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EXHIBIT 1
D&N CAPITAL CORPORATION
____% NONCUMULATIVE PREFERRED STOCK, SERIES A
(LIQUIDATION PREFERENCE $25.00 PER SHARE)
EXCHANGEABLE INTO PREFERRED STOCK OF
D&N BANK
UNDERWRITING AGREEMENT
____________, 1997
▇▇▇▇▇ & Co., L.L.C.
As representative of the several Underwriters
named in Schedule I hereto,
c/▇ ▇▇▇▇▇ & Co., L.L.C.,
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
D&N Capital Corporation, a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
1,100,000 shares (the "Firm Shares") of _____% Noncumulative Preferred Stock,
Series A (the "Preferred Stock") of the Company and up to an aggregate of
110,000 shares (the "Optional Shares") of Preferred Stock (the Firm Shares and
the Optional Shares that the Underwriters elect to purchase pursuant to Section
2 hereof being collectively referred to as the "Shares").
D&N Bank, a federally chartered and federally insured stock savings bank and
the parent of the Company (the "Bank"), has prepared and filed on ___________,
1997 with the Office of Thrift Supervision (the "OTS") a preliminary offering
circular under cover of Form OC (Docket No. __________), also filed with the
Securities and Exchange Commission (the "Commission") as an attachment to the
Registration Statement (as defined below), for the registration of the
preferred stock of the Bank for which the Preferred Stock will be exchanged
automatically under certain conditions (the "Bank Preferred Shares") pursuant
to 12 C.F.R. Section 563g of the rules and regulations of the OTS (all of the
rules and regulations set forth in Chapter V of Title 12 of the Code of Federal
Regulations, including without limitation, 12 C.F.R. Section 563g, and the
rules and regulations of the Commission made applicable to the offering
circular by the rules and regulations of the OTS, are hereinafter collectively
referred to as the "OTS Rules and Regulations"). The Bank will promptly
prepare and file an offering circular, which includes the information (the
"Pricing Information") excluded from the preliminary offering circular in
reliance upon 12 C.F.R. Section 563g.2(c)(2) of the OTS Rules and Regulations
and 17 C.F.R. Section 230-430A, in accordance with the provisions of Rule
424(b). Each offering circular used before the time such offering circular is
declared effective by the OTS and any offering circular that omits
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the Pricing Information that is used after such effectiveness and prior to the
date hereof is herein called a "Preliminary Offering Circular." Such filing
under the cover of Form OC, and the offering circular constituting a part
thereof, as amended at the time the offering circular becomes effective under
the OTS Rules and Regulations (and including the Pricing Information),
including all documents incorporated by reference therein, are hereinafter
referred to as the "Form OC" and the "Offering Circular," respectively, except
that if any amended or supplemented offering circular shall be provided to the
Underwriters by the Bank for use in connection with the offering of the Bank
Preferred Shares which differs from the Offering Circular at the time it
becomes effective, the term "Offering Circular" shall refer to such newly
amended or supplemented offering circular from and after the time it is first
provided to the Underwriters for such use.
1. (a) The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(i) A registration statement on Form S-11 (File No. 333-_______) as amended
by any pre-effective amendment thereto in respect of the Shares (the "Initial
Registration Statement") has been filed with the Commission; the Initial
Registration Statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits thereto, as the
same may have been amended from time to time, to each of the other
Underwriters, have been declared effective by the Commission in such form;
other than a registration statement, if any, increasing the size of the
offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission; and no
stop order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, as amended, is hereinafter called a "Preliminary
Prospectus;" the various parts of the Initial Registration Statement and the
Rule 462(b) Registration Statement, if any, including all exhibits thereto
and including the information contained in the form of final prospectus filed
with the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to be
part of the Initial Registration Statement at the time it was declared
effective or such part of the Rule 462(b) Registration Statement, if any,
became or hereafter becomes effective, each as amended at the time such part
of the registration statement became effective, is hereinafter collectively
called the "Registration Statement;" and such final prospectus, in the form
first filed pursuant to Rule 424(b) under the Act, is hereinafter called the
"Prospectus");
(ii) No order preventing or suspending the use of any Preliminary Prospectus
has been issued by the Commission, and each Preliminary Prospectus, at the
time of filing thereof, conformed in all material respects to the requirements
of the Act and the rules
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and regulations of the Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
▇▇▇▇▇ & Co., L.L.C. expressly for use therein; and
(iii) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder and do not and
will not, as of the applicable effective date of the Registration Statement
and any amendment thereto, and as of the applicable filing date of the
Prospectus and any amendment or supplement thereto, 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;
provided, however, that this representation and warranty shall not apply to
any statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
▇▇▇▇▇ & Co., L.L.C. expressly for use therein;
(b) The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(i) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any material
adverse change in or affecting the general affairs, management, financial
position, stockholders' equity, results of operations or prospects of the
Company, otherwise than as set forth or contemplated in the Prospectus;
(ii) 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
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business so as to require such qualification or is
subject to no material liability or disability by reason of the failure to be
so qualified in any such jurisdiction;
(iii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and
nonassessable;
(iv) The Shares have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued and
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fully paid and nonassessable and will conform in all material respects to the
description of the Preferred Stock contained in the Prospectus;
(v) The issue and sale of the Shares by the Company and the compliance by the
Company with all of the provisions of this Agreement and the consummation of
the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the Company is
subject, nor will such action result in any violation of the provisions of the
Certificate of Incorporation (or other charter document) or By-laws of the
Company 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
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the
Company of the transactions contemplated by this Agreement and the agreements
listed in Annex III hereto, except the registration under the Act and 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 Shares by the Underwriters;
(vi) The Company is not in violation of its Certificate of Incorporation or
By-laws or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may
be bound;
(vii) The statements set forth in the Prospectus under the captions
"Description of Series A Preferred Shares," insofar as they purport to
constitute a summary of the terms of the Preferred Stock, "Description of
Capital Stock," insofar as they purport to constitute a summary of the terms
of the capital stock of the Company, and under the captions "Federal Income
Tax Considerations," "ERISA Considerations," "Business and Strategy --
Acquisition of Initial Portfolio," "Business and Strategy -- Servicing,"
"Management -- The Advisor," and "Underwriting," insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate, complete in all material respects and fair;
(viii) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company is a party or of which
any property of the Company is the subject which, if determined adversely to
the Company would individually or in the aggregate have a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Company; and, to the best of the Company's knowledge, no
such proceedings are threatened or contemplated by any governmental
authorities or threatened by others;
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(ix) Each of the agreements listed in Annex III hereto has been duly
authorized, executed and delivered by the Company and constitutes the valid
and legally binding obligation of the Company and is enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization, moratorium
and similar laws of general applicability relating to or affecting creditors'
rights;
(x) The Company is not and, after giving effect to the offering and sale of
the Shares, will not be an "investment company" or an entity "controlled" by
an "investment company," as such terms are defined in the Investment Company
Act of 1940, as Amended (the "Investment Company Act");
(xi) The Company does not do business with the government of Cuba or with any
person or affiliate located in Cuba within the meaning of Section 517.075,
Florida Statutes;
(xii) Coopers & ▇▇▇▇▇▇▇ L.L.P., who have certified certain financial
statements of the Company, are independent public accountants as required by
the Act and the rules and regulations of the Commission thereunder;
(xiii) This Agreement has been duly authorized, executed and delivered by
the Company;
(xiv) There are no contracts or documents which are required to be described
in the Registration Statement or the Prospectus or to be filed as exhibits
thereto which have not been so described and filed as required;
(xv) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority
or agency is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale of
the Preferred Stock hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already obtained or
as may be required under the Act or the rules and regulations thereunder or
state securities laws or by the OTS;
(xvi) The Company possesses such permits, licenses, approvals, consents, and
other authorizations (collectively "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by it; the Company is in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not have a material adverse effect
on the financial position, stockholders' equity or results of operations of
the Company; all of the Governmental Licenses are valid and in full force and
effect, except where the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect would not
have a material adverse effect on the financial position, stockholders' equity
or results of operations of
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the Company; the Company has not received any notice of proceedings relating
to the revocation or modification of any such Governmental Licenses which
singly or in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would result in a material adverse effect on the financial
position, stockholders' equity or results of operations of the Company;
(xvii) There are no persons with registration rights or other similar rights
to have any securities registered pursuant to the Registration Statement or
otherwise registered by the Company under the Act; and
(xviii) The Company is organized and carries on its business so as to qualify
as a "real estate investment trust" (a "REIT") under Sections 856 through 860
of the Internal Revenue Code of 1986, as amended (the "Code"), and no
transaction or other event has occurred which would cause the Company not to
enable it to qualify as a REIT for its current taxable year or for future
taxable years.
(c) The Bank represents and warrants to, and agrees with, each of the
Underwriters that:
(i) The Bank has been duly organized and is validly existing as a federally
chartered savings bank under the laws of the United States of America, with
power and authority (corporate and other) to own its properties and conducts
its business as now being conducted;
(ii) Since December 31, 1996, there has not been any material adverse change
in or affecting the general affairs, management, financial position,
stockholders' equity, results of operations of D&N Financial Corporation, the
parent of the Bank (the "Holding Company"), or the Bank;
(iii) The issue and sale of the Shares by the Company and the compliance by
the Company and the Bank with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Holding Company or any
of its subsidiaries (including the Bank) is a party or by which the Holding
Company or any of its subsidiaries (including the Bank) is bound or to which
any of the property or assets of the Holding Company or any of its
subsidiaries (including the Bank) is subject, nor will such action result in
any violation of the provisions of the Certificate of Incorporation (or other
charter document) or By-laws of the Bank or the Holding Company or any statute
or any order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Holding Company or any of its subsidiaries
(including the Bank) or any of their properties, except where such would not
result in a material adverse effect on the financial position, stockholders'
equity or results of operations of the Company; and, except as have
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been obtained, no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required to be obtained by the Holding Company or the Bank for the issue and
sale of the Shares by the Company or the consummation by the Bank of the
transactions contemplated by this Agreement and the agreements listed in Annex
III hereto;
(iv) Each of the agreements listed in Annex III hereto has been duly
authorized, executed and delivered by the Bank and constitutes the valid and
legally binding obligation of the Bank and is enforceable in accordance with
its terms, subject to bankruptcy, insolvency, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights;
(v) The representations and warranties of the Bank contained in the
Residential Mortgage Loan Purchase and Warranties Agreement between the
Company and the Bank, the Commercial Mortgage Loan Purchase and Warranties
Agreement between the Company and the Bank, the Residential Mortgage Loan
Servicing Agreement between the Company and the Bank, and the Commercial
Mortgage Loan Servicing Agreement between the Company and the Bank, each of
even date herewith, are as of the date hereof and will be as of the Time of
Delivery true and correct;
(vi) This Agreement has been duly authorized, executed and delivered by the
Bank;
(vii) The Form OC and the Offering Circular, at the respective times the
Form OC and any post-effective amendments thereto became effective, at the
date hereof and at all times subsequent thereto up to the Time of Delivery (as
defined in Section 4 hereof), and if any Optional Shares are purchased, at the
Second Time of Delivery (as defined in Section 4 hereof), complied and will
comply in all material respects with the requirements of the OTS Rules and
Regulations; the Form OC, at the respective times the Form OC and any
post-effective amendments thereto became effective, and at the date hereof,
did not or 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 were
made, not misleading; the Offering Circular, at the respective times the Form
OC and any post-effective amendments thereto up to the Time of Delivery, and
if any Optional Shares are purchased, at the Second Time of Delivery, did not
and will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon, and in
conformity with, information furnished in writing to the Bank by an
Underwriter through ▇▇▇▇▇ & Co., L.L.C. expressly for use therein;
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(viii) The documents incorporated or deemed to be incorporated by reference
in the Form OC and the Offering Circular, at the time they were or hereafter
are filed with the OTS, complied and will comply in all material respects with
the requirements of the OTS Rules and Regulations, and, when read together
with the other information in the Offering Circular, at the time the Form OC
became effective, at the time the Offering Circular was issued and at the Time
of Delivery (and if any Optional Shares are purchased, at the Second Time of
Delivery), did not and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading;
(ix) Coopers & ▇▇▇▇▇▇▇ L.L.P., who have certified certain financial
statements of the Bank, are independent public accountants as required by the
Act and the rules and regulations of the Commission and the OTS thereunder;
(x) The financial statements and the related notes thereto included in the
Offering Circular present fairly the financial position of the Bank and its
subsidiaries as of the latest respective dates of such financial statements,
and the results of operations of the Bank and its subsidiaries for the
respective periods covered thereby. Such statements and related notes have
been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods involved; the tables
included in the Offering Circular present fairly the information purported to
be shown thereby at the respective dates thereof and for the respective
periods covered thereby and conform in all material respects with the OTS
Rules and Regulations;
(xi) Except as disclosed in the Offering Circular, the Bank and its
subsidiaries are conducting their respective businesses in compliance in all
material respects with all laws, rules, regulations, decisions, directives and
orders (including, without limitation, all regulations and orders of, or
agreements with, the OTS and the FDIC) applicable to them. There is no
action, suit, investigation or proceeding before or by any government,
governmental instrumentality or court, domestic or foreign, now pending or, to
the knowledge of the Bank, threatened against or affecting the Bank or any of
its subsidiaries (A) that is required to be disclosed in the Offering Circular
and not disclosed therein, (B) that would likely result in any material
adverse change in the condition (financial or otherwise), earnings, business
affairs of the Bank and its subsidiaries, (C) that could materially and
adversely affect the properties, assets or leasehold interests thereof, or (D)
that would likely adversely affect the consummation of the transactions
contemplated by this Agreement; all pending legal or governmental proceedings
to which the Bank or any of its subsidiaries is a party or of which any of
their property is subject, which are not described in the Offering Circular,
including ordinary routine litigation incidental to their respective
businesses, would not have a material adverse effect on the condition
(financial or otherwise), earnings, business affairs of the Bank and its
subsidiaries;
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(xii) There are no contracts or documents which are required to be described
in the Registration Statement, the Form OC, the Prospectus or the Offering
Circular or to be filed as exhibits thereto which have not been so described
and filed as required;
(xiii) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority
or agency is necessary or required for the performance by the Bank of its
obligations hereunder, in connection with the offering, issuance or sale of
the Preferred Stock hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already obtained or
as may be required under applicable law or the OTS Rules and Regulations or
state securities laws;
(xiv) The Bank possesses such Governmental Licenses issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by it; the Bank is in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not have a material adverse effect
on the financial position, stockholders' equity or results of operations of
the Bank; all of the Governmental Licenses are valid and in full force and
effect, except where the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect would not
have a material adverse effect on the financial position, stockholders' equity
or results of operations of the Bank; the Bank has not received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Bank;
(xv) There are no persons with registration rights or other similar rights to
have any securities registered pursuant to the Registration Statement or
otherwise registered by the Bank under the Act; and
(xvi) The Bank Preferred Shares have been duly authorized and, if and when
issued and delivered by the Bank pursuant to the terms and conditions set
forth in the Registration Statement, will be validly issued and fully paid and
nonassessable; the Bank Preferred Shares conform to the statements relating
thereto in the Offering Circular and such description conforms to the
instruments defining the same; no holder of the Bank Preferred Shares will be
subject to personal liability by reason of being such a holder and the
issuance of the bank Preferred Shares is not subject to the preemptive or
other similar rights of any stockholder of the Bank.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at a purchase price per share of $25.00 the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto and (b) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional
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Shares as provided below, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at the purchase price per share set forth in
clause (a) of this Section 2, that portion of the number of Optional Shares as
to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction, the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at their
election up to 110,000 Optional Shares, at the purchase price per share set
forth in the paragraph above, for the sole purpose of covering overallotments
in the sale of the Firm Shares. Any such election to purchase Optional Shares
may be exercised only by written notice from you to the Company, given within a
period of 30 business days after the date of this Agreement, setting forth the
aggregate number of Optional Shares to be purchased and the date on which such
Optional Shares are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or
later than ten business days after the date of such notice.
As compensation to the Underwriters for their commitments hereunder, the
Company at each Time of Delivery (as defined in Section 4 hereof) will pay to
▇▇▇▇▇ & Co., L.L.C., for the accounts of the several Underwriters, an amount
equal to $.9375 per share for the Shares to be delivered by the Company
hereunder at such Time of Delivery; provided that, with regard to that portion
of the Firm Shares which has been reserved for sale to certain purchasers of
the Firm Shares introduced to you by the Company of the Company, the Company
will pay to ▇▇▇▇▇ & Co., L.L.C., for the account of the several Underwriters,
an amount equal to $__________ per share.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder will be
represented by one or more definitive certificates registered in the name of
_____________ which will be deposited by or on behalf of the Company with The
Depository Trust Company ("DTC") or its designated custodian. The Company will
deliver the Shares to ▇▇▇▇▇ & Co., L.L.C., for the account of each Underwriter,
against payment by or on behalf of such Underwriter of the purchase price
therefor by wire transfer to the account specified by the Company in Federal
(same day) funds, by causing DTC to credit the Shares to the account of ▇▇▇▇▇ &
Co., L.L.C. at DTC. The Company will cause the certificates representing the
Shares to be made available to ▇▇▇▇▇ & Co., L.L.C. for checking at least
twenty-four hours prior to the Time of Delivery at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 A.M.,
Detroit time, on
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___________ 1997 or such other time and date as ▇▇▇▇▇ & Co., L.L.C. and the
Company may agree upon in writing, and, with respect to the Optional Shares,
9:30 A.M., Detroit time, on the date specified by ▇▇▇▇▇ & Co., L.L.C. in the
written notice given by ▇▇▇▇▇ & Co., L.L.C. of the Underwriters' election to
purchase such Optional Shares, or such other time and date as ▇▇▇▇▇ & Co.,
L.L.C. and the Company may agree upon in writing. Such time and date for
delivery of the Firm Shares is herein called the "First Time of Delivery," such
time and date for delivery of the Optional Shares, if not the First Time of
Delivery, is herein called the "Second Time of Delivery," and each such time
and date for delivery is herein called a "Time of Delivery."
(b) The documents to be delivered at each Time of Delivery by or on behalf of
the parties hereto pursuant to Section 8 hereof, including the cross-receipt
for the Shares and any additional documents requested by the Underwriters
pursuant to Section 8(k) hereof, will be delivered at the offices of ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
(the "Closing Location"), the Shares will be delivered at the Designated
Office, and the wire transfers will be made to the specified accounts, all at
such Time of Delivery. A meeting will be held at the Closing Location at 2:00
P.M., Detroit time, on the Detroit Business Day next preceding such Time of
Delivery, at which meeting the final drafts of the documents to be delivered
pursuant to the preceding sentence will be available for review by the parties
hereto. For the purposes of this Section 4, "Detroit Business Day' shall mean
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in Detroit are generally authorized or obligated by
law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and to
furnish you with copies thereof; to advise you, 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 Preliminary Prospectus or
prospectus, of the suspension of the qualification of the Shares 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 the Registration Statement or Prospectus 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 Preliminary Prospectus or
prospectus or suspending any such qualification, promptly to use every
reasonable effort to obtain the withdrawal of such order;
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(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws
of such jurisdictions as you 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 Shares,
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;
(c) As soon after the execution and delivery of this Agreement as possible and
thereafter from time to time for such period as delivery of a Prospectus is
required in connection with the offering or sale of the Shares, to furnish the
Underwriters with copies of the Prospectus in Detroit in such quantities as you
may from time to time reasonably request, and, if the delivery of a prospectus
is required at any time prior to the expiration of nine months after the time
of issue of the Prospectus in connection with the offering or sale of the
Shares and if at such time any event shall have occurred as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such period to amend or
supplement the Prospectus in order to comply with the Act, to notify you and
upon your request to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such compliance, and in
case any Underwriter is required to deliver a prospectus in connection with
sales of any of the Shares at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of such
Underwriter, to prepare and deliver to such Underwriter as many copies as you
may reasonably request of an amended or supplemented Prospectus complying with
Section 10(a)(3) of the Act;
To make generally available to the Company's security holders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company complying with Section 11(a) of
the Act and the rules and regulations thereunder (including, at the option of
the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to and
including the date 90 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder,
any securities of the Company or another subsidiary of the Holding Company that
are substantially similar to the Shares;
(f) To the extent necessary to comply with NASDAQ NMS rules and regulations or
the rules and regulations of any other exchange on which the Shares are listed,
to furnish to holders of the Shares as soon as practicable after the end of
each fiscal year an annual report (including a balance sheet and statements of
income, stockholders, equity and cash flows of the Company certified by
independent public accountants) and, as soon as practicable after the end
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of each of the first three quarters of each fiscal year (beginning with the
fiscal quarter ending after the effective date of the Registration Statement),
consolidated summary financial information of the Company for such quarter in
reasonable detail;
(g) During a period of three years from the effective date of the Registration
Statement, to furnish to you copies of all reports or other communications
(financial or other) furnished to stockholders of the Company, and to deliver
to you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed; and (ii)
such additional information concerning the business and financial condition of
the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries (if any) are consolidated in reports furnished to
their stockholders generally or to the Commission);
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under the
caption "Use of Proceeds;"
If the Company elects to rely upon Rule 462(b), the Company shall file a Rule
462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 5:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act;
(j) Except to the extent that a Tax Event (as defined in the Prospectus) shall
have occurred, to make the elections and take the procedural steps described in
the Prospectus under the heading "Federal Income Tax Considerations" in a
timely fashion, to meet the requirements to qualify, for its taxable year
ending December 31, 1997, as a REIT under the Code as in effect on the date
hereof and to otherwise use every reasonable effort to do so; and
(k) To file with the Commission such reports on Form SR as may be required by
Rule 463 under the Act.
6. The Bank agrees with each of the Underwriters:
(a) The Bank will notify the Underwriters immediately, and confirm the notice
in writing, (i) of the effectiveness of the Offering Circular and any amendment
thereto, (ii) of the receipt by the Bank or its counsel of any comments from
the OTS with respect to the offering of the Shares, (iii) of any request to the
Bank or its counsel by the OTS for any amendment or supplement to the Offering
Circular or for any additional information, and (iv) of the issuance or
initiation by the OTS or by any other state or federal banking or securities
regulatory authority of any stop order or cease-and-desist proceeding to
suspend the effectiveness of the Offering Circular or interfering with the
offering of the Shares, or of the suspension of the qualification of the Shares
for offering or sale in any jurisdiction, or the initiation or threat of any
other orders or proceedings for such purposes; the Bank will make every
reasonable effort to prevent the
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issuance or initiation of any such stop orders or cease-and-desist proceedings
and, if any such stop orders or cease-and-desist proceedings are issued or
initiated, to obtain the lifting or dismissal thereof at the earliest possible
moment;
(b) The Bank will give ▇▇▇▇▇ & Co., L.L.C. notice of its intention to file or
prepare any amendment to the Offering Circular (or to any Preliminary Offering
Circular, as the case may be) or any amendment, supplement or revision to the
Offering Circular, will ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., L.L.C. with copies of any such
documents a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file or use any such document to which ▇▇▇▇▇ &
Co., L.L.C. or counsel for the Underwriters shall object;
(c) The Bank has furnished or will deliver to ▇▇▇▇▇ & Co., L.L.C. and counsel
for the Underwriters, without charge, signed copies of the Form OC, as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to ▇▇▇▇▇ & Co.,
L.L.C., without charge, a conformed copy of the Form OC, as originally filed
and each amendment thereto (without exhibits) for each of the Underwriters;
(d) If any event shall occur as a result of which it is necessary, in the
opinion of counsel for the Underwriters, to amend or supplement the Offering
Circular in order to make the Offering Circular not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, the Bank
will forthwith amend or supplement the Offering Circular by preparing and
furnishing to the Underwriters a reasonable number of copies of an amendment or
amendments of, or a supplement or supplements to, the Offering Circular (in
form and substance reasonably satisfactory to such counsel) so that, as so
amended or supplemented, the Offering Circular will not contain 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 circumstances existing at
the time the Offering Circular is delivered to a purchaser, not misleading, and
the Bank will furnish to each underwriter such number of copies of such
amendment or supplement as such Underwriter shall reasonably request. For the
purposes of this subsection, the Bank shall furnish such information with
respect to itself to ▇▇▇▇▇ & Co., L.L.C., counsel for the Underwriters and
counsel for the Bank, as may be necessary for counsel for the Underwriters and
counsel for the Bank with respect to the need to amend or supplement the
Offering Circular and shall furnish such further information as may from time
to time be reasonably requested; and
(e) The Bank, during the period when the Offering Circular is required to be
delivered under 12 C.F.R. Section 563g, will file all documents required to be
filed with the OTS within the time periods required by 12 C.F.R. Section 563g
and the OTS Rules and Regulations.
7. The Company and the Bank, jointly and severally, covenant and agree with
the several Underwriters to pay or cause to be paid the following: (i) the
fees, disbursements and expenses of their counsel and accountants in connection
with the registration of the Shares under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus and the Prospectus and amendments and
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supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) the cost of printing or producing any Agreement
among Underwriters, this Agreement and Blue Sky Memoranda, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Legal Investment and Blue Sky surveys;
(iv) all fees and expenses in connection with listing the Shares on the NASDAQ
NMS; (v) the cost of preparing stock certificates; (vi) the cost and charges of
any transfer agent or registrar; (vii) the cost and charges of DTC; (vii) the
out-of-pocket expenses of the Underwriters, including without limitation, road
show expenses and the Underwriter's legal fees and expenses (provided that the
Company's and the Bank's obligation to pay such out-of-pocket expenses shall
not exceed the amount of $75,000) and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section.
8. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and the Bank herein are, at and as of such Time of Delivery, true
and correct, the condition that the Company and the Bank shall have performed
all of their respective obligations hereunder theretofore to be performed, and
the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to Rule
424(b) within the applicable time period prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 5(a) hereof;
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 all requests for
additional information on the part of the Commission shall have been complied
with to your reasonable satisfaction; if the Company has elected to rely upon
Rule 462(b), the Rule 462(b) Registration Statement shall have become effective
by 5:00 P.M., Washington, D.C. time, on the date of this Agreement;
(b) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇, counsel for the Underwriters, shall
have furnished to you such opinion or opinions (a draft of each such opinion is
attached as Annex II(a) hereto), dated such Time of Delivery, with respect to
the validity of the Shares as well as such other related matters as you may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(c) Silver, ▇▇▇▇▇▇▇▇ & Taff, L.L.P., counsel for the Company, shall have
furnished to you their written opinion, dated such Time of Delivery, in form
and substance satisfactory to you, to the effect that:
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(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, and the
Bank has been duly organized and is validly existing under the laws of the
United States of America as a federally chartered savings bank, each with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus;
(ii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
(including the Shares being delivered at such Time of Delivery) have been duly
and validly authorized and issued and are fully paid and non-assessable; and
the Shares conform in all material respects to the description of the
Preferred Stock contained in the Prospectus;
(iii) To the knowledge of such counsel and other than as set forth in the
Prospectus there are no legal or governmental proceedings pending to which the
Company is a party or of which any property of the Company is the subject
which, if determined adversely to the Company, would individually or in the
aggregate have a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of the
Company; and, to the knowledge of such counsel, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(iv) This Agreement has been duly authorized, executed and delivered by the
Company and the Bank;
(v) The issue and sale of the Shares being delivered at such Time of Delivery
by the Company and the compliance by the Company with all of the provisions of
this Agreement and the consummation of the transactions herein contemplated
will not conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument known to such
counsel to which the Company is a party or by which the Company is bound or to
which any of the property or assets of the Company is subject, nor will such
action result in any violation of the provisions of the Certificate of
Incorporation (or other charter document) or By-laws of the Company or any
statute or any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or any of its
properties;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the
Company or the Bank of the transactions contemplated by this Agreement and the
agreements listed in Annex III hereto, except the registration under the Act
of the Shares and such consents, approvals, authorizations, registrations or
qualifications as may be required under the OTS Rules and Regulations, state
securities or Blue Sky laws in connection with the purchase and distribution
of the Shares by the Underwriters;
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(vii) The Company is not, to the knowledge of such counsel, (i) in violation
of its Certificate of Incorporation (or other charter documents) or By-laws or
(ii) in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound;
(viii) The statements set forth in the Prospectus under the captions
"Description of Series A Preferred Shares," insofar as they purport to
constitute a summary of the terms of the Preferred Stock and the Automatic
Exchange, "Description of Capital Stock," insofar as they purport to
constitute a summary of the terms of the capital stock of the Company, and
under the captions "Federal Income Tax Considerations," "ERISA
Considerations," "Business and Strategy -- Acquisition of Initial Portfolio,"
"Business and Strategy -- Servicing," "Management -- The Advisor," and
"Underwriting," insofar as they constitute or purport to describe matters of
law or legal conclusions, provisions of laws and documents referred to
therein, have been reviewed by such counsel, are accurate in all material
respects and present fairly the information required to be shown therein;
(ix) Each of the agreements listed in Annex III hereto has been duly
authorized, executed and delivered by the Bank and the Company and constitutes
the valid and legally binding obligation of the Bank and the Company
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights;
(x) The Company is not an "investment company" or an entity "controlled" by
an "investment company," as such terms are defined in the Investment Company
Act;
(xi) The Registration Statement and the Prospectus and any further amendments
and supplements thereto made by the Company prior to such Time of Delivery
(other than the financial statements, related schedules and other financial
data therein, as to which such counsel need express no opinion) comply as to
form in all material respects with the requirements of the Act and the rules
and regulations thereunder; although such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus, except as otherwise
indicated in its opinion, such counsel has no reason to believe that, as of
its effective date, the Registration Statement or any further amendment
thereto made by the Company prior to such Time of Delivery (other than the
financial statements, related schedules and other financial data therein, as
to which such counsel need express no opinion) contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that, as
of its date, the Prospectus or any further amendment or supplement thereto
made by the Company prior to such Time of Delivery (other than the financial
statements, related schedules and other financial data therein, as to which
such counsel need express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact necessary to make
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the statements therein, in the light of the circumstances under which they
were made, not misleading or that, as of such Time of Delivery, either the
Registration Statement or the Prospectus or any further amendment or
supplement thereto made by the Company prior to such Time of Delivery (other
than the financial statements, related schedules and other financial data
therein, as to which such counsel need express no opinion) contains an untrue
statement of a material fact or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; and they do not know of any amendment to the
Registration Statement required to be filed or of any contracts or other
documents of a character required to be filed as an exhibit to the
Registration Statement or required to be described in the Registration
Statement or the Prospectus which are not filed or described as required; and
(d) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, counsel of the Bank, shall have furnished to you his
written opinion, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that the issue and sale of the Shares being
delivered at such Time of Delivery by the Company and the compliance by the
Company and the Bank with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such counsel to which the
Bank is a party or by which the Bank is bound or to which any of the property
or assets of the Bank is subject, nor will such action result in any violation
of the provisions of the Certificate of Incorporation (or other charter
document) or By-laws of the Bank or any statute or any order, rule or
regulation known to such counsel of any court or governmental agency or body
having jurisdiction over the Bank or any of its properties;
(e) On the date of the Prospectus at a time prior to the execution of this
Agreement, at 9:30 A.M., Detroit time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, Coopers & ▇▇▇▇▇▇▇
L.L.P. shall have furnished to you a letter or letters, dated the respective
dates of delivery thereof, in form and substance satisfactory to you, to the
effect set forth in Annex I hereto (the executed copy of the letter delivered
prior to the execution of this Agreement is attached as Annex I(a) hereto and a
draft of the form of letter to be delivered on the effective date of any
post-effective amendment to the Registration Statement and as of each Time of
Delivery is attached as Annex I(b) hereto);
(f) (i) Neither the Company nor the Bank shall have sustained since the date
of the latest audited financial statements included in the Prospectus or the
Offering Circular, as the case may be, 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 Prospectus or the
Offering Circular, and (ii) since the respective dates as of which information
is given in the Prospectus or the Offering Circular there shall not have been
any change in the capital stock or long-term debt of the Company or the Bank or
any change in or affecting the general affairs, management, financial position,
stockholders' equity, results of operations of the
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Company or the Bank, otherwise than as set forth or contemplated in the
Prospectus or the Offering Circular, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the Representative after
discussion with the Company so material and adverse as to make it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Shares being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(g) On or after the date hereof the Shares shall be rated at least BB- by Duff
& ▇▇▇▇▇▇ Inc.;
(h) (x) On or after the date hereof (i) trading in securities generally on
the NASDAQ NMS shall not have been suspended or materially limited, (ii)
trading in the common stock of the Holding Company or the Shares on the NASDAQ
NMS shall not have been suspended, (iii) a general moratorium on commercial
banking activities in Detroit shall not have been declared by Federal or
Detroit authorities, (iv) there shall not have occurred any outbreak of
hostilities or escalation thereof or other calamity or crisis having an adverse
effect on the financial markets of the United States or (v) there shall not
have occurred any material adverse development in any of the real estate
markets in which the mortgaged properties are located and (y) the occurrence or
consequences of any one or more of such events shall have, in the reasonable
judgment of the Underwriters, made it impracticable to market the Shares on the
terms and in the manner contemplated by the Prospectus;
(i) The Shares to be sold at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the NASDAQ NMS;
(j) The Company shall have complied with the provisions of Section 5(c) hereof
with respect to the furnishing of Prospectuses;
(k) The Company shall furnish or cause to be furnished to you at such Time of
Delivery certificates of officers of the Company and the Bank satisfactory to
you as to the accuracy of the representations and warranties of the Company and
the Bank herein at and as of such Time of Delivery, as to the performance by
the Company and the Bank of all of its obligations hereunder to be performed at
or prior to such Time of Delivery, as to the matters set forth in subsections
(a) and (e) of this Section and as to such other matters as you may reasonably
request; and
(l) The Company shall be furnished or caused to be furnished to you at such
Time of Delivery an opinion of Coopers & ▇▇▇▇▇▇▇ L.L.P., in form and substance
satisfactory to you, to the effect that commencing with the Company's taxable
year ending December 31, 1997 and assuming that the elections and other
procedural steps described in the Prospectus under the heading "Federal Income
Tax Considerations," are completed by the Company in a timely fashion and based
on the other assumptions stated therein, the Company will be organized, managed
and owned in conformity with the requirements for qualification as a REIT under
the Code and its
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proposed method of operation will enable it to meet the requirements for
qualification and taxation as a REIT under the Code;
(m) The Offering Circular has become effective and at the Time of Delivery
(and, if any of the Optional Shares are purchased, at the Second Time of
Delivery), no stop order or cease-and-desist proceeding suspending the
effectiveness of the Offering Circular or interfering with the offering of the
Shares or the Bank Preferred Shares shall have been issued and no proceedings
for the purposes of issuing a stop order or cease-and-desist proceedings shall
have been instituted or shall be pending, or to the knowledge of the Bank,
shall be contemplated by the OTS or by any other state or federal banking or
securities regulatory authority. Any request on the part of the OTS for
additional information or for the inclusion of additional information in the
Form OC shall have been complied with to the reasonable satisfaction of counsel
for the Underwriters.
9. (a) The Company and the Bank, jointly and severally, will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, Preliminary Offering Circular, the Registration
Statement, the Form OC, the Prospectus or the Offering Circular, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that neither
the Company nor the Bank shall be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, Preliminary Offering Circular, the
Registration Statement, the Form OC, the Prospectus or the Offering Circular,
or any such amendment or supplement thereto in reliance upon and in conformity
with written information furnished to the Company by any Underwriter through
▇▇▇▇▇ & Co., L.L.C. expressly for use therein; and provided, further, that with
respect to any untrue statement or omission or alleged untrue statement or
omission made in any Preliminary Prospectus or Preliminary Offering Circular,
the indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Underwriter to the extent that any such loss, claim, damage or
liability of such Underwriter results from the fact that a copy of the
Prospectus or the Offering Circular was not sent or given to any person at or
prior to the written confirmation of the sale of such securities to such
person; and will reimburse the Company and the Bank for any legal or other
expenses reasonably incurred by the Company and the Bank in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(b) Each Underwriter will indemnify and hold harmless the Company and the Bank
against any losses, claims, damages or liabilities to which the Company and the
Bank may
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become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, Preliminary Offering Circular, the
Registration Statement, the Form OC, the Prospectus or the Offering Circular,
or any amendment or supplement thereto, or arise out of or are based on the
omission or alleged omission to state therein a material fact required be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement,
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, Preliminary Offering Circular, the Registration
Statement, the Form OC, the Prospectus or the Offering Circular, or any such
amendment or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through ▇▇▇▇▇ & Co.,
L.L.C. expressly for use therein.
(c) Promptly after receipt by an indemnified party under subsections (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it has notified the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder unless such settlement, compromise or judgment (i)
includes a conditional release of the indemnified party from all liability
arising out of such action or claim 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 9 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or (b)
above in respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Bank on the one hand and the Underwriters on the other from
the offering of the Shares. If, however, the allocation provided for by the
immediately preceding sentence is not permitted by applicable
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law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Bank on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or abilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Bank on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion the total net proceeds from the
offering (before deducting expenses) received by the Company and the Bank bear
to the total underwriting commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company and the Bank on the one hand or the Underwriters on the other and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, the Bank and
the Underwriters agree that it would not be just and equitable if contributions
pursuant to this section (d) were determined by pro rata allocation (even if
the Underwriters are treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include 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
subsection (d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
(e) The obligations of the Company and the Bank under this Section 9 shall be
in addition to any liability which the Company and the Bank may otherwise have
and shall extend, upon the same terms and conditions, to each person, if any,
who controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section 9 shall be in addition to any liability
which the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company or the
Bank and to each person, if any, who controls the Company or the Bank within
the meaning of the Act.
10. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained
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herein. If within thirty-six hours after such default by any Underwriter you
do not arrange for the purchase of such Shares, then the Company shall be
entitled to a further period of thirty-six hours within which to procure
another party or other parties satisfactory to you to purchase such Shares on
such terms. In the event that, within the respective prescribed periods, you
notify the Company that you have so arranged for the purchase of such Shares,
or the Company notifies you that it has so arranged for the purchase of such
Shares, you or the Company shall have the right to postpone such Time of
Delivery for a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments to the Registration Statement or the Prospectus
which in your opinion may thereby be made necessary. The term "Underwriter" as
used in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to this
Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the Shares
of a defaulting Underwriter or Underwriters by you and the Company as provided
in subsection (a) above, the aggregate number of such Shares which remains
unpurchased does not exceed one-tenth of the aggregate number of all the Shares
to be purchased at such Time of Delivery, then the Company shall have the right
to require each non- defaulting Underwriter to purchase the number of shares
which such Underwriter agreed to purchase hereunder at such Time of Delivery
and, in addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made, but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the Shares
of a defaulting Underwriter or Underwriters by you and the Company as provided
in subsection (a) above, the aggregate number of such Shares which remains
unpurchased exceeds one-tenth of the aggregate number of all the Shares to be
purchased at such Time of Delivery, or if the Company shall not exercise the
right described in subsection (b) above to require non-defaulting Underwriters
to purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Time of Delivery, the obligations of
the Underwriters to purchase and of the Company to sell the Optional Shares)
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter, the Company or the Bank, except for the expenses to be borne by
the Company, the Bank, the Holding Company and the Underwriters as provided in
Section 7 hereof and the indemnity and contribution agreements in Section 9
hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
11. The respective indemnities, agreements, representations, warranties and
other statements of the Company or the Bank and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter,
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or the Company or the Bank, or any officer or director or controlling person of
the Company or the Bank, and shall survive delivery of and payment for the
Shares.
12. If this Agreement shall be terminated pursuant to Section 10 hereof,
neither the Company nor the Bank shall then be under any liability to any
Underwriter except as provided in Sections 7 and 9 hereof; but, if for any
other reason, any Shares are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through you for
all out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Shares not so
delivered, but the Company or the Bank shall then be under no further liability
to any Underwriter except as provided in Sections 7 and 9 hereof.
13. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to ▇▇▇▇▇ & Co., L.L.C. at ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention Corporate Finance Department; and if to the Company
or the Bank shall be delivered or sent by mail to the address of the Company or
the Bank, respectively set forth in the Registration Statement, Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.; provided, however, that any notice to an Underwriter
pursuant to Section 9(c) hereof shall be delivered or sent by mail, telex or
facsimile transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company or the Bank by you upon request. Any
such statements, requests, notices or agreements shall take effect upon receipt
thereof.
14. This Agreement shall be binding upon, and inure solely to the benefit of,
the Underwriters, the Company, the Bank and, to the extent provided in Sections
9 and 11 hereof, the officers and directors of the Company, the Bank and each
person who controls the Company, the Bank or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
15. As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
16. This Agreement shall be governed by and construed in accordance with the
laws of the State of Michigan.
17. This Agreement may be executed by any one or more of the parties hereto in
any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same
instrument.
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If the foregoing is in accordance with your understanding, please sign and
return to us one counterpart for the Company and the Bank plus one for each
counsel thereof, and upon the acceptance hereof by you, on behalf of each of
the Underwriters, this letter and such acceptance hereof shall constitute a
binding agreement between each of the Underwriters, the Company and the Bank.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement
among Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
D&N Capital Corporation
By:___________________________
Name:
Title:
D&N Bank
By:___________________________
Name:
Title:
Accepted as of the date hereof:
▇▇▇▇▇ & Co., L.L.C.
By:_________________________
Name:
Title:
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SCHEDULE I
Number of Optional
Shares to be
Total Number of Purchased if
Shares to be Maximum Option
Underwriter Purchased Exercised
----------- --------------- -----------------
▇▇▇▇▇ & Co, L.L.C. . . . . . . . .
Total
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ANNEX I
[Insert appropriate form of
non-shelf comfort letter]
ANNEX 1 (a)
ANNEX 1 (b)
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ANNEX II
Form ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ Opinion
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ANNEX III
Residential Mortgage Loan Purchase and Warranties Agreement
Residential Mortgage Loan Servicing Agreement
Commercial Mortgage Loan Purchase and Warranties Agreement
Commercial Mortgage Loan Servicing Agreement
Advisory Agreement
