Exhibit 1
_____________________________________
XXXXX SPRING BANCORP, INC.
(a Maryland corporation); and
XXXXX SPRING CAPITAL TRUST
(a Delaware statutory business trust)
1,400,000
____% Cumulative Trust
Preferred Securities
UNDERWRITING AGREEMENT
Dated: __________, 1999
_____________________________________
XXXXX SPRING BANCORP, INC.
(a Maryland corporation); and
XXXXX SPRING CAPITAL TRUST
(a Delaware statutory business trust)
1,400,000
____% Cumulative Trust
Preferred Securities
(Liquidation Amount $25 Per Cumulative Preferred Security)
UNDERWRITING AGREEMENT
----------------------
______, 1999
XXXX XXXXX XXXX XXXXXX, INCORPORATED
FIRST UNION SECURITIES
XXXXXX, XXXXX XXXXX, INCORPORATED
As Representatives of the Several Underwriters
c/x Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
0000 Xxxxxxxxxxxx Xxxxxx X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxx X. Xxxxxxx, Managing Director
Ladies and Gentlemen:
Xxxxx Spring Capital Trust (the "Trust"), a statutory business trust
organized under the Delaware Business Trust Act, 12 Del. C. (S)(S) 3801 et seq.
-- ----
(the "Delaware Act"), confirms its agreement with you and Xxxx Xxxxx Xxxx
Xxxxxx, Incorporated, First Union Securities and Xxxxxx, Xxxxx Xxxxx,
Incorporated (the "Representatives"), as the representatives of each of the
corporations listed on Schedule A hereto (collectively, the "Underwriters"),
with respect to the issuance and sale by the Trust, and the purchase by the
Underwriters, acting severally and not jointly, of the respective numbers of
_____ % Cumulative Trust Preferred Securities (liquidation amount $25 per
preferred security) set forth in Schedule A hereto. The aforesaid 2,000,000
preferred securities to be purchased by the Underwriters are hereinafter called,
the "Preferred Securities." The Preferred Securities are more fully described in
the Prospectus (as defined below).
The Preferred Securities will be guaranteed by Xxxxx Spring Bancorp, Inc.
(the "Company"), to the extent set forth in the Prospectus (as defined below),
with respect to distributions and amounts payable upon liquidation or redemption
(the "Preferred Securities Guarantee") pursuant to the Preferred Securities
Guarantee Agreement (the "Preferred Securities Guarantee Agreement") to be
dated as of Closing Time (as defined below) executed and delivered by the
Company and The Bank of New York (the "Guarantee Trustee"), a New York banking
corporation, not in its individual capacity but solely as trustee for the
benefit of the holders from time to time of the Preferred Securities. The
Company and the Trust each understand that the Underwriters propose to make a
public offering of the Preferred Securities as soon as they deem advisable after
this Agreement has been executed and delivered, and the Declaration (as defined
herein), the Indenture (as defined herein), and the Preferred Securities
Guarantee Agreement have been qualified under the Trust Indenture Act of 1939,
as amended (the "1939 Act"). The entire proceeds from the sale of the Preferred
Securities will be combined with the entire proceeds from the sale by the Trust
to the Company of its common securities (the "Common Securities") guaranteed by
the Company, to the extent set forth in the Prospectus, with respect to
distributions and amounts payable upon liquidation or redemption (the "Common
Securities Guarantee" and, together with the Preferred Securities Guarantee, the
"Guarantees") pursuant to the Common Securities Guarantee Agreement (the "Common
Securities Guarantee Agreement" and, together with the Preferred Securities
Guarantee Agreement, the "Guarantee Agreements"), to be dated as of Closing
Time, executed and delivered by the Company for the benefit of the holders from
time to time of the Common Securities, and will be used by the Trust to purchase
the ____% Junior Subordinated Deferrable Interest Debentures due 2029 (the
"Junior Subordinated Debentures") issued by the Company. The Preferred
Securities and the Common Securities will be issued pursuant to the Amended and
Restated Declaration of Trust of the Trust, to be dated as of Closing Time (the
"Declaration"), among the Company, as Sponsor, The Bank of New York, as property
trustee (the "Property Trustee"), The Bank of New York (Delaware), as Delaware
trustee (the "Delaware Trustee"), and Hunter X. Xxxxxx, Xxxxx X. Xxxxxxxx, and
______________ as administrative trustees (the "Administrative Trustees" and
together with the Property Trustee and the Delaware Trustee, the "Trustees"),
and the holders from time to time of undivided beneficial interests in the
assets of the Trust. The Junior Subordinated Debentures will be issued pursuant
to an Indenture, to be dated as of Closing Time (the "Indenture"), between the
Company and The Bank of New York, as debenture trustee (the "Debenture
Trustee"). The Preferred Securities, the Preferred Securities Guarantee and the
Junior Subordinated Debentures are collectively referred to herein as the
"Securities." The Trust and the Company are collectively referred to herein as
the "Offerors." The Indenture, the Declaration and this Agreement are
collectively referred to herein as the "Operative Documents." Capitalized terms
used herein without definition have the respective meanings specified in the
Prospectus.
The Company and the Trust have filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (Nos. 333-
_____ and 333-_____-01) covering the registration of the Securities under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus. Promptly after execution and deliver of this Agreement,
the Company will either (i) prepare and file a prospectus in accordance with the
provisions of Rule 430A ("Rule 430A") and the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b) of
Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company and
the Trust have elected to rely upon Rule 434 ("Rule 434") of the 1933 Act
Regulations, prepare and file a term sheet (a "Term Sheet") in accordance with
the provisions of Rule 434 and Rule 424(b). The information included in such
prospectus or in such
2
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (a) pursuant to paragraph
(b) of Rule 430A is referred to as "Rule 430A Information" or (b) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434 Information." Each
prospectus used before such registration statement became effective, and any
prospectus that omitted, as applicable, the Rule 430A Information or the Rule
434 Information that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto and
schedules thereto, if any, at the time it became effective and including the
Rule 430A Information and the Rule 434 Information, as applicable, is herein
called the "Registration Statement." Any registration statement filed pursuant
to Rule 462(b) of the 1933 Act Regulations is herein referred to as the "Rule
462(b) Registration Statement" and after such filing the term "Registration
Statement" shall include the Rule 462(b) Registration Statement. The final
prospectus in the form first furnished to the Underwriters for use in connection
with the offering of the Preferred Securities is herein call the "Prospectus."
If Rule 434 is relied on, the term "Prospectus" shall refer to the preliminary
prospectus dated __________, 1999 together with the Term Sheet and all
references in this Agreement to the date of the Prospectus shall mean the date
of the Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the Prospectus or any Term
Sheet or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
------------------------------
(a) The Offerors jointly and severally represent and warrant to each
Underwriter as of the date hereof and as of the Closing Time referred to in
Section 2(c) hereof, and agree with each Underwriter as follows:
(i) Compliance with Registration Requirements. Each of the
-----------------------------------------
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time, the Registration Statement, the
Rule 462(b) Registration Statement, if any, and any amendments and
supplements thereto complied and will comply in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations and 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. Neither the
3
Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued and at the
Closing Time, included or will include an untrue statement of a material
fact or omitted or will 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. If Rule 434 is used, the Company will
comply with the requirements of Rule 434 and the Prospectus shall not be
"materially different," as such term is used in Rule 434, from the
prospectus included in the Registration Statement at the time it became
effective. The representations and warranties in this subsection shall not
apply (A) to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information
furnished to the Trust or the Company in writing by any Underwriter through
the Representatives expressly for use in the Registration Statement or
Prospectus and (B) that part of the Registration Statement which shall
constitute the Statements of Eligibility (Forms T-1) under the 1939 Act.
Each preliminary prospectus and the prospectus filed as part of
the Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and, if
applicable, each preliminary prospectus and the Prospectus delivered to the
Underwriters for use in connection with this offering was substantively
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation
S-T.
(ii) Independent Accountants. The accountants who certified the
-----------------------
financial statements incorporated by reference in the Prospectus are
independent public accountants within the meaning of the 1933 Act and the
1933 Act Regulations.
(iii) Financial Statements. The consolidated historical financial
--------------------
statements, together with the related schedules and notes, incorporated by
reference in the Prospectus present fairly, in all material respects, the
consolidated financial position of the Company and its consolidated
subsidiaries at the dates indicated, and the statements of income, changes
in stockholders' equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified, said financial statements have been
prepared in con formity with generally accepted accounting principles
("GAAP") in the United States applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such financial
statements; the supporting schedules, if any, included in the Prospectus
present fairly, in all material respects, the information required to be
stated therein; and the summary financial data included in the Prospectus
present fairly, in all material respects, the information shown therein and
have been compiled on a basis consistent with that of the audited financial
statements incorporated by reference in the Prospectus.
(iv) No Material Adverse Change in Business. Since the respective
--------------------------------------
dates as of which information is given in the Prospectus, except as
otherwise stated therein or contemplated thereby, there has not been (A)
any material adverse change in the financial
4
condition, or in the earnings, business affairs or business prospects of
the Trust, or of the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"), (B) any transaction entered into by the Trust,
the Company or any of its subsidiaries, other than in the ordinary course
of business, that is material to the Trust, or to the Company and its
subsidiaries, considered as one enterprise, or (C) any dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock, other than regular quarterly dividends on the
Company's common stock.
(v) Good Standing of the Company. The Company has been duly
----------------------------
organized and is validly existing as a corporation in good standing under
the laws of the State of Maryland and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its obligations
under each of the Operative Documents to which it is a party; the Company
is duly registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended.
(vi) Good Standing of the Bank. Xxxxx Spring National Bank of
-------------------------
Maryland (the "Bank") has been duly organized and is validly existing as a
commercial bank in good standing under the laws of the United States and
has full power and authority under such laws to own, lease and operate its
properties and to conduct its business as now being conducted and as
described in the Prospectus.
(vii) Good Standing of Other Subsidiaries. The only direct or
-----------------------------------
indirect subsidiaries of the Company are the Bank, Xxxxx Spring Insurance
Corporation and Xxxxx Spring Mortgage Corporation (collectively, the
"Subsidiaries"). Each of the Subsidiaries has been duly organized and is
validly existing as a corporation in good standing under the laws of its
respective jurisdiction of incorporation and each Subsidiary has the
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus or the documents
incorporated by reference therein.
(viii) Foreign Qualifications. The Company and each of the
----------------------
Subsidiaries are duly qualified as a foreign corporation to transact
business and are each in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify
or be in good standing would not result in a Material Adverse Effect (as
defined in Section 1(a)(iv) hereof).
(ix) Capital Stock Duly Authorized and Validly Issued. All of the
------------------------------------------------
issued and outstanding capital stock of the Company has been duly
authorized and validly issued and is fully paid and nonassessable and none
of the capital stock of the Company was issued in violation of the
preemptive rights or similar rights arising by operation of law, under the
Articles of Incorporation or bylaws of the Company or under any agreement
to which the
5
Company is a party. All of the issued and outstanding capital stock of each
of the Subsidiaries has been duly authorized and validly issued, is fully
paid and nonassessable and is owned by the Company, directly or through its
Subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equitable right; and none of such outstanding
shares of capital stock of the Subsidiaries was issued in violation of any
preemptive or similar rights arising by operation of law, or under the
Articles of Incorporation or bylaws of the Company or any such Subsidiary
or under any agreement to which the Company or any such Subsidiary is a
party.
(x) Capitalization. The authorized, issued and outstanding
--------------
capital stock of the Company as of September 30, 1999 is as set forth in
the Prospectus under "Capitalization," and there have not been any
subsequent issuances of capital stock of the Company except for subsequent
issuances, if any, pursuant to any dividend reinvestment plan,
reservations, agreements, conversions, stock dividends or employee or
director benefit plans.
(xi) Good Standing of the Trust. The Trust has been duly created
--------------------------
and is validly existing in good standing as a business trust under the
Delaware Act with the power and authority to own property and to conduct
its business as described in the Prospectus and to enter into and perform
its obligations under the Operative Documents, as applicable, and the
Preferred Securities; the Trust is not a party to or otherwise bound by any
material agreement other than those described in the Prospectus; and the
Trust is, and will be, under current law, classified for United States
federal income tax purposes as a grantor trust and not as an association
taxable as a corporation.
(xii) Authorization of Common Securities. The Common Securities
----------------------------------
have been duly authorized for issuance by the Trust pursuant to the
Declaration and, when certificates therefor have been issued, executed and
authenticated in accordance with the Declaration and delivered by the Trust
to the Company against payment therefor in accordance with the Common
Securities Subscription Agreement, will be validly issued and fully paid
and nonassessable undivided beneficial ownership interests in the assets of
the Trust. The issuance of the Common Securities is not subject to
preemptive or other similar rights, and, at the Closing Time, all of the
issued and outstanding Common Securities of the Trust will be directly
owned by the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equitable right.
(xiii) Authorization of Preferred Securities. At the Closing
-------------------------------------
Time, the Preferred Securities will have been duly authorized for issuance
by the Trust pursuant to the Declaration, and the Preferred Securities,
when certificates therefore have been issued, executed and authenticated in
accordance with the Declaration and delivered against payment therefor as
provided herein, will be validly issued and fully paid and nonassessable
undivided beneficial ownership interests in the assets of the Trust and
will conform to the description thereof in the Prospectus. The issuance of
the Preferred Securities will not be subject to preemptive or other similar
rights.
6
(xiv) Authorization of Agreement. This Agreement has been duly
--------------------------
authorized, executed and delivered by the Offerors.
(xv) Authorization of Declaration. The Declaration has been
----------------------------
qualified under the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and delivered by the
Company and the Trustees, and assuming due authorization, execution and
delivery of the Declaration by the Trustees, the Declaration will, at the
Closing Time, be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except to the extent that
enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws now
or hereafter in effect relating to creditors' rights generally, (b) general
principles of equity (regardless of whether enforceability is considered in
a proceeding at law or in equity) and (c) any public policy underlying
applicable federal or state laws (collectively, the "Enforceability
Exceptions").
(xvi) Authorization of Guarantees. The Preferred Securities
---------------------------
Guarantee has been qualified under the 1939 Act and each of the Guarantees
has been duly authorized by the Company; at the Closing Time, each of the
Guarantees will have been duly executed and delivered by the Company and
will constitute a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except to the extent that
enforceability may be limited by the Enforceability Exceptions; and the
Preferred Securities Guarantee will conform in all material respects to the
description thereof in the Prospectus.
(xvii) Authorization of Indenture. The Indenture has been
--------------------------
qualified under the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and delivered by the
Company and will constitute a valid, legal and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that enforceability may be limited by the
Enforceability Exceptions.
(xviii) Authorization of Debentures. The Junior Subordinated
---------------------------
Debentures have been duly authorized by the Company; at the Closing Time,
the Junior Subordinated Debentures will have been duly executed by the
Company and, when authenticated in the manner provided for in the Indenture
and delivered by the Company to the Trust against payment therefor as
described in the Prospectus, will constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with their
terms, except to the extent that enforceability may be limited by the
Enforceability Exceptions; and the Junior Subordinated Debentures will be
in the form contemplated by, and entitled to the benefits of, the Indenture
and will conform in all material respects to the descriptions thereof in
the Prospectus.
7
(xix) Authorization of Trustees. Each of the Administrative
-------------------------
Trustees of the Trust is an officer of the Company and has been duly
authorized by the Company to execute and deliver the Declaration.
(xx) Trust and Company Not Investment Company. Neither the Trust
----------------------------------------
nor the Company is, and immediately following consummation of the
transactions contemplated hereby and the application of the net proceeds as
described in the Prospectus neither the Trust nor the Company will be, an
"investment company" or a company "controlled" by an "investment company"
which is required to be registered under the Investment Company Act of
1940, as amended (the "1940 Act").
(xxi) Accuracy of Disclosure. The Operative Documents conform in
----------------------
all material respects to the descriptions thereof contained in the
Prospectus.
(xxii) Absence of Defaults and Conflicts. The Trust is not in
---------------------------------
violation of the trust certificate of the Trust filed with the State of
Delaware (the "Trust Certificate") or the Declaration, and neither the
Company nor any of its Subsidiaries is in violation of its respective
Articles of Incorporation or bylaws; none of the Trust, the Company nor any
of its Subsidiaries is in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease
or other agreement or instrument to which it is a party or by which it or
any of them may be bound, or to which any of its property or assets is
subject (collectively, "Agreements and Instruments"), except for such
defaults under Agreements and Instruments that would not result in a
Material Adverse Effect; and the execution, delivery and performance of the
Operative Documents by the Trust or the Company, as the case may be, the
issuance, sale and delivery of the Preferred Securities, the Junior
Subordinated Debentures, the Preferred Securities Guarantee and the Common
Securities Guarantee, the consummation of the transactions contemplated by
the Operative Documents and compliance by the Offerors with the terms of
the Operative Documents to which they are a party have been duly authorized
by all necessary corporate action on the part of the Company and, at the
Closing Time, will have been duly authorized by all necessary action on the
part of the Trust and do not and will not, whether with or without the
giving of notice or passage of time or both, violate, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
under, or result in the creation or imposition of any security interest,
mortgage, pledge, lien, charge, encumbrance, claim or equitable right upon
any property or assets of the Trust, the Company or any of its Subsidiaries
pursuant to any of the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the Articles of Incorporation or
bylaws of the Company or any of its Subsidiaries or the Declaration or the
Trust Certificate, or violation by the Company or any of its Subsidiaries
of any applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government authority, agency or instrumentality
or court, domestic or foreign, including, without limitation, the Office of
the Comptroller of the
8
Currency, the Board of Governors of the Federal Reserve System, and the
Federal Deposit Insurance Corporation, having jurisdiction over the Trust,
the Company, the Subsidiaries, or their respective properties
(collectively, "Governmental Entities"). As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Trust, the
Company or any of its Subsidiaries.
(xxiii) Absence of Labor Disputes. No labor dispute with the
-------------------------
employees of the Company or any of its Subsidiaries exists or, to the
knowledge of the Company, is imminent, which may reasonably be expected to
result in a Material Adverse Effect.
(xxiv) Absence of Proceedings. There is no action, suit,
----------------------
proceeding, inquiry or investigation before or brought by any Governmental
Entity now pending, or, to the knowledge of the Trust or the Company,
threatened, against or affecting the Trust or the Company or any of its
Subsidiaries, which is not disclosed in the Prospectus and which in the
reasonable judgment of the Trust or the Company might result in a Material
Adverse Effect, or which, in the reasonable judgment of the Company might
materially and adversely affect the properties or assets thereof or the
consummation of the transactions contemplated by the Operative Documents or
the performance by the Trust or the Company of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental proceedings
to which the Trust or the Company or any of its Subsidiaries is a party or
of which any of their respective properties or assets is the subject which
are not described in the Prospectus, including ordinary routine litigation
incidental to the business, are not, in the reasonable judgement of the
Company or the Trust, expected to result in a Material Adverse Effect.
(xxv) Absence of Further Requirements. No filing with, or
-------------------------------
authorization, approval, consent, license, order, registration,
qualification or decree of, any Governmental Entity, other than those that
have been made or obtained, is necessary or required for the performance by
the Trust or the Company of their obligations under the Operative
Documents, as applicable, or the consummation by the Trust and the Company
of the transactions contemplated by the Operative Documents.
(xxvi) Possession of Licenses and Permits. The Trust, the Company
----------------------------------
and its Subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses") issued by
the appropriate Governmental Entities necessary to conduct the business now
operated by them; the Trust, the Company and its Subsidiaries are in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the
aggregate, have a Material Adverse
9
Effect; all of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect would
not have a Material Adverse Effect; and neither the Trust, the Company nor
any of its Subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, in the reasonable judgment of the Company, is
likely to result in a Material Adverse Effect.
(xxvii) No Other Agreements. Other than such agreements,
-------------------
contracts and other documents as are described in the Prospectus or
otherwise filed as exhibits to the Company's annual report on Form 10-K or
quarterly reports on Form 10-Q or current reports on Form 8-K incorporated
by reference in the Prospectus, there are no agreements, contracts or
documents of a character described in Item 601 of Regulation S-K of the
Commission to which the Company or any of its Subsidiaries is a party.
(xxviii) Title to Property. Each of the Trust, the Company and
-----------------
its Subsidia xxxx has good and marketable title to all of their respective
real and personal properties, in each case free and clear of all liens,
encumbrances and defects, except as stated in the Prospectus, or such as do
not materially affect the value of such properties in the aggregate to the
Trust, or to the Company and its Subsidiaries considered as one enterprise;
and all of the leases and subleases material to the business of the Trust,
and to the Company and its Subsidiaries, considered as one enterprise, and
under which either of the Offerors or any of such Subsidiaries holds
properties described in the Prospectus, are in full force and effect and
neither the Offerors nor such Subsidiaries have any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of
the Offerors or such Subsidiaries under any of the leases or subleases
mentioned above, or affecting or questioning the rights of such entity to
the continued possession of the leased or subleased premises under any such
lease or sublease, which individually or in the aggregate might result in a
Material Adverse Effect.
(xxvix) Regulation M. The Company has not taken and will not
------------
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of
the price of the Preferred Securities.
(xxx) Intellectual Property. Each of the Trust, the Company
---------------------
and its Subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, licenses, trademarks, service marks, or trade names
(collectively, "Intellectual Property") presently employed by them in
connection with the business now operated by them or reasonably necessary
in order to conduct such business, and neither the Trust, the Company nor
any of its Subsidiaries has received any notice or is otherwise aware of
any infringement of or conflict with asserted rights of others with respect
to any Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Trust, the Company or any of its Subsidiaries therein, and
which infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate,
in the reasonable judgment of the Company, is likely to result in a
Material Adverse Effect.
10
(xxxi) Year 2000. The computer software operated by the
---------
Company and any Subsidiary which is material to the conduct of the business
of the Company and any Subsidiary is in compliance in all material respects
with all relevant Federal Financial Institutions Examination Council
guidance and requirements relating to the Year 2000 computer issues.
(b) Any certificate signed by any Trustee of the Trust or any duly
authorized officer of the Company or any of its Subsidiaries and delivered to
you or to counsel for the Underwriters shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Underwriters as
to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriter; Closing.
------------------------------------------
(a) Preferred Securities. On the basis of the representations and
--------------------
warranties herein contained and subject to the terms and conditions herein set
forth, the Trust agrees to sell to each Underwriter, severally and not jointly,
and each Underwriter, severally and not jointly, agrees to purchase from the
Trust, at the purchase price of $25 per Preferred Security, the number of
Preferred Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Preferred Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof, subject, in each case, to such adjustments among the
Underwriters as they in their sole discretion shall make to eliminate any sales
or purchases of fractional securities. As compensation to the Underwriters for
their commitments hereunder and in view of the fact that the proceeds of the
sale of the Preferred Securities will be used to purchase the Junior
Subordinated Debentures, the Company hereby agrees to pay at the Closing Time to
the Underwriters a commission of $____ per Preferred Security purchased by the
Underwriters by wire transfer of immediately available funds.
(b) Payment. Payment of the purchase price for, and delivery of
-------
certificates for the Preferred Securities shall be made at the offices of Elias,
Matz, Xxxxxxx & Xxxxxxx L.L.P. in Washington, D.C., or at such other place as
shall be agreed upon by the Underwriters and the Offerors, at 9:00 a.m.,
Washington, D.C. time, on ________, 1999 (unless postponed in accordance with
the provisions of Section 10 hereof), or such other time not later than ten (10)
business days after such date as shall be agreed upon by the Underwriters and
the Offerors (such time and date of payment and delivery being herein called the
"Closing Time").
Payment shall be made to the Trust by wire transfer of immediately
available funds, to the order of the Trust, to a bank designated by the Company,
against delivery to the Underwriters through the facilities of the Depository
Trust Company ("DTC") of certificates for the Preferred Securities to be
purchased by them.
(c) Denominations, Registration. Certificates for the Preferred
---------------------------
Securities shall be in definitive form, and in such denominations and registered
in such names as the Underwriters may request in writing at least one business
day before the Closing Time. All such certificates shall be
11
made available for examination and packaging by the Underwriters at the office
of DTC or its designated custodian not later than 10:00 a.m. on the last
business day prior to the Closing Time.
SECTION 3. Covenants of the Offerors. The Offerors jointly and severally
-------------------------
covenant with each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests.
--------------------------------------------------------------
The Company and the Trust, subject to Section 3(b) hereof, will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify the
Underwriters immediately, and confirm the notice in writing, (i) when any post-
effective amendment to the Registration Statement shall become effective, or any
supplement to the Prospectus or any amended Prospectus shall have been filed,
(ii) of the receipt of any comments from the Commission, (iii) of any request by
the Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Preferred Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes. The
Company and the Trust will promptly effect the filings necessary pursuant to
Rule 424(b) and will take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not, it will
promptly file such prospectus. The Company and the Trust will make every
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company and the Trust will give the
--------------------
Underwriters notice of their intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term Sheet
or any amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the Prospectus,
whether pursuant to the 1933 Act or otherwise, will furnish the Underwriters
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Underwriters or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or
-----------------------------------
will deliver to the Underwriters and counsel for the Underwriters, without
charge, two copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and copies of all consents and certificates of experts, and
will also deliver to the Underwriters, without charge, a conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters. The copies of the Registration
Statement and each amendment thereto furnished to the Underwriters will be
substantively identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
12
(d) Delivery of Prospectuses. The Offerors, as promptly as possible,
------------------------
will furnish to the Underwriters, without charge, such number of copies of the
preliminary prospectus, the final Prospectus and any amendments and supplements
thereto and documents incorporated by reference therein as the Underwriter may
reasonably request, and the Company and the Trust hereby consent to the use of
such copies for purposes permitted by the 1933 Act. The Company will furnish to
each Underwriter, without charge, during the period when the Prospectus is
required to be delivered under the 1933 Act or the Securities Exchange Act of
1934 (the "1934 Act"), such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters will be
substantively identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company and the
-----------------------------------------
Trust will comply with the 1933 Act and the 1933 Act Regulations so as to permit
the completion of the distribution of the Securities as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required by
the 1933 Act to be delivered in connection with sales of the Preferred
Securities, any event shall occur or condition shall exist as a result of which
it is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company and the Trust will
promptly prepare and file with the Commission, subject to Section 3(b) hereof,
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may reasonably
request.
(f) Blue Sky Qualifications. The Company and the Trust will each use
-----------------------
its best efforts, in cooperation with the Underwriters, to qualify the Preferred
Securities for offering and sale under the applicable securities laws of such
states and other jurisdictions as the Underwriters may reasonably designate and
to maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement, provided, however, that neither the Company nor
-------- -------
the Trust shall be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Preferred Securities have been so
qualified, the Company and the Trust will file such statements and reports as
may be required by the laws of such jurisdiction to continue such qualification
in effect for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration Statement.
13
(g) Rule 158. The Company will timely file such reports pursuant to
--------
the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Notice and Effect of Material Events. The Offerors will
------------------------------------
immediately notify the Underwriters, and confirm such notice in writing, of (x)
any filing made by the Offerors of information relating to the offering of the
Preferred Securities with any securities exchange or any other regulatory body
in the United States, and (y) prior to the completion of the distribution of the
Preferred Securities by the Underwriters as evidenced by a notice in writing
from the Underwriters to the Offerors, any Material Adverse Effect, which (i)
makes any statement in the Prospectus false or misleading or (ii) is not
disclosed in the Prospectus. In such event or if during such time any event
shall occur as a result of which it is necessary, in the reasonable opinion of
the Company, its counsel or the Underwriters or counsel to the Underwriters, to
amend or supplement the final Prospectus in order that the final Prospectus not
include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light of
the circumstances then existing, the Company will forthwith amend or supplement
the final Prospectus by preparing and furnishing to the Underwriters an
amendment or amendments of, or a supplement or supplements to, the final
Prospectus (in form and substance satisfactory in the reasonable opinion of
counsel for the Underwriters) so that, as so amended or supplemented, the final
Prospectus 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 existing at the time it is delivered to a subsequent
purchaser, not misleading.
(i) DTC. The Offerors will cooperate with the Underwriters and use
---
their best efforts to permit the Preferred Securities to be eligible for
clearance and settlement through the facilities of DTC.
(j) Use of Proceeds. The Trust will use the proceeds received by it
---------------
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds." The Company will use the net proceeds received by it from
the sale of the Junior Subordinated Debentures, in the manner specified in the
Prospectus under "Use of Proceeds."
(k) Listing. The Company will use its best efforts to effect the
-------
listing of the Preferred Securities on the Nasdaq National Market ("NASDAQ"). If
the Junior Subordinated Debentures are distributed on the occurrence of a Tax
Event (as defined in the Prospectus), the Company will use its best efforts to
effect the listing of the Junior Subordinated Debentures on NASDAQ or such other
exchange where the Preferred Securities are listed.
(l) Restriction on Sale of Securities. During a period of 90 days
---------------------------------
from the date of the Prospectus, neither the Company nor the Trust will, without
the prior written consent of the Representatives, (i) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or
14
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase or otherwise transfer or dispose of any Preferred
Securities or Junior Subordinated Debentures (or any equity or debt securities
substantially similar to the Preferred Securities or Junior Subordinated
Debentures, respectively), or any securities convertible into or exercisable or
exchangeable for Preferred Securities or Junior Subordinated Debentures (or any
equity or debt securities substantially similar to the Preferred Securities or
Junior Subordinated Debenture, respectively) or file any registration statement
under the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of Preferred
Securities or Junior Subordinated Debentures (or any equity or debt securities
substantially similar to the Preferred Securities or Junior Subordinated
Debentures, respectively), whether any such swap or transaction described in
clause (i) or (ii) above is to be settled by delivery of Preferred Securities or
Junior Subordinated Debentures (or any equity or debt securities substantially
similar to the Preferred Securities or Junior Subordinated Debentures,
respectively) or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to the Preferred Securities or Junior Subordinated
Debentures to be sold hereunder.
(m) Reporting Requirements. The Company and the Trust, during the
----------------------
period when the Prospectus is required to be delivered under the 1933 Act or the
1934 Act, will file all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the rules and regulations of the Commission under
the 1934 Act.
(n) Furnish Reports. For and during the period ending three years
---------------
after the effective date of the Registration Statement, the Company will furnish
to the Underwriters copies of all reports and other communications (financial or
otherwise) furnished by the Company to its securityholders generally and copies
of any reports or financial statements furnished to or filed by the Company with
the Commission or any national securities exchange on which any class of
securities of the Company may be listed.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses. The Company, as borrower under the Junior Subordinated
--------
Debentures, will pay all expenses incident to the performance of its, and the
Trust's, obligations under this Agreement, including (i) the preparation,
printing and any filing of the Registration Statement (including financial
statements and any schedules or exhibits and any document incorporated therein
by reference) and of each amendment or supplement thereto, (ii) the preparation,
printing and delivery to the Underwriters of this Agreement, the Operative
Documents and such other documents as may be required in connection with the
offering, purchase, sale and delivery of the Preferred Securities and the Junior
Subordinated Debentures, (iii) the preparation, issuance and delivery of the
certificates for the Preferred Securities to the Underwriters, including any
stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance, or delivery of the Preferred Securities to the Underwriters,
(iv) the fees and disbursements of the Company's counsel,
15
accountants and other advisors, (v) the fees and expenses of any trustee
appointed under any of the Operative Documents, including the fees and
disbursements of counsel for such trustees in connection with the Operative
Documents, (vi) the printing and delivery to the Underwriter of copies of each
preliminary prospectus, any Term Sheets and of the Prospectus and any amendments
or supplements thereto, if any, (vii) the fees and expenses of any transfer
agent or registrar for the Preferred Securities, (viii) the filing fees incident
to the review by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Preferred Securities, (ix) the fees and
expenses incurred in connection with the listing of the Preferred Securities
and, if applicable, the Junior Subordinated Debentures on NASDAQ, and (x) the
cost and charges of qualifying the Preferred Securities with DTC.
(b) Termination of Agreement. If this Agreement is terminated by the
------------------------
Underwriters in accordance with the provisions of Section 5, Section 9(a)(i) or
Section 10 hereof, the Company shall reimburse the Underwriters for all of their
reasonable, actual, accountable out-of-pocket expenses, including the reasonable
fees and disbursements of Elias, Matz, Xxxxxxx & Xxxxxxx L.L.P., counsel for the
Underwriters.
SECTION 5. Conditions of Underwriter' Obligations. The obligations of the
--------------------------------------
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Offerors contained in Section 1 hereof or
in certificates of any Trustee of the Trust, officer of the Company or any of
its Subsidiaries delivered pursuant to the provisions hereof, to the performance
by the Offerors of their obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
---------------------------------------
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430(a) or, if the Company has elected to rely upon Rule
434, a Term Sheet shall have been filed with the Commission in accordance with
Rule 424(b)).
(b) Opinion of Outside Counsel for Offerors. At the Closing Time, the
---------------------------------------
Underwriters shall have received the favorable opinion, dated as of the Closing
Time, of Xxxxxxx, Xxxxx & Xxxxx, LLP, counsel for the Offerors, in form and
substance reasonably satisfactory to the Underwriters. Such counsel may state
that, insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of Trustees of the Trust, officers of
the Company or any designated Subsidiary and certificates of public officials.
(c) Opinion of Special Delaware Counsel for Offerors. At the Closing
------------------------------------------------
Time, the Underwriters shall have received the favorable opinion, dated as of
the Closing Time, of Xxxxxxxx,
16
Xxxxxx & Finger P.A., special Delaware counsel for the Offerors, in form and
substance reasonably satisfactory to the Underwriters.
(d) Opinion of Counsel for The Bank of New York. At the Closing Time,
-------------------------------------------
the Underwriters shall have received the favorable opinion, dated as of the
Closing Time, of Xxxxx, Xxxxxx & Xxxxxx, LLP, counsel to The Bank of New York,
as Property Trustee under the Declaration, Guarantee Trustee under the Preferred
Securities Guarantee Agreement and Debenture Trustee under the Indenture, in
form and substance reasonably satisfactory to counsel for the Underwriters.
(e) Opinion of Special Tax Counsel for the Offerors. At the Closing
-----------------------------------------------
Time, the Underwriters shall have received an opinion, dated as of the Closing
Time, of Xxxxxxx, Xxxxx & Xxxxx, LLP, special tax counsel to the Offerors,
substantially to the effect that (i) the Junior Subordinated Debentures will be
classified as indebtedness for United States federal income tax purposes, (ii)
the Trust will be classified as a grantor trust for United States federal income
tax purposes, and (iii) the statements set forth in the Prospectus under the
caption "Certain Federal Income Tax Consequences" constitute, in all material
respects, a fair and accurate summary of the United States federal income tax
consequences of the ownership and disposition of the Preferred Securities under
current law. Such opinion may be conditioned on, among other things, the initial
and continuing accuracy of the facts, financial and other information, covenants
and representations set forth in certificates of officers of the Company and
other documents deemed necessary for such opinion.
(f) Opinion of Counsel for the Underwriters. At the Closing Time, the
---------------------------------------
Underwriters shall have received the favorable opinion, dated as of the Closing
Time, of Elias, Matz, Xxxxxxx & Xxxxxxx L.L.P., counsel for the Underwriters,
with respect to the Preferred Securities, the Operative Documents, the
Prospectus and other related matters as the Underwriters may require. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of Trustees
of the Trust, officers of the Company or the Subsidiaries and certificates of
public officials.
(g) Certificates. At the Closing Time, there shall not have been,
------------
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the financial condition
or in the earnings, business affairs or business prospects of the Trust, or the
Company and its Subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, and the Underwriters shall have
received a certificate of the Chairman, the Chief Executive Officer, the
President or any Vice President of the Company and of the Chief Financial
Officer of the Company and a certificate of an Administrative Trustee of the
Trust, dated as of the Closing Time, to the effect that, to his or her knowledge
(i) there has been no such material adverse change, (ii) the representations and
warranties in Section 1 hereof were true and correct when made and are true and
correct with the same force and effect as though expressly made at and as of the
Closing Time, and (iii) the Offerors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or prior
to the Closing Time.
17
(h) Accountant's Comfort Letter. At the time of the execution of this
---------------------------
Agreement, the Underwriters shall have received from Xxxxxxx & Company (the
"Accountants") a letter dated such date, in form and substance satisfactory to
the Underwriters, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Underwriters with respect to the
financial statements and certain financial information included or incorporated
by reference in the Prospectus.
(i) Bring-down Comfort Letter. At the Closing Time, the Underwriters
-------------------------
shall have received from the Accountants a letter dated as of the Closing Time,
to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (h) of this Section, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Time.
(j) Approval of Listing. At the Closing Time, the Preferred Securities
-------------------
shall have been approved for listing on NASDAQ.
(k) Additional Documents. At the Closing Time, counsel for the
--------------------
Underwriters shall have been furnished such documents and opinions as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Preferred Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties of the
Offerors, or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Offerors in connection with the issuance and sale of
the Preferred Securities as herein contemplated shall be satisfactory in form
and substance to the Underwriters and counsel for the Underwriters.
(l) Termination of Agreement. If any condition specified in this
------------------------
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Underwriters by notice to the Offerors at any
time at or prior to the Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4 hereof
and except that Sections 7 and 8 hereof shall survive any such termination and
remain in full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification of Underwriters. The Offerors agree to jointly and
-------------------------------
severally indemnify and hold harmless (x) each Underwriter, (y) each person, if
any, who controls any Underwriter within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act (each such person, a "Control Person") and (z)
the respective partners, directors, officers and employees of each Underwriter
or any Control Person as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment or supplement
18
thereto), including the Rule 430A Information and the Rule 434 Information,
if applicable, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading or arising out of any untrue statement of a material
fact contained in any preliminary prospectus or the Prospectus (or any
amendment or supple ment thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Offerors; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Underwriters), reasonably incurred in investigating, preparing for or
defending against any litigation or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission to the extent that any such expense is
not paid under (i) or (ii) above; provided, however, that this indemnity
agreement shall not apply to any loss, liability, claim, damage or expense
to the extent arising out of any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with
written information furnished to the Offerors by any Underwriter through
the Representatives expressly for use in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto). The foregoing indemnity with
respect to any untrue statement or alleged untrue statement contained in or
omission or alleged omission from a preliminary prospectus shall not inure
to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any loss, liability, claim,
damage or expense purchases any of the Preferred Securi ties which are the
subject thereof if the Company shall sustain the burden of proving that
such person was not sent or given a copy of the Prospectus (or the
Prospectus as amended or supplemented) at or prior to the written
confirmation of the sale of such Preferred Securities to such person and
the untrue statement contained in or omission from such preliminary
prospectus was corrected in the Prospectus (or the Prospectus as amended or
supplemented) and the Company has previously furnished copies thereof to
such Underwriter.
19
(b) Indemnification of Offerors, Directors, Officers and Employees.
--------------------------------------------------------------
Each Underwriter severally agrees to indemnify and hold harmless the Company,
its directors, officers and employees, the Trust, each of the Trustees and each
person, if any, who controls the Trust, any of the Trustees or the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in Section 6(a) above, as incurred, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions, made
in the Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Offerors by any Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary
prospectus, or the Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party
-------------------------------------
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof, and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. An indemnifying party may participate at its own
expense in the defense of any such action or, if it so elects within a
reasonable time after receipt of such notice, to assume the defense of any suit
brought to enforce any such claim, but if it so elects to assume the defense,
such defense shall be conducted by counsel chosen by it and approved by the
indemnified parties, which approval shall not be unreasonably withheld. In the
event that an indemnifying party elects to assume the defense of any such suit
and retain such counsel, the indemnified party or parties shall bear the fees
and expenses of any additional counsel thereafter retained by such indemnified
party or parties; provided, however, that the indemnified party or parties shall
-------- -------
have the right to employ counsel (in addition to local counsel) to represent the
indemnified party or parties who may be subject to liability arising out of any
action in respect of which indemnity may be sought against the indemnifying
party if, in the reasonable judgement of counsel for the indemnified party or
parties, there may be legal defenses available to such indemnified person which
are different from or in addition to those available to such indemnifying
person, in which event the reasonable fees and expenses of appropriate separate
counsel shall be borne by the indemnifying party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investi gation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 6 or Section 7 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim
20
and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
SECTION 7. Contribution. In order to provide for just and equitable
------------
contribution in circumstances under which the indemnification provided for in
Section 6 hereof is for any reason held to be unenforceable by an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors on the one
hand and the Underwriters on the other hand from the offering of the Preferred
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) 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 Offerors, on the one hand, and of the
Underwriters, on the other hand, in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Offerors on the one hand and the
Underwriters on the other hand in connection with the offering of the Preferred
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Preferred Securities pursuant to this Agreement (before deducting expenses)
received by the Offerors and the total commission received by the Underwriters,
bear to the aggregate initial offering price of the Preferred Securities.
The relative fault of the Offerors, on the one hand, and the Underwriters,
on the other hand, shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statements of a material fact of
omission or alleged omission to state a material fact relates to information
supplied by the Offerors or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Offerors 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 or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Preferred Securities purchased by it and distributed to the
public were offered to the public exceeds the amount
21
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 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
Section 7, each person, if any, who controls the Underwriters within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act and the respective
partners, directors, officers and employees of the Underwriters shall have the
same rights to contribution as the Underwriters, and each officer, director and
employee of the Company, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
shall have the same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or trustees of the Trust submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or con trolling
person, or by or on behalf of the Trust or the Company, and shall survive
delivery of the Preferred Securities to the Underwriters.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The Underwriters may terminate this
--------------------
Agreement, by notice to the Offerors, at any time at or prior to the Closing
Time (i) if there has occurred, since the time of execution of this Agreement or
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Trust or the Company and
its Subsidiaries, considered as one enterprise, whether or not arising in the
ordinary course of business or (ii) if there has occurred any material adverse
change in the financial markets in the United States, any outbreak of
hostilities or escalation thereof or other calamity or crisis, or any change or
development involving a prospective change in national political, financial or
economic conditions, in each case the effect of which is such as to make it, in
the judgment of the Underwriters, impracticable to market the Preferred
Securities or to enforce contracts for the sale of the Preferred Securities, or
(iii) if trading in any securities of the Company has been suspended or limited
by the Commission, or if trading generally on the American Stock Exchange, the
New York Stock Exchange or NASDAQ has been suspended or limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the NASD or any other governmental authority, or (iv) if a banking
moratorium has been declared by either federal or Maryland authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
-----------
Section, such termination shall he without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
6 and 7 hereof shall survive such termination and remain in full force and
effect.
22
SECTION 10. Default by One or More of the Underwriters. If one of the
------------------------------------------
Underwriters shall fail at Closing Time to purchase the Preferred Securities
which it or they are obligated to purchase under this Agreement (the "Defaulted
Securities"), the remaining Underwriters shall have the right, within 24 hours
thereafter, to make arrangement, to purchase all, but not less than all, of the
Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, such Underwriters shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of defaulted Securities does not exceed 10% of the
number of Preferred Securities to be purchased on such date, the non-defaulting
Underwriters shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of the non-defaulting
Underwriters, or
(b) if the number of Defaulted securities exceeds 10% of the number of
Preferred Securities to be purchased on such date, the obligation of the
Underwriters to purchase and of the Company to sell the Preferred Securities to
be purchased and sold on such Closing Time shall terminate without liability on
the part of the non-defaulting Underwriters.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement and which does not result in a termination of the
obligation of the Underwriters to purchase and the Company to sell the Preferred
Securities, either the Underwriters or the Company shall have the right to
postpone Closing Time for required changes in the Registration Statement or
Prospectus or in any other documents or arrangements. As used herein, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section 10.
SECTION 11. Notices. 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 directed to the Representatives c/x Xxxx Xxxxx Xxxx
Xxxxxx, Incorporated, 0000 Xxxxxxxxxxxx Xxxxxx X.X., Xxxxxxxxxx, X.X. 00000,
Attention: Xxxx X. Xxxxxxx, Managing Director, with a copy to Elias, Matz,
Xxxxxxx & Xxxxxxx L.L.P. , 000 00xx Xxxxxx, X.X., 00xx Xxxxx, Xxxxxxxxxx, X.X.
00000, Attention: Xxxxxx X. Xxxxx Esq.; notices to the Offerors shall be
directed to Xxxxx Spring Bancorp, Inc., 00000 Xxxxxxx Xxxxxx, Xxxxx, Xxxxxxxx
00000, Attention: Hunter X. Xxxxxx, with a copy to Xxxxxxx, Xxxxx & Xxxxx, LLP,
0000 Xxxxxxxxx Xxxx, Xxxxx X-00, Xxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X.
Xxxxx, III, Esq.
SECTION 12. Parties. This Agreement shall inure to the benefit of and be
-------
binding upon each of the Underwriters and the Offerors and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or
23
corporation, other than the Underwriters and the Offerors and their respective
successors and the controlling persons and officers and directors referred to in
Sections 1, 6 and 7 hereof and their heirs and legal representatives, any legal
or equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the Underwriters
and the Offerors and their respective successors, and said controlling persons
and officers and directors and their heirs and legal representatives, and for
the benefit of no other person, firm or corporation. No purchaser of Preferred
Securities from the Underwriters shall be deemed to be a successor by reason
merely of such purchase.
The Company, on behalf of itself and its Subsidiaries (including, without
limitation, the Trust), hereby irrevocably submits to the exclusive jurisdiction
of the federal and New York State courts located in the City of New York in
connection with any suit, action or proceeding related to this Agreement or any
of the matters contemplated hereby, irrevocably waives any defense of lack of
personal jurisdiction and irrevocably agrees that all claims in respect of any
suit, action or proceeding may be heard and determined in any such court. The
Company, on behalf of itself and the Subsidiaries (including, without
limitation, the Trust), irrevocably waives, to the fullest extent it may
effectively do so under applicable law, any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum.
SECTION. 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAW PRINCIPLES.
SECTION 14. Effect of Headings. The Article and Section headings herein are
------------------
for convenience only and shall not affect the construction hereof.
24
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters and the Offerors in accordance with its terms.
Very truly yours,
XXXXX SPRING BANCORP, INC.
By:
----------------------------------
Name: Hunter X. Xxxxxx
Title: President and Chief Executive Officer
XXXXX SPRING CAPITAL TRUST
By:
----------------------------------
Name: Hunter X. Xxxxxx
Title: Administrative Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXX XXXXX XXXX XXXXXX, INCORPORATED
FIRST UNION SECURITIES
XXXXXX, XXXXX XXXXX, INCORPORATED
By: Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
By:
----------------------------------
Authorized Signatory
For itself and as the Representatives of the several
Underwriters named in Schedule A hereto.
25
SCHEDULE A
Number of
Name of Underwriter Preferred Securities
-------------------------------------------------------------------------
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated.................
First Union Securities...............................
Xxxxxx, Xxxxx Xxxxx, Incorporated....................
Total................................................
26
