Exhibit 99.3
[FORM OF]
STANDBY PURCHASE AGREEMENT
This is a STANDBY PURCHASE AGREEMENT (the "Agreement"), dated as of the
date on the signature page between Union Acceptance Corporation, an Indiana
corporation (the "Company"), and the purchaser named on the signature page (the
"Purchaser").
A total of 16,000,000 shares (the "Shares") of Class A common stock,
without par value, of the Company (the "Class A common stock"), subject to the
right of the Company to increase the size of the offering to 17,600,000 Shares
as described in the Registration Statement (as defined below), are being offered
pursuant to an offering to the Company's existing shareholders (the "Rights
Offering") and to certain potential standby purchasers (the "Standby Offering").
The Rights Offering and the Standby Offering will constitute one offering (the
"Offering"). The Shares being offered in the Rights Offering are being offered
to holders of record ("Record Date Holders") of the Class A common stock and
Class B common stock, without par value, of the Company (the "Class B common
stock") as of the close of business on _______________ 2001 (the "Record Date")
in proportion to their respective ownership of Class A common stock or Class B
common stock then outstanding. On or prior to the date hereof, a registration
statement with respect to the shares of Class A common stock to be issued in the
Rights Offering and the Standby Offering has been declared effective by the
Securities and Exchange Commission (the "Commission"). The Purchaser desires to
agree to serve as a standby purchaser for a specified number of the Shares in
the Standby Offering, to the extent available after the exercise of rights in
the Rights Offering, and agrees to purchase a minimum number of the Shares, as
set forth in this Agreement. To that end, the parties have entered into this
Agreement.
1. RIGHTS OFFERING; REGISTRATION OF THE CLASS A COMMON STOCK
A registration statement and any supplements or amendments thereto on Form
S-2 (the "Registration Statement") with respect to the Offering have been filed
with, and declared effective by, the Commission. A copy of the Preliminary
Prospectus, and the Prospectus and the Standby Purchaser Supplement included in
the Registration Statement at the time the Registration Statement became
effective, have been furnished to the Purchaser.
2. PURCHASE AND DELIVERY OF SHARES
A. The Purchaser and the Company hereby acknowledge and agree that
the Company has entered into, or contemplates entering into, one
or more additional standby purchase agreements ("Standby Purchase
Agreements") with certain other parties (collectively with the
Purchaser, the "Standby Purchasers") on terms substantially
similar to this Agreement, except that they may provide for the
purchase of a different Maximum Standby Purchase Commitment and a
different Minimum Standby Purchase Right (both as defined below).
B. Subject to the terms, conditions and limitations of this
Agreement and to the availability of Shares after exercise of
rights in the Rights Offering, the Purchaser agrees to purchase
from the Company, at the subscription price per share of $______
(the "Subscription Price"), up to the number of Shares stated on
the signature page of this Agreement, to the extent necessary to
provide for full subscription for all Shares offered by the
Company in the Standby Offering (the "Maximum Standby Purchase
Commitment").
C. Subject to the terms and conditions at the Closing (as defined
below), the Company agrees to issue and sell to the Purchaser,
and the Purchaser agrees to purchase from the Company, at the
Subscription Price, a number of Shares equal to 4 million shares
of Class A common stock times the percentage that Purchaser's
Maximum Standby Purchase Commitment represents in comparison to
the sum of the Maximum Standby Purchase Commitments of all
Standby Purchasers (the "Minimum Standby Purchase Right"). In no
event will the Minimum Standby Purchase Right exceed the Maximum
Standby Purchase Commitment.
D. In the event that the number of Shares remaining and not
subscribed for after the exercise of rights in the Rights
Offering and allocation of Shares necessary to satisfy the
Minimum Standby Purchase Rights of all Standby Purchasers is less
than the aggregate Maximum Standby Purchase Commitments of
Standby Purchasers, such remaining Shares will be allocated pro
rata among Standby Purchasers according to their respective
Maximum Standby Purchase Commitments. Subject to the terms and
conditions of this Agreement, the Purchaser agrees to purchase
such number of Shares as are allocated to the Purchaser pursuant
to this Agreement.
E. The rights and obligations of the Purchaser and the Company under
the Agreement are subject to any conditions or minimums described
in the Registration Statement.
3. THE CLOSING
As soon as practicable following its determination of the number of Shares
subscribed for pursuant to the Rights Offering, the Company shall notify the
Purchaser of the number of Shares to be purchased by the Purchaser pursuant to
Section 2. The Shares shall be delivered, and payment for the Shares tendered,
in the manner contemplated by Section 4, simultaneously with the closing of the
sale of Shares pursuant to the Rights Offering. The place, date and time for
delivery of payment and Shares shall be as provided in the Registration
Statement (the "Closing Time", the date of the Closing Time being referred to as
the "Closing Date" and the consummation of the transactions being referred to as
the "Closing").
4. DELIVERY OF SHARES
At the Closing, the Shares to be purchased by the Purchaser, registered in
the name of the Purchaser or its nominee, as the Purchaser may specify to the
Company in writing at least four (4) business days prior to the Closing Date,
shall be delivered to the Purchaser, for the Purchaser's account within three
(3) business days of Closing. Concurrently, the Purchaser shall deliver to the
Company the Subscription Price for each share purchased pursuant hereto by wire
transfer of immediately available funds to an account designated by the Company
to the Purchaser in writing prior to the Closing Date.
5. AGREEMENTS AND CONSENTS OF PURCHASER
The Purchaser agrees with the Company that:
A. Notwithstanding anything to the contrary contained or implied
herein, without the consent of the Company, the Company shall not
be obligated to issue to the Purchaser any Shares in an amount
which, when aggregated with other shares of Class A common stock
beneficially owned by the Purchaser, would exceed 10% of the
total issued and outstanding shares of common stock (Class A and
Class B) upon completion of the Offering.
B. The Company may, in its sole discretion, decline to issue any of
the Shares to the Purchaser if, in the reasonable opinion of the
Company, the Purchaser is required to obtain prior clearance or
approval of such transaction from any government bank regulatory
authority and satisfactory evidence such approval or clearance
has not been presented to the Company by the Closing Date.
C. The Company may rely upon and disclose the terms of this
Agreement. Purchaser consents to disclosures concerning Purchaser
in the Prospectus and the Registration Statement, or in any
amendment or supplement thereto, and in any related filing or
disclosures of the Company.
6. REPRESENTATION AND WARRANTIES
A. The Company represents and warrants to the Purchaser that:
(i) The Company has filed the Registration Statement with the
Commission with respect to the Shares and the Registration
Statement has been declared effective by the Commission.
(ii) The Company has been duly incorporated and is a validly
existing corporation under the laws of the state of Indiana,
with the corporate power and authority to perform its
obligations under this Agreement.
(iii)The execution, delivery and performance of this Agreement
by the Company and the consummation by the Company of the
transactions contemplated by this Agreement have been duly
authorized by all necessary corporate action of the Company.
This Agreement, when duly executed and delivered by the
Purchaser, will constitute a valid and legally binding
agreement of the Company enforceable in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors'
rights and to general equity principles.
(iv) The Shares, when issued and delivered by the Company after
payment therefor as contemplated hereby, will be validly
issued, fully paid and nonassessable.
(v) The execution and delivery of this Agreement, the
consummation by the Company of the transactions contemplated
hereby and the compliance by the Company with the terms of
this Agreement do not violate the Articles of Incorporation
or Bylaws of the Company, 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, except
as would not have a material adverse effect on the financial
condition of the Company, or any applicable statute or any
order, judgment, decree, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Company or any of its properties or assets. No consent,
approval, authorization, order, registration or
qualification of or with any such court or governmental
agency or body is required for the valid authorization,
execution, delivery and performance by the Company of this
Agreement, the issuance of the Shares, or the consummation
by the Company of the other transactions contemplated by
this Agreement, except such as may be required and have been
obtained from the National Association of Securities
Dealers, Inc. ("NASD") and under the Securities Act of 1933,
as amended. Such consents, approvals, authorizations,
registrations or qualifications as have been obtained under
federal and state securities or "blue sky" laws; subject,
for the purposes of this Section 6A(v), to the satisfaction
or fulfillment by the Company of any conditions precedent to
the validity, grant or effectiveness of any such consents,
approvals, authorizations, orders, registrations or
qualifications.
(vi) The Registration Statement contains all material statements
which are required to be stated therein and does not include
any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances
under which they were made, not misleading.
(vii)The Company has received binding subscriptions from its
principal shareholders, directors, and management for at
least 6,400,000 Shares in the aggregate as part of the
Rights Offering, subject only to the Company's issuance of
the rights.
B. The Purchaser represents and warrants to the Company that:
(i) As of the date of this Agreement, the Purchaser beneficially
owns the number of shares of Class A common stock set forth
on the signature page and does not have any short positions
in the Class A common stock.
(ii) If an entity, the Purchaser is the type of entity described
on the signature page, was duly formed and is validly
existing and in good standing under the laws of its state of
formation, with the power and authority to perform its
obligations under this Agreement.
(iii)The execution, delivery and performance of this Agreement
by the Purchaser and the consummation by the Purchaser of
the transactions contemplated hereby have been duly
authorized by all necessary action of the Purchaser. This
Agreement, when duly executed and delivered by the Company,
will constitute a valid and legally binding instrument,
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability now or
hereinafter in effect relating to or affecting creditors'
rights and to general equity principles.
(iv) The Purchaser is not insolvent and has sufficient cash funds
on hand to purchase the Shares on the terms and conditions
contained in this Agreement and will have such funds on the
Closing Date. The Purchaser has, simultaneous with or prior
to the execution and delivery of this Agreement, provided
the Company with evidence or substantiated that such
Purchaser has the financial means to satisfy its financial
obligations under this Agreement. The foregoing evidence and
substantiation is a true and accurate representation of such
means.
(v) The execution and delivery of this Agreement, the
consummation by the Purchaser of the transactions
contemplated hereby and the compliance by the Purchaser,
with the terms of hereof, do not violate the constituent
documents of the Purchaser 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 Purchaser is a party or by which the Purchaser is
bound, except as would not have a material adverse affect on
the financial condition of Purchaser or its right or ability
to perform this Agreement, or any applicable law or any
order, judgment, decree, rule or regulation of any court or
governmental agency or body, having jurisdiction over the
Purchaser or any of its properties or assets. No consent,
approval, authorization, order, registration or
qualification of or with any court or governmental agency or
body, is required for the valid authorization, execution,
and delivery by the Purchaser of this Agreement or the
consummation by the Purchaser of the transactions
contemplated by this Agreement.
(vi) The Purchaser has not entered into any contracts,
arrangements, understandings or relationships (legal or
otherwise) with any other person or persons with respect to
the securities of the Company, including, but not limited to
transfer or voting any of the securities, finder's fees,
joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss, or the
giving or withholding of proxies.
7. CLOSING CONDITIONS
The respective obligations of the Purchaser and the Company to consummate
the purchase and sale of the Shares shall be subject, in the discretion of the
Company or the Purchaser, as the case may be, to the condition that (i) all
representations and warranties and other statements of the other party are, at
and as of the Closing Time, true and correct in all material respects, (ii) the
other party shall have performed all of its obligations hereunder theretofore to
be performed in all material respects, and (iii) no stop order suspending the
effectiveness of the Registration Statement or any amendment or supplement
thereto shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission.
8. TERMINATION
A. This Agreement shall terminate upon mutual consent of the parties
hereto. In addition, the Company may terminate this Agreement if
it is not in material breach of its obligations under this
Agreement and there has been a material breach of any
representation, warranty, covenant or agreement contained in this
Agreement on the part of the Purchaser. Purchaser may terminate
this Agreement if it is not in material breach of its obligations
under this Agreement and there has been a material breach of any
representation, warranty, covenant or agreement contained in this
Agreement on the part of the Company. Either of the parties may
terminate this Agreement (i) if the transactions contemplated
hereby are not consummated by August 31, 2001, unless such
nonconsummation is a result of a breach of this Agreement by the
party seeking to terminate; or (ii) in the event the Company is
unable to obtain required federal or state approvals for the
transactions contemplated hereby on conditions reasonably
satisfactory to it despite its reasonable efforts to obtain such
approvals.
B. The Company and the Purchaser hereby agree that any termination
of this Agreement pursuant to Section 8A (other than, in either
case, termination in the event of a breach of this Agreement by
the Purchaser or Company or misrepresentation of any of the
statements made herein by the Purchaser or the Company) shall be
without liability to the Company or the Purchaser.
9. FUTURE ACQUISITION AND DISPOSITION OF SHARES
The Purchaser agrees with the Company that during the period beginning on
the date of this Agreement and continuing until the Closing Date, it will not
offer, sell, contract to sell or otherwise dispose of, or bid for, purchase,
contract to purchase or otherwise acquire, any shares of common stock of the
Company, except pursuant to any rights it is granted as a shareholder in the
Rights Offering, without the prior written consent of the Company.
10. NOTICES
All communications hereunder will be in writing and, if to the Company,
will be mailed, delivered or telecopied and confirmed to it, at the offices of
the Company at 000 Xxxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000,
Attention: Xxxx X. Xxxxx, Chief Financial Officer, Facsimile: (000) 000-0000,
with a copy to Castle Creek Financial LLC at 6051 El Tordo, P. O. Xxx 0000,
Xxxxxx Xxxxx Xx, Xxxxxxxxxx 00000, Attention: Xxxx X. Xxx, Facsimile: (858)
756-8301; and if to the Purchaser, will be mailed, delivered or telecopied and
confirmed to it at the address on the signature page.
11. BINDING EFFECT
This Agreement shall be binding upon, and shall inure solely to the benefit
of, each of the parties hereto, and each of their respective heirs, executors,
administrators, successors and permitted assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No party may
assign any of its rights or obligations hereunder to any other person or entity
without the prior written consent of the other party.
12. GOVERNING LAW
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Indiana (excluding principles of conflicts of laws) in
effect at the time of the execution hereof.
13. EXECUTION IN COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which
counterparts when so executed shall be deemed to be an original, but all such
respective counterparts shall together constitute but one and the same
instrument.
14. ENTIRE AGREEMENT
This Agreement represents the entire understanding of the parties with
respect to the matters addressed in this Agreement and supersedes all prior
written and oral understanding concerning the subject matter of this Agreement.
[signature page follows]
SIGNATURE PAGE
The Purchaser and the Company have executed this Agreement as of the day
and year first above written.
PURCHASER INFORMATION
(must be completed)
1. Name of Purchaser
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2. Purchaser's Address:
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Facsimile number
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3. Number of shares of Class A common stock beneficially owned by Purchaser as
of the date of this Agreement (See section 6B(i))
Shares
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4. Maximum Standby Purchase Commitment
(See section 2B) Shares
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5. If purchaser is an entity, specify type of entity and state of formation
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[entity type]
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[state of formation]
"Purchaser" "Company"
[ ] UNION ACCEPTANCE CORPORATION
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By: By:
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Name: Name:
Title: Title:
Date: , 2001 Date: , 2001
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