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Exhibit 1.1
MERCURY GENERAL CORPORATION
Debt Securities
Underwriting Agreement
August 2, 2001
To the Representatives named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Ladies and Gentlemen:
MERCURY GENERAL CORPORATION, a California corporation (the "Company"),
proposes to issue and sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"), the principal amount of its debt securities identified in
Schedule I hereto (the "Securities"), to be issued under an Indenture, dated as
of June 1, 2001 (as amended or supplemented from time to time, the "Indenture"),
between the Company and Bank One Trust Company, National Association, as trustee
thereunder (the "Trustee"). If the firm or firms listed in Schedule II hereto
include only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representatives", as used herein, shall each be deemed to
refer to such firm or firms.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-62228) under the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), relating to certain
debt securities (the "Shelf Securities") and the offering thereof from time to
time in accordance with Rule 415 of Regulation C under the Securities Act by the
Company. Such registration statement and each post-effective amendment thereto,
if applicable, has been declared effective by the Commission. Such registration
statement, as so amended, if applicable, to the date of this Agreement
(including the exhibits and schedules thereto), is hereinafter referred to as
the "Registration Statement"; provided, that in the event any post-effective
amendment to such registration statement or any Rule 462(b) registration
statement becomes effective prior to the Closing Date, the term "Registration
Statement" shall also mean such registration statement as so amended or such
Rule 462(b) registration statement, as the case may be. The prospectus covering
the Shelf Securities (the "Base Prospectus"), as supplemented by the prospectus
supplement specifically relating to the Securities, in the forms first used to
confirm sales of the Securities, are collectively hereinafter referred to as the
"Prospectus". Any reference in this Agreement to the Registration Statement, the
Base Prospectus, any preliminary form of prospectus (a "Preliminary Prospectus")
previously filed with the Commission pursuant to Rule 424 of Regulation C under
the Securities Act or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act, which were filed under the Securities Exchange Act of
1934, as
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amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act"), on or before the date of this Agreement or
the date of the Base Prospectus, any Preliminary Prospectus or the Prospectus,
as the case may be; and any reference to "amend", "amendment" or "supplement"
with respect to the Registration Statement, the Base Prospectus, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents filed under the Exchange Act after the date of this Agreement or the
date of the Base Prospectus, any Preliminary Prospectus or the Prospectus, as
the case may be, which are deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Securities to the several
Underwriters as hereinafter provided, and each Underwriter, on the basis of the
representations, warranties and agreements of the Company herein contained, but
subject to the conditions hereinafter stated, agrees to purchase, severally and
not jointly, from the Company the respective principal amount of Securities set
forth opposite such Underwriter's name in Schedule II hereto at the purchase
price set forth in Schedule I hereto plus accrued interest, if any, from the
date specified in Schedule I hereto to the date of payment and delivery.
2. The Company understands that the several Underwriters intend (i) to
make a public offering of their respective portions of the Securities in
conformity with the Securities Act, any applicable blue sky laws and all other
rules and regulations applicable to them in connection therewith and (ii)
initially to offer the Securities upon the terms set forth in the Prospectus.
3. Payment for the Securities shall be made to the Company or to its
order by wire transfer of same-day funds to an account designated by the Company
or, if specifically requested by the Company, by certified or official bank
check or checks payable to the Company in federal or other same-day funds on the
date and at the time and place set forth in Schedule I hereto (or at such other
time and place on the same or such other date, not later than the tenth Business
Day (as hereinafter defined) thereafter, as you and the Company may agree in
writing). Such payment will be made upon delivery to, or to you for the
respective accounts of, such Underwriters of the Securities through the
facilities of The Depository Trust Company or, if specifically requested by the
Representatives, in certificated form registered in such names and in such
denominations as you shall request not less than one full Business Day prior to
the date of delivery with any transfer taxes payable in connection with transfer
to the Underwriters duly paid by the Company. As used herein, the term "Business
Day" means any day other than a day on which banks are authorized or required to
be closed in the City of New York, New York. The time and date of such payment
and delivery with respect to the Securities are collectively hereinafter
referred to as the "Closing Date". The certificates for the Securities will be
made available for inspection and packaging by you by 1:00 P.M. local time on
the Business Day prior to the Closing Date at such place in the City of New
York, New York as you and the Company shall agree.
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4. The Company represents and warrants to each Underwriter as of the
date hereof and as of the Closing Date (each, a "Representation Date") that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act. The Registration Statement has been declared effective by the
Commission under the Securities Act; no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceeding for that purpose
has been instituted or, to the knowledge of the Company, threatened by the
Commission; the Registration Statement and Prospectus (as amended or
supplemented if the Company shall have filed with the Commission any amendments
or supplements thereto) comply, or will comply, as the case may be, when they
become effective or are filed with the Commission, as the case may be, in all
material respects with the Securities Act and the Trust Indenture Act of 1939,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Trust Indenture Act"); as of the applicable effective date
and each Representation Date, the Registration Statement and any amendment
thereto did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; and as of the applicable filing date and
each Representation Date, the Prospectus and any amendment or supplement thereto
did not and will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided,
however, that the foregoing representations and warranties shall not apply to
(i) that part of the Registration Statement which constitutes the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of the Trustee and (ii)
statements or omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information relating to any Underwriter
furnished to the Company in writing by such Underwriter through the
Representatives expressly for inclusion therein.
(b) The documents incorporated by reference in the Prospectus, when they
were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act, and none of such documents, when they were so
filed, included an untrue statement of a material fact or omitted 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; and any further
documents so filed and incorporated by reference in the Prospectus, when such
documents are filed with the Commission, will conform in all material respects
to the requirements of the Exchange Act, as applicable, and will not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(c) This Agreement has been duly authorized, executed and delivered by
the Company.
(d) The Indenture has been duly qualified under the Trust Indenture Act,
has been duly authorized, executed and delivered by the Company and, assuming
due authorization, execution
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and delivery by the Trustee, constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms (subject
to applicable bankruptcy, insolvency and other laws affecting the enforceability
of creditors' rights generally and to general principles of equity regardless of
whether enforcement is considered in a proceeding in equity or at law); the
Securities have been duly authorized by the Company and, when executed and
authenticated in accordance with the terms of the Indenture and delivered to and
paid for by the Underwriters in accordance with the terms of this Agreement,
will have been duly executed and delivered by the Company and will constitute
valid and binding obligations of the Company, enforceable against the Company in
accordance with their terms and the terms of the Indenture (subject to
applicable bankruptcy, insolvency and other laws affecting the enforceability of
creditors' rights generally and to general principles of equity regardless of
whether enforcement is considered in a proceeding in equity or at law), and
holders of the Securities will be entitled to the benefits provided for in the
Indenture; and the Securities and the Indenture conform in all material respects
to the descriptions thereof in the Prospectus.
(e) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of California, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing (or the
local equivalent) under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction.
(f) Other than Mercury Casualty Company and Mercury Insurance Company
(each a "Subsidiary" and collectively, the "Subsidiaries"), the Company has no
subsidiaries that would, individually or in the aggregate, constitute a
"significant subsidiary" (as such term is defined in Rule 1-02 of Regulation
S-X) as of the last day of the Company's most recent fiscal quarter; each of the
Subsidiaries has been duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its incorporation, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing (or the
local equivalent) under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to require such
qualification, or is subject to no material liability or disability by reason of
the failure to be so qualified in any such jurisdiction.
(g) The authorized, issued and outstanding shares of capital stock of
the Company are as set forth in the column entitled "Actual" under the
"Capitalization" section of the Prospectus, such shares of capital stock have
been duly authorized and validly issued by the Company and are fully paid and
non-assessable, and none of such shares of capital stock were issued in
violations of preemptive or other similar rights of any security holder of the
Company; all of the outstanding shares of capital stock of each Subsidiary have
been duly authorized and validly issued and are fully paid and non-assessable,
except as otherwise set forth in the Prospectus, all outstanding shares of
capital stock of the Subsidiaries are owned by the Company, either directly or
through
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wholly owned subsidiaries, free and clear of any perfected security interest or
any other security interests, liens or encumbrances.
(h) The financial statements and schedules of the Company and its
consolidated subsidiaries included or incorporated by reference in the
Prospectus and the Registration Statement fairly present in all material
respects the consolidated financial condition, results of operations and cash
flows of the Company and its consolidated subsidiaries as of the dates and for
the periods indicated, and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein).
(i) KPMG LLP, who have certified certain financial statements included
or incorporated by reference in the Prospectus, are independent public
accountants as required by the Securities Act.
(j) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated therein,
there (A) has been no material adverse change, or any development involving a
prospective material adverse exchange, in or affecting the business, financial
position or results of operations of the Company and its subsidiaries taken as a
whole, whether or not arising in the ordinary course of business (a "Material
Adverse Change") and (B) have been no transactions entered into by the Company
or any of its subsidiaries, other than those arising in the ordinary course of
business, which are material with respect to the Company and its subsidiaries
considered as one enterprise.
(k) The execution, delivery and performance of this Agreement, the
Indenture and any other agreement or instrument entered into or issued by the
Company in connection with the transactions contemplated hereby or thereby or in
the Registration Statement and the Prospectus, the consummation of the
transactions contemplated herein and in the Registration Statement and the
Prospectus and compliance by the Company with its obligations hereunder and
thereunder do not and will not conflict with or result in a breach of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets, properties or operations of the Company
or any of its subsidiaries pursuant to, any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or other agreement or instrument
to which the Company or any of its subsidiaries is a party or by which it or any
of them may be bound or to which any of the assets, properties or operations of
the Company or any of its subsidiaries is subject (collectively, the "Agreements
and Instruments"), the result of which would cause a Material Adverse Change,
nor will any of the above actions result in any violation of the provisions of
the charter or bylaws of the Company or any of its subsidiaries or any
applicable law or statute or any order, rule, regulation or judgment of any
court or governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their assets, properties or operations.
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(l) There is no action, suit, proceeding, inquiry or investigation
before, or brought by, any court or governmental agency or body now pending or,
to the knowledge of the Company, threatened against or affecting the Company or
any of its subsidiaries which is required to be disclosed in the Registration
Statement and the Prospectus (other than as stated therein), or which might
reasonably be expected to result in a Material Adverse Change, or have a
material adverse effect on the consummation of the transactions contemplated by
the Prospectus, this Agreement or the Indenture or the performance by the
Company of its obligations hereunder and thereunder; and the aggregate of all
pending legal or governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their respective assets, properties
or operations is the subject which are not described in the Registration
Statement and the Prospectus, including ordinary routine litigation incidental
to the business, is not reasonably expected to result in a Material Adverse
Change.
(m) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the due authorization, execution and delivery by the Company of this
Agreement or for the performance by the Company of the transactions contemplated
by the Prospectus, this Agreement or the Indenture, except such as have already
been made, obtained or rendered, as applicable.
(n) Each insurance company subsidiary of the Company (collectively, the
"Insurance Subsidiaries") is duly licensed as an insurance company in its
jurisdiction of organization and is duly licensed or authorized as an insurer in
each jurisdiction outside its jurisdiction of organization where it is required
to be so licensed or authorized to conduct its business as described in the
Registration Statement and the Prospectuses, except where the failure to be so
licensed or authorized would not result in a Material Adverse Change.
(o) Each of the Company and each Insurance Subsidiary is in compliance
with the requirements of the insurance laws of the jurisdiction of its
incorporation or domicile and any applicable regulations thereunder and has
filed all reports, registrations, documents or other information required to be
filed thereunder, except where the failure to comply or file would not result in
a Material Adverse Change; and each of the Insurance Subsidiaries is in
compliance with the insurance laws and regulations of each other jurisdiction
that is applicable to such Insurance Subsidiary, except where the failure to
comply would not result in a Material Adverse Change.
(p) The statutory annual and quarterly statements of the Insurance
Subsidiaries required to be filed, including the statutory balance sheets and
income statements included in such statutory annual and quarterly statements,
most recently filed in each jurisdiction, have been prepared in all material
respects in conformity with required or permitted statutory accounting
principles or practices consistently followed, except as may otherwise be
indicated in the notes thereto, and fairly present in all material respects the
financial position of the Insurance Subsidiaries (on a statutory basis) for the
periods covered thereby.
(q) All ceded reinsurance treaties, contracts, agreements and
arrangements to which
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the Company or any of its Insurance Subsidiaries is a party are in full force
and effect and neither the Company nor any of its Insurance Subsidiaries is in
violation of, or in default in the performance, observance or fulfillment of,
any obligation, agreement, covenant or condition contained therein, except for
such violations or defaults which could not reasonably be expected, singly or in
the aggregate, to have a Material Adverse Effect; neither the Company nor any of
its Insurance Subsidiaries has received any notice from any of the other parties
to such treaties, contracts, agreements or arrangements indicating that such
other party intends not to perform in any material respect its obligations
thereunder and none of the Company nor any of its Insurance Subsidiaries has any
reason to believe that any of the other parties to such treaties, contracts,
agreements or arrangements will be unable to perform its obligations thereunder,
except to the extent that (i) the Company or such Insurance Subsidiary has
established appropriate reserves on its financial statements therefor or (ii)
such nonperformance could not reasonably be expected, singly or in the
aggregate, to result in a Material Adverse Change.
(r) The Company is not and, after giving effect to the offering and sale
of the 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, as amended (the "Investment Company Act").
Any certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the Underwriters in connection with the
offering of the Securities shall be deemed a representation and warranty by the
Company as to matters covered thereby to each Underwriter.
5. The Company covenants and agrees with each Underwriter as follows:
(a) To file the Prospectus in a form approved by you (such approval not
to be unreasonably withheld or delayed) pursuant to Rule 424 of Regulation C
under the Securities Act not later than the Commission's close of business on
the second Business Day following the date of determination of the offering
price of the Securities .
(b) To deliver to each Representative and counsel for the Underwriters,
at the expense of the Company, a conformed copy of the Registration Statement
(as originally filed) and each amendment thereto prior to the Closing Date, in
each case including exhibits and documents incorporated by reference therein
and, during the period mentioned in paragraph (e) below, to each of the
Underwriters as many copies of the Prospectus (including all amendments and
supplements thereto) and documents incorporated by reference therein as you may
reasonably request.
(c) For so long as the delivery of a Prospectus is required in
connection with the offering or sale of the Securities, to furnish to you a copy
of any proposed amendment or supplement to the Registration Statement or the
Prospectus, for your review, and not to file any such proposed amendment or
supplement to which you reasonably and timely object in writing; provided,
however, that the provisions of this paragraph (c) shall not apply to any of the
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Company's periodic filings under the Exchange Act described in paragraph (d),
copies of which filings the Company has delivered to you in advance of their
transmission to the Commission for filing.
(d) To file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a Prospectus is required in connection with the offering or sale of
the Securities, and during such same period, to advise you promptly, and to
confirm such advice in writing, (i) when the Prospectus, and any supplement
thereto, shall have been filed (if required) with the Commission pursuant to
Rule 424 of Regulation C under the Securities Act or when any Rule 462(b)
Registration Statement related to the Securities shall have been filed with the
Commission, (ii) when any amendment to the Registration Statement shall have
become effective during any time period when the Prospectus is required to be
delivered under the Securities Agreement, (iii) of any request, during any time
period when the Prospectus is required to be delivered under the Securities Act,
by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for any additional information,
insofar as such amendment or supplement relates to or covers the Company
generally or the Securities specifically, (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
the initiation or threatening of any proceeding for that purpose at any time
prior to the Closing Date and (v) of the receipt by the Company of any
notification with respect to any suspension of the qualification of the
Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and to use its best efforts to
prevent the issuance of any such stop order or notification and, if issued, to
obtain as soon as possible the withdrawal thereof.
(e) If, at any time when the Prospectus is required to be delivered
under the Securities Act, any event shall occur or condition shall exist as a
result of which it is necessary to amend or supplement the Prospectus in order
to make the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading or, if it is necessary to
amend or supplement the Prospectus to comply with law, to promptly prepare and
furnish, subject to subsection (c) above, at the expense of the Company (unless
such event shall occur more than nine months after the date of the Prospectus,
in which case the cost of preparing and furnishing such amendments or
supplements shall be borne by the Underwriter or Underwriters requesting the
same), to the Underwriters and to the dealers (whose names and addresses you
will furnish to the Company) to which Securities may have been sold by you on
behalf of the Underwriters and to any other dealers upon request, such
amendments or supplements to the Prospectus as may be necessary so that the
statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus will comply with law.
(f) To make generally available to its security holders and to you as
soon as practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Section 158(c) under
the Securities Act), an earnings
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statement of the Company and its subsidiaries, which shall satisfy the
provisions of Section 11(a) of the Securities Act.
(g) From and including the date hereof to and including the Business Day
following the Closing Date, not to offer, sell, contract to sell or otherwise
dispose of any debt securities of or guaranteed by, the Company, which are
substantially similar to the Securities, without your prior written consent.
(h) The Company will use its reasonable efforts to arrange, if
necessary, for the qualification of the Securities for sale under the laws of
such jurisdictions as the Representatives may designate and to maintain such
qualifications in effect so long as required for the distribution of the
Securities and will pay any fee of the National Association of Securities
Dealers, Inc. in connection with its review of the offering; provided, that in
no event shall the Company be obligated to qualify to do business in any
jurisdiction in which it is not now so qualified or to take any action that
would subject it to service of process in suits, other than those arising out of
the offering or sale of the Securities, in any jurisdiction in which it is not
now so subject.
(i) To pay, except as otherwise provided in paragraph (e) above, all
costs and expenses incident to the performance of its obligations hereunder,
including, without limiting the generality of the foregoing, all costs and
expenses (i) incident to the preparation, issuance, execution, authentication
and delivery of the Securities, including any expenses of the Trustee, (ii)
incident to the preparation and filing under the Securities Act of the
Registration Statement, the Prospectus and any Preliminary Prospectus
(including, in each case, all exhibits, amendments and supplements thereto),
(iii) incident to the printing and delivery of reasonable quantities of the
Registration Statement, the Prospectus and any Preliminary Prospectus
(including, in each case, all exhibits, amendments and supplements thereto),
(iv) incurred in connection with the registration or qualification and
determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Underwriters may designate (including the fees and
disbursements of counsel for the Underwriters in an amount not to exceed
$7,500), (v) in connection with any listing of the Securities on any stock
exchange or quotation system, (vi) related to any required filing with the
National Association of Securities Dealers, Inc., (vii) in connection with the
printing (including word processing and duplication costs) and delivery of this
Agreement, the Indenture, the Preliminary and Final Blue Sky Memoranda and any
Legal Investment Survey and (viii) payable to rating agencies in connection with
the rating of the Securities; provided, however, that, except as provided in
this Section 5(i) and in Sections 7 and 10 hereof, the Underwriters shall pay
their own costs and expenses, including the fees and expenses of their counsel,
any transfer taxes on the Securities which they may sell and the expenses of
advertising any offering of the Securities made by the Underwriters.
(j) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected to
cause or result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities.
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6. The several obligations of the Underwriters hereunder shall be
subject to the following conditions:
(a) The representations and warranties of the Company contained herein
are true and correct on and as of the Closing Date, as if made on and as of the
Closing Date, and the Company shall have complied with all agreements and all
conditions on its part to be performed or satisfied hereunder at or prior to the
Closing Date.
(b) The Prospectus shall have been filed with the Commission pursuant to
Rule 424 of Regulation C under the Securities Act within the applicable time
period prescribed for such filing by the rules and regulations under the
Securities Act; no stop order suspending the effectiveness of the Registration
Statement shall be in effect and no proceedings for such purpose shall be
pending before or, to the knowledge of the Company, threatened by the
Commission; and all reasonable requests for additional information on the part
of the Commission shall have been complied with to your satisfaction.
(c) From and including the date of this Agreement to and including the
Closing Date, there shall not have occurred any downgrading, nor shall any
notice have been given of (i) any intended or potential downgrading or (ii) any
probable change that does not indicate an improvement in the rating accorded any
securities of, or guaranteed by, the Company by Xxxxx'x Investors Service, Inc.
or Standard & Poor's Ratings Services.
(d) Since the respective dates as of which information is given in the
Prospectus, there shall not have been any Material Adverse Change, otherwise
than as set forth or contemplated in the Prospectus, the effect of which, in the
judgment of the Representatives, makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities on the terms
and in the manner contemplated in the Prospectus.
(e) The Representatives shall have received, on and as of the Closing
Date, a certificate of the Chief Financial Officer of the Company to the effect
set forth in subsections (a) through (c) of this Section and to the further
effect that there has not occurred any Material Adverse Change, otherwise than
as set forth or contemplated in the Prospectus.
(f) Xxxxxx & Xxxxxxx, counsel for the Company, shall have furnished to
you their written opinion, dated as of the Closing Date, in form and substance
satisfactory to you, to the effect that:
(i) The Company is a corporation and is validly existing and in
good standing under the laws of the State of California, with corporate
power and authority to own its properties and to conduct is business as
described in the Prospectus.
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(ii) Each of Mercury Casualty Company and Mercury Insurance
Company is a corporation and is validly existing and good standing under
the laws of the State of California, with corporate power and authority
to own its properties and to conduct its business as described in the
Prospectus.
(iii) The Underwriting Agreement has been duly authorized,
executed, and delivered by the Company.
(iv) The Indenture has been duly authorized, executed and
delivered by the Company, and is a legally valid and binding agreement
of the Company, enforceable against the Company in accordance with its
terms, subject to customary exceptions.
(v) The execution and delivery of the Securities have been duly
authorized by the Company, and the Securities have been duly executed,
and when the Securities are authenticated in accordance with the terms
of the Indenture and delivered to and paid for by the Underwriters in
accordance with the terms of this Agreement, the Securities will be
issued and legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject
to customary exceptions.
(vi) The issue and sale of the Securities pursuant to the
Indenture and this Agreement on the date hereof and compliance by the
Company with the provisions of the Indenture and this Agreement will
not:
(a) result in a breach of or a default under, any agreements or
instruments to which the Company or any of its subsidiaries is a
party or by which the Company or any such subsidiary is bound or
to which any of the assets, properties or operations of the
Company or any such subsidiary is subject and which are
identified to such counsel in an officers certificate as
material;
(b) violate any federal, New York or California statute, rule or
regulation; or
(c) require any consents, approvals, authorizations,
registrations, declarations or filings by the Company under any
federal, New York or California statute, rule or regulation
applicable to the Company, except such as have been obtained
under the Act and the Trust Indenture Act and such as may be
required under state securities laws in connection with the
purchase and distribution of the Securities by the Underwriters.
(vii) The Indenture has been qualified under the Trust Indenture
Act.
(viii) The Registration Statement has become effective under the
Act, and to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued under the Act and no Proceedings therefor have
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been initiated. Any required filing of the Prospectus and the Prospectus
Supplement pursuant to Rule 424 under the Act has been made in
accordance with Rule 424 under the Act.
(ix) The Registration Statement and the Prospectus, as of their
respective effective or issue dates, complied as to form in all material
respects with the requirements for registration statements on Form S-3
under the Act and the rules and regulations of the Commission
thereunder, it being understood that such counsel need express no
opinion with respect to the financial statements, schedules, other
financial data, exhibits included in, incorporated by reference in, or
omitted from the Registration Statement or the Prospectus or the
Trustee's Statement of Eligibility on Form T-1. In passing upon the
compliance as to form of the Registration Statement and Prospectus, such
counsel may assume that the statements made therein are correct and
complete.
(x) The documents incorporated by reference in the Registration
Statement (the "Incorporated Documents"), as of their respective filing
dates, complied as to form in all material respects with the applicable
respective requirements for reports on Forms 00-X, 00-X, 0-X and proxy
statements under the Exchange Act and the rules and regulations of the
Commission thereunder, it being understood that such counsel need
express no opinion with respect to the financial statements, schedules,
other financial data, or exhibits included in, incorporated by reference
in, or omitted from such Incorporated Documents. In passing upon the
compliance as to form of the Incorporated Documents, such counsel may
assume that the statements therein are correct and complete.
(xi) The Securities and the Indenture conform in all material
respects to the description thereof under the captions "Description of
Debt Securities" and "Description of Securities" in the Prospectus.
(xii) The statements incorporated by reference from Item 3 of
Part 1 of the Company's most recent Form 10-K and in the Registration
Statement in Item 15, insofar as such statements constitute a summary of
legal matters, documents, statutes and regulations are accurate
summaries in all material respects.
(xiii) The Company is not, and after giving effect to the sale of
the 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, as amended.
(xiv) Such counsel shall state that on the basis of their
participation in the preparation of the Registration Statement, the
Prospectus, and the Incorporated Documents, but not passing upon the
accuracy, completeness, or fairness of the statements contained therein
(other than as provided in paragraphs (xi) and (xii) above), nothing
came to their attention which caused them to believe that the
Registration Statement, at the time it became effective or as of the
date of such opinion, or the
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Incorporated Documents, as of the dates of their respective filing,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus, as to its
date, the date hereof, or the date of such opinion contained or contains
an untrue statement of a material fact or omitted or omits to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (it being
understood that such counsel need express no belief with respect to
financial statements, schedules, other financial data or exhibits
included, incorporated by reference in, or omitted from, the
Registration Statement, Prospectus, or Incorporated Documents).
In rendering such opinions, such counsel may: rely as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and certificates or other written statements of
officials of jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company. With respect to the matters to be
covered in subparagraphs (ix) and (x) above, counsel may state his opinion and
belief is based upon his participation in the preparation of the Registration
Statement and the Prospectus and any amendment or supplement thereto but is
without independent check or verification except as specified.
(g) Xxxxxxx Xxxxxxx, General Counsel for the Company, shall have
furnished to you his written opinion, dated as of the Closing Date, in form and
substance satisfactory to you, to the effect that:
(i) The Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing (or the local
equivalent) under the laws of each other jurisdiction in which it owns
or leases properties or conducts any business so as to require such
qualification, or is subject to no material liability or disability by
reason of the failure to be so qualified in any such jurisdiction.
(ii) Each of Mercury Casualty Company and Mercury Insurance
Company is in good standing (or the local equivalent) under the laws of
each jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no
material liability or disability by reason of the failure to be so
qualified in any such jurisdiction.
(iii) All of the outstanding shares of capital stock of each of
Mercury Casualty Company and Mercury Insurance Company have been duly
authorized and validly issued and are fully paid and non-assessable and,
except as otherwise set forth in the Prospectus, all outstanding shares
of capital stock of such subsidiaries are owned by the Company, either
directly or through wholly owned subsidiaries, free and clear of any
perfected security interest and, to the knowledge of such counsel, after
due inquiry, any other security interest, lien or encumbrance.
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(iv) To the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property, required to
be disclosed in the Registration Statement or Prospectus which is not,
and there is no document required to be described in the Registration
Statement or Prospectus, or to be filed as an exhibit thereto, which is
not.
(v) The issue and sale of the Securities pursuant to the
Indenture and this Agreement on the date hereof and compliance by the
Company with the provisions of the Indenture and this Agreement will not
result in a breach of or a default under the Company's articles of
incorporation, as amended, or the Company's Bylaws, as amended.
In rendering such opinion, such counsel may: rely as to matters of fact,
to the extent such counsel deems proper, on certificates of responsible officers
of the Company and certificates or other written statements of officials of
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company.
(h) On the date hereof and on the Closing Date, KPMG LLP shall have
furnished to you a letter, dated as of each such date, in form and substance
satisfactory to you, containing statements and information of the type
customarily included in accountants "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(i) You shall have received on and as of the Closing Date an opinion of
Xxxxx, Xxxxx & Xxxxx, counsel to the Underwriters, with respect to the validity
of the Indenture and the Securities, the effectiveness of the Registration
Statement, the disclosure in the Registration Statement and the Prospectus and
such other matters as the Representatives may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters.
(j) On or prior to the Closing Date, the Company shall have furnished to
the Representatives such further certificates and documents as the
Representatives shall reasonably request.
7. (a) The Company agrees to indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each Underwriter
and each person, if any, who controls any Underwriter within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act from
and against any and all losses, claims, damages and liabilities (including,
without limitation, the reasonable legal fees and other expenses reasonably
incurred in connection with any suit, action or proceeding or any claim asserted
in respect thereof) as incurred to which such Underwriter or controlling person
may be subject, insofar as such losses, claims, damages or liabilities arise out
of or are based upon:
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(i) any untrue statement or alleged untrue statement of a material
fact contained or included in the Registration Statement or any
amendment thereof, the Prospectus the Prospectus as amended or
supplemented or any amendment or supplement thereto, or any
Preliminary Prospectus; or
(ii) the omission or alleged omission to state therein a material
fact required to be stated therein or, in the case of the
Registration Statement or any amendment thereof, the Prospectus
or the Prospectus as amended or supplemented or any amendment or
supplement thereto, necessary to make the statements therein not
misleading or, in the case of any Preliminary Prospectus,
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided, however, the Company shall not be liable insofar as such losses,
claims, damages or liabilities arise out of or are based upon an untrue
statement or omission or alleged untrue statement or omission made in any
Preliminary Prospectus or in the Registration Statement or any amendment
thereof, the Prospectus, the Prospectus as amended or supplemented or any such
amendment or supplement thereto in reliance upon and in conformity with
information furnished to the Company in writing by such Underwriter through the
Representatives expressly for inclusion therein; and provided, further, that the
Company shall not be liable to any Underwriter or any person controlling such
Underwriter under the indemnity agreement provided for in this paragraph (a)
with respect to a Preliminary Prospectus to the extent that any such loss,
claim, damage or liability of such Underwriter or controlling person results
solely from the fact that such Underwriter sold Securities to a person to whom
there was not sent or given, at or prior to the written confirmation of such
sale, a copy of the Prospectus (excluding documents incorporated by reference)
or of the Prospectus as then amended or supplemented (excluding documents
incorporated by reference), whichever is most recent, if (A) the Company has
previously furnished copies thereof to such Underwriter and (B) the applicable
untrue or alleged untrue statement or omission was corrected therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers, employees and agents and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages and liabilities (including, without limitation, the
reasonable legal fees and other expenses reasonably incurred in connection with
any suit, action or proceeding or any claim asserted in respect thereof) as
incurred to which the Company may become subject, insofar as such losses,
claims, damages or liabilities arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of a material
fact contained or included in the Registration Statement or any
amendment thereof, the Xxxxxxxxxx,
00
00
the Prospectus as amended or supplemented or any amendment or
supplement thereto, or any Preliminary Prospectus; or
(ii) the omission or alleged omission to state therein a material
fact required to be stated therein or, in the case of the
Registration Statement or any amendment thereof, the Prospectus
or the Prospectus as amended or supplemented or any amendment or
supplement thereto, necessary to make the statements therein not
misleading or, in the case of any Preliminary Prospectus,
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
in each case to the extent, but only to the extent, that such untrue statement
or omission or alleged untrue statement or alleged omission was made in any
Preliminary Prospectus or in the Registration Statement or any amendment
thereof, the Prospectus or the Prospectus as amended or supplemented or any
amendment or supplement thereto in reliance upon and in conformity with
information furnished to the Company in writing by or on behalf of such
Underwriter expressly for use therein.
(c) If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought (the "Indemnified
Person") pursuant to either of subsections (a) or (b) above, such Indemnified
Person shall promptly notify the person against whom such indemnity may be
sought (the "Indemnifying Person") in writing (in such detail as may be
available to such Indemnified Person). In no case shall an Indemnifying Person
be liable under this Section 7 with respect to any claim made against an
Indemnified Person unless such Indemnifying Person shall be notified in writing
of the nature of the claim within a reasonable time after the Indemnified Party
is aware of such claim, but failure to so notify such Indemnifying Person shall
relieve the Indemnifying Party only to the extent the Indemnifying Party is
actually prejudiced by such failure and failure shall not relieve the
Indemnifying Party from any liability which it may have otherwise than on
account of this Section 7. Upon such notice, the Indemnifying Person shall be
entitled to participate in and, to the extent that it shall wish, jointly with
any other Indemnifying Person similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such Indemnified Person, and after
notice from the Indemnifying Person to such Indemnified Person of its election
to so assume the defense thereof, the Indemnifying Person shall not be liable to
such Indemnified Person for any legal or other expenses subsequently incurred by
such Indemnified Person in connection with the defense thereof other than
reasonable costs of investigation or as provided in subsection (d) below. Each
Indemnified Person shall assist the Indemnifying Person in any defense
undertaken pursuant to this Section 7 by providing such assistance and
cooperation (including, without limitation, witness and documentary or other
information) as may be reasonably requested by the Indemnifying Person in
connection with such defense, provided that all reasonable costs and expenses of
such assistance and cooperation shall be borne by the Indemnifying Person.
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(d) Notwithstanding anything contained herein, any Indemnified Person
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the
contrary, (ii) the Indemnifying Person has failed within a reasonable time to
retain counsel reasonably satisfactory to the Indemnifying Person or (iii) the
named parties in the applicable suit, action, proceeding, claim or demand
(including any impleaded parties) include both the Indemnified Person and the
Indemnified Person and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them or
defenses available to them. It is understood that the Indemnifying Person shall
not in connection with any proceeding or related proceeding in the same
jurisdiction be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons and that all such
fees and expenses, to the extent they are reasonable, shall be reimbursed as
they are incurred. Any such separate firm for the Underwriters and such control
persons of the Underwriters shall be designated in writing by the first of the
named Representatives on Schedule I hereto and any such separate firm for the
Company, its directors, its officers who sign the Registration Statement and
such control persons of the Company or authorized representatives shall be
designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Person agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. No Indemnifying Person shall, without the prior written consent of the
Indemnified Person, effect any settlement of any pending or threatened claim,
action, suit or proceeding in respect of which any Indemnified Person is or
could have been a party and indemnity could have been sought hereunder by such
Indemnified Person, unless such settlement (i) includes an unconditional release
of the Indemnified Person from all liability arising out of such claim, action,
suit or proceeding; and (ii) does not include any statement as to, or any
admission of, fault, culpability or failure to act by or on behalf of an
indemnified party.
(e) If the indemnification provided for in subsections (a) or (b) above
is legally unavailable to an Indemnified Person in respect of any losses,
claims, damages or liabilities referred to therein, then each Indemnifying
Person under such subsection, in lieu of indemnifying such Indemnified Person
thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities (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 hand 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 hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations.
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(f) The relative benefits received by the Company on the one hand and
the Underwriters on the other hand shall be deemed to be in the same proportions
as the net proceeds from the offering of the Securities received by the Company
(net of underwriting discounts and commissions but before deducting expenses)
bear to the total underwriting discounts and the commissions received by the
Underwriters. The relative fault of the Company on the one hand and the
Underwriters on the other hand 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 by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. With respect to any Underwriter, such relative fault
shall also be determined by reference to the extent (if any) to which such
losses, claims, damages or liabilities (or actions in respect thereof) with
respect to any Preliminary Prospectus result from the fact that such Underwriter
sold Securities to a person to whom there was not sent or given, at or prior to
the written confirmation of such sale, a copy of the Prospectus (excluding
documents incorporated by reference) or of the Prospectus as then amended or
supplemented (excluding documents incorporated by reference) if the Company has
previously furnished copies thereof to such Underwriter.
(g) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in subsection (f) above. The amount paid or
payable by an Indemnified Person as a result of the losses, claims, damages and
liabilities referred to in subsection (f) above shall be deemed to include,
subject to the limitations set forth above, any reasonable legal or other
expenses incurred by such Indemnified Person in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 7, in no event shall an Underwriter 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 that 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 Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7 are several in proportion to the respective principal amounts of the
Securities set forth opposite their names in Schedule I hereto, and not joint.
(h) The indemnity and contribution agreements contained in this Section
7 are in addition to any liability which the Indemnifying Persons may otherwise
have to the Indemnified Persons referred to above.
(i) The indemnity and contribution agreements contained in this Section
7 and the representations and warranties of the Company set forth in this
Agreement shall remain operative
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and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any Underwriter or any
person controlling any Underwriter or by or on behalf of the Company, its
officers or directors or any other person controlling the Company and (iii)
acceptance of and payment for any of the Securities.
8. Notwithstanding anything contained herein, this Agreement may be
terminated in the absolute discretion of the Representatives, by notice given to
the Company if, from and including the date of this Agreement to and including
the Closing Date, (i) trading generally shall have been suspended or materially
limited on or by, as the case may be, any of the New York Stock Exchange, the
American Stock Exchange or the National Association of Securities Dealers, Inc.,
(ii) trading of any securities of, or guaranteed by, the Company shall have been
suspended on any stock exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the sole judgment of the
Representatives, is material and adverse and which, in the sole judgment of the
Representatives, makes it impracticable to market the Securities on the terms
and in the manner contemplated in the Prospectus.
9. If, on the Closing Date, any one or more of the Underwriters shall
fail or refuse to purchase Securities which it or they have agreed to purchase
under this Agreement and the aggregate principal amount of Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate principal amount of the Securities,
the other Underwriters shall be obligated, severally in the proportions that the
principal amount of Securities set forth opposite their respective names in
Schedule I hereto bears to the aggregate principal amount of Securities set
forth opposite the names of all such non-defaulting Underwriters or in such
other proportions as the Representatives may specify, to purchase the Securities
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase on such date; provided that in no event shall the principal amount
of Securities that any Underwriter has agreed to purchase pursuant to Section 1
be increased pursuant to this Section 9 by an amount in excess of one-ninth of
such principal amount of Securities without the written consent of such
Underwriter.
If, on the Closing Date, any Underwriter or Underwriters shall fail or
refuse to purchase Securities and the aggregate principal amount of Securities
with respect to which such default occurs is more than one-tenth of the
aggregate principal amount of Securities to be purchased and arrangements
satisfactory to you and the Company for the purchase of such Securities are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter or Underwriters or the
Company. In any such case, either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected.
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Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
10. If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, the
Company agrees to reimburse the Underwriters or such Underwriters as have so
terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the reasonable fees and expenses of their
counsel) reasonably incurred by such Underwriters in connection with this
Agreement and the offering of Securities.
11. This Agreement shall inure to the benefit of and be binding upon the
Company, the Underwriters, any controlling persons referred to herein and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person, firm or
corporation any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained. No purchaser of Securities
from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
12. Any action by the Underwriters hereunder may be taken by you jointly
or by the first of the named Representatives set forth in Schedule I hereto
alone on behalf of the Underwriters, and any such action taken by you jointly or
by the first of the named Representatives set forth in Schedule I hereto alone
shall be binding upon the Underwriters. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be given at the address set forth in Schedule I hereto.
Notices to the Company shall be given to it at 0000 Xxxxxxxx Xxxxxxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000 Attention: Xxxxxxx Xxxxxxx, Vice President and Chief
Financial Officer.
13. This Agreement may be signed in counterparts, each of which shall be
an original and all of which together shall constitute one and the same
instrument. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without giving effect to the conflicts of
laws provisions thereof.
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Very truly yours,
MERCURY GENERAL CORPORATION
By: /s/ XXXXXXX XXXXXXX
------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President and
Chief Financial Officer
Accepted:
BANC OF AMERICA SECURITIES LLC
XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
By: BANC OF AMERICA SECURITIES LLC
By: /s/ XXXX XXXXX
------------------------------
Name: Xxxx Xxxxx
Title: Principal
Acting severally on behalf of themselves
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SCHEDULE I
The Securities
Representatives: Banc of America Securities LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Title of Securities: 7.25% Notes due 0000
Xxxxxxxxx principal amount: $125,000,000
Maturity: August 15, 2001
Interest Rate: 7.25% per annum
Interest Payment Dates: February 15 and August 15?commencing
February 15, 2002
Optional Redemption/ Repayment
Provisions: Market make-whole at T+0.25%, as described
in the Prospectus
Sinking Fund Provisions: None
Price to Public: 99.723%
Price to Underwriters: 99.073% ($123,841,250)
Form: Book-entry only form through the facilities
of The Depository Trust Company
Other Provisions: Not applicable
Closing Date and Location: August 7, 2001
10:00 a.m., pacific time
Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
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Address for Notices to
Underwriters: c/o Banc of America Securities LLC
Bank of America Corporate Center
NC1-007-07-01
000 Xxxxx Xxxxx Xxxxxx
Xxxxx Xxxxxxxx, XX 00000
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SCHEDULE II
Principal Amount
Underwriter of Securities
----------- -----------------
Banc of America Securities LLC $106,250,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated $18,750,000
Total $125,000,000
