CONSECO, INC.
(an Indiana corporation)
$800,000,000 8.75% Notes due February 9, 2004
Underwriting Agreement
February 2, 2000
CONSECO, INC.
(an Indiana corporation)
$800,000,000 8.75% Notes due February 9, 2004
Underwriting Agreement
February 2, 2000
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
BANC OF AMERICA SECURITIES LLC
DEUTSCHE BANK SECURITIES INC.
as Representatives of the several Underwriters
c/x Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx Xxxxx World Headquarters
World Financial Center
North Tower
New York, New York 10281
Ladies and Gentlemen:
Conseco, Inc., an Indiana corporation (the "Company"), confirms its
agreement with the several underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof) with respect to the
issue and sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of $800,000,000 aggregate principal amount of the
Company's 8.75% Notes due February 9, 2004 (the "Notes"), to be issued pursuant
to an indenture dated as of November 13, 1997 (the "Indenture"), between the
Company and The Bank of New York, as successor to LTCB Trust Company, as trustee
(the "Trustee"). Capitalized terms used herein without definition shall be used
as defined in the Prospectus (defined below).
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-83465) covering the
registration of securities of the Company, including the Notes, under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or prospectuses, and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the Commission
under the 1933 Act
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(the "1933 Act Regulations") and the Company has filed such post-effective
amendments thereto as may be required prior to the execution of this Agreement.
Such registration statement, as amended, has been declared effective by the
Commission and the Indenture has been duly qualified under the Trust Indenture
Act of 1939, as amended (the "1939 Act"). Such registration statement No.
333-83465, as amended, including the exhibits and schedules thereto, if any, and
the information, if any, deemed to be a part thereof pursuant to Rule 430A(b) of
the 1933 Act Regulations (the "Rule 430A Information") or Rule 434(d) of the
1933 Act Regulations (the "Rule 434 Information") is referred to herein as the
"Registration Statement" and the final prospectus and the prospectus supplement
relating to the offering of the Notes, in the form first furnished to the
Underwriters by the Company for use in connection with the offering of the
Notes, are collectively referred to herein as the "Prospectus"; provided,
however, that all references to the "Registration Statement" and the
"Prospectus" shall be deemed to include all documents incorporated therein by
reference pursuant to the Securities Exchange Act of 1934, as amended (the "1934
Act"), prior to the execution of this Agreement; provided, further, that if the
Company files a registration statement with the Commission pursuant to Section
462(b) of the 1933 Act Regulations (a "Rule 462(b) Registration Statement"),
then after such filing, all references to the "Registration Statement" shall be
deemed to include the Rule 462(b) Registration Statement; and provided, further,
that if the Company elects to rely upon Rule 434 of the 1933 Act Regulations,
then all references to "Prospectus" shall be deemed to include the final or
preliminary prospectus and the applicable term sheet or abbreviated term sheet
(the "Term Sheet"), as the case may be, in the form first furnished to the
Underwriters by the Company in reliance upon Rule 434 of the 1933 Act
Regulations, and all references in this Agreement to the date of the Prospectus
shall mean the date of the Term Sheet. A "preliminary prospectus" shall be
deemed to refer to any prospectus used before the applicable registration
statement became effective and any prospectus that omitted, as applicable, the
Rule 430A Information, the Rule 434 Information or other information to be
included upon pricing in a form of prospectus filed with the Commission pursuant
to Rule 424(b) of the 1933 Act Regulations, that was used after such
effectiveness and prior to the execution and delivery of the applicable
underwriting agreement. 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 thereof filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("XXXXX").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the 1934 Act which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the Prospectus, as the
case may be.
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The Company understands that the Underwriters propose to make a public
offering of the Notes as soon as the Underwriters deem advisable after this
Agreement has been executed and delivered.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter as of the date
hereof (such date being hereinafter referred to as the "Representation Date")
that:
(i) No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been initiated
or, to the knowledge and information of the Company, threatened by the
Commission.
(ii) The Company meets, and at the respective times of the
commencement and consummation of the offering of the Notes will meet, the
requirements for the use of Form S-3 under the 1933 Act. Each of the
Registration Statement, and any Rule 462(b) Registration Statement has become
effective under the 1933 Act. At the respective times the Registration
Statement, any Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at the Representation Date and at the
Closing Time (as defined herein), the Registration Statement, any Rule 462
Registration Statement 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 the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 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. At the date of the Prospectus and at the Closing Time, the
Prospectus and any amendments and supplements 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. If the Company elects
to rely upon Rule 434 of the 1933 Act Regulations, the Company will comply with
the requirements of Rule 434. Notwithstanding the foregoing, the representations
and warranties in this subsection shall not apply to (A) statements in or
omissions from the Registration Statement, or the Prospectus made in reliance
upon and in conformity with information furnished to the Company in writing by
an Underwriter through Xxxxxxx Xxxxx & Co., Banc of America Securities LLC and
Deutsche Banc Xxxx. Xxxxx (each a "Representative" and collectively the
"Representatives") expressly for use in the Registration Statement or the
Prospectus or (B) the part of the Registration Statement which shall constitute
the Statement of Eligibility (Form T-1) under the 1939 Act.
Each preliminary prospectus and 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 the offering of Notes will, at the time of such delivery, be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
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(iii) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement, or the Prospectus, at the time they
were or hereafter are filed with the Commission or last amended, as the case may
be, complied and will comply in all material respects with the requirements of
the 1934 Act, and the rules and regulations of the Commission thereunder (the
"1934 Act Regulations"), and at the time of filing or as of the time of any
subsequent amendment, did not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
or are made, not misleading; and any additional documents deemed to be
incorporated by reference in the Registration Statement or the Prospectus will,
if and when such documents are filed with the Commission, or when amended, as
appropriate, comply in all material respects with the requirements of the 1934
Act and the 1934 Act Regulations 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; provided, however, that
this representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through the Representatives expressly for use in
the Registration Statement or the Prospectus.
(iv) PricewaterhouseCoopers LLP and KPMG LLP, which certified the
financial statements and supporting schedules of the Company and Conseco Finance
Corp. (formerly Green Tree Financial Corporation) ("Conseco Finance"),
respectively, included or incorporated by reference in the Registration
Statement and the Prospectus, each are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations with respect to the
Company and Conseco Finance, respectively.
(v) The financial statements of the Company and, with respect to
Conseco Finance, the financial statements for the fiscal years ended December
31, 1996 and 1997, included or incorporated by reference in the Registration
Statement and the Prospectus, together with the related schedules and notes,
present fairly the financial position of the Company and its consolidated
subsidiaries and Conseco Finance and its consolidated subsidiaries,
respectively, as of the dates indicated and the results of their respective
operations for the periods specified. Except as otherwise stated therein such
financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved. The supporting schedules, if any, included or incorporated by
reference in the Registration Statement and the Prospectus present fairly the
information required to be stated therein. The ratio of earnings to fixed
charges (and the ratio of earnings to fixed charges and preferred stock
dividends) included in the Prospectus have been calculated in compliance with
Item 503(d) of Regulation S-K of the Commission. Any selected financial
information and summary financial data included in the Prospectus present fairly
the information shown therein and have been compiled on a basis consistent with
that of the audited financial statements included in the Registration Statement
and the Prospectus. Any pro forma financial statements and the related notes
thereto included in the Registration Statement and the Prospectus present fairly
the information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the bases described therein, and the
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assumptions used in the preparation thereof are reasonable and the adjustments
used therein are appropriate to give effect to the transactions and
circumstances referred to therein.
(vi) The statutory financial statements of each of the Company's
insurance subsidiaries, from which certain ratios and other statistical data
contained in the Registration Statement have been derived, have for each
relevant period been prepared in accordance with accounting practices prescribed
or permitted by the National Association of Insurance Commissioners, and with
respect to each insurance subsidiary, the appropriate Insurance Department of
the state of domicile of such insurance subsidiary, and such accounting
practices have been applied on a consistent basis throughout the periods
involved.
(vii) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, and except as otherwise stated
therein, (A) there has been no material adverse change and no development which
could reasonably be expected to result in a material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects 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) there 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, and (C) except for regular dividends
on the Common Stock or Preferred Stock of the Company in amounts per share that
are consistent with past practice or the applicable charter document or
supplement thereto, respectively, there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock.
(viii) The Company has been incorporated, is validly existing as a
corporation and its status is active under the laws of the State of Indiana,
with corporate power and authority to own, lease and operate its properties and
to conduct its business as presently conducted and as described in the
Prospectus and to enter into and perform its obligations under, or as
contemplated under, this Agreement and the Indenture. The Company is qualified
as a foreign corporation to transact business and is 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 have a Material Adverse
Effect.
(ix) Each "significant subsidiary" of the Company within the
meaning of Rule 1-02 of Regulation S-X promulgated under the 1933 Act is listed
on Schedule B hereto, and each such subsidiary, and each of the other
subsidiaries listed for purposes of this Agreement on Schedule B hereto (each of
such subsidiaries listed on Schedule B, for purposes of this Agreement, a
"Significant Subsidiary") has been incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own, lease and operate
its properties and to conduct its business as presently conducted and as
described in the Prospectus, and is qualified as a foreign corporation to
transact business and is 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 have a Material Adverse Effect. Except as
otherwise stated in the Registration
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Statement and the Prospectus, all of the issued and outstanding shares of
capital stock of each Significant Subsidiary of the Company have been authorized
and validly issued, are fully paid and non-assessable and all such shares are
owned by the Company, directly or through its subsidiaries, free and clear of
any material security interest, mortgage, pledge, lien, encumbrance, claim or
equity.
(x) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus; since the date indicated in the
Prospectus there has been no change in the consolidated capitalization of the
Company and its subsidiaries (other than changes in outstanding Common Stock of
the Company resulting from (A) incentive compensation plan, employee or agent
benefit plan or dividend reinvestment and stock purchase plan transactions,
including, without limitation, the purchase of shares of Common Stock of the
Company or cancellation of options in connection therewith, or (B) the exercise
of conversion or exchange rights with respect to securities outstanding as of
the date of the Prospectus); and all of the issued and outstanding capital stock
of the Company has been authorized and validly issued, is fully paid and
non-assessable and conforms to the descriptions thereof contained in the
Prospectus.
(xi) The Indenture has been authorized by the Company and qualified
under the 1939 Act and, at the Closing Time, has been executed and delivered and
constitutes a legal, valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except to the extent that
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally or by
general principles of equity (regardless of whether enforcement is considered in
a proceeding at law or in equity) (the "Bankruptcy Exceptions"); the Indenture
conforms in all material respects to the description thereof contained in the
Prospectus.
(xii) The Notes have been duly authorized by the Company and, at
the Closing Time, will have been executed by the Company and, when authenticated
in the manner provided for in the Indenture and delivered against payment
therefor as described in the Prospectus, will constitute legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms except to the extent that enforcement
thereof may be limited by the Bankruptcy Exceptions, and 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 contained in the
Prospectus.
(xiii) Neither the Company nor any of its Significant Subsidiaries
is in violation of its articles of incorporation or by-laws. Neither the Company
nor any of its Significant Subsidiaries is in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, note, lease, loan or credit agreement or any
other agreement or instrument (the "Agreements and Instruments") to which the
Company or any of its Significant Subsidiaries is a party or by which any of
them may be bound, or to which any of the property or assets of the Company or
any Significant Subsidiary is subject, or in violation of any applicable law,
rule or regulation or any judgment, order or decree of any government,
governmental instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of its
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Significant Subsidiaries or any of their respective properties or assets, which
violation or default would, singly or in the aggregate, have a Material Adverse
Effect.
(xiv) The offer of the Notes as contemplated herein and in the
Prospectus; the execution, delivery and performance of this Agreement and the
Indenture, and the consummation of the transactions contemplated herein, therein
and in the Registration Statement (including the issuance and sale of the Notes
and the use of proceeds from the sale of the Notes as described in the
Prospectus under the caption "Use of Proceeds") and compliance by the Company
with its obligations hereunder and thereunder do not and will not, whether with
or without the giving of notice or passage of time or both, conflict with or
constitute a breach of any of the terms or provisions of, or constitute a
default or Repayment Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any subsidiary pursuant to, 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 any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any of its
Significant Subsidiaries, or any of their assets, properties or operations
(except for such violations that would not result in a Material Adverse Effect),
nor will such action result in any violation of the provisions of the charter or
by-laws of the Company or any Significant Subsidiary. As used herein, a
"Repayment Event" means any event or condition which gives the holder of any
note, debenture or other evidence of indebtedness of the Company or any
Significant Subsidiary (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 Company or any Significant Subsidiary.
(xv) There is no action, suit, proceeding, inquiry or investigation
before or by any court or governmental agency or body, domestic or foreign
(including, without limitation, any proceeding to revoke or deny renewal of any
Insurance Licenses (as defined below)), 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 Effect, or which might be reasonably expected to
materially and adversely affect the consummation of this Agreement, the
Indenture or the transactions contemplated herein, therein or in the
Registration Statement or the Prospectus. The aggregate of all pending legal or
governmental proceedings to which the Company or any subsidiary thereof is a
party or of which any of their respective properties or operations is the
subject which are not described in the Registration Statement or the Prospectus,
including ordinary routine litigation incidental to the business or the Company
or any of its subsidiaries, could not reasonably be expected to result in a
Material Adverse Effect; and there are no contracts or documents of the Company
or any of its subsidiaries which are required to be filed as exhibits to the
Registration Statement or to be incorporated by reference therein, by the 1933
Act, the 1933 Act Regulations, the 1934 Act or the 1934 Act Regulations, which
have not been so filed or incorporated by reference.
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(xvi) The Company and its subsidiaries possess such permits,
licenses, approvals, consents and other authorizations issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies (including,
without limitation, insurance licenses from the insurance departments of the
various states where the subsidiaries write insurance business (the "Insurance
Licenses")) that are material to the Company and its subsidiaries taken as a
whole and are necessary to conduct the business now operated by them; the
Company and its subsidiaries are in compliance with the terms and conditions of
all such Insurance Licenses, except where the failure so to comply would not,
singly or in the aggregate, result in a Material Adverse Effect; all of the
Insurance Licenses are valid and in full force and effect, except where the
invalidity of such Insurance Licenses or the failure of such Insurance Licenses
to be in full force and effect would not result in a Material Adverse Effect;
and neither the Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such Insurance
Licenses which, singly or in the aggregate, may reasonably be expected to result
in a Material Adverse Effect.
(xvii) No authorization, approval, consent, order, registration or
qualification of or with any court or governmental authority or agency
(including, without limitation, any Insurance regulatory agency or body) is
required in connection with the offering, issuance and sale of the Notes or the
consummation by the Company of any other transactions contemplated hereby,
except such as have been obtained and made under the federal securities laws or
state Insurance laws and such as may be required under state or foreign
securities or Blue Sky laws.
(xviii) This Agreement has been duly authorized, executed and
delivered by the Company.
(xix) Neither the Company nor any of its Significant Subsidiaries
is, and upon the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus will
be, an "investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended (the
"1940 Act").
(xx) None of the Company, its Significant Subsidiaries or any of
their respective directors, officers or controlling persons, has taken, directly
or indirectly, any action resulting in a violation of Regulation M under the
1934 Act, or designed to cause or result in, or that has constituted or that
reasonably might be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Notes or the Common Stock of the Company, in each case in violation of
applicable law.
(xxi) No "forward looking statement" (as defined in Rule 175 under
the 1933 Act) contained in the Registration Statement, any preliminary
prospectus or the Prospectus was made or reaffirmed without a reasonable basis
or was disclosed other than in good faith.
(b) Any certificate signed by any officer of the Company and delivered to
the Underwriters or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby.
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SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company agrees to sell
to each Underwriter, and each Underwriter severally and not jointly agrees to
purchase from the Company, at the price of 99.396% of the principal amount
thereof, the principal amount of Notes set forth in Schedule A hereto opposite
the name of such Underwriter, plus any additional principal amount of Notes
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) The initial public offering price of the Notes shall be 99.946% of the
principal amount thereof, plus accrued interest, if any, from the date of
issuance. The interest rate on the Notes shall be 8.75% per annum. The Notes
will be redeemable as a whole or in part at the option of the Company at any
time, at a redemption price equal to the greater of (i) 100% of the principal
amount thereof and (ii) the sum of the present values of the remaining scheduled
payments of principal and interest thereon from the redemption date to the
maturity date, computed by discounting such payments, in each case, to the
redemption date on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate (as defined in the Prospectus) plus
25 basis points plus, in each case, accrued interest on the principal amount
thereof to the date of redemption.
(c) Delivery of certificates for the Notes against payment of the purchase
price for such Notes shall be made at the offices of LeBoeuf, Lamb, Xxxxxx &
XxxXxx, L.L.P., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such other
place as shall be agreed upon by the Underwriters and the Company, at 9:00 a.m.
(New York City time) on the third business day after execution of this Agreement
(or, if pricing of the Notes occurs after 4:30 p.m., New York City time, on the
fourth full business day thereafter), or such other time not later than ten
business days after such date as shall be agreed upon by the Underwriters and
the Company (such time and date of payment and delivery being referred to herein
as the "Closing Time"). Payment for the Notes purchased by the Underwriters
shall be made by wire transfer of immediately available funds, payable to the
Company, against delivery to the respective accounts of the Underwriters of the
Notes to be purchased by them. Delivery of, and payment for, the Notes shall be
made through the facilities of the Depository Trust Company.
Certificates for the Notes, if any, shall be in such denominations
and registered in such names as the Underwriters may request in writing at least
two full business days before the Closing Time. Each Representative,
individually and not as a representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Notes, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time, but such payment shall not relieve such Underwriter from its obligations
hereunder. The certificates for the Notes will be made available for examination
by the Underwriters no later than 10:00 a.m. (New York City time) on the last
business day prior to the Closing Time.
SECTION 3. Covenants of the Company. The Company agrees with the
Underwriters as follows:
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(a) Promptly following the execution of this Agreement, the Company will
cause the Prospectus to be filed with the Commission pursuant to Rule 424 of the
1933 Act Regulations and the Company will promptly advise the Underwriters when
such filing has been made. Prior to the filing, the Company will cooperate with
the Underwriters in the preparation of the prospectus supplement to assure that
the Underwriters have no reasonable objection to the form or content thereof
when filed or mailed.
(b) The Company, subject to Section 3(c), will comply with the requirements
of Rule 430A of the 1933 Act Regulations and/or Rule 434 of the 1933 Act
Regulations if and as applicable, and will notify the Underwriters immediately
of (i) the effectiveness of any post-effective amendment to the Registration
Statement or the filing of any supplement or amendment to the Prospectus, (ii)
the receipt of any comments from the Commission, (iii) any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, (iv) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose and
(v) the issuance by any state securities commission or other regulatory
authority of any order suspending the qualification or the exemption from
qualification of the Notes under state securities or Blue Sky laws or the
initiation or threatening of any proceeding for such purpose. The Company will
make all reasonable efforts to prevent the issuance of any stop order and, if
any stop order is issued, to promptly obtain the lifting thereof.
(c) The Company will give the Underwriters notice of its intention to file
or prepare any amendment to the Registration Statement (including any
post-effective amendment and any filing under Rule 462(b) of the 1933 Act
Regulations), 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, the 1934 Act
or otherwise; will furnish the Underwriters with copies of any such Rule 462(b)
Registration Statement, Term Sheet, amendment, supplement or revision a
reasonable amount of time prior to such proposed filing or use, as the case may
be; and will not file any such Rule 462(b) Registration Statement, Term Sheet,
amendment, supplement or revision to which the Underwriters or counsel for the
Underwriters shall reasonably object.
(d) The Company will deliver to the Representatives and counsel for the
Underwriters, without charge, conformed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or
deemed to be incorporated by reference therein) and conformed copies of all
consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters. If applicable, the copies of the Registration Statement and
each amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
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(e) The Company has delivered to each Underwriter, without charge, as many
copies of any preliminary prospectus as such Underwriter reasonably requested,
and the Company hereby consents 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 1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request. If applicable, the
Prospectus and any amendments or supplements thereto furnished to the
Underwriter will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(f) The Company will comply with the 1933 Act and the 1933 Act Regulations
and the 1934 Act and the 1934 Act Regulations so as to permit the completion of
the distribution of the Notes as contemplated in this Agreement and in the
Registration Statement and the Prospectus. If at any time when the Prospectus is
required by the 1933 Act or the 1934 Act to be delivered in connection with
sales of the Notes, 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 in order that the Registration
Statement 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 or to amend or supplement the Prospectus in
order that the 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 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 will promptly prepare and file with
the Commission, subject to Section 3(c), 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, without charge, such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(g) The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Notes for offering and sale under the applicable
securities laws of such states and other jurisdictions (domestic or foreign) as
the Representatives may designate; provided, however, that the Company shall not
be obligated to qualify as a foreign corporation in any jurisdiction in which it
is not so qualified or subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject.
(h) The Company will make generally available to its securityholders as
soon as practicable, but not later than 45 days (or 90 days, in the case of a
period that is also the Company's fiscal year) after the close of the period
covered thereby, an earnings statement of the Company and its subsidiaries (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve-month period beginning not later than the first day of the
Company's fiscal quarter next following the "effective date" (as defined in said
Rule 158) of the Registration Statement.
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(i) The Company will use the net proceeds received by it from the sale of
the Notes in the manner specified in the Prospectus under "Use of Proceeds."
(j) If, at the time that the Registration Statement became (or in the case
of a post-effective amendment becomes) effective, any information shall have
been omitted therefrom in reliance upon Rule 430A or Rule 434 of the 1933 Act
Regulations, then immediately following the execution of this Agreement, the
Company will prepare, and file or transmit for filing with the Commission in
accordance with such Rule 430A or Rule 434 and Rule 424(b) of the 1933 Act
Regulations, copies of an amended Prospectus, or Term Sheet, or, if required by
such Rule 430A, a post-effective amendment to the Registration Statement
(including an amended Prospectus), containing all information so omitted.
(k) If the Company elects to rely upon Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) and pay the applicable fees in accordance with Rule 111 of the 1933 Act
Regulations by the earlier of (i) 10:00 p.m. New York City time on the date of
this Agreement and (ii) the time confirmations are sent or given, as specified
by Rule 462(b)(2).
(l) The Company, during the period when the Prospectus is required to be
delivered under the 1933 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 1934 Act Regulations.
(m) Between the date of the Prospectus and the Closing Time, the Company
will not, without the prior written consent of the Representatives, directly or
indirectly, issue, sell, offer or contract to sell, grant any option for the
sale of, or otherwise transfer or dispose of, any debt securities of the Company
(other than the Notes or commercial paper in the ordinary course of business).
(n) The Company, during a period of one year from the Closing Time, will
make generally available to the Underwriters copies of all reports and other
communications (financial or other) mailed to stockholders, and deliver to the
Underwriters promptly after they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed
(such financial statements to be on a consolidated basis to the extent the
accounts of the Company and its subsidiaries are consolidated in reports
furnished to its stockholders generally or to the Commission).
(o) Neither the Company nor its subsidiaries will take, directly or
indirectly, any action resulting in a violation of Regulation M under the 1934
Act, or designed to cause or result in, or that reasonably might be expected to
constitute, the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Notes or the Common Stock of
the Company, in each case, in violation of applicable law.
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SECTION 4. Payment of Expenses. The Company will pay all expenses incident
to the performance of its obligations under this Agreement, including, without
limitation, expenses related to the following, if incurred: (i) the preparation,
delivery, printing and filing of the Registration Statement and Prospectus as
originally filed (including financial statements and exhibits) and of each
amendment thereto; (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement Among Underwriters, the Indenture
and such other documents as may be required in connection with the offering,
purchase, sale and delivery of the Notes; (iii) the preparation, issuance and
delivery of the certificates for the Notes; (iv) the fees and disbursements of
the Company's counsel, accountants and other advisors or agents (including the
transfer agents and registrars), as well as fees and disbursements of the
Trustee and any Depositary, and their respective counsel (except as provided for
in the Prospectus); (v) the qualification of the Notes under securities laws in
accordance with the provisions of Section 3(g), including filing fees and the
reasonable fees and disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of any Blue Sky Survey and any
Legal Investment Survey; (vi) the printing and delivery to the Underwriters of
copies of the Registration Statement as originally filed and of each amendment
thereto, of each preliminary prospectus, any Term Sheet and of the Prospectus
and any amendments or supplements thereto; (vii) the printing and delivery to
the Underwriters of copies of any Blue Sky Survey and any Legal Investment
Survey; (viii) any fees payable in connection with the rating of the Notes by
nationally recognized statistical rating organizations; (ix) the filing fees
incident to, and the fees and disbursements of counsel to the Underwriters in
connection with, the review, if any, by the National Association of Securities
Dealers, Inc. (the "NASD") of the terms of the sale of the Notes; (x) any fees
payable in connection with any listing of Notes on any securities exchange or
quotation system; and (xi) any fees payable to the Commission.
If this Agreement is terminated by the Underwriters in accordance with the
provisions of Section 5 or Section 9(a)(i) hereof, the Company shall reimburse
the Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P.,
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
Underwriters to purchase and pay for the Notes pursuant to this Agreement are
subject to the accuracy of the representations and warranties of the Company
herein contained or in certificates of any officer of the Company or any
subsidiary delivered pursuant to the provisions hereof, to the performance by
the Company of its obligations hereunder, and to the following further
conditions:
(a) The Registration Statement, including any Rule 462(b) Registration
Statement, shall have become effective under the 1933 Act not later than 5:30
p.m., New York City time, on the date hereof, and on the date hereof and at the
Closing Time, no stop order suspending the effectiveness of the Registration
Statement or any part thereof 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 satisfaction of counsel to the Underwriters. A prospectus
containing information relating to the description of the Notes, the specific
method of distribution and similar matters shall have been filed with the
Commission in accordance with Rule 424(b)(1), (2), (3), (4) or (5), as
applicable (or any required post-effective
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amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A), or, if the Company
has elected to rely upon Rule 434 of the 1933 Act Regulations, a Term Sheet
including the Rule 434 Information shall have been filed with the Commission in
accordance with Rule 424(b)(7).
(b) At the Closing Time the Underwriters shall have received:
(1) The favorable opinion, dated as of the Closing Time, of Xx.
Xxxx X. Xxxx, Executive Vice President, General Counsel and Secretary of the
Company, in form and substance reasonably satisfactory to counsel for the
Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Indiana.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as described
in the Prospectus.
(iii) The Company is qualified as a foreign corporation to
transact business and is 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.
(iv) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus (including information which
is incorporated by reference therein) (except for subsequent issuances, if
any, pursuant to (x) incentive compensation plan, employee or agent benefit
plan or dividend reinvestment and stock purchase plan transactions,
including, without limitation, the purchase of shares of Common Stock of
the Company or cancellation of options in connection therewith, or (y) the
exercise of conversion or exchange rights with respect to securities
outstanding as of the date of the Prospectus), and all the issued and
outstanding capital stock of the Company has been authorized and validly
issued and is fully paid and non-assessable and conforms to the
descriptions thereof contained in the Prospectus.
(v) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus, and is duly qualified as a
foreign corporation to transact business and is 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 have a
Material Adverse Effect; all of the issued and outstanding capital stock of
each such Significant Subsidiary of the Company has been authorized and
validly issued, is fully paid and non-assessable and, except as set forth
in the Prospectus, all
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such shares are owned by the Company, directly or through its subsidiaries,
free and clear of any material security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(vi) All legally required proceedings in connection with the
authorization and valid issuance of the Notes and the sale of such Notes in
accordance with this Agreement (other than the filing of post-issuance
reports, the non-filing of which would not render the Notes invalid) have
been taken and all legally required orders, consents or other
authorizations or approvals of any other public boards or bodies
(including, without limitation, any insurance regulatory agency or body) in
connection with the authorization and valid issuance of the respective
Notes and the sale of such Notes in accordance with this Agreement (other
than in connection with or in compliance with the provisions of the
securities or Blue Sky laws of any jurisdictions, as to which no opinion
need be expressed) have been obtained and are in full force and effect.
(vii) The Registration Statement is effective under the 1933
Act and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933
Act, and no proceedings therefor have been initiated or threatened by the
Commission.
(viii) The Registration Statement, as of its effective date,
and the Prospectus, and each amendment or supplement thereto as of its
issue date (in each case, other than the financial statements and the notes
thereto, the financial schedules, and any other financial data included or
incorporated by reference therein, as to which such counsel need express no
belief), complied as to form in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations; and the Indenture complied as
to form in all material respects with the requirements of the 1939 Act and
the 1939 Act Regulations.
(ix) Each of the documents incorporated by reference in the
Registration Statement or the Prospectus at the time they were filed or
last amended (other than the financial statements and the notes thereto,
the financial schedules, and any other financial data included or
incorporated by reference therein and the Statements of Eligibility on Form
T-1 filed with the Commission as part of the Registration Statement, as to
which such counsel need express no belief), complied as to form in all
material respects with the requirements of the 1934 Act and the 1934 Act
Regulations, as applicable.
(x) The information in the Prospectus under the captions
"Description of the Notes," to the extent it involves matters of law,
summaries of legal matters, documents or proceedings or legal conclusions,
has been reviewed by such counsel and is correct in all material respects.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
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(xii) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming authorization, execution, and
delivery thereof by the Trustee, constitutes a valid and legally binding
obligation of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be
limited by the Bankruptcy Exceptions; and the Indenture has been duly
qualified under the 1939 Act and conforms in all material respects to the
description thereof contained in the Prospectus.
(xiii) The Notes are in the form contemplated by the
Indenture, have been duly authorized, executed and delivered by the Company
and, when authenticated by the Trustee in the manner provided for in the
Indenture and delivered against payment therefor by the Company, will
constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their respective terms,
except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions, and such Notes conform in all material respects to
the description thereof contained in the Prospectus.
(xiv) The offer of the Notes as contemplated herein and in
the Prospectus; the execution, delivery and performance of this Agreement
and the Indenture, and the consummation of the transactions contemplated
herein, therein and in the Registration Statement (including the issuance
and sale of the Notes and the use of proceeds from the sale of the Notes as
described in the prospectus under the caption "Use of Proceeds") and
compliance by the Company with its obligations hereunder and thereunder
have been authorized by all necessary corporate action and do not and will
not, whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of any of the terms or
provisions of, or constitute a default or Repayment Event under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Significant Subsidiary pursuant
to, 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
any applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any Significant Subsidiary
or any of their assets, properties, or operations (except for such
violations that would not result in a Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter or
by-laws of the Company or any Significant Subsidiary.
(xv) To such counsel's knowledge, there are no statutes
required to be described in or incorporated by reference in the
Registration Statement which are not described or incorporated by
reference; and there are no legal or governmental proceedings pending or,
to such counsel's knowledge, threatened which are required to be disclosed
or incorporated by reference in the Registration Statement, other than
those disclosed or incorporated by reference therein.
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(xvi) To such counsel's knowledge, there are no contracts,
indentures, mortgages, agreements, notes, leases or other instruments
required to be described or referred to or incorporated by reference in the
Registration Statement or to be filed as exhibits thereto other than those
described or referred to or incorporated by reference therein or filed as
exhibits thereto; and the descriptions thereof or references thereto are
true and correct in all material respects.
(xvii) No authorization, approval, consent, order,
registration or qualification of or with any court or federal or state
governmental authority or agency (including, without limitation, any
insurance regulatory agency or body) is required for the issuance and sale
of the Notes by the Company to the Underwriters or the performance by the
Company of its obligations under this Agreement, the Indenture and the
Notes except such as has been obtained and made under the federal
securities laws or state insurance laws or such as may be required under
state or foreign securities or Blue Sky laws.
(xviii) The Company and its subsidiaries possess such
permits, licenses, approvals, consents and other authorizations issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies (including, without limitation, the Insurance Licenses) that are
material to the Company and its subsidiaries taken as a whole and are
necessary to conduct the business now operated by them; the Company and its
subsidiaries are in compliance with the terms and conditions of all such
Insurance Licenses, except where the failure so to comply would not, singly
or in the aggregate, result in a Material Adverse Effect; all of the
Insurance Licenses are valid and in full force and effect, except where the
invalidity of such Insurance Licenses or the failure of such Insurance
Licences to be in full force and effect would not result in a Material
Adverse Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Insurance Licenses which, singly or in the
aggregate, may reasonably be expected to result in a Material Adverse
Effect.
(xix) Neither the Company nor any of its subsidiaries is, and
upon the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will be, an "investment company" as such term is defined in the 1940 Act.
Moreover, such counsel shall confirm that nothing has come to such
counsel's attention that causes such counsel to believe that the
Registration Statement, including any information provided pursuant to Rule
430A and related schedules and Rule 434 (except for financial statements
and the notes thereto, the financial schedules and any other financial data
included or incorporated by reference therein, and the Statements of
Eligibility on Form T-1 filed with the Commission as part of the
Registration Statement as to which such counsel need express no opinion),
at the time it became effective or at the Representation Date, 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 (except for financial statements and
the notes thereto, the financial schedules, and any other
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financial data included or incorporated by reference therein, as to which
such counsel need express no opinion), at the Representation Date (unless
the term "Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of the
Notes which differs from the Prospectus on file at the Commission at the
time the Registration Statement became effective, in which case at the time
it is first provided to the Underwriters for such use) or at the Closing
Time, included (or includes) an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(2) The favorable opinion, dated as of the Closing Time, of Xxxxxx
Xxxxxxxx & Xxxxxxx LLP, special counsel to the Company, in form and substance
reasonably satisfactory to counsel for the Underwriters, to the effect that
nothing has come to such counsel's attention that causes such counsel to believe
that the Registration Statement, including any information provided pursuant to
Rule 434 (except for financial statements and the notes thereto, the financial
schedules and any other financial data included or incorporated by reference
therein, and the Statements of Eligibility on Form T-1 filed with the Commission
as part of the Registration Statement as to which counsel need express no
opinion), at the time it became effective or at the Representation Date,
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 (except for financial statements and the
notes thereto, the financial schedules, and any other financial data included or
incorporated by reference therein, as to which counsel need express no opinion),
at the Representation Date (unless the term "Prospectus" refers to a prospectus
which has been provided to the Underwriters by the Company for use in connection
with the offering of the Securities which differs from the Prospectus on file at
the Commission at the time the Registration Statement became effective, in which
case at the time it is first provided to the Underwriters for such use) or at
the Closing Time, included (or includes) an untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(3) The favorable opinion, dated as of the Closing Time, of
LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P., counsel for the Underwriters, in form
and substance satisfactory to the Underwriters, with respect to the issuance and
sale of the Notes, and other related matters as the Underwriters may reasonably
require, and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such matters. In
rendering such opinion, XxXxxxx, Xxxx, Xxxxxx & XxxXxx, L.L.P. may rely as to
matters governed by the laws of Indiana upon the opinion referred to in Section
5(b)(1) hereto.
(c) Between the date of this Agreement and prior to the Closing Time, no
material adverse change shall have occurred in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise, whether or not in
the ordinary course of business.
-18-
(d) At the Closing Time, the Underwriters shall have received a certificate
of the President or a Vice-President of the Company and of the Chief Financial
Officer or Chief Accounting Officer of the Company, dated as of the Closing
Time, to the effect that (i) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not in the ordinary course of business, (ii) the
representations and warranties in Section 1 hereof are true and correct as
though expressly made at and as of the Closing Time, (iii) the Company has
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied at or prior to the Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been initiated or, to the knowledge of such
officers, threatened by the Commission.
(e) At the time of the execution of this Agreement, the Underwriters shall
have received from PricewaterhouseCoopers LLP a "comfort letter", with respect
to the financial information of the Company, dated such date in form and
substance satisfactory to the Underwriters and counsel to the Underwriters.
(f) At the time of the execution of this Agreement, the Underwriters shall
have received from KPMG LLP a "comfort letter", with respect to the financial
information of Conseco Finance, dated such date in form and substance
satisfactory to the Underwriters and counsel to the Underwriters.
(g) At the Closing Time, the Underwriters shall have received from each of
PricewaterhouseCoopers LLP, with respect to the Company, and KPMG LLP, with
respect to Conseco Finance, a letter, dated as of the Closing Time, to the
effect that they reaffirm the statements made in the letters furnished pursuant
to subsections (e) and (f) of this Section and other customary matters, except
that (i) such statements shall include any financial statements and pro forma
financial information incorporated by reference in the Registration Statement
and the Prospectus which are filed subsequent to the date of this Agreement and
prior to the Closing Time and (ii) the specified date referred to shall be a
date not more than five days prior to the Closing Time.
(h) At the Closing Time, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may require for the purpose
of enabling them to pass upon the issuance and sale of the Notes as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Notes as herein contemplated shall
be satisfactory in form and substance to the Underwriters and counsel for the
Underwriters.
(i) At the Closing Time, the Notes shall be rated at least BBB+ by Duff &
Xxxxxx Credit Rating Agency and BBB+ by Standard & Poor's Ratings Service, and
the Company shall have delivered to the Underwriters a letter, dated the Closing
Time, from each such rating agency, or other evidence satisfactory to the
Underwriters, confirming that the Notes have such ratings; and between the
Representation Date and the Closing Time (i) there shall not have occurred any
decrease in the
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rating assigned to the Notes or any securities of the Company or of the
financial strength or claims paying ability of the Company by any "nationally
recognized statistical rating organization," as defined for purposes of Rule
436(g)(2) under the 1933 Act Regulations and (ii) no such organization shall
have publicly announced that it has under surveillance or review, without
indicating an improvement, its rating of the Notes or any securities of the
Company or of the financial strength or claims paying ability of the Company.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
Underwriters by notice to the Company 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 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Underwriter and
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 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 thereto), including the Rule 434 Information
deemed to be part thereof, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any amendment
or supplement 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 arising out of or 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 Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representatives), reasonably incurred 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 arising out of or 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
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(i) or (ii) above; provided, however, that the foregoing indemnity
agreement shall not apply to any loss, liability, claim, damage or expense
to the extent arising out of or based upon any untrue statement or omission
or alleged untrue statement or omission (A) made in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 434
Information deemed to be a part thereof, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), (B)
made in any Statement of Eligibility on Form T-1 filed as an exhibit to the
Registration Statement or (C) made in any preliminary prospectus supplement
and corrected in the Prospectus, as supplemented, where the person
asserting any such loss, liability, claim, damage or expense purchased the
Notes that are the subject thereof, and it shall have been established (i)
that 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) in any case where such delivery is required by the 1933 Act and
(ii) the Company shall have previously furnished copies thereof in
sufficient quantities to such Underwriter.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, 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 against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, 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 434
Information deemed to be a part thereof, 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
Company by such 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) 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. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by the Representatives, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified 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
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of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation 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 and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
Notwithstanding the immediately preceding sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
affected without its consent if such indemnifying party (i) reimburses such
indemnified party in accordance with such request to the extent it considers
such request to be reasonable and (ii) provides written notice to the
indemnified party substantiating the unpaid balance as unreasonable, in each
case prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless 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 Company on the one
hand, and the Underwriters, on the other hand, from the offering of the Notes
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 Company on the one hand, and 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 Company on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the Notes
pursuant to this Agreement shall in each case be deemed to be in the same
respective proportions as the total net proceeds from the offering of such Notes
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters in respect of such Notes, in each case as
set forth on the cover
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of the Prospectus, or, if Rule 434 is used, the corresponding location on the
Term Sheet, bear to the aggregate initial public offering price of such Notes as
set forth on such cover.
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.
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 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 Notes underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) 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 an
Underwriter 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 such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, 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. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the aggregate principal amount of Notes set forth opposite their
respective names in Schedule A to this Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or
contained in certificates of officers of the Company 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 controlling person,
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or by or on behalf of the Company, and shall survive delivery of and payment for
the Notes to the Underwriters.
SECTION 9. Termination of Agreement.
(a) The Underwriters may terminate this Agreement, by notice to the Company
at any time at or prior to the Closing Time, if (i) there has been, since the
date of this Agreement or since the respective dates as of which information is
given in the Prospectus, any material adverse change or any development which
could reasonably be expected to result in a prospective material adverse change
in the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or any outbreak of hostilities or escalation of hostilities or
other calamity or crisis, or any change or development involving a prospective
change in national or international political, financial or economic conditions
the effect of which is such as to make it, in the judgment of the
Representatives, impracticable to market the Notes or to enforce contracts for
the sale of the Notes, or (iii) if trading in the Common Stock or any other
security of the Company has been suspended or limited by the Commission, NASD or
the New York Stock Exchange, or if trading generally on either the American
Stock Exchange, the New York Stock Exchange or in the over-the-counter market
has been suspended or limited, or minimum or maximum prices for trading have
been fixed, or maximum ranges for prices for securities have been required, by
either of such exchanges or by such system or by order of the Commission, NASD
or any other governmental authority, or (iv) if a banking moratorium has been
declared by either Federal, New York or Indiana authorities.
(b) If this Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party except as
provided in Section 4, and provided, further, that Sections 1, 6, 7 and 8 shall
survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at the Closing Time to purchase the Notes which it
or they are obligated to purchase under this Agreement (the "Defaulted Notes"),
the Representatives shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted Notes in
such amounts as may be agreed upon and upon the terms herein set forth; if,
however, the Representatives shall not have completed such arrangements within
such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Notes does not exceed
10% of the total aggregate principal amount of Notes, 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 all non-defaulting
Underwriters, or
-24-
(b) if the aggregate principal amount of Defaulted Notes exceeds 10% of the
total aggregate principal amount of the Notes to be purchased on such date, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter.
No action taken pursuant to this Section 10 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, either the Representatives or the Company shall have the right
to postpone the Closing Time for a period not exceeding seven days in order to
effect any required changes in the Registration Statement or the 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 Underwriters c/x Xxxxxxx Xxxxx & Co.,
World Financial Center, North Tower, New York, New York 10281, Attention of
Xxxxxx Xxxxxxxx; to Banc of America Securities LLC, 000 Xxxxx Xxxxx Xxxxxx, Mail
Code: NC-1- 000-00-00, Charlotte, North Carolina 28255-0001, Attention of Xxxx
XxXxxxxxx; and to Deutsche Bank Securities Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention of Xxx Xxxxxxx; with a copy to LeBoeuf, Lamb, Xxxxxx &
XxxXxx, L.L.P., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention of
Xxxxxxx Xxxxx, Esq.; notices to the Company shall be directed to the Company at
Conseco, Inc., 00000 X. Xxxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxx 00000, Attention of
Xxxx X. Xxxx, Esq., Executive Vice President, General Counsel and Secretary.
SECTION 12. Parties. This Agreement shall inure to the benefit of and be
binding upon the Company and the Underwriters and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters
and the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 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 or therein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the parties hereto and thereto and their
respective successors and legal representatives, 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 Notes from
any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME UNLESS OTHERWISE INDICATED.
-25-
SECTION 14. Effect of Headings. The Article and Section headings herein are
for convenience only and shall not affect the construction hereof.
SECTION 15. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts hereof shall constitute a single instrument.
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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, shall become a binding agreement
among the Company and the Underwriters in accordance with its terms.
Very truly yours,
CONSECO, INC.
By: /S/ XXXXXX X. XXXX
-------------------------------
Name: Xxxxxx X. Xxxx
Title: Executive Vice President and Chief
Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
BANC OF AMERICA SECURITIES LLC
DEUTSCHE BANK SECURITIES INC.
as Representatives of the several Underwriters
By: XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By: /S/ XXXXXX X. XXXXXXXXX
--------------------------------------
Authorized Signatory
By: BANC OF AMERICA SECURITIES LLC
By: /S/ XXXX XXXXXXXXX
--------------------------------------
Authorized Signatory
By: DEUTSCHE BANK SECURITIES INC.
By: /S/ XXXXX XXXXX
--------------------------------------
Authorized Signatory
By: /S/ X. XXXXX XXXXXXX
--------------------------------------
Authorized Signatory
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Schedule A
Principal
Amount of
Underwriters Notes
------------ -----
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated......................................... 208,000,000
Banc of America Securities LLC................................... 208,000,000
Deutsche Bank Securities Inc..................................... 208,000,000
Chase Securities Inc............................................. 44,000,000
First Union Securities, Inc...................................... 44,000,000
X.X. Xxxxxx Securities Inc....................................... 44,000,000
XX Xxxxx Securities Corporation.................................. 44,000,000
------------
Total........................................... $800,000,000
============
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Schedule B
Significant Subsidiaries
------------------------
Conseco Life Insurance Company of Texas
Wabash Life Insurance Company
CIHC, Incorporated
Bankers Life Insurance Company of Illinois
Bankers Life and Casualty Company
Conseco Annuity Assurance Company
Conseco Senior Health Insurance Company
Pioneer Life Insurance Company
Conseco Finance Corporation (formerly Green Tree Financial Corporation)
Conseco Health Insurance Company
Conseco Life Insurance Company
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