not been any (i) material change in the capital
stock or long-term debt of the Company or any of its subsidiaries
considered as a whole or (ii) any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, business, management, financial
position, surplus, reserves, stockholders' equity or results
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of operations (in each case considered either on a statutory or U.S.
generally accepted accounting principles of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Final
Prospectus.
(F) Ernst & Young LLP, or another accounting firm of
national stature (the "Accountants"), whose reports appear in the Final
Prospectus, are independent public accountants with respect to the
Company and its subsidiaries as required by the Securities Act and the
Rules.
Section 3. Fees and Expenses. (a) For the performance of its
services as Remarketing Agent in connection with Remarketings hereunder, the
Company agrees to pay to the Remarketing Agent a fee on each Remarketing
Settlement Date, in an amount customary for the types of services provided by
the Remarketing Agent hereunder and as shall be mutually agreed upon between the
Company and the Remarketing Agent.
(b The Company agrees to pay (i) the costs incident to the
preparation and filing of any registration statements and any amendments thereto
required in connection with this Agreement; (ii) the costs incident to the
preparation, printing, and distribution of any prospectus (preliminary or final)
and any supplements thereto required in connection with this Agreement; (iii)
the fees and expenses of qualifying Remarketed Securities under the securities
laws of the several jurisdictions as provided in Section 4(g) and of preparing,
printing, and distributing a blue sky survey (including related reasonable fees
and expenses of counsel to the Remarketing Agent); (iv) all other costs and
expenses incident to the performance of the obligations of the Company
hereunder; and (v) the fees and expenses of counsel and accountants for the
Company.
Section 4. Further Agreements of the Company. The Company
agrees:
(a) To prepare the Registration Statement, Basic Prospectus,
any Interim Prospectus or Final Prospectus, and any amendments and supplements
thereto required in connection with any Remarketing, in a form reasonably
acceptable to the Remarketing Agent and to file any such documents with the
Commission pursuant to the Securities Act as required by the Securities Act and
the Rules.
(b) To advise the Remarketing Agent, promptly after it
receives notice thereof, of the time when any registration statement or any
amendment thereto has been filed with the Commission or becomes effective, and
when any prospectus (preliminary or final) or any supplement thereto has been
filed, in each such case excluding documents incorporated by reference therein;
during the term of this Agreement to file promptly all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act; to advise the Remarketing Agent, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any prospectus (Interim Prospectus or Final
Prospectus) or any supplement thereto filed or prepared in connection with this
Agreement, of the
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suspension of the qualification of any Remarketed Securities for offering or
sale in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of any such registration statement or prospectus or amendment or
supplement thereto or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending the use of
any prospectus (Basic Prospectus, Interim Prospectus or Final Prospectus) or
supplement thereto or suspending any such qualification, to use promptly its
best efforts to obtain its withdrawal.
(c) To deliver promptly to the Remarketing Agent such number
of the following documents as the Remarketing Agent shall reasonably request (i)
conformed copies of the Registration Statement prepared in connection with any
Remarketing as originally filed with the Commission and each amendment thereto
(in each case excluding exhibits), any Interim Prospectus or Final Prospectus
prepared in connection with any Remarketing and any supplements thereto; (ii)
copies of the Certificates of Designations and the Calculation Agent Agreement,
and any amendment to any such document thereof, and each report or other
document mailed or made available to holders of the Preferred Stock; and (iii)
if the delivery of a prospectus is required at any time in connection with a
Remarketing and if at such time any event has occurred as a result of which the
Final Prospectus as then supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made
when such Final Prospectus is delivered, not misleading, or if for any other
reason it shall be necessary to amend or supplement the Final Prospectus or to
file under the Exchange Act any document incorporated by reference in the Final
Prospectus in order to comply with the Securities Act or the Exchange Act, to
notify the Remarketing Agent, and upon its request, to file such document and to
prepare and furnish without charge to the Remarketing Agent and to any dealer in
shares of the Remarketed Securities as many copies as the Remarketing Agent may
from time to time reasonably request of an amended or supplemented Final
Prospectus which will correct such statement or omission or effect such
compliance.
(d) Prior to filing with the Commission any amendment to any
Registration Statement or supplement to any Interim Prospectus or Final
Prospectus filed or prepared in connection with any Remarketing under Rule 424
of the Rules, to furnish a copy thereof to the Remarketing Agent and counsel to
the Remarketing Agent and obtain the consent of the Remarketing Agent to such
filing, which consent shall not be unreasonably withheld.
(e) Promptly from time to time to take such action as the
Remarketing Agent may reasonably request to qualify the Remarketed Securities
for offering and sale under the securities or laws of such jurisdictions as the
Remarketing Agent 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 Remarketed Securities;
provided that in connection therewith, the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction.
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(f) The Company will make generally available to its security
holders and deliver to the Remarketing Agent as soon as reasonably practicable
after the date of any Final Prospectus, an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section 11(a) of the
Securities Act and the Rules (including, at the option of the Company, Rule 158
of the Rules).
(g) During the period when a Final Prospectus is required to
be delivered under the Securities Act or the Exchange Act in connection with
sale of Remarketed Securities, to file all documents required to be filed by it
with the Commission pursuant to Section 13, 14 or 15 of the Exchange Act within
the time periods required by the Exchange Act.
(h) The Company will use its reasonable efforts to take all
reasonable action necessary to enable Standard & Poor's Corporation ("S&P") and
Xxxxx'x Investors Services, Inc. ("Xxxxx'x") or any other nationally recognized
rating organization to provide their respective credit ratings.
Section 5. Conditions to the Remarketing Agent's Obligations.
The obligations of the Remarketing Agent hereunder are subject to the accuracy,
when made and on the related Remarketing Settlement Date, of the representations
and warranties of the Company contained herein, to the performance by the
Company of its respective obligations hereunder, and to each of the following
additional terms and conditions:
(a) The Final Prospectus shall have been timely filed with the
Commission in accordance with Section 4(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Final Prospectus or
otherwise shall have been complied with.
(b) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Remarketed
Securities, any Registration Statement, Interim Prospectus and/or Final
Prospectus and any amendments or supplements thereto and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to counsel for the Remarketing
Agent, and the Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon such
matters.
(c) Without the prior written consent of the Remarketing
Agent, the Certificates of Designations shall not have been amended in any
manner, or otherwise contain any provision not contained therein as of the date
hereof that, in the opinion of the Remarketing Agent, materially changes the
nature of the Remarketed Securities or the Remarketing Procedures.
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(d) On the related Remarketing Settlement Date, Debevoise &
Xxxxxxxx LLP or such other counsel satisfactory to the Remarketing Agent, shall
have furnished to the Remarketing Agent their written opinion, as counsel to the
Company, addressed to the Remarketing Agent and dated such date, in form and
substance reasonably satisfactory to the Remarketing Agent, to the effect set
forth in Exhibit A hereto.
(e) On the related Remarketing Settlement Date, the General
Counsel of the Company shall have furnished to the Remarketing Agent her written
opinion, addressed to the Remarketing Agent and dated such date, in form and
substance reasonably satisfactory to the Remarketing Agent, to the effect set
forth in Exhibit B hereto.
(f) On the related Remarketing Settlement Date, counsel
satisfactory to the Remarketing Agent, shall have furnished to the Remarketing
Agent their written opinion, addressed to the Remarketing Agent and dated such
date, in form and substance reasonably satisfactory to the Remarketing Agent, to
the effect set forth in Exhibit C hereto.
(g) On any Election Date, the Remarketing Agent shall have
received from the Accountants a letter or letters, in form and substance
satisfactory to the Remarketing Agent, addressed to the Remarketing Agent and
dated the date of such Remarketing Date (i) confirming that they are independent
public accountants within the meaning of the Securities Act and the Rules and
are in compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X of the Commission and (ii)
stating, as of such Remarketing Date (or, with respect to matters involving
changes or developments since the respective dates as of which specified
financial information is given in the Final Prospectus, as of a date not more
than five days prior to the date hereof), the conclusions and findings of such
firm with respect to the financial information and other matters ordinarily
covered by accountants' "comfort letters" to underwriters in connection with
registered public offerings.
(h) With respect to the letter or letters of the Accountants
referred to in the preceding paragraph and delivered to the Remarketing Agent on
any Election Date (the "initial letters"), the Company shall have furnished to
the Remarketing Agent a letter (the "bring-down letter") of the Accountants,
addressed to the Remarketing Agent and dated the related Remarketing Settlement
Date (i) confirming that they are independent public accountants within the
meaning of the Securities Act and the Rules and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the
bring-down letter (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information is given
in the Final Prospectus, as of a date not more than five days prior to the date
of the bring-down letter), the conclusions and findings of such firm with
respect to the financial information and other matters covered by the initial
letters and (iii) confirming in all material respects the conclusions and
findings set forth in the initial letters.
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(i) The Company shall have furnished to the Remarketing Agent
a certificate, dated the date of the related Remarketing Settlement Date, of its
Chairman of the Board, its President or a Vice President and its chief financial
officer stating that:
(I) The representations, warranties and agreements of the
Company in Section 2 are true and correct as of the related Remarketing
Settlement Date; the Company has complied with all its agreements
contained herein; and the conditions set forth in paragraphs (a) and
(j) of this Section 5 have been fulfilled; and
(II) They have carefully examined the Registration
Statement and the Final Prospectus and, in their opinion (x) as of the
date of the Final Prospectus, the Registration Statement and Final
Prospectus did not include any untrue statement of a material fact and
did not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (y) since
the date of the Final Prospectus, no event has occurred which should
have been set forth in a supplement or amendment to the Registration
Statement or the Final Prospectus which has not been so set forth.
(j) As of any Election Date, (A) neither the Company nor any
of its subsidiaries shall have sustained since the date of the latest audited
financial statements included in the Final Prospectus 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, otherwise than as set forth or contemplated in the Final
Prospectus, or (B) since such date, there has not been any decrease in the
outstanding capital stock of the Company or increase in the consolidated
long-term debt of the Company, in each case, not otherwise disclosed to the
Remarketing Agent, or any development involving a prospective 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 Final Prospectus, the effect of which,
in any such case described in clause (A) or (B), is, in the judgment of the
Remarketing Agent, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Remarketed Securities being delivered on the related Remarketing Settlement Date
on the terms and in the manner contemplated in the Final Prospectus.
(k) Subsequent to any Election Date there shall not have
occurred any of the following: (i) trading of any securities of or guaranteed by
the Company shall have been suspended on any exchange or in any over-the-counter
market, (ii) trading in securities on the New York Stock Exchange, the American
Stock Exchange, and the National Association of Securities Dealers, Inc., shall
have been generally suspended, or there shall have been a material disruption in
settlement of securities generally, (iii) minimum or maximum ranges for prices
shall have been generally established on the New York Stock Exchange by the
Commission or by the New York Stock Exchange, (iv) a general banking moratorium
shall have been declared by federal or New York State authorities, (v) any major
disruption of settlements of securities or clearance services in the United
States, or (vi) any outbreak or escalation of major hostilities in which the
11
United States is involved, any declaration of war by the United States Congress
or any other substantial national or international calamity, crisis or emergency
(including, without limitation, acts of terrorism) affecting the United States,
in any such case provided for in clauses (i) through (vi), as to make it, in the
judgment of the Remarketing Agent, impracticable or inadvisable to proceed with
the public offering or delivery of the Remarketed Securities being delivered on
the related Remarketing Settlement Date on the terms and in the manner
contemplated in the Final Prospectus.
(l) On or after any Election Date, (i) no downgrading shall
have occurred in the rating accorded the Company's debt securities or the debt
securities of any of its Significant Subsidiaries (including any "surplus notes"
of PLIC) or PLIC's claims paying ability or financial strength by any
"nationally recognized statistical rating organization", as such term is defined
in Rule 436(g)(2) of the Rules, (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities or the debt
securities of any of its Significant Subsidiaries (including any "surplus notes"
of PLIC) or PLIC's claims paying ability or financial strength and (iii) the
Remarketed Securities shall continue to be rated BBB by Standard & Poor's and
Baa2 by Moody's, or the equivalent of such ratings at the time of any
Remarketing.
(m) The Remarketing Agent shall not have discovered and
disclosed to the Company on or prior to the Election Date, or during the period
between the Remarketing Date and the Remarketing Settlement Date, that any
Registration Statement, Interim Prospectus or Final Prospectus or any amendment
or supplement thereto contains any untrue statement of a fact which, in the
opinion of the counsel for the Remarketing Agent, 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.
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 Remarketing Agent.
Section 6. Indemnification. (a) The Company shall indemnify
and hold harmless the Remarketing Agent, its directors, officers and employees
and each person, if any, who controls the Remarketing Agent 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 the Remarketed Securities), to which the Remarketing Agent, director,
officer, employee or 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, any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any
Interim Prospectus or the Final Prospectus or in any amendment or supplement
thereto or the omission or alleged omission to state in the Registration
Statement, any Interim Prospectus or the Final Prospectus, or in any amendment
or supplement thereto, any
12
material fact required to be stated therein or necessary to make the statements
therein not misleading, and shall reimburse the Remarketing Agent and each such
director, officer, employee or controlling person promptly upon demand for any
legal or other expenses reasonably incurred by the Remarketing Agent, director,
officer, employee or 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; provided, however, that the Company
shall not be liable 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 Registration Statement, any Interim Prospectus or the Final Prospectus, or
in any such amendment or supplement, in reliance upon and in conformity with
written information concerning the Remarketing Agent furnished to the Company by
or on behalf of the Remarketing Agent specifically for inclusion therein which
information consists solely of the information specified in Section 6(e). The
foregoing indemnity agreement is in addition to any liability which the Company
may otherwise have to the Remarketing Agent or to any director, officer,
employee or controlling person of the Remarketing Agent.
(b) The Remarketing Agent shall indemnify and hold harmless
the Company, its officers and employees, each of its directors, and each person,
if any, who controls the Company 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 or any such director, officer or
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 in the Registration Statement, any Interim Prospectus or the
Final Prospectus or in any amendment or supplement thereto, or (ii) the omission
or alleged omission to state in the Registration Statement, any Interim
Prospectus or the Final Prospectus, or in any amendment or supplement thereto,
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 written information concerning the
Remarketing Agent furnished to the Company through the Representative by or on
behalf of the Remarketing Agent specifically for inclusion therein, which
information is limited to the information set forth in Section 6(e), and shall
reimburse the Company and any such director, officer or controlling person for
any legal or other expenses reasonably incurred by the Company or any such
director, officer or 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 Remarketing Agent may otherwise have to the
Company or any such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 6 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 6, notify the indemnifying party in
writing of the claim or the commencement of
13
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 6(a) or (b) 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 6(a) or (b). 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 (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
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 6 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall without the prior written consent of the indemnified
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 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 (i) includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding,
and (ii) does not include a statement as to, or an admission of, fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 6
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 6(a) or 6(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, in such
proportion as shall be appropriate to reflect the relative fault of the Company
on the one hand and the Remarketing Agent on the other 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 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
or the Remarketing Agent, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Remarketing Agent agree that it would
not be just and equitable if contributions pursuant to this Section were to be
determined by pro rata 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 shall
be deemed to include, for purposes of this Section 6(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding
14
the provisions of this Section 6(d), the Remarketing Agent shall not be required
to contribute any amount in excess of the amount by which the total price at
which the Remarketed Securities distributed to the public were offered to the
public exceeds the amount of any damages which the Remarketing Agent 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 Remarketing Agent confirms and the Company
acknowledges that the statements with respect to the Remarketing of the
Remarketed Securities by the Remarketing Agent to be set forth on the cover page
of, and the concession and reallowance figures to appear under the caption
"Underwriting" in, the Final Prospectus as of any Remarketing Settlement Date
are correct and constitute the only information concerning the Remarketing Agent
to have been furnished in writing to the Company by or on behalf of the
Remarketing Agent specifically for inclusion in the Registration Statement and
the Final Prospectus.
Section 7. Resignation and Removal of Remarketing Agent. The
Remarketing Agent may resign and be discharged from its duties and obligations
hereunder, and the Company may remove the Remarketing Agent, by giving 30 days'
prior written notice, in the case of a resignation, to the Company and the
Clearing Agency Participant, and, in the case of a removal, such removed
Remarketing Agent and the Clearing Agency Participant; provided, however, that
(i) the Company may not remove the Remarketing Agent unless (A) the Remarketing
Agent becomes involved as debtor in a bankruptcy, insolvency or similar
proceeding, (B) the Remarketing Agent shall not be among the five underwriters
with the largest volume underwritten in dollars, on a lead or co-managed basis,
of U.S. domestic preferred securities during the twelve-month period ended as of
the last calendar quarter preceding the Scheduled Remarketing Date, (C) the
Remarketing Agent shall be subject to any restriction preventing the performance
of its obligations hereunder or (D) the distribution rates provided by the
Remarketing Agent in connection with remarketings of securities by it in the
twelve month period ended as of the end of the last calendar quarter preceding a
Remarketing Date shall not be among the lowest remarketing distribution rates
provided by the top three underwriters during such 12 month period and (ii) no
such resignation nor any such removal shall become effective until the Company
shall have appointed at least one nationally recognized broker-dealer as
successor Remarketing Agent and such successor Remarketing Agent shall have
entered into a with the Company in which it shall have
agreed to conduct the Remarketing in accordance with the Remarketing Procedures.
In such case, the Company will use its best efforts to appoint a successor
Remarketing Agent and enter into such a with such person
as soon as reasonably practicable. The provisions of Sections 3 and 6 shall
survive the resignation or removal of the Remarketing Agent pursuant to this
Agreement.
Section 8. Dealing in the Remarketed Securities. The
Remarketing Agent, when acting as a Remarketing Agent or in its individual or
any other capacity, may, to the extent permitted by law, buy, sell, hold and
deal in any Remarketed
15
Securities. Notwithstanding the foregoing, the Remarketing Agent is not
obligated to purchase any Remarketed Securities that would otherwise remain
unsold in a Remarketing. To the extent the Remarketing Agent holds Remarketed
Securities, the Remarketing Agent may exercise any vote or join in any action
which any beneficial owner of Remarketed Securities may be entitled to exercise
or take pursuant to the Certificates of Designations, with like effect as if it
did not act in any capacity hereunder. The Remarketing Agent, in its individual
capacity, either as principal or agent, may also engage in or have an interest
in any financial or other transaction with the Company as freely as if it did
not act in any capacity hereunder.
Section 9. Remarketing Agent's Performance; Duty of Care. The
duties and obligations of the Remarketing Agent shall be determined solely by
the express provisions of this Agreement and the Certificates of Designations.
No implied covenants or obligations of or against the Remarketing Agent shall be
read into this Agreement or the Certificates of Designations, as applicable. In
the absence of bad faith on the part of the Remarketing Agent, the Remarketing
Agent may conclusively rely upon any document furnished to it, which purports to
conform to the requirements of this Agreement or the Certificates of
Designations as to the truth of the statements expressed in any of such
documents. The Remarketing Agent shall be protected in acting upon any document
or communication reasonably believed by it to have been signed, presented or
made by the proper party or parties. The Remarketing Agent, acting under this
Agreement, shall incur no liability to the Company or to any holder of
Remarketed Securities in its individual capacity or as Remarketing Agent for any
action or failure to act, on its part in connection with a Remarketing or
otherwise, except if such liability is judicially determined to have resulted
from gross negligence or willful misconduct on its part.
Section 10. Termination. This Agreement shall terminate as to
the Remarketing Agent on the effective date of the resignation or removal of the
Remarketing Agent pursuant to Section 7.
In addition, the obligations of the Remarketing Agent
hereunder with respect to a specific Remarketing may be terminated by it by
notice given to the Company prior to 10:00 A.M., New York City time, on the
applicable Remarketing Date if, prior to that time, any of the events described
in Sections 5(j), (k) or (l) herein shall have occurred or if the Remarketing
Agent shall decline to perform its obligations under this Agreement for any
reason permitted hereunder.
The Company may elect to terminate a specific Remarketing on
any day prior to such Remarketing.
Section 11. Notices. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Remarketing Agent, shall be delivered or sent by
mail, telex or facsimile transmission to Xxxxxx Brothers Inc., 000 0xx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate Department (Fax: (000) 000-0000),
with a copy,
16
in the case of any notice pursuant to Section 6(c), to the Director of
Litigation, Office of the General Counsel, Xxxxxx Brothers Inc., 000 Xxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
prospectus or any supplement thereto, Attention: General Counsel (Fax:
000-000-0000).
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
Section 12. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Remarketing
Agent, the Company and their respective successors. This Agreement and the terms
and provisions hereof are for the sole benefit of only those persons, except
that (x) the representations, warranties, indemnities and agreements of the
Company contained in this Agreement shall also be deemed to be for the benefit
of the directors, officers and the person or persons, if any, who control the
Remarketing Agent within the meaning of Section 15 of the Securities Act and (y)
the representations, warranties, indemnity and agreement of the Remarketing
Agent contained in Section 6(b) of this Agreement shall be deemed to be for the
benefit of directors of the Company, officers of the Company who signed the
Registration Statement as defined in Section 2(b)(II)(A) of this Agreement and
any person controlling the Company 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 12, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
Section 13. Survival. The respective indemnities,
representations, warranties and agreements of the Company and the Remarketing
Agent contained in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement shall survive the Remarketing 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.
Section 14. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
Section 15. Counterparts. 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.
Section 16. 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.
17
If the foregoing correctly sets forth the agreement between
the Company and the Remarketing Agent, please indicate your acceptance in the
space provided for that purpose below.
Very truly yours,
PRINCIPAL FINANCIAL GROUP, INC.
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
Accepted:
XXXXXX BROTHERS INC.
By:
----------------
Name:
Title:
18
EXHIBIT A
FORM OF OPINION OF
COMPANY COUNSEL TO BE DELIVERED
PURSUANT TO SECTION 5(D)
(a) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Final Prospectus;
(b) The Company has an authorized capitalization as set forth in the
Final Prospectus.
(c) The Remarketed Securities have been duly and validly authorized,
are fully paid and non-assessable and conform to the descriptions thereof
contained in the Final Prospectus.
(d) This Agreement and the Calculation Agent Agreement were duly and
validly authorized, executed and delivered by the Company.
(e) The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion, the Final
Prospectus was filed with the Commission pursuant to the subparagraph of Rule
424(b) of the Rules specified in such opinion on the date specified therein and
to the knowledge of such counsel no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceeding for that purpose is
pending or threatened by the Commission.
(f) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby will not
conflict with or result in a breach or violation of (A) any of the provisions of
the certificate of incorporation or by-laws or similar organizational documents
of the Company or any of its Significant Subsidiaries (B) any agreement or
instrument listed as an exhibit to the Registration Statement, or (C) New York
or Federal statute or the Delaware General Corporation Law or any rule or
regulation of any New York or Federal governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
respective properties, in the case of clauses (B) and (C), the effect of which,
individually or in the aggregate, would be to affect adversely the consummation
of the transactions contemplated by this Agreement, or to have a Material
Adverse Effect; and no notice, consent, approval, authorization, order
registration or qualification of or with or to any court or governmental agency
or body is required for the consummation of transactions contemplated hereby,
except for the registration of the Remarketed Securities under the Securities
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable state
securities laws in connection with the purchase and distribution of the
Remarketed Securities by the Remarketing Agent.
A-1
(g) The Registration Statement and the Final Prospectus and any further
amendments or supplements thereto made by the Company prior to the Remarketing
Settlement Date (except for the financial statements, the related notes and
schedules therein, as to which such counsel need express no belief) appear on
their face to be appropriately responsive in all material respects with the
requirements of the Securities Act and the Rules.
(h) The statements contained in the Basic Prospectus under the caption
"Description of Capital Stock of Principal Financial Group Inc.", in the Series
A Final Prospectus under the caption "Description of the Shares", in the Series
B Final Prospectus and under the caption "Description of the Shares", and in the
Final Prospectus under the caption "Certain U.S. Federal Income Tax
Consequences", insofar as they describe the terms of agreements, the Remarketed
Securities or Federal statutes, rules and regulations, constitute a fair summary
thereof.
(i) Neither the Company nor any of its subsidiaries is an "investment
company" as defined in the Investment Company Act of 1940, as amended, it being
understood that certain separate accounts of PLIC are registered as investment
companies under the Investment Company Act in the ordinary course of PLIC's
business.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the Delaware General Corporation Law.
Such counsel shall also state that in the course of its review and
discussion of contents of the Registration Statement with certain officers and
employees of the Company and representatives of the Company's independent
accountants, but without independent check or verification, no facts have come
to the attention of such counsel which cause them to believe that the
Registration Statement (except for the financial statements, the related notes
and schedules therein, as to which such counsel need express no belief) as of
the date of the Final Prospectus, contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or that, as of
the date of the Final Prospectus or as of the date of such opinion, the Final
Prospectus (except for the financial statements, the related notes and schedules
therein, as to which such counsel need express no belief) contained or contains
an untrue statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The foregoing opinion and statement may be qualified by a statement
to the effect that such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Final Prospectus.
----------
* To the extent no registration statement or prospectus is required under the
Securities Act in connection with the Remarketing, the foregoing opinions shall
be revised as appropriate to reflect such fact.
A-2
EXHIBIT B
FORM OF OPINION OF
GENERAL COUNSEL TO BE DELIVERED
PURSUANT TO SECTION 5(E)
(a) Each of the Company and its Significant Subsidiaries has been duly
incorporated and is validly existing as a corporation, partnership or limited
partnership, as applicable, and is in good standing under the laws of its
jurisdiction, with corporate power and authority to own its properties and
conduct its business as described in the Final Prospectus; the Company is duly
qualified to do business as a foreign corporation and is in good standing under
the laws of each other jurisdiction in which its ownership or lease of property
or the conduct of its business requires such qualification, or is subject to no
material liability or disability by reason of the failure to be so qualified and
in good standing in any such jurisdiction; and each subsidiary of the Company is
duly qualified to do business as a foreign corporation, partnership or limited
partnership, as applicable, and is in good standing under the laws of each other
jurisdiction in which its ownership or lease of property or the conduct of its
business requires such qualification and good standing, except where the failure
to be so qualified would not have a Material Adverse Effect.
(b) The Company has an authorized capitalization as set forth in the
Final Prospectus. All of the issued shares of capital stock of the Company
conform to the description thereof contained in the Final Prospectus. All of the
outstanding shares of capital stock of each Significant Subsidiary of the
Company have been duly authorized and validly 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.
(c) The Remarketed Securities have been duly and validly authorized,
are fully paid and non-assessable and conform to the descriptions thereof
contained in the Final Prospectus.
(d) This Agreement and the Calculation Agent Agreement have been duly
authorized, executed and delivered by the Company.
(e) The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion, the Final
Prospectus was filed with the Commission pursuant to the subparagraph of Rule
424(b) of the Rules specified in such opinion on the date specified therein and
to the knowledge of such counsel no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceeding for that purpose is
pending or threatened by the Commission.
(f) The execution, delivery and performance of this Agreement by the
Company and the consummation 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 the Company or
its subsidiaries is a party or by which
B-1
the Company or its subsidiaries is bound or to which any of the property or
assets of the Company or its subsidiaries is subject or give the holder of any
of the notes, debentures, or other evidence of indebtedness of the Company or
its subsidiaries the right to require repurchase, redemption or repayment of all
or a portion of such indebtedness by any of the Company or its subsidiaries, or
result in the creation or imposition of any lien, charge or encumbrance upon any
of the assets, properties or operations of any of the Company or its
subsidiaries, nor will such actions result in any violation of the provisions of
the certificate of incorporation or by-laws or similar organizational documents
of the Company or its subsidiaries, or any statute or any order, rule or
regulation of any court or insurance or other regulatory agency or governmental
agency or body having jurisdiction over the Company or its subsidiaries or any
of their respective properties or assets, in each case the effect of which
(other than any violation of the provisions of the certificate of incorporation
or by-laws or similar organizational documents of the Company or any of its
subsidiaries), individually or in the aggregate, would be to affect adversely
the consummation of transaction contemplated hereby, or to have a Material
Adverse Effect; and no notice, consent, approval, authorization, order
registration or qualification of or with or to any court or governmental agency
or body is required for the consummation of transactions contemplated hereby,
except for the registration of the Remarketed Securities under the Securities
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable state
securities laws in connection with the purchase and distribution of the
Remarketed Securities by the Remarketing Agent.
(g) To the best of such counsel's knowledge, there are no contracts or
other documents which are required to be described in the Final Prospectus or
filed as exhibits to the Registration Statement by the Securities Act or by the
Rules which have not been described or filed as exhibits to the Registration
Statement.
(h) Each of the Company and its subsidiaries that are required to be
organized and licensed or registered as an insurance or an insurance holding
company (collectively, the "Insurance Entities") is duly organized and licensed
or registered as an insurance or insurance holding company, as the case may be,
in its jurisdiction of incorporation, and, in the case of an insurance company,
is duly licensed or authorized in each other jurisdiction where it is required
to be so licensed or authorized to conduct its business and all such licenses or
authorizations are in full force and effect. Except as otherwise described in
the Final Prospectus, each of the Insurance Entities has all approvals, orders,
consents, authorizations, licenses, certificates, permits, registrations and
qualifications (collectively, the "Approvals") of and from all insurance and
regulatory authorities, as the case may be, to conduct its business, with such
exceptions as would not have, individually or in the aggregate, a Material
Adverse Effect, and all such Approvals are in full force and effect except where
the failure of such Approvals to be in full force and effect would not have,
individually or in the aggregate, a Material Adverse Effect. There is no pending
or, to the knowledge of such counsel after due inquiry, threatened action, suit,
proceeding or investigation that could reasonably be expected to lead to the
revocation, termination, suspension or limitation of any such Approval or
otherwise impose any limitation on the conduct of business of any Insurance
Entity, the revocation, termination or suspension of which would have,
individually or in
B-2
the aggregate, a Material Adverse Effect, and, to the knowledge of such counsel
after due inquiry, no insurance or regulatory agency or body has issued any
order or decree impairing, restricting or prohibiting the payment of dividends
by any Insurance Entity. Except as otherwise described in the Final Prospectus,
none of the Insurance Entities has received any notification from any applicable
regulatory authority to the effect that any additional Approvals from such
regulatory authority are needed to be obtained by such Insurance Entity in any
case where it could be reasonably expected that (i) any of the Insurance
Entities would in fact be required either to obtain any such additional
Approvals or cease or otherwise limit engaging in certain business and (ii) the
failure to have such Approvals or limiting such business would have,
individually or in the aggregate, a Material Adverse Effect. Each of the Company
and its Insurance Entities is in compliance with all applicable insurance laws,
rules, regulations, orders, bylaws and similar requirements which are applicable
to it, and has filed all notices, reports, documents or other information
required to be filed thereunder, in each case with such exceptions as would not
have, individually or in the aggregate, a Material Adverse Effect.
(i) Each of the Company and its bank subsidiaries, broker-dealer
subsidiaries and investment advisor subsidiaries (respectively, a "Bank
Subsidiary", a "Broker-Dealer Subsidiary" and "Investment Advisor Subsidiary")
is duly licensed or registered as a bank, broker-dealer or investment advisor,
as the case may be, in each jurisdiction where it is required to be so licensed
or registered to conduct its business. Each Bank Subsidiary, Broker-Dealer
Subsidiary and Investment Advisor Subsidiary has all other necessary Approvals
of and from all applicable regulatory authorities, including any self-regulatory
organization, to conduct its businesses, in each case with such exceptions as
would not have, individually or in the aggregate, a Material Adverse Effect.
There is no pending or, to the knowledge of such counsel after due inquiry,
threatened action, suit, proceeding or investigation that could reasonably be
expected to lead to the revocation, termination, suspension or limitation of any
such Approval or otherwise impose any limitation on the conduct of business of
any Bank Subsidiary, Broker-Dealer Subsidiary or Investment Advisor Subsidiary,
the revocation, termination or suspension of which would have, individually or
in the aggregate, a Material Adverse Effect. Except as otherwise described in
the Final Prospectus, none of the Bank Subsidiaries, Broker-Dealer Subsidiaries
or Investment Advisor Subsidiaries has received any notification from any
applicable regulatory authority to the effect that any additional Approvals from
such regulatory authority are needed to be obtained by such Bank Subsidiary,
Broker-Dealer Subsidiary or Investment Advisor Subsidiary in any case where it
could be reasonably expected that (i) any of the Bank Subsidiaries,
Broker-Dealer Subsidiaries or Investment Advisor Subsidiaries would in fact be
required either to obtain any such additional Approvals or cease or otherwise
limit engaging in certain business and (ii) the failure to have such Approvals
or limiting such business would have, individually or in the aggregate, a
Material Adverse Effect; and each Bank Subsidiary, Broker-Dealer Subsidiary and
Investment Advisor Subsidiary is in compliance with the requirements of the
banking, broker-dealer and investment advisor laws and regulations of each
jurisdiction which are applicable to such subsidiary, and has filed all notices,
reports, documents or other information required to be filed thereunder, in each
case with such exceptions as would not have, individually or in the aggregate, a
Material Adverse Effect.
B-3
In rendering such opinion, such counsel may state that her opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of Iowa and the Delaware General Corporation Law.
Such counsel shall also state that in the course of review and
discussion of the contents of the Registration Statement by her or by lawyers in
the Company's law department under her supervision, but without independent
check or verification, no facts have come to her attention which lead her to
believe that the Registration Statement (except for the financial statements,
the related notes and schedules therein, as to which such counsel need express
no belief) as of the date of the Final Prospectus, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading, or
that, as of the date of the Final Prospectus or as of the date of such opinion,
the Final Prospectus (except for the financial statements, the related notes and
schedules therein, as to which such counsel need express no belief) contained or
contains any untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The foregoing opinion and statement may be qualified by a
statement to the effect that she does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Final Prospectus.
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* To the extent no registration statement or prospectus is required under the
Securities Act in connection with the Remarketing, the foregoing opinions shall
be revised as appropriate to reflect such fact.
B-4
EXHIBIT C
FORM OF OPINION OF
COUNSEL TO THE REMARKETING AGENT
TO BE DELIVERED
PURSUANT TO SECTION 5(F)
(a) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware.
(b) Each of this Agreement and the Calculation Agent Agreement was duly
and validly authorized executed and delivered by the Company.
(c) The Remarketed Securities conform in all material respects to the
descriptions thereof in any applicable registration statement and any applicable
prospectus under the caption "Description of Preferred Securities" and under the
captions "Description of Series [A] [B] Preferred Stock".
(d) Upon payment for the security entitlement in respect of the
Remarketed Securities at such Remarketing Settlement Date by the purchasers
thereof as provided in this Agreement and the crediting of such Remarketed
Securities on the records of DTC to a security account or security accounts in
the name of such purchasers or in the name of such purchasers' DTC participants
(assuming that such purchaser or its DTC participant does not have notice of any
adverse claim (as such phrase is defined in Section 8-105 of the Uniform
Commercial Code as in effect in the State of New York, or any successor
provision (the "Code")) to such Remarketed Securities), (A) under Section 8-501
of the Code, such purchaser or its DTC participant will acquire a security
entitlement in respect of such Remarketed Securities and (B) no action based on
any "adverse claim" (as defined in Section 8-102 of the Code) to such Remarketed
Securities may be asserted against such purchaser or its DTC participant; it
being understood that for purposes of this opinion, such counsel may assume that
when such payment and crediting occur, (x) such Remarketed Securities will have
been registered in the name of Cede & Co., or such other nominee as may be
designated by the Depository Trust Company ("DTC"), in each case on the
Company's share registry in accordance with its certificate of incorporation,
bylaws and applicable law, (y) DTC will be registered as a "clearing
corporation" within the meaning of Section 8-102 of the Code and (z) appropriate
entries to the securities account or accounts in the name of such purchaser or
its DTC participant on the records of DTC will have been made pursuant to the
Code.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware. Such opinion shall also be to the effect that (x) such counsel has
acted as counsel to the Company in connection with the preparation of the
Registration Statement and (y) based on the foregoing but without independent
check or verification, no facts have come to the attention of such counsel which
cause them to believe that the Registration Statement (except for the financial
statements, the related notes and schedules therein, as to which
C-1
such counsel need express no belief) as of the date of the Final Prospectus,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Final Prospectus (except as stated above)
contains an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The foregoing opinion and statement may be qualified by a statement
to the effect that such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Final Prospectus (other than as set forth in
clause (x) above).
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* To the extent no registration statement or prospectus is required under the
Securities Act in connection with the Remarketing, the foregoing opinions shall
be revised as appropriate to reflect such fact.
C-2
