__________ SHARES
SAFETY INSURANCE GROUP, INC.
COMMON STOCK, PAR VALUE $0.01 PER SHARE
UNDERWRITING AGREEMENT
____________, 2002
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXXXX & COMPANY, INC.,
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. INTRODUCTORY. Safety Insurance Group, Inc., a Delaware corporation
("COMPANY"), proposes to issue and sell [________] shares ("FIRM SECURITIES") of
its common stock, par value $0.01 per share ("SECURITIES"), and also proposes to
issue and sell to the several underwriters named in Schedule A hereto
("UNDERWRITERS"), at the option of the Underwriters, an aggregate of not more
than [_________] additional shares ("OPTIONAL SECURITIES") of its Securities as
set forth below. The Firm Securities and the Optional Securities are herein
collectively called the "OFFERED SECURITIES". The Company hereby agrees with the
several Underwriters named in Schedule A hereto ("UNDERWRITERS") as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-87056) relating to the
Offered Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission ("COMMISSION") and either (i) has been
declared effective under the Securities Act of 1933, as amended ("ACT"),
and is not proposed to be amended or (ii) is proposed to be amended by
amendment or post-effective amendment. If such registration statement
("INITIAL REGISTRATION STATEMENT") has been declared effective, either (i)
an additional registration statement ("ADDITIONAL REGISTRATION STATEMENT")
relating to the Offered Securities may have been filed with the Commission
pursuant to Rule 462(b) ("RULE 462(b)") under the Act and, if so filed, has
become effective upon filing pursuant to such Rule and the Offered
Securities all have been duly registered under the Act pursuant to the
initial registration statement and, if applicable, the additional
registration statement or (ii) such an additional registration statement is
proposed to be filed with the Commission pursuant to Rule 462(b) and will
become effective upon filing pursuant to such Rule and upon such filing the
Offered Securities will all have been duly registered under the Act
pursuant to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional
registration statement has been filed and the Company does not propose to
amend it, and if any post-effective amendment to either such registration
statement has been filed with the Commission prior to the execution and
delivery of this Agreement, the most recent amendment (if any) to each such
registration statement has been declared effective by the Commission or has
become effective upon filing pursuant to Rule 462(c) ("RULE 462(c)") under
the Act or, in the case of the additional registration statement, Rule
462(b). For purposes of this Agreement, "EFFECTIVE TIME" with respect to
the initial registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement means (i)
if the Company has advised Credit Suisse First Boston Corporation and
Xxxxxxxxx & Company, Inc., as representatives of the several Underwriters
(the "REPRESENTATIVES") that it does not propose to amend such registration
statement, the date and time as of which such registration statement, or
the most recent post-effective amendment thereto (if any) filed prior to
the execution and delivery of this Agreement, was declared effective by the
Commission or has become effective upon filing pursuant to Rule 462(c), or
(ii) if the Company has advised the Representatives that it proposes to
file an amendment or post-effective amendment to such registration
statement, the date and time as of which such registration statement, as
amended by such amendment or post-effective amendment, as the case may be,
is declared effective by the Commission. If an additional registration
statement has not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Representatives that it proposes
to file one, "EFFECTIVE TIME" with respect to such additional registration
statement means the date and time as of which such registration statement
is filed and becomes effective pursuant to Rule 462(b). "EFFECTIVE DATE"
with respect to the initial registration statement or the additional
registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its Effective
Time, including all information contained in the additional registration
statement (if any) and deemed to be a part of the initial registration
statement as of the Effective Time of the additional registration statement
pursuant to the General Instructions of the Form on which it is filed and
including all information (if any) deemed to be a part of the initial
registration statement as of its Effective Time pursuant to Rule 430A(b)
("RULE 430A(b)") under the Act, is hereinafter referred to as the "INITIAL
REGISTRATION STATEMENT". The additional registration statement, as amended
at its Effective Time, including the contents of the initial registration
statement incorporated by reference therein and including all information
(if any) deemed to be a part of the additional registration statement as of
its Effective Time pursuant to Rule 430A(b), is hereinafter referred to as
the "ADDITIONAL REGISTRATION STATEMENT". The Initial Registration Statement
and the Additional Registration Statement are herein referred to
collectively as the "REGISTRATION STATEMENTS" and individually as a
"REGISTRATION STATEMENT". The form of prospectus relating to the Offered
Securities, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) ("RULE 424(b)") under the Act or (if no such
filing is required) as included in a Registration Statement, is hereinafter
referred to as the "PROSPECTUS". No document has been or will be prepared
or distributed in reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
("RULES AND REGULATIONS") and did not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii) on
the Effective Date of the Additional Registration Statement (if any), each
Registration Statement conformed, or will conform, in all material respects
to the requirements of the Act and the Rules and Regulations and did not
include, or will not include, any untrue statement of a material fact and
did not omit, or will not omit, to state any material fact required to be
stated therein or necessary to make the statements therein not misleading
and (iii) on the date of this Agreement, the Initial Registration Statement
and, if the Effective Time of the Additional Registration Statement is
prior to the execution and delivery of this Agreement, the Additional
Registration Statement each conforms, and at the time of filing of the
Prospectus pursuant to Rule 424(b) or (if no such filing is required) at
the Effective Date of the Additional Registration Statement in which the
Prospectus is included,
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each Registration Statement and the Prospectus will conform, in all
material respects to the requirements of the Act and the Rules and
Regulations, and none of such documents includes, or will include, any
untrue statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement: on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement and the Prospectus will conform in all
material respects to the requirements of the Act and the Rules and
Regulations, none of such documents will include any untrue statement of a
material fact or will omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and no
Additional Registration Statement has been or will be filed. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus (and any amendment or supplement
thereto) based upon written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein, it
being understood and agreed that the only such information is that
described as such in Section 7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
requisite corporate power to own its properties and conduct its business as
described in the Prospectus; and the Company is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of
its business requires such qualification, except where the failure to be so
qualified would not, individually or in the aggregate, be reasonably
expected to have a material adverse effect on the condition (financial or
other), business, properties, results of operations or prospects of the
Company and its subsidiaries taken as a whole ("MATERIAL ADVERSE EFFECT").
The Commonwealth of Massachusetts is the only jurisdiction in which the
Company maintains an office, leases property or conducts business.
(d) Each subsidiary of the Company has been duly incorporated
and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with requisite corporate power to own
its properties and conduct its business as described in the Prospectus; and
each subsidiary of the Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in which
its ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to be so qualified would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect; the Commonwealth of Massachusetts is the only jurisdiction
in which the subsidiaries of the Company maintain offices, lease property
or conduct business; all of the issued and outstanding capital stock of
each subsidiary of the Company has been duly authorized and validly issued
and is fully paid and nonassessable; except as disclosed in the Prospectus
and except for the right of first offer with respect to the common stock of
Safety Insurance Company set forth in Safety Insurance Company's Articles
of Organization, all of the outstanding capital stock of each subsidiary is
owned by the Company, either directly or through subsidiaries, free from
liens, claims, encumbrances and defects; and none of the outstanding shares
of capital stock of any subsidiary of the Company was issued in violation
of preemptive or other similar rights of any securityholder of such
subsidiary.
(e) The Offered Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all outstanding
shares of capital stock of the Company are, and, when the Offered
Securities have been delivered and paid for in accordance with this
Agreement on each Closing Date (as defined below), such Offered Securities
will have been, validly issued, fully paid and nonassessable (except for
those Securities of the Company owned by the Company's "Management Team"
(as that term is used in the Prospectus)) and will conform to the
description thereof contained in the Prospectus; and the stockholders of
the Company have no preemptive rights with respect to the Offered
Securities.
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(f) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any person
that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like payment
in connection with this offering.
(g) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require the
Company to file a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the Company under the
Act, except for the registration rights contained in Article VI of the
Stockholders Agreement, dated as of October 16, 2001 as amended (the
"Stockholders Agreement").
(h) The Offered Securities have been approved for listing on the
Nasdaq Stock Market's National Market, subject to notice of issuance.
(i) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance and sale of the Offered Securities by the
Company, except such as have been obtained and made under the Act, the
Securities and Exchange Act of 1934, as amended ("EXCHANGE ACT"), and such
as may be required under state securities or insurance securities laws.
(j) The execution, delivery and performance of this Agreement,
and the issuance and sale of the Offered Securities will not result in a
breach or violation of any of the terms and provisions of, or constitute a
default under, (i) any statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or any of
their properties provided, that no representation is hereby made with
respect to state securities or state insurance securities laws, or (ii) any
agreement or instrument to which the Company or any such subsidiary is a
party or by which the Company or any such subsidiary is bound or to which
any of the properties of the Company or any such subsidiary is subject, or
(iii) the charter or by-laws of the Company or any such subsidiary except,
in the case of clause (ii), as would not have a Material Adverse Effect,
and the Company has the requisite corporate power to authorize, issue and
sell the Offered Securities as contemplated by this Agreement.
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) Except as disclosed in the Prospectus and except for the
right of first offer with respect to the common stock of Safety Insurance
Company set forth in Safety Insurance Company's Articles of Organization,
the Company and its subsidiaries have good and marketable title to all real
properties and all other properties and assets owned by them that are
material to the business of the Company and its subsidiaries, in each case
free from liens, claims, encumbrances and defects that would materially
affect the value thereof or materially interfere with the use made or to be
made thereof by them; and except as disclosed in the Prospectus, the
Company and its subsidiaries hold any leased real or personal property
under valid and enforceable leases with no exceptions that would materially
interfere with the use made or to be made thereof by them.
(m) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by them
and have not received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its subsidiaries, would
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
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(n) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent that
might have a Material Adverse Effect.
(o) The Company and its subsidiaries own, possess or can acquire
on reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and
other intellectual property (collectively, "INTELLECTUAL PROPERTY RIGHTS")
necessary to conduct the business now operated by them, or presently
employed by them, and have not received any notice of infringement of or
conflict with asserted rights of others with respect to any intellectual
property rights that, if determined adversely to the Company or any of its
subsidiaries, would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect. The Company is not aware of
any infringement or other violation by any third-party with respect to its
intellectual property rights.
(p) Except as disclosed in the Prospectus, neither the Company
nor any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or restoration
of the environment or human exposure to hazardous or toxic substances
(collectively, "ENVIRONMENTAL LAWS"), owns or operates any real property
contaminated with any substance that is subject to any environmental laws,
is liable for any off-site disposal or contamination pursuant to any
environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim
would reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect; and the Company is not aware of any pending
investigation which might lead to such a claim.
(q) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if determined
adversely to the Company or any of its subsidiaries, would reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect, or would reasonably be expected to materially and adversely affect
the ability of the Company to perform its obligations under this Agreement,
or which are otherwise material in the context of the sale of the Offered
Securities; and to the knowledge of the Company no such actions, suits or
proceedings are threatened or contemplated.
(r) The financial statements included in each Registration
Statement and the Prospectus present fairly in all material respects the
financial position of the Company and its consolidated subsidiaries as of
the dates shown and their results of operations, comprehensive income,
changes in stockholders' equity, and cash flows for the periods shown, and
such financial statements have been prepared in accordance with generally
accepted accounting principles in the United States applied on a consistent
basis, except as disclosed therein, and the schedules included in each
Registration Statement present fairly in all material respects the
information required to be stated therein; and, in each case, the
assumptions used in preparing the pro forma financial statements included
in each Registration Statement and the Prospectus provide a reasonable
basis for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma adjustments
give appropriate effect to those assumptions, and the pro forma columns
therein reflect the proper application of those adjustments to the
corresponding historical financial statement amounts.
(s) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has
been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties, results of operations or prospects of the Company and
its subsidiaries taken as a whole, and, except as disclosed in or
contemplated by the Prospectus, there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital stock.
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(t) The Company is not and, after giving effect to the offering
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment company"
as defined in the Investment Company Act of 1940.
(u) Each subsidiary of the Company which is engaged in the
business of insurance or reinsurance (collectively, the "INSURANCE
SUBSIDIARIES") holds such insurance licenses, certificates and permits from
governmental authorities (including, without limitation, from the insurance
regulatory agencies of the various jurisdictions where it conducts business
(the "INSURANCE LICENSES")) as are necessary to the conduct of its business
as described in the Prospectus; the Company and each Insurance Subsidiary
have fulfilled and performed all obligations necessary to maintain the
Insurance Licenses; except as disclosed in the Prospectus, there is no
pending or, to the knowledge of the Company, threatened action, suit,
proceeding or investigation that would reasonably be expected to result in
the revocation, termination or suspension of any Insurance License which
would reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect; and except as disclosed in the Prospectus, no
insurance regulatory agency or body has issued, or commenced any proceeding
for the issuance of, any order or decree impairing, restricting or
prohibiting the payment of dividends by any Insurance Subsidiary to its
parent.
(v) Except as disclosed in the Prospectus, the Company and its
Insurance Subsidiaries have made no material change in their insurance
reserving practices since the most recent audited financial statements
included in the Prospectus.
(w) All reinsurance treaties, contracts, agreements and
arrangements to which any Insurance Subsidiary is a party are in full force
and effect and no Insurance Subsidiary is in violation of, or in default in
the performance, observance or fulfillment of, any obligation, agreement,
covenant or condition contained therein, except where the failure to be in
full force and effect or where such violation or default would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect; no Insurance Subsidiary has received any notice from any of
the other parties to such treaties, contracts, agreements or arrangements
that such other party intends not to perform thereunder and, to the
knowledge of the Company and the Insurance Subsidiaries, none of the other
parties to such treaties, contracts, agreements or arrangements will be
unable to perform such treaty, contract, agreement or arrangement, except
where such nonperformance would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect.
(x) The statutory financial statements of the Insurance
Subsidiaries, from which certain ratios and financial, statistical and
other data included in the Registration Statement and the Prospectus have
been derived, have been prepared for each relevant period in conformity, in
all material respects, with statutory accounting principles or practices
prescribed or permitted by the National Association of Insurance
Commissioners and by the appropriate Insurance Department of the
jurisdiction of domicile of each Insurance Subsidiary, and such statutory
accounting practices have been applied on a consistent basis in all
material respects throughout the periods involved, except as may otherwise
be indicated therein or in the notes thereto, and such statutory financial
statements present fairly in all material respects the statutory financial
position of the Insurance Subsidiaries as of the dates thereof, and the
statutory basis results of operations of the Insurance Subsidiaries for the
periods covered thereby.
(y) The persons and entities which executed and delivered lockup
letters as contemplated by Section 6(h) hereof constitute the only holders
of Securities, or any securities convertible into or exchangeable or
exercisable for Securities, or holders of options, warrants, stock
appreciation rights or similar instruments with respect to Securities.
Every holder of the registration rights referred to in Section 2(g) hereof
executed and delivered lockup letters as contemplated by Section 6(h)
hereof.
3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the
6
Company agrees to sell to the Underwriters, and the Underwriters agree,
severally and not jointly, to purchase from the Company, at a purchase price of
$______ per share, the respective numbers of shares of Firm Securities set forth
opposite the names of the Underwriters in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives for the
accounts of the Underwriters, at the office of Xxxxx Xxxxxxxxxx LLP, New York,
New York, against payment of the purchase price in Federal (same day) funds by
wire transfer to an account at a bank acceptable to Credit Suisse First Boston
Corporation ("CSFBC") at the office of Xxxxx Xxxxxxxxxx LLP, New York, New York,
at 10:00 A.M., New York time, on [ ], or at such other time not later than
seven full business days thereafter as CSFBC and the Company determine, such
time being herein referred to as the "FIRST CLOSING DATE". For purposes of Rule
15c6-1 under the Securities Exchange Act of 1934, the First Closing Date (if
later than the otherwise applicable settlement date) shall be the settlement
date for payment of funds and delivery of securities for all the Offered
Securities sold pursuant to the offering. The certificates for the Firm
Securities so to be delivered will be in definitive form, in such denominations
and registered in such names as CSFBC requests and will be made available for
checking and packaging at the above office of Xxxxx Xxxxxxxxxx LLP, New York,
New York at least 24 hours prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company from time
to time not more than 30 days subsequent to the date of the Prospectus, the
Underwriters may purchase all or less than all of the Optional Securities at the
purchase price per Security to be paid for the Firm Securities. The Company
agrees to sell to the Underwriters the number of shares of Optional Securities
specified in such notice and the Underwriters agree, severally and not jointly,
to purchase such Optional Securities. Such Optional Securities shall be
purchased for the account of each Underwriter in the same proportion as the
number of shares of Firm Securities set forth opposite such Underwriter's name
bears to the total number of shares of Firm Securities (subject to adjustment by
CSFBC to eliminate fractions) and may be purchased by the Underwriters only for
the purpose of covering over-allotments made in connection with the sale of the
Firm Securities. No Optional Securities shall be sold or delivered unless the
Firm Securities previously have been, or simultaneously are, sold and delivered.
The right to purchase the Optional Securities or any portion thereof may be
exercised from time to time and to the extent not previously exercised may be
surrendered and terminated at any time upon notice by CSFBC to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CSFBC
but shall be not later than five full business days after written notice of
election to purchase Optional Securities is given. The Company will deliver the
Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, at the office of
Xxxxx Xxxxxxxxxx LLP, New York, New York, against payment of the purchase price
therefor in Federal (same day) funds by official bank check or checks or wire
transfer to an account at a bank acceptable to CSFBC drawn to the order of the
Company at the above office of Xxxxx Xxxxxxxxxx LLP, New York, New York. The
certificates for the Optional Securities being purchased on each Optional
Closing Date will be in definitive form, in such denominations and registered in
such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the above
office of Xxxxx Xxxxxxxxxx LLP, New York, New York at a reasonable time in
advance of such Optional Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by
7
CSFBC, subparagraph (4)) of Rule 424(b) not later than the earlier of (A)
the second business day following the execution and delivery of this
Agreement or (B) the fifteenth business day after the Effective Date of the
Initial Registration Statement.
The Company will advise CSFBC promptly of any such filing pursuant to Rule
424(b). If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement and an additional
registration statement is necessary to register a portion of the Offered
Securities under the Act but the Effective Time thereof has not occurred as
of such execution and delivery, the Company will file the additional
registration statement or, if filed, will file a post-effective amendment
thereto with the Commission pursuant to and in accordance with Rule 462(b)
on or prior to 10:00 P.M., New York time, on the date of this Agreement or,
if earlier, on or prior to the time the Prospectus is printed and
distributed to any Underwriter, or will make such filing at such later date
as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to
amend or supplement the initial or any additional registration statement as
filed or the related prospectus or the Initial Registration Statement, the
Additional Registration Statement (if any) or the Prospectus and will not
effect such amendment or supplementation without CSFBC's consent, which
consent shall not be unreasonably withheld; and the Company will also
advise CSFBC promptly of the effectiveness of each Registration Statement
(if its Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a Registration
Statement or the Prospectus and of the institution by the Commission of any
stop order proceedings in respect of a Registration Statement and will use
its best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs 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
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company will promptly
notify CSFBC of such event and will promptly prepare and file with the
Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability
Date (as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act.
For the purpose of the preceding sentence, "AVAILABILITY DATE" means the
45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the Company's fiscal year,
"AVAILABILITY DATE" means the 90th day after the end of such fourth fiscal
quarter.
(e) The Company will furnish to the Representatives copies of
each Registration Statement (three of which will be signed and will include
all exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Offered Securities is required to be delivered
under the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in each
case in such quantities as CSFBC reasonably requests. The Prospectus shall
be so furnished on or prior to 3:00 P.M., New York time, on the business
day following the later of the execution and delivery of this Agreement or
the Effective Time of the Initial Registration Statement. All other
documents shall be so furnished
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as soon as available. The Company will pay the expenses of printing and
distributing to the Underwriters all such documents.
(f) The Company will cooperate with the Underwriters and counsel
to the Underwriters in connection with the qualification of the Offered
Securities for sale under the laws of such jurisdictions as designated by
CSFBC and will continue such qualifications in effect so long as required
for the distribution; provided, however, that the Company shall not be
required in connection therewith to qualify as a foreign corporation in any
jurisdiction in which it is not now qualified or to take any action that
would subject it to taxation in any jurisdiction in which it is not now
subject or consent to service of process generally in any jurisdiction in
which it is not now subject to such consent.
(g) The Company will pay all expenses incident to the
performance of its obligations under this Agreement, for filing fees of the
Commission, for any fees of the Nasdaq Stock Market's National Market, for
any filing fees and other expenses (including reasonable fees and
disbursements of counsel) incurred in connection with qualification of the
Offered Securities for sale under the laws of such jurisdictions as CSFBC
designates and the printing of memoranda relating thereto, for the filing
fee incident to the review by the National Association of Securities
Dealers, Inc. ("NASD") of the Offered Securities, for any travel expenses
of the Company's officers and employees and any other expenses of the
Company in connection with attending meetings with prospective purchasers
of the Offered Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including any amendments and
supplements thereto) to the Underwriters; provided, that the Underwriters
shall pay all of their own travel and other expenses in connection with
attending meetings with prospective purchasers and shall pay all expenses
(including, without limitation, meeting room and dining charges) in
connection with arranging and hosting such meetings. Notwithstanding the
foregoing, the Company and the Underwriters agree to split, on a 50/50
basis, the cost of any private aviation used to travel to or from any
"roadshow" meetings between the Company and prospective purchasers.
(h) For a period of 180 days after the date of the initial
public offering of the Offered Securities, the Company will not offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under the
Act relating to, any additional shares of its capital stock or securities
convertible into or exchangeable or exercisable for any shares of its
capital stock, or publicly disclose the intention to make any such offer,
sale, pledge, disposition or filing, without the prior written consent of
CSFBC, except (i) the filing of a registration statement on Form S-8 under
the Securities Act, (ii) grants of options to purchase Securities under the
Company's 2002 Management Omnibus Incentive Plan disclosed in the
Prospectus and existing and in effect on the date hereof, so long as such
options are not exercisable within the 180-day period, and (iii) the
issuance by the Company of Securities upon the exercise of stock options
outstanding on the date hereof.
(i) The Company agrees not to release to or on behalf of any
member of the "Management Team" (as that term is used in the Prospectus)
the stock certificates representing the Securities owned by the Management
Team which are held by the Company pursuant to those certain pledge
agreements entered into in connection with loans to the Management Team
evidenced by those certain promissory notes as described under "Certain
Relationships and Related Transactions" in the Prospectus, until such
member has first repaid in full the outstanding amount owed the Company
under such loan.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
in any
9
certificates of the Company delivered pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(a) The Representatives shall have received a letter, dated the
date of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of PricewaterhouseCoopers
LLP in the form set out as EXHIBIT A to this Agreement.
(b) If the Effective Time of the Initial Registration Statement
is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York
time, on the date of this Agreement or such later date as shall have been
consented to by CSFBC. If the Effective Time of the Additional Registration
Statement (if any) is not prior to the execution and delivery of this
Agreement, such Effective Time shall have occurred not later than 10:00
P.M., New York time, on the date of this Agreement or, if earlier, the time
the Prospectus is printed and distributed to any Underwriter, or shall have
occurred at such later date as shall have been consented to by CSFBC. If
the Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, the Prospectus shall have been
filed with the Commission in accordance with the Rules and Regulations and
Section 5(a) of this Agreement. Prior to such Closing Date, no stop order
suspending the effectiveness of a Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or,
to the knowledge of the Company or the Representatives, shall be
contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties, results of operations or prospects of the Company and
its subsidiaries taken as one enterprise which, in the judgment of a
majority in interest of the Underwriters including the Representatives, is
material and adverse and makes it impractical or inadvisable to proceed
with completion of the public offering or the sale of and payment for the
Offered Securities; (ii) any downgrading in the rating of any debt
securities or preferred stock of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Act) or downgrading in the insurance claims paying ability rating
of any Insurance Subsidiary by A.M. Best Company, or any public
announcement that any such organization has under surveillance or review
its rating of any such rating (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any change in U.S. or international
financial, political or economic conditions or currency exchange rates or
exchange controls as would, in the judgment of a majority in interest of
the Underwriters including the Representatives, be likely to prejudice
materially the success of the proposed issue, sale or distribution of the
Offered Securities, whether in the primary market or in respect of dealings
in the secondary market; (iv) any material suspension or material
limitation of trading in securities generally on the New York Stock
Exchange or the Nasdaq Stock Market's National Market, or any setting of
minimum prices for trading on such exchange, or any suspension of trading
of any securities of the Company on any exchange or in the over-the-counter
market; (v) any banking moratorium declared by U.S. Federal or New York
authorities; (vi) any major disruption of settlements of securities or
clearance services in the United States or (vii) any attack on, outbreak or
escalation of hostilities or act of terrorism involving the United States,
any declaration of war by Congress or any other national or international
calamity or emergency if, in the judgment of a majority in interest of the
Underwriters including the Representatives, the effect of any such attack,
outbreak, escalation, act, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
10
(d) The Representatives shall have received an opinion, dated
such Closing Date, of LeBoeuf, Lamb, Xxxxxx and XxxXxx, L.L.P., counsel for
the Company, to the effect that:
(i) The Company has been duly incorporated and is
an existing corporation in good standing under the laws of the
State of Delaware, with the requisite corporate power to own its
properties and conduct its business as described in the
Prospectus; and the Company is duly qualified to do business as a
foreign corporation in good standing in the Commonwealth of
Massachusetts;
(ii) Each subsidiary of the Company is an existing
corporation in good standing under the laws of the jurisdiction
of its incorporation, with the requisite corporate power to own
its properties and conduct its business as described in the
Prospectus; the Company or one of its direct or indirect
subsidiaries is the registered holder of all of the capital stock
of each subsidiary;
(iii) The Offered Securities delivered on such
Closing Date and all other outstanding Securities of the Company
have been duly authorized and validly issued, are (except for
those Securities of the Company owned by the Company's
"Management Team" (as that term is used in the Prospectus)) fully
paid and nonassessable and conform to the description thereof
contained in the Prospectus; and, except as provided in Section
5.5 of the Stockholders Agreement, the stockholders of the
Company have no preemptive rights with respect to the Securities
under Delaware law, under the Company's charter or by-laws or
under any agreement to which the Company or any of its
subsidiaries is a party that is filed as an exhibit to the
Registration Statement;
(iv) There are no contracts, agreements or
understandings known to such counsel between the Company and any
person granting such person the right to require the Company to
file a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or
to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or
in any securities being registered pursuant to any other
registration statement filed by the Company under the Act, except
for the registration rights contained in Article VI of the
Stockholders Agreement;
(v) No consent, approval, authorization or order
of, or filing with, any governmental agency or body or any court
of the Commonwealth of Massachusetts, the State of Delaware or
the federal government of the United States is required for the
consummation of the transactions contemplated by this Agreement
in connection with the issuance or sale of the Offered Securities
by the Company, except such as have been obtained and made under
the Act and the Exchange Act and such as may be required under
state securities and insurance securities laws (as to which such
counsel expresses no opinion);
(vi) The execution, delivery and performance of this
Agreement and the issuance and sale of the Offered Securities
will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, (i) any statute,
rule, regulation or order of any governmental agency or body of
the Commonwealth of Massachusetts, the State of Delaware or the
federal government of the United States or any court of the
Commonwealth of Massachusetts, the State of Delaware or the
federal government of the United States having jurisdiction over
the Company or any subsidiary of the Company or any of their
properties (except such as may be required under state securities
or state insurance securities laws, as to which such counsel need
express no opinion), or (ii) any agreement or instrument filed as
an exhibit to the Registration Statement to which the Company or
any such subsidiary is a party or by which the Company or any
such subsidiary is bound or to which any of the properties of the
11
Company or any such subsidiary is subject, or (iii) the charter
or by-laws of the Company or any such subsidiary except, in the
case of clause (ii), as would not have a Material Adverse Effect,
and the Company has the requisite corporate power to authorize,
issue and sell the Offered Securities as contemplated by this
Agreement;
(vii) Each Registration Statement and the Prospectus
and each amendment or supplement thereto comply (except for
financial statements and schedules and other financial data
included therein as to which such counsel need not express any
opinion) as to form in all material respects with the
requirements of the Act and Rules and Regulations; such counsel
has been advised by the Commission that the Registration
Statement was declared effective under the Act as of the date and
time specified in such opinion, the Prospectus either was filed
with the Commission pursuant to the sub-paragraph of Rule 424(b)
specified in such opinion on the date specified therein or was
included in a Registration Statement and, to the knowledge of
such counsel, no stop order suspending the effectiveness of a
Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending
or contemplated by the Commission;
(viii) The statements set forth in the Registration
Statements and Prospectus under the captions
"Business--Regulation", "Common Stock Eligible for Future Sale"
and "Description of Capital Stock", insofar as they purport to
describe statutes, legal and governmental proceedings and
contracts and other documents are accurate in all material
respects and fairly present the information required to be shown;
the statements set forth in the Registration Statements and
Prospectus under the caption "The Acquisition", insofar as they
purport to summarize contracts and other documents, fairly
summarize the terms of such contracts and other documents; and
such counsel do not know of any legal or governmental proceedings
required to be described in a Registration Statement or the
Prospectus which are not described as required or of any
contracts or documents of a character required to be filed as
exhibits to a Registration Statement which are not filed as
required.
(ix) This Agreement has been duly authorized,
executed and delivered by the Company;
(x) The Company is not and, after giving effect to
the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the
Prospectus, will not be an "investment company" as defined in the
Investment Company Act of 1940; and
(xi) To the knowledge of such counsel, each
Insurance Subsidiary holds such Insurance Licenses as are
necessary to the conduct of its business as described in the
Prospectus; to the knowledge of such counsel, there is no pending
or threatened action, suit, proceeding or investigation that
would reasonably be expected to result in the revocation,
termination or suspension of such Insurance Licenses which would
reasonably be expected to have a Material Adverse Effect; and
except as disclosed in the Prospectus, to the knowledge of such
counsel, no insurance regulatory agency or body has issued, or
commenced any proceeding for the issuance of, any order or decree
impairing, restricting or prohibiting the payment of dividends by
any Insurance Subsidiary to its parent.
Such counsel may also state that (except as provided in (viii) above) they
have not made any independent verification or check, and are not passing upon
and do not assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement and Prospectus, but
such counsel shall state that they have participated in reviews and discussions
in connection with the preparation of the Registration Statement and Prospectus
prior to the Closing Date, and in the course of such reviews and discussions no
facts came to their attention that have caused them to believe
12
that (x) the Registration Statement or any amendment thereto and the prospectus
included therein at the time the Registration Statement became effective (in
each case, apart from the financial statements and schedules and other financial
data contained therein or omitted therefrom as to which such counsel need not
express any opinion) contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or (y) the Prospectus or any
amendment or supplement thereto as of its issue date or as of such Closing Date
(apart from the financial statements and schedules and other financial data
contained therein or omitted therefrom as to which such counsel need not express
any opinion) contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(e) The Representatives shall have received from Xxxxx
Xxxxxxxxxx LLP, counsel for the Underwriters, such opinion or opinions,
dated such Closing Date, with respect to the incorporation of the Company,
the validity of the Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related matters as the
Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(f) The Representatives shall have received a certificate, dated
such Closing Date, of the Company executed by the President or any Vice
President and a principal financial or accounting officer of the Company in
which such officers, to the best of such officers' knowledge after
reasonable investigation, shall state that: the representations and
warranties of the Company in this Agreement are true and correct as of the
Closing Date; the Company has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied hereunder at or
prior to such Closing Date; no stop order suspending the effectiveness of
any Registration Statement has been issued and no proceedings for that
purpose have been instituted or are contemplated by the Commission; if any
Additional Registration Statement was filed, the Additional Registration
Statement satisfying the requirements of subparagraphs (1) and (3) of Rule
462(b) was filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b) under the Act,
prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties,
results of operations or prospects of the Company and its subsidiaries
taken as a whole except as set forth in or contemplated by the Prospectus
or as described in such certificate.
(g) The Representatives shall have received a letter, dated such
Closing Date, from PricewaterhouseCoopers LLP bringing down the letter from
PricewaterhouseCoopers LLP provided to the Representatives pursuant to
Section 6(a) to a date not more than 3 days prior to such Closing Date, in
a form reasonably acceptable to the Representatives and their counsel.
(h) On or prior to the date of this Agreement, the
Representatives shall have received lockup letters in form and substance
satisfactory to the Representatives from each of the Company's officers and
directors and from each holder of Securities or options to purchase
Securities of the Company.
(i) The Offered Securities shall have been approved for listing
on the Nasdaq Stock Market's National Market, subject to notice of
issuance.
(j) The Company's outstanding manditorily redeemable preferred
stock shall have been converted into the Securities as described in the
Prospectus under the heading "The Preferred Share Exchange."
13
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFBC may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder,
whether in respect of an Optional Closing Date or otherwise.
7. INDEMNIFICATION AND CONTRIBUTION
(a) The Company will indemnify and hold harmless each
Underwriter, its partners, members, directors and officers and each person, if
any, who controls such Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, 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 any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, 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 reasonable legal or other expenses
incurred by such Underwriter in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company will not 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 in or omission or alleged
omission from any of such documents in reliance upon and in conformity with
written information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (b) below; and provided, further,
that with respect to any untrue statement or alleged untrue statement in or
omission or alleged omission from any preliminary prospectus the indemnity
agreement contained in this subsection (a) shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased the Offered Securities concerned, to the extent that a
prospectus relating to such Offered Securities was required to be delivered by
such Underwriter under the Act in connection with such purchase and any such
loss, claim, damage or liability of such Underwriter results from the fact that
there was not sent or given to such person, at or prior to the written
confirmation of the sale of such Offered Securities to such person, a copy of
the Prospectus if the Company had previously furnished copies thereof to such
Underwriter.
(b) Each Underwriter will severally and not jointly indemnify
and hold harmless the Company, its directors and officers and each person, if
any who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which the Company 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 any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein, and will reimburse any
reasonable legal or other expenses incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Underwriter consists of the following information
in the Prospectus furnished on behalf of each Underwriter: the concession and
reallowance figures appearing in the fourth paragraph under the caption
"Underwriting" and the information contained in [the sixth paragraph, the first
sentence of the thirteenth paragraph and in the fourteenth paragraph] under the
caption "Underwriting."
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made
14
against the indemnifying party under subsection (a) or (b) above, notify the
indemnifying party of the commencement thereof; but the omission so to notify
the indemnifying party will not relieve it from any liability which it may have
to any indemnified party otherwise than under subsection (a) or (b) above. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
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 reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party (which consent shall
not be unreasonably withheld), be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such 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 party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement (i) includes
an unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action 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 an indemnified party.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other from the offering
of the Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company 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 liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters. 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 or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any
reasonable legal or other expenses incurred by such indemnified party in
connection with investigating or defending any action or claim which is the
subject of this subsection (d). 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 Securities
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 under this Section shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each partner, member, director
and officer of any Underwriter and to each person, if any, who controls any
Underwriter within the meaning of the Act or the Exchange Act; and the
obligations of the Underwriters under this Section 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 director of the Company, to each
officer
15
of the Company who has signed a Registration Statement and to each person, if
any, who controls the Company within the meaning of the Act or the Exchange Act.
8. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Offered Securities that such defaulting Underwriters
agreed but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate number of shares of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
number of shares of Offered Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFBC and the
Company for the purchase of such Offered Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 9 (provided that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). As used in this Agreement, the term "Underwriter" includes
any person substituted for an Underwriter under this Section. Nothing herein
will relieve a defaulting Underwriter from liability for its default.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company and the Underwriters shall each
remain responsible for the respective expenses to be paid or reimbursed by it
pursuant to Section 5 and the respective obligations of the Company and the
Underwriters pursuant to Section 7 shall remain in effect, and if any Offered
Securities have been purchased hereunder the representations and warranties in
Section 2 and all obligations under Section 5 shall also remain in effect. If
the purchase of the Offered Securities by the Underwriters is not consummated
for any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause (iii),
(iv), (v), (vi) or (vii) of Section 6(c), the Company will reimburse the
Underwriters for all out-of-pocket expenses (including reasonable fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the Offered Securities.
10. NOTICES. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or faxed and confirmed to the
Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory Group (fax:
000-000-0000), or, if sent to the Company, will be mailed, delivered or faxed
and confirmed to it at Safety Insurance Group, Inc., 00 Xxxxxx Xxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: (fax: ); provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or faxed and confirmed to such Underwriter.
11. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers,
directors, members, partners, and controlling persons referred to in Section 7,
and no other person will have any right or obligation hereunder.
16
12. REPRESENTATION OF UNDERWRITERS. The Representatives will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.
13. COUNTERPARTS. This Agreement may be executed 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 Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
17
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
SAFETY INSURANCE GROUP, INC.
By
------------------------------
Name:
Title:
Theforegoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXXXX & COMPANY, INC.
Acting on behalf of themselves and as the
Representatives of the several
Underwriters
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By
----------------------------------
Name:
Title:
18
SCHEDULE A
NUMBER OF
UNDERWRITER FIRM SECURITIES
----------- ---------------
Credit Suisse First Boston Corporation.............................
Xxxxxxxxx & Company, Inc...........................................
---------------
Total....................................................
===============
19
