1
EXHIBIT 1
600,000 Preferred Securities
IBC Capital Finance
___% Cumulative Trust Preferred Securities
(Liquidation Amount of $25 per Preferred Security)
UNDERWRITING AGREEMENT
December __, 1996
XXXXXX, XXXXXXXX & COMPANY, INCORPORATED
000 Xxxxx Xxxxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Dear Sirs:
Independent Bank Corporation, a Michigan corporation (the "Company") and
its financing subsidiary, IBC Capital Finance, a Delaware business trust (the
"Trust", and hereinafter together with the Company, the "Offerors"), propose
that the Trust issue and sell to Xxxxxx, Xxxxxxxx & Company, Incorporated
(sometimes referred to herein as the "Underwriter"), pursuant to the terms of
this Agreement, 600,000 of the Trust's ____% Cumulative Trust Preferred
Securities, with a liquidation amount of $25.00 per preferred security (the
"Preferred Securities"), to be issued under the Trust Agreement (as hereinafter
defined), the terms of which are more fully described in the Prospectus (as
hereinafter defined). The aforementioned 600,000 Preferred Securities to be
sold to the Underwriter are herein called the "Firm Preferred Securities".
Solely for the purpose of covering over-allotments in the sale of the Firm
Preferred Securities, the Offerors further propose that the Trust issue and
sell to the Underwriter, at its option, up to an additional 90,000 Preferred
Securities (the "Option Preferred Securities") upon exercise of the
over-allotment option granted in Section 1 hereof. The Firm Preferred
Securities and any Option Preferred Securities are herein collectively referred
to as the "Designated Preferred Securities".
The Offerors hereby confirm as follows their agreement with the
Underwriter in connection with the proposed purchase of the Designated
Preferred Securities.
2
1. SALE, PURCHASE AND DELIVERY OF DESIGNATED PREFERRED SECURITIES;
DESCRIPTION OF DESIGNATED PREFERRED SECURITIES.
(a) On the basis of the representations, warranties and agreements
herein contained, and subject to the terms and conditions herein set forth, the
Offerors hereby agree that the Trust shall issue and sell to the Underwriter and
the Underwriter agrees to purchase from the Trust, at a purchase price of $25.00
per share (the "Purchase Price"), the Firm Preferred Securities. Because the
proceeds from the sale of the Firm Preferred Securities will be used to purchase
from the Company its Subordinated Debentures (as hereinafter defined and as
described in the Prospectus), the Company shall pay to the Underwriter a
commission of $____ per Firm Preferred Security (the "Firm Preferred Securities
Commission").
In addition, on the basis of the representations, warranties and
agreements herein contained and subject to the terms and conditions herein set
forth, the Trust hereby grants to the Underwriter an option to purchase all or
any portion of the 90,000 Option Preferred Securities, and upon the exercise of
such option in accordance with this Section 1, the Offerors hereby agree that
the Trust shall issue and sell to the Underwriter, and the Underwriter agrees to
purchase from the Trust, all or any portion of the Option Preferred Securities
at the same Purchase Price per share paid for the Firm Preferred Securities.
Because the proceeds from the sale of the Option Preferred Securities will be
used to purchase from the Company its Subordinated Debentures, the Company shall
pay to the Underwriter a commission of $______ per Option Preferred Security for
each Option Preferred Security purchased (the "Option Preferred Securities
Commission"). The option hereby granted (the "Option") shall expire 30 days
after the date upon which the Registration Statement (as hereinafter defined)
becomes effective and may be exercised only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Firm Preferred Securities. The Option may be exercised in
whole or in part at any time (but not more than once) by the Underwriter giving
notice (confirmed in writing) to the Trust setting forth the number of Option
Preferred Securities as to which the Underwriter is exercising the Option and
the time, date and place for payment and delivery of certificates for such
Option Preferred Securities. Such time and date of payment and delivery for the
Option Preferred Securities (the "Option Closing Date") shall be determined by
the Underwriter, but shall not be earlier than two nor later than five full
business days after the exercise of such Option, nor in any event prior to the
Closing Date (as hereinafter defined). The Option Closing Date may be the same
as the Closing Date.
Payment of the Purchase Price and the Firm Preferred Securities
2
3
Commission and delivery of certificates for the Firm Preferred Securities shall
be made at the offices of the Underwriter, 000 Xxxxx Xxxxxxxx, Xx. Xxxxx,
Xxxxxxxx 00000, or such other place as shall be agreed to by the Underwriter
and the Offerors, at 10:00 a.m., St. Louis time, on _____ __, 1996, or at such
other time not more than five full business days thereafter as the Offerors and
the Underwriter shall determine (the "Closing Date"). If the Underwriter
exercises the option to purchase any or all of the Option Preferred Securities,
payment of the Purchase Price and Option Preferred Securities Commission and
delivery of certificates for such Option Preferred Securities shall be made on
the Option Closing Date at the Underwriter's office, or at such other place as
the Offerors and the Underwriter shall determine. Such payments shall be made
to an account designated by the Trust by wire transfer prior to 1:00 p.m.
eastern standard time on the Closing Date, in the amount of the Purchase Price
therefor, against delivery by or on behalf of the Trust to the Underwriter of
certificates for the Designated Preferred Securities to be purchased by the
Underwriter.
The Agreement contained herein with respect to the timing of the
Closing Date and Option Closing Date is intended to, and does, constitute an
express agreement, as described in Rule 15c6-1(c) and (d) promulgated under the
1934 Act (as defined herein), for a settlement date other than four business
days after the date of the contract.
Certificates for Designated Preferred Securities to be purchased by
the Underwriter shall be delivered to the Offerors in fully registered form in
the name of Cede & Co., the nominee of the Depositary (as defined in the
Prospectus) which shall act as securities depositary for the Designated
Preferred Securities, not later than 12:00 noon, St. Louis time, two business
days prior to the Closing Date and, if applicable, the Option Closing Date.
Certificates for Designated Preferred Securities to be purchased by the
Underwriter shall be made available by the Offerors to the Underwriter for
inspection, checking and packaging at the offices of the Depositary not later
than 1:00 p.m., St. Louis time, on the last business day prior to the Closing
Date and, if applicable, on the last business day prior to the Option Closing
Date.
Time shall be of the essence, and delivery of the certificates for the
Designated Preferred Securities at the time and place specified pursuant to this
Agreement is a further condition of the obligations of the Underwriter
hereunder.
(b) The Offerors propose that the Trust issue the Designated Preferred
Securities pursuant to an Amended and Restated Trust Agreement among State
Street Bank and Trust Company, as Property Trustee, Wilmington Trust Company, as
Delaware Trustee, the Administrative Trustees named therein, (collectively, the
"Trustees"), and the Company, in substantially the form heretofore delivered to
the Underwriter, said Agreement being hereinafter referred to as the "Trust
3
4
Agreement". In connection with the issuance of the Designated Preferred
Securities, the Company proposes (i) to issue its Subordinated Debentures ( the
"Debentures") pursuant to an Indenture, dated as of _____________, 1996,
between the Company and State Street Bank and Trust Company, as Trustee (the
"Indenture") and (ii) to guarantee certain payments on the Designated Preferred
Securities pursuant to a Guarantee Agreement between the Company and State
Street Bank and Trust Company, as guarantee trustee (the "Guarantee"), to the
extent described therein.
2. REPRESENTATIONS AND WARRANTIES.
(a) The Offerors jointly and severally represent and warrant to, and
agree with, the Underwriter that:
(i) The reports filed with the Securities and Exchange Commission
(the "Commission") by the Company under the Securities Exchange Act of
1934, as amended (the "1934 Act") and the rules and regulations thereunder
(the "1934 Act Regulations") at the time they were filed with the
Commission, complied as to form in all material respects with the
requirements of the 1934 Act and the 1934 Act Regulations and 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 light of the circumstances in which they were made, not
misleading.
(ii) The Offerors have prepared and filed with the Commission a
registration statement on Form S-2 (File No. 333-14507) for the
registration of the Designated Preferred Securities, the Guarantee and
$17,250,000 aggregate principal amount of Debentures under the Securities
Act of 1933, as amended (the "1933 Act"), including the related prospectus
subject to completion, and one or more amendments to such registration
statement may have been so filed, in each case in conformity in all
material respects with the requirements of the 1933 Act, the rules and
regulations promulgated thereunder (the "1933 Act Regulations") and the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the
rules and regulations thereunder. Copies of such registration statement,
including any amendments thereto, each Preliminary Prospectus (as defined
herein) contained therein and the exhibits, financial statements and
schedules to such registration statement, as finally amended and revised,
have heretofore been delivered by the Offerors to the Underwriter. After
the execution of this Agreement, the Offerors will file with the Commission
(A) if such registration statement, as it may have been amended, has been
declared by the Commission to be effective under the 1933 Act, a prospectus
in the form most recently included in an amendment to such registration
statement (or, if no such amendment shall have been filed, in such
registration
4
5
statement), with such changes or insertions as are required by Rule 430A of
the 1933 Act Regulations ("Rule 430A") or permitted by Rule 424(b) of the
1933 Act Regulations ("Rule 424(b)") and as have been provided to and not
objected to by the Underwriter prior to (or as are agreed to by the
Underwriter subsequent to) the execution of this Agreement, or (B) if such
registration statement, as it may have been amended, has not been declared
by the Commission to be effective under the 1933 Act, an amendment to such
registration statement, including a form of final prospectus, necessary to
permit such registration statement to become effective, a copy of which
amendment has been furnished to and not objected to by the Underwriter
prior to (or is agreed to by the Underwriter subsequent to) the execution
of this Agreement. As used in this Agreement, the term "Registration
Statement" means such registration statement, as amended at the time when
it was or is declared effective under the 1933 Act, including (1) all
financial schedules and exhibits thereto, (2) all documents (or portions
thereof) incorporated by reference therein filed under the 1934 Act, and
(3) any information omitted therefrom pursuant to Rule 430A and included in
the Prospectus (as hereinafter defined); the term "Preliminary Prospectus"
means each prospectus subject to completion filed with such registration
statement or any amendment thereto including all documents (or portions
thereof) incorporated by reference therein under the 1934 Act (including
the prospectus subject to completion, if any, included in the Registration
Statement and each prospectus filed pursuant to Rule 424(a) under the 0000
Xxx); and the term "Prospectus" means the prospectus first filed with the
Commission pursuant to Rule 424(b)(1) or (4) or, if no prospectus is
required to be filed pursuant to Rule 424(b)(1) or (4), the prospectus
included in the Registration Statement, in each case including the
financial schedules and all documents (or portions thereof) incorporated by
reference therein under the 1934 Act. The date on which the Registration
Statement becomes effective is hereinafter referred to as the "Effective
Date."
(iii) The documents incorporated by reference in the Preliminary
Prospectus or Prospectus or from which information is so incorporated by
reference, when they became effective or were filed with the Commission, as
the case may be, complied in all material respects with the requirements of
the 1934 Act and the 1934 Act Regulations, and when read together and with
the other information in the Preliminary Prospectus or Prospectus, as the
case may be, at the time the Registration Statement became or becomes
effective and at the Closing Date and any Option Closing Date, did not or
will not, as the case may be, 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 light of the circumstances
under which they were made, not misleading.
5
6
(iv) No order preventing or suspending the use of any Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus) has been issued by the Commission, nor has the Commission, to
the knowledge of the Offerors, threatened to issue such an order or
instituted proceedings for that purpose. Each Preliminary Prospectus, at
the time of filing thereof, (A) complied in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and (B) did not
contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading; provided, however, that this representation and
warranty does not apply to statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Offerors by
the Underwriter expressly for inclusion in the Prospectus beneath the
heading "Underwriting" (such information referred to herein as the
"Underwriter's Information").
(v) At the Effective Date and at all times subsequent thereto, up
to and including the Closing Date and, if applicable, the Option Closing
Date, the Registration Statement and any post-effective amendment thereto
(A) complied and will comply in all material respects with the requirements
of the 1933 Act, the 1933 Act Regulations and the Trust Indenture Act (and
the rules and regulations thereunder) and (B) 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 Effective Date and at all times when the Prospectus
is required to be delivered in connection with offers and sales of
Designated Preferred Securities, including, without limitation, the Closing
Date and, if applicable, the Option Closing Date, the Prospectus, as
amended or supplemented, (A) complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and the Trust Indenture Act (and the rules and regulations thereunder) and
(B) did not contain and will not contain an untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty does not apply to Underwriter's Information.
(vi) (A) The Company is duly organized, validly existing and in
good standing under the laws of the State of Michigan, with full corporate
and other power and authority to own, lease and operate its properties and
conduct its business as described in and contemplated by the Registration
Statement and the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus) and as currently being conducted
and is
6
7
duly registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended (the "BHC Act").
(B) The Trust has been duly created and is validly existing
as a statutory business trust in good standing under the Delaware Business
Trust Act with the power and authority (trust and other) to own its
property and conduct its business as described in the Registration
Statement and Prospectus, to issue and sell its common securities (the
"Common Securities") to the Company pursuant to the Trust Agreement, to
issue and sell the Designated Preferred Securities, to enter into and
perform its obligations under this Agreement and to consummate the
transactions herein contemplated; the Trust has no subsidiaries and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or the ownership of its property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect
on the Trust; the Trust has conducted and will conduct no business other
than the transactions contemplated by this Agreement and described in the
Prospectus; the Trust is not a party to or bound by any agreement or
instrument other than this Agreement, the Trust Agreement and the
agreements and instruments contemplated by the Trust Agreement and
described in the Prospectus; the Trust has no liabilities or obligations
other than those arising out of the transactions contemplated by this
Agreement and the Trust Agreement and described in the Prospectus; the
Trust is not a party to or subject to any action, suit or proceeding of any
nature; the Trust is not, and at the Closing Date or any Option Closing
Date will not be, classified as an association taxable as a corporation for
United States federal income tax purposes; and the Trust is, and as of the
Closing Date or any Option Closing Date will be, treated as a consolidated
subsidiary of the Company pursuant to generally accepted accounting
principles.
(vii) The Company has five subsidiaries. They are Independent
Bank, Independent Bank West Michigan, Independent Bank South Michigan,
Independent Bank East Michigan (the "Banks") and the Trust. The Company
does not own or control, directly or indirectly, more than 5% of any class
of equity security of any corporation, association or other entity other
than the Banks, Independent Title Services, Inc., IBC Financial Services,
Inc. and the Trust. Each of the Banks is a Michigan State Bank duly
incorporated, validly existing and in good standing under the laws of
Michigan. Each Bank has full corporate and other power and authority to
own, lease and operate its properties and to conduct its business as
described in and contemplated by the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
7
8
Preliminary Prospectus) and as currently being conducted. Each Bank is a
member of the Federal Reserve System, and no proceedings for the
termination or revocation of such membership are pending or, to the
knowledge of the Offerors, threatened. The deposit accounts of each Bank
are insured by the Bank Insurance Fund administered by the Federal Deposit
Insurance Corporation (the "FDIC") up to the maximum amount provided by
law, except to the extent the Prospectus discloses such deposit accounts
are insured by the Savings Association Insurance Fund administered by the
FDIC ("SAIF") and to such extent the deposit accounts are so insured up to
the maximum amount provided by law; and no proceedings for the
modification, termination or revocation of any such insurance are pending
or, to the knowledge of the Offerors, threatened.
(viii) The Company and each of the Banks is duly qualified to
transact business as a foreign corporation and is in good standing in each
other jurisdiction in which it owns or leases property or conducts its
business so as to require such qualification and in which the failure to so
qualify would, individually or in the aggregate, have a material adverse
effect on the condition (financial or otherwise), earnings, business,
prospects or results of operations of the Company and the Banks on a
consolidated basis. All of the issued and outstanding shares of capital
stock of the Banks (A) have been duly authorized and are validly issued,
(B) are fully paid and nonassessable except to the extent such shares may
be deemed assessable under 12 U.S.C. Section 55 or 12 U.S.C. Section 1831o,
and (C) except as disclosed in the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus), are directly owned
by the Company free and clear of any security interest, mortgage, pledge,
lien, encumbrance, restriction upon voting or transfer, preemptive rights,
claim or equity. Except as disclosed in the Prospectus, there are no
outstanding rights, warrants or options to acquire or instruments
convertible into or exchangeable for any capital stock or equity securities
of the Offerors or the Banks.
(ix) The capital stock of the Company and the equity securities
of the Trust conform to the description thereof contained in the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus). The outstanding shares of capital stock and equity securities
of each Offeror have been duly authorized and validly issued and are fully
paid and nonassessable, and no such shares were issued in violation of the
preemptive or similar rights of any security holder of an Offeror; no
person has any preemptive or similar right to purchase any shares of
capital stock or equity securities of the Offerors. Except as disclosed in
the Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus), there are no outstanding rights, options or
warrants to acquire any securities of the Offerors other than options
issued under the
8
9
Company's Incentive Share Grant Plan, Stock Option Plans and Dividend
Reinvestment Plan, and there are no outstanding securities convertible into
or exchangeable for any such securities.
(x) (A) The Trust has all requisite power and authority to
issue, sell and deliver the Designated Preferred Securities in accordance
with and upon the terms and conditions set forth in this Agreement, the
Trust Agreement, the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus).
All corporate and trust action required to be taken by the Offerors for the
authorization, issuance, sale and delivery of the Designated Preferred
Securities in accordance with such terms and conditions has been validly
and sufficiently taken. The Designated Preferred Securities, when
delivered in accordance with this Agreement, will be duly and validly
issued and outstanding, will be fully paid and nonassessable undivided
beneficial interests in the assets of the Trust, will be entitled to the
benefits of the Trust Agreement, will not be issued in violation of or
subject to any preemptive or similar rights, and will conform to the
description thereof in the Registration Statement and the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary
Prospectus) and the Trust Agreement. None of the Designated Preferred
Securities, immediately prior to delivery, will be subject to any security
interest, lien, mortgage, pledge, encumbrance, restriction upon voting or
transfer, preemptive rights, claim, equity or other defect.
(B) The Debentures have been duly and validly authorized,
and, when duly and validly executed, authenticated and issued as provided
in the Indenture and delivered to the Trust pursuant to the Trust
Agreement, will constitute valid and legally binding obligations of the
Company entitled to the benefits of the Indenture and will conform to the
description thereof contained in the Prospectus.
(C) The Guarantee has been duly and validly authorized,
and, when duly and validly executed and delivered to the guarantee trustee
for the benefit of the Trust, will constitute a valid and legally binding
obligation of the Company and will conform to the description thereof
contained in the Prospectus.
(xi) The Offerors and the Banks have complied in all material
respects with all federal, state and local statutes, regulations,
ordinances and rules applicable to the ownership and operation of their
properties or the conduct of their businesses as described in and
contemplated by the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus) and
as currently being
9
10
conducted.
(xii) The Offerors and the Banks have all material permits,
easements, consents, licenses, franchises and other governmental and
regulatory authorizations from all appropriate federal, state, local or
other public authorities ("Permits") as are necessary to own and lease
their properties and conduct their businesses in the manner described in
and contemplated by the Registration Statement and the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary Prospectus)
and as currently being conducted in all material respects. All such Permits
are in full force and effect and each of the Offerors and the Banks are in
all material respects complying therewith, and no event has occurred that
allows, or after notice or lapse of time would allow, revocation or
termination thereof or will result in any other material impairment of the
rights of the holder of any such Permit, subject in each case to such
qualification as may be adequately disclosed in the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus).
Such Permits contain no restrictions that would materially impair the
ability of the Company or the Banks to conduct their businesses in the
manner consistent with their past practices. Neither the Offerors nor the
Banks have received notice or otherwise has knowledge of any proceeding or
action relating to the revocation or modification of any such Permit.
(xiii) Neither of the Offerors nor any of the Banks is in breach
or violation of their corporate charter, by-laws or other governing
documents (including without limitation, the Trust Agreement). Neither of
the Offerors nor any of the Banks are, and to the knowledge of the
Offerors no other party is, in violation, breach or default (with or
without notice or lapse of time or both) in the performance or observance
of any term, covenant, agreement, obligation, representation, warranty or
condition contained in (A) any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease, franchise, license, Permit or
any other agreement or instrument to which it is a party or by which it or
any of its properties may be bound, which such breach, violation or default
could have material adverse consequences to the Offerors and the Banks on a
consolidated basis, and to the knowledge of the Offerors, no other party
has asserted that the Offerors or any of the Banks is in such violation,
breach or default (provided that the foregoing shall not apply to defaults
by borrowers from the Banks), or (B) except as disclosed in the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus), any order, decree, judgment, rule or regulation of any court,
arbitrator, government, or governmental agency or instrumentality, domestic
or foreign, having jurisdiction over the Offerors or the Banks or any of
their respective properties the breach, violation or default of which could
have a material
10
11
adverse effect on the condition, financial or otherwise, earnings, affairs,
business, prospects, or results of operations of the Offerors and the Banks
on a consolidated basis.
(xiv) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated by this Agreement,
the Trust Agreement, the Registration Statement and the Prospectus (or, if
the Prospectus in not in existence, the most recent Preliminary Prospectus)
do not and will not conflict with, result in the creation or imposition of
any material lien, claim, charge, encumbrance or restriction upon any
property or assets of the Offerors or the Banks or the Designated Preferred
Securities pursuant to, constitute a breach or violation of, or constitute
a default under, with or without notice or lapse of time or both, any of
the terms, provisions or conditions of the charter or by-laws of the
Company or the Banks, the Trust Agreement, the Guarantee, the Indenture,
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease, franchise, license, Permit or any other agreement or
instrument to which the Offerors or the Banks is a party or by which any of
them or any of their respective properties may be bound or any order,
decree, judgment, rule or regulation of any court, arbitrator, government,
or governmental agency or instrumentality, domestic or foreign, having
jurisdiction over the Offerors or the Banks or any of their respective
properties which conflict, creation, imposition, breach, violation or
default would have either singly or in the aggregate a material adverse
effect on the condition, financial or otherwise, earnings, affairs,
business, prospects or results of operations of the Offerors and the Banks
on a consolidated basis. No authorization, approval, consent or order of,
or filing, registration or qualification with, any person (including,
without limitation, any court, governmental body or authority) is required
in connection with the transactions contemplated by this Agreement, the
Trust Agreement, the Indenture, the Guarantee, the Registration Statement
and the Prospectus (or such Preliminary Prospectus), except such as may be
required under the 1933 Act, and such as may be required under state
securities laws in connection with the purchase and distribution of the
Designated Preferred Securities by the Underwriter. No authorization,
approval, consent or order of or filing, registration or qualification
with, any person (including, without limitation, any court, governmental
body or authority) is required in connection with the transactions
contemplated by this Agreement, the Trust Agreement, the Indenture, the
Guarantee, the Registration Statement and the Prospectus, except such as
have been obtained under the 1933 Act, and such as may be required under
state securities laws or Interpretations or Rules of the National
Association of Securities Dealers, Inc. ("NASD") in connection with the
purchase and distribution of the Designated Preferred Securities by the
Underwriter.
11
12
(xv) The Offerors have all requisite corporate power and
authority to enter into this Agreement and this Agreement has been duly and
validly authorized, executed and delivered by the Offerors and constitutes
the legal, valid and binding agreement of the Offerors, enforceable against
the Offerors in accordance with its terms, except as the enforcement
thereof may be limited by general principles of equity and by bankruptcy or
other laws relating to or affecting creditors' rights generally and except
as any indemnification or contribution provisions thereof may be limited
under applicable securities laws. Each of the Indenture, the Trust
Agreement, the Guarantee and the Agreement as to Expenses and Liabilities
(the "Expense Agreement") has been duly authorized by the Company, and,
when executed and delivered by the Company on the Closing Date, each of
said agreements will constitute a valid and legally binding obligation of
the Company and will be enforceable against the Company in accordance with
its terms, except as the enforcement thereof may be limited by general
principles of equity and by bankruptcy or other laws relating to or
affecting creditors' rights generally and except as any indemnification or
contribution provisions thereof may be limited under applicable securities
laws. Each of the Indenture, the Trust Agreement and the Guarantee has
been duly qualified under the Trust Indenture Act and will conform to the
description thereof contained in the Prospectus.
(xvi) The Company and the Banks have good and marketable title
in fee simple to all real property and good title to all personal property
owned by them and material to their business, in each case free and clear
of all security interests, liens, mortgages, pledges, encumbrances,
restrictions, claims, equities and other defects except such as are
referred to in the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus) or such as do not materially affect
the value of such property in the aggregate and do not materially interfere
with the use made or proposed to be made of such property; and all of the
leases under which the Company or the Banks hold real or personal property
are valid, existing and enforceable leases and in full force and effect
with such exceptions as are not material and do not materially interfere
with the use made or proposed to be made of such real or personal property,
and neither the Company nor the Banks is in default in any material respect
of any of the terms or provisions of any leases.
(xvii) KPMG Peat Marwick LLP, who have certified certain of the
consolidated financial statements of the Company and the Banks including
the notes thereto, included in the Registration Statement and Prospectus,
are independent public accountants with respect to the Offerors and the
Banks, as required by the 1933 Act and the 1933 Act Regulations.
12
13
(xviii) The consolidated financial statements including the notes
thereto, included in the Registration Statement and the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary Prospectus)
with respect to the Company and the Banks comply in all material respects
with the 1933 Act and the 1933 Act Regulations and present fairly the
consolidated financial position of the Company and the Banks as of the
dates indicated and the consolidated results of operations, cash flows and
stockholders' equity of the Company and the Banks for the periods specified
and have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis. The selected and summary
consolidated financial data concerning the Offerors and the Banks included
in the Registration Statement and the Prospectus (or such Preliminary
Prospectus) comply in all material respects with the 1933 Act and the 1933
Act Regulations, present fairly the information set forth therein, and have
been compiled on a basis consistent with that of the consolidated financial
statements of the Offerors and the Banks in the Registration Statement and
the Prospectus (or such Preliminary Prospectus). The other financial,
statistical and numerical information included in the Registration
Statement and the Prospectus (or such Preliminary Prospectus) comply in all
material respects with the 1933 Act and the 1933 Act Regulations, present
fairly the information shown therein, and to the extent applicable have
been compiled on a basis consistent with the consolidated financial
statements of the Company and the Banks included in the Registration
Statement and the Prospectus (or such Preliminary Prospectus).
(xix) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus),
except as otherwise stated therein:
(A) neither of the Offerors nor any of the Banks have
sustained any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental
action, order or decree which is material to the condition
(financial or otherwise), earnings, business, prospects or
results of operations of the Offerors and the Banks on a
consolidated basis;
(B) there has not been any material adverse change in, or
any development which is reasonably likely to have a material
adverse effect on, the condition (financial or otherwise),
earnings, business, prospects or results of operations of the
Offerors and the Banks on a consolidated basis, whether or not
arising in the ordinary course of
13
14
business;
(C) neither of the Offerors nor any of the Banks have
incurred any liabilities or obligations, direct or contingent, or
entered into any material transactions, other than in the
ordinary course of business which is material to the condition
(financial or otherwise), earnings, business, prospects or
results of operations of the Offerors and the Banks on a
consolidated basis;
(D) other than the Company's fourth quarter dividend
declared on _____, 1996 and paid to the holders of its common
securities, neither of the Offerors have declared or paid any
dividend, and neither of the Offerors nor any of the Banks have
become delinquent in the payment of principal or interest on any
outstanding borrowings; and
(E) there has not been any change in the capital stock
(except for shares of the Company's common stock issued under its
Dividend Reinvestment Plan and the exercise of employee stock
options issued under the Company's Incentive Share Grant Plan and
Stock Option Plans, and disclosed as outstanding), equity
securities, long-term debt, obligations under capital leases or,
other than in the ordinary course of business and other than the
Company's short-term indebtedness to Northern Trust Company not
to exceed $_________ (the "Bridge Loan"), short-term borrowings
of the Offerors or the Banks.
(xx) Except as set forth in the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus), no charge, investigation, action, suit or
proceeding is pending or, to the knowledge of the Offerors, threatened,
against or affecting the Offerors or the Banks or any of their respective
properties before or by any court or any regulatory, administrative or
governmental official, commission, board, agency or other authority or
body, or any arbitrator, wherein an unfavorable decision, ruling or finding
could have a material adverse effect on the consummation of this Agreement
or the transactions contemplated herein or the condition (financial or
otherwise), earnings, affairs, business, prospects or results of operations
of the Offerors and the Banks on a consolidated basis or which is required
to be disclosed in the Registration Statement or the Prospectus (or such
Preliminary Prospectus) and is not so disclosed.
(xxi) There are no contracts or other documents required to be
filed as exhibits to the Registration Statement by the 1933 Act or the 1933
14
15
Act Regulations or the Trust Indenture Act (or any rules or regulations
thereunder) which have not been filed as exhibits or incorporated by
reference to the Registration Statement, or that are required to be
summarized in the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus) that are not so summarized.
(xxii) Neither of the Offerors has taken, directly or
indirectly, any action designed to result in or which has constituted or
which might reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Offerors to facilitate the
sale or resale of the Designated Preferred Securities, and neither of the
Offerors is aware of any such action taken or to be taken by any affiliate
of the Offerors.
(xxiii) The Offerors and the Banks own, or possess adequate
rights to use, all patents, copyrights, trademarks, service marks, trade
names and other rights necessary to conduct the businesses now conducted by
them in all material respects or as described in the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus) and
neither the Offerors nor the Banks have received any notice of infringement
or conflict with asserted rights of others with respect to any patents,
copyrights, trademarks, service marks, trade names or other rights which,
individually or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse effect on the
condition (financial or otherwise), earnings, affairs, business, prospects
or results of operations of the Offerors and the Banks on a consolidated
basis, and the Offerors do not know of any basis for any such infringement
or conflict.
(xxiv) Except as adequately disclosed in the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary
Prospectus), no labor dispute involving the Company or the Banks exists or,
to the knowledge of the Offerors, is imminent which might be expected to
have a material adverse effect on the condition (financial or otherwise),
earnings, affairs, business, prospects or results of operations of the
Offerors and the Banks on a consolidated basis or which is required to be
disclosed in the Prospectus (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus). Neither the Company nor the Banks
have received notice of any existing or threatened labor dispute by the
employees of any of its principal suppliers, customers or contractors which
might be expected to have a material adverse effect on the condition
(financial or otherwise), earnings, affairs, business, prospects or results
of operations of the Company and the Banks on a consolidated basis.
(xxv) The Offerors and the Banks have timely and properly
prepared and filed all necessary federal, state, local and foreign tax
returns
15
16
which are required to be filed and have paid all taxes shown as due thereon
and have paid all other taxes and assessments to the extent that the same
shall have become due, except such as are being contested in good faith or
where the failure to so timely and properly prepare and file would not have
a material adverse effect on the condition (financial or otherwise),
earnings, affairs, business, prospects or results of operations of the
Offerors and the Banks on a consolidated basis. The Offerors have no
knowledge of any tax deficiency which has been or might be assessed against
the Offerors or the Banks which, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the condition
(financial or otherwise), earnings, affairs, business, prospects or results
of operations of the Offerors and the Banks on a consolidated basis.
(xxvi) Each of the material contracts, agreements and
instruments described or referred to in the Registration Statement or the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) and each contract, agreement and instrument filed
as an exhibit to the Registration Statement is in full force and effect and
is the legal, valid and binding agreement of the Offerors or the Banks,
enforceable in accordance with its terms, except as the enforcement thereof
may be limited by general principles of equity and by bankruptcy or other
laws relating to or affecting creditors' rights generally. Except as
disclosed in the Prospectus (or such Preliminary Prospectus), to the
knowledge of the Offerors, no other party to any such agreement is (with or
without notice or lapse of time or both) in breach or default in any
material respect thereunder.
(xxvii) No relationship, direct or indirect, exists between or
among the Offerors or the Banks, on the one hand, and the directors,
officers, trustees, stockholders, customers or suppliers of the Offerors or
the Banks, on the other hand, which is required to be described in the
Registration Statement and the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) which is not adequately
described therein.
(xxviii) No person has the right to request or require the
Offerors or the Banks to register any securities for offering and sale
under the 1933 Act by reason of the filing of the Registration Statement
with the Commission or the issuance and sale of the Designated Preferred
Securities except as adequately disclosed in the Registration Statement and
the Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus).
(xxix) The Designated Preferred Securities have been approved
for quotation on the Nasdaq National Market subject to official notice of
16
17
issuance.
(xxx) Except as described in the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus),
there are no contractual encumbrances or restrictions or material legal
restrictions, on the ability of the Banks (A) to pay dividends or make any
other distributions on its capital stock or to pay any indebtedness owed to
the Company, (B) to make any loans or advances to, or investments in, the
Company or (C) to transfer any of its property or assets to the Company.
(xxxi) Neither of the Offerors is an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(xxxii) The Offerors have not distributed and will not distribute
prior to the Closing Date any prospectus in connection with the Offering,
other than a Preliminary Prospectus, the Prospectus, the Registration
Statement and the other materials permitted by the 1933 Act and the 1933
Act Regulations and reviewed by the Underwriter.
3. OFFERING BY THE UNDERWRITER. After the Registration Statement
becomes effective or, if the Registration Statement is already effective, after
this Agreement becomes effective, the Underwriter proposes to offer the Firm
Preferred Securities for sale to the public upon the terms and conditions set
forth in the Prospectus. The Underwriter may from time to time thereafter
reduce the public offering price and change the other selling terms, provided
the proceeds to the Trust shall not be reduced as a result of such reduction or
change.
The Underwriter may reserve and sell such of the Designated
Preferred Securities purchased by the Underwriter as the Underwriter may elect
to dealers chosen by it (the "Selected Dealers") at the public offering price
set forth in the Prospectus less the applicable Selected Dealers' concessions
set forth therein, for re-offering by Selected Dealers to the public at the
public offering price. The Underwriter may allow, and Selected Dealers may
re-allow, a concession set forth in the Prospectus to certain other brokers and
dealers.
4. CERTAIN COVENANTS OF THE OFFERORS. The Offerors jointly
and severally covenant with the Underwriter as follows:
(a) The Offerors shall use their best efforts to cause the
Registration Statement and any amendments thereto, if not effective at the time
of execution of this Agreement, to become effective as promptly as possible. If
the Registration Statement has become or becomes effective pursuant to Rule 430A
and information has been omitted therefrom in reliance on Rule 430A, then, the
17
18
Offerors will prepare and file in accordance with Rule 430A and Rule 424(b)
copies of the Prospectus or, if required by Rule 430A, a post-effective
amendment to the Registration Statement (including the Prospectus) containing
all information so omitted and will provide evidence satisfactory to the
Underwriter of such timely filing.
(b) The Offerors shall notify the Underwriter immediately, and
confirm such notice in writing:
(i) when the Registration Statement, or any post-effective
amendment to the Registration Statement, has become effective, or when the
Prospectus or any supplement to the Prospectus or any amended Prospectus
has been filed;
(ii) of the receipt of any comments or requests from the
Commission;
(iii) of any request of the Commission to amend or supplement the
Registration Statement, any Preliminary Prospectus or the Prospectus or for
additional information; and
(iv) of the issuance by the Commission or any state or other
regulatory body of any stop order or other order suspending the
effectiveness of the Registration Statement, preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, or suspending the
qualification of any of the Designated Preferred Securities for offering or
sale in any jurisdiction or the institution or threat of institution of any
proceedings for any of such purposes. The Offerors shall use their best
efforts to prevent the issuance of any such stop order or of any other such
order and if any such order is issued, to cause such order to be withdrawn
or lifted as soon as possible.
(c) The Offerors shall furnish to the Underwriter, from time to time
without charge, as soon as available, as many copies as the Underwriter may
reasonably request of (i) the registration statement as originally filed and of
all amendments thereto, in executed form, including exhibits, whether filed
before or after the Registration Statement becomes effective, (ii) all exhibits
and documents incorporated therein or filed therewith, (iii) all consents and
certificates of experts in executed form, (iv) each Preliminary Prospectus and
all amendments and supplements thereto, and (v) the Prospectus, and all
amendments and supplements thereto.
(d) During the time when a prospectus is required to be delivered
under the 1933 Act, the Offerors shall comply to the best of their ability with
the
18
19
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
Designated Preferred Securities as contemplated herein and in the Trust
Agreement and the Prospectus. The Offerors shall not file any amendment to the
registration statement as originally filed or to the Registration Statement and
shall not file any amendment thereto or make any amendment or supplement to any
Preliminary Prospectus or to the Prospectus of which the Underwriter shall not
previously have been advised in writing and provided a copy a reasonable time
prior to the proposed filings thereof or to which the Underwriter or the
Underwriter's counsel shall reasonably object. If it is necessary, in the
Underwriter's reasonable opinion or in the reasonable opinion of the
Underwriter's counsel to amend or supplement the Registration Statement or the
Prospectus in connection with the distribution of the Designated Preferred
Securities, the Offerors shall forthwith amend or supplement the Registration
Statement or the Prospectus, as the case may be, by preparing and filing with
the Commission, and furnishing to the Underwriter, such number of copies as the
Underwriter may reasonably request of an amendment or amendments of, or a
supplement or supplements to, the Registration Statement or the Prospectus, as
the case may be (in form and substance reasonably satisfactory to the
Underwriter and the Underwriter's counsel. If any event shall occur as a
result of which it is necessary to amend or supplement the Prospectus to
correct an untrue statement of a material fact or to include a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, or if for any reason it is necessary at
any time to amend or supplement the Prospectus to comply with the 1933 Act and
the 1933 Act Regulations, the Offerors shall, subject to the second sentence of
this subsection (d), forthwith amend or supplement the Prospectus by preparing
and filing with the Commission, and furnishing to the Underwriter, such number
of copies as the Underwriter may reasonably request of an amendment or
amendments of, or a supplement or supplements to, the Prospectus (in form and
substance satisfactory to the Underwriter and the Underwriter's counsel so
that, as so amended or supplemented, the Prospectus shall not contain an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
(e) The Offerors shall cooperate with the Underwriter and the
Underwriter's counsel in order to qualify the Designated Preferred Securities
for offering and sale under the securities or blue sky laws of such
jurisdictions as the Underwriter may reasonably request and shall continue such
qualifications in effect so long as may be advisable for distribution of the
Designated Preferred Securities; provided, however, that the Offerors shall not
be required to qualify to do business as a foreign corporation or file a general
consent to service of process in any jurisdiction in connection with the
foregoing. The Offerors shall file such statements and reports as may be
required by the laws of each jurisdiction in which the Designated Preferred
Securities have been qualified as above. The Offerors will
19
20
notify the Underwriter immediately of, and confirm in writing, the suspension
of qualification of the Designated Preferred Securities or threat thereof in
any jurisdiction.
(f) The Offerors shall make generally available to their security
holders in the manner contemplated by Rule 158 of the 1933 Act Regulations and
furnish to the Underwriter as soon as practicable, but in any event not later
than 16 months after the Effective Date, a consolidated earnings statement of
the Offerors conforming with the requirements of Section 11(a) of the 1933 Act
and Rule 158.
(g) The Offerors shall use the net proceeds from the sale of the
Designated Preferred Securities to be sold by the Trust hereunder in the manner
specified in the Prospectus under the caption "Use of Proceeds."
(h) For five years from the Effective Date, the Offerors shall furnish
to the Underwriter copies of all reports and communications (financial or
otherwise) furnished by the Offerors to the holders of the Designated Preferred
Securities as a class, copies of all reports and financial statements filed with
or furnished to the Commission (other than portions for which confidential
treatment has been obtained from the Commission) or with any national securities
exchange or the Nasdaq National Market as the Underwriter may reasonably
request, other than such documents, reports and information for which the
Offerors has the legal obligation not to reveal to the Underwriter.
(i) For a period of 180 days from the date hereof, the Offerors shall
not, directly or indirectly, offer for sale, sell or agree to sell or otherwise
dispose of any Designated Preferred Securities, any other beneficial interests
in the assets of the Trust or any securities of the Trust or the Company that
are substantially similar to the Designated Preferred Securities, including any
guarantee of such beneficial interests or substantially similar securities, or
securities convertible into or exchangeable for or that represent the right to
receive any such beneficial interest or substantially similar securities,
without the Underwriter's prior written consent.
(j) The Offerors shall use their best efforts to cause the Designated
Preferred Securities to become quoted on the Nasdaq National Market, or in lieu
thereof a national securities exchange, and to remain so quoted for at least
five years from the Effective Date or for such shorter period as may be
specified in a written consent of the Underwriter, provided this shall not
prevent the Company from redeeming the Designated Preferred Securities pursuant
to the terms of the Trust Agreement. If the Designated Preferred Securities are
exchanged for Debentures, the Company will use its best efforts to have the
Debentures promptly listed on the Nasdaq National Market or other organization
on which the Designated Preferred Securities are then listed, and to have the
Debentures promptly registered under the Exchange Act.
20
21
(k) Subsequent to the date of this Agreement and through the date
which is the later of (i) the day following the date on which the Underwriter's
option to purchase the Option Preferred Securities shall expire or (ii) the day
following the Option Closing Date with respect to any Option Preferred
Securities that the Underwriter shall elect to purchase, except as described in
or contemplated by the Prospectus, neither the Offerors nor the Banks shall take
any action (or refrain from taking any action) which will result in the Offerors
or the Banks incurring any material liability or obligation, direct or
contingent, or enter into any material transaction, except in the ordinary
course of business, and there will not be any material change in the financial
position, capital stock, or any material increase in long-term debt, obligations
under capital leases or short-term borrowings of the Offerors and the Banks on a
consolidated basis.
(l) The Offerors shall not, for a period of 180 days after the date
hereof, without the prior written consent of the Underwriter, purchase, redeem
or call for redemption, or prepay or give notice of prepayment (or announce any
redemption or call for redemption, or any repayment or notice of prepayment) of
any of the Offerors' securities, provided that the foregoing shall not prevent
an employee or director from delivering the Company's securities in payment of
the exercise price of options issued under the Company's Incentive Share Grant
Plan and Stock Option Plans.
(m) The Offerors shall not take, directly or indirectly, any action
designed to result in or which has constituted or which might reasonably be
expected to cause or result in stabilization or manipulation of the price of any
security of the Offerors to facilitate the sale or resale of the Designated
Preferred Securities and the Offerors are not aware of any such action taken or
to be taken by any affiliate of the Offerors.
(n) Prior to the Closing Date (and, if applicable, the Option Closing
Date), the Offerors will not issue any press release or other communication
directly or indirectly or hold any press conference with respect to the
Offerors, the Banks or the offering of the Designated Preferred Securities (the
"Offering") without the Underwriter's prior written consent which will not be
unreasonably withheld.
5. PAYMENT OF EXPENSES. Whether or not this Agreement is terminated
or the sale of the Designated Preferred Securities to the Underwriter is
consummated, the Company covenants and agrees that it will pay or cause to be
paid (directly or by reimbursement) all costs and expenses incident to the
performance of the obligations of the Offerors under this Agreement, including:
(a) the preparation, printing, filing, delivery and shipping of the
initial registration statement, the Preliminary Prospectus or Prospectuses, the
21
22
Registration Statement and the Prospectus and any amendments or supplements
thereto, and the printing, delivery and shipping of this Agreement and any
other underwriting documents (including, without limitation, selected dealers
agreements), the certificates for the Designated Preferred Securities and the
Preliminary and Final Blue Sky Memoranda and any legal investment surveys and
any supplements thereto;
(b) all fees, expenses and disbursements of the Offerors' counsel and
accountants;
(c) all reasonable fees and expenses incurred in connection with the
qualification of the Designated Preferred Securities, Debentures and the
Guarantee under the securities or blue sky laws of such jurisdictions as the
Underwriter may request, including all filing fees and reasonable fees and
disbursements of counsel for the Underwriter in connection therewith, including,
without limitation, in connection with the preparation of the Preliminary and
Final Blue Sky Memoranda and any legal investment surveys and any supplements
thereto;
(d) all fees and expenses incurred in connection with filings made
with the NASD;
(e) any applicable fees and other expenses incurred in connection with
the listing of the Designated Preferred Securities and, if applicable, the
Guarantee and the Debentures on the Nasdaq National Market;
(f) the cost of furnishing to the Underwriter copies of the initial
registration statements, any Preliminary Prospectus, the Registration Statement
and the Prospectus and all amendments or supplements thereto;
(g) the costs and charges of any transfer agent or registrar and the
fees and disbursements of counsel for any transfer agent or registrar;
(h) all costs and expenses (including stock transfer taxes) incurred
in connection with the printing, issuance and delivery of the Designated
Preferred Securities to the Underwriter;
(i) all expenses incident to the preparation, execution and delivery
of the Trust Agreements, the Indenture and the Guarantee; and
(j) all other costs and expenses incident to the performance of the
obligations of the Company hereunder and under the Trust Agreement that are not
otherwise specifically provided for in this Section 5.
If the sale of Designated Preferred Securities contemplated by this
22
23
Agreement is not completed for any reason whatsoever, including without
limitation if this Agreement is terminated by the Offerors or by the
Underwriter for any reason whatsoever, whether or not such termination is
allowable hereunder, the Company will pay the Underwriter its accountable
out-of-pocket expenses in connection herewith or in contemplation of the
performance of the Underwriter's obligations hereunder, including without
limitation travel expenses, reasonable fees, expenses and disbursements of
counsel or other out-of-pocket expenses incurred by the Underwriter in
connection with any discussion of the Offering or the contents of the
Registration Statement, any investigation of the Offerors and the Banks, or any
preparation for the marketing, purchase, sale or delivery of the Designated
Preferred Securities, in each case following presentation of reasonably
detailed invoices therefor.
If the sale of Designated Preferred Securities contemplated by this
Agreement is completed, the Company shall not be responsible for payment of fees
or disbursements of counsel for the Underwriter other than in accordance with
paragraph (c) above, or for the reimbursement of any expenses of the
Underwriter, including but not limited to any advertising expenses related to
any offers made by the Underwriter.
6. CONDITIONS OF THE UNDERWRITER'S OBLIGATIONS. The obligations of
the Underwriter to purchase and pay for the Firm Preferred Securities and,
following exercise of the option granted by the Offerors in Section 1 of this
Agreement, the Option Preferred Securities, are subject, in the Underwriter's
sole discretion, to the accuracy of and compliance with the representations and
warranties and agreements of the Offerors herein as of the date hereof and as of
the Closing Date (or in the case of the Option Preferred Securities, if any, as
of the Option Closing Date), to the accuracy of the written statements of the
Offerors made pursuant to the provisions hereof, to the performance by the
Offerors of their covenants and obligations hereunder and to the following
additional conditions:
(a) If the Registration Statement or any amendment thereto filed prior
to the Closing Date has not been declared effective prior to the time of
execution hereof, the Registration Statement shall become effective not later
than 10:00 a.m., St. Louis time, on the first business day following the time of
execution of this Agreement, or at such later time and date as the Underwriter
may agree to in writing. If required, the Prospectus and any amendment or
supplement thereto shall have been timely filed in accordance with Rule 424(b)
and Rule 430A under the 1933 Act and Section 4(a) hereof. No stop order
suspending the effectiveness of the Registration Statement or any amendment or
supplement thereto shall have been issued under the 1933 Act or any applicable
state securities laws and no proceedings for that purpose shall have been
instituted or shall be pending, or, to the knowledge of the Offerors the
Underwriter, shall be contemplated by the Commission or any state authority.
Any request on the part
23
24
of the Commission or any state authority for additional information (to be
included in the Registration Statement or Prospectus or otherwise) shall have
been disclosed to the Underwriter and complied with to the Underwriter's
satisfaction and to the satisfaction of the Underwriter's counsel.
(b) The Underwriter shall not have advised the Company at or before
the Closing Date (and, if applicable, the Option Closing Date) that the
Registration Statement or any post-effective amendment thereto, or the
Prospectus or any amendment or supplement thereto, contains an untrue statement
of a fact which, in the Underwriter's opinion, is material or omits to state a
fact which, in the Underwriter's opinion, is material and is required to be
stated therein or is necessary to make statements therein (in the case of the
Prospectus or any amendment or supplement thereto, in light of the circumstances
under which they were made) not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Trust Agreement, and the
Designated Preferred Securities, and the authorization and form of the
Registration Statement and Prospectus, other than financial statements and other
financial data, and all other legal matters relating to this Agreement and the
transactions contemplated hereby or by the Trust Agreement shall be satisfactory
in all respects to the Underwriter's counsel, and the Offerors and the Banks
shall have furnished to such counsel all documents and information relating
thereto that they may reasonably request to enable them to pass upon such
matters.
(d) Varnum, Riddering, Xxxxxxx & Xxxxxxx LLP, counsel for the
Offerors, shall have furnished to the Underwriter their signed opinion, dated
the Closing Date or the Option Closing Date, as the case may be, in form and
substance satisfactory to the Underwriter's counsel, to the effect that:
(i) The Company has been duly incorporated and is validly
existing and in good standing under the laws of the State of Michigan, and
is duly registered as a bank holding company under the BHC Act. Each of
the Banks is a state banking corporation duly incorporated, validly
existing and in good standing under the laws of Michigan. Each of the
Banks is a member of the Federal Reserve System, and to the knowledge of
such counsel no proceedings for the termination or revocation of such
membership are pending or threatened. The deposit accounts of the Banks
are insured by the FDIC up to the maximum amount provided by law, except to
the extent the Prospectus discloses such deposit accounts are insured by
SAIF and to such extent the deposit accounts are so insured up to the
maximum amount provided by law; and to the knowledge of such counsel no
proceedings for the termination or revocation of any such insurance or such
membership are pending or threatened. Each of the Company and the Banks
has full
24
25
corporate power and authority to own or lease its properties and to conduct
its business as such business is described in the Prospectus and is
currently conducted in all material respects. All outstanding shares of
capital stock of the Banks have been duly authorized and validly issued and
are fully paid and nonassessable except to the extent such shares may be
deemed assessable under Section 201 of the Michigan Banking Code of 1969,
as amended (M.C.L.A. Section 487.501) or 12 U.S.C. Section 55 or 12 U.S.C.
Section 1831o and, to the best of such counsel's knowledge, except as
disclosed in the Prospectus, there are no outstanding rights, options or
warrants to purchase any such shares or securities convertible into or
exchangeable for any such shares.
(ii) The capital stock, Debentures and Guarantee of the Company
and the equity securities of the Trust conform to the description thereof
contained in the Prospectus in all material respects. The capital stock of
the Company authorized and issued as of September 30, 1996 is as set forth
under the caption "Capitalization" in the Prospectus, has been duly
authorized and validly issued, is fully paid and nonassessable. The form
of certificates to evidence the Designated Preferred Securities has been
approved by the Trust and is in due and proper form and complies with all
applicable requirements. To the best of such counsel's knowledge, there
are no outstanding rights, options or warrants to purchase, no other
outstanding securities convertible into or exchangeable for, and no
commitments, plans or arrangements to issue, any shares of capital stock of
the Company or equity securities of the Trust, except as described in the
Prospectus.
(iii) The issuance, sale and delivery of the Designated Preferred
Securities and Debentures in accordance with the terms and conditions of
this Agreement and the Indenture have been duly authorized by all necessary
actions of the Offerors. The sale and delivery of the Guarantee pursuant
to its terms has been duly authorized by all necessary actions of the
Company. All of the Designated Preferred Securities have been duly and
validly authorized and, when delivered in accordance with this Agreement
will be duly and validly issued, fully paid and nonassessable, and will
conform to the description thereof in the Registration Statement, the
Prospectus and the Trust Agreement. The Designated Preferred Securities
have been approved for quotation on the Nasdaq National Market subject to
official notice of issuance. There are no preemptive or other rights to
subscribe for or to purchase, and other than as disclosed in the Prospectus
no restrictions upon the voting or transfer of, any shares of capital stock
or equity securities of the Offerors or the Banks pursuant to the corporate
charter, by-laws or other governing documents (including without
limitation, the Trust Agreement) of the Offerors or the Banks, or, to the
best of such counsel's knowledge, any agreement or other instrument to
which either
25
26
Offeror or any of the Banks is a party or by which either Offeror or any of
the Banks may be bound.
(iv) The Offerors have all requisite corporate and trust power to
enter into and perform their obligations under this Agreement, and this
Agreement has been duly and validly authorized, executed and delivered by
the Offerors and constitutes the legal, valid and binding obligations of
the Offerors enforceable in accordance with its terms, except as the
enforcement hereof or thereof may be limited by general principles of
equity and by bankruptcy or other laws relating to or affecting creditors'
rights generally, and except as the indemnification and contribution
provisions hereof may be limited under applicable laws and certain remedies
may not be available in the case of a non-material breach.
(v) Each of the Indenture, the Trust Agreement and the
Guarantee has been duly qualified under the Trust Indenture Act, has been
duly authorized, executed and delivered by the Company, and is a valid and
legally binding obligation of the Company enforceable in accordance with
its terms, subject to the effect of bankruptcy, insolvency, reorganization,
receivership, moratorium and other laws affecting the rights and remedies
of creditors generally and of general principles of equity;
(vi) The Debentures have been duly authorized, executed,
authenticated and delivered by the Company, are entitled to the benefits
of the Indenture and are legal, valid and binding obligations of the
Company enforceable against the Company in accordance with their terms,
subject to the effect of bankruptcy, insolvency, reorganization,
receivership, moratorium and other laws affecting the rights and remedies
of creditors generally and of general principles of equity;
(vii) The Expense Agreement has been duly authorized, executed and
delivered by the Company, and is a valid and legally binding obligation
of the Company enforceable in accordance with its terms, subject to the
effect of bankruptcy, insolvency, reorganization, receivership,
moratorium and other laws affecting the rights and remedies of creditors
generally and of general principles of equity;
(viii) To the best of such counsel's knowledge, neither of the
Offerors nor any of the Banks is in breach or violation of, or default
under, with or without notice or lapse of time or both, its corporate
charter, by-laws or governing document (including without limitation, the
Trust Agreement). The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated by this
Agreement, and the Trust Agreement do not and will not conflict with,
result in the creation or
26
27
imposition of any material lien, claim, charge, encumbrance or restriction
upon any property or assets of the Offerors or the Banks or the Designated
Preferred Securities pursuant to, or constitute a material breach or
violation of, or constitute a material default under, with or without
notice or lapse of time or both, any of the terms, provisions or conditions
of the charter, by-laws or governing document (including without
limitation, the Trust Agreement) of the Offerors or the Banks, or to the
best of such counsel's knowledge, any material contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease, franchise,
license or any other agreement or instrument to which either Offeror or the
Banks is a party or by which any of them or any of their respective
properties may be bound or any order, decree, judgment, franchise, license,
Permit, rule or regulation of any court, arbitrator, government, or
governmental agency or instrumentality, domestic or foreign, known to such
counsel having jurisdiction over the Offerors or the Banks or any of their
respective properties which, in each case, is material to the Offerors and
the Banks on a consolidated basis. No authorization, approval, consent or
order of, or filing, registration or qualification with, any person
(including, without limitation, any court, governmental body or authority)
is required under Michigan law in connection with the transactions
contemplated by this Agreement in connection with the purchase and
distribution of the Designated Preferred Securities by the Underwriters.
(ix) To the best of such counsel's knowledge, holders of
securities of the Offerors either do not have any right that, if
exercised, would require the Offerors to cause such securities to be
included in the Registration Statement or have waived such right. To the
best of such counsel's knowledge, neither the Offerors nor any of the
Banks is a party to any agreement or other instrument which grants rights
for or relating to the registration of any securities of the Offerors.
(x) Except as set forth in the Registration Statement and the
Prospectus, to the best of such counsel's knowledge, (i) no action, suit
or proceeding at law or in equity is pending or threatened in writing to
which the Offerors or the Banks is or may be a party, and (ii) no action,
suit or proceeding is pending or threatened in writing against or
affecting the Offerors or the Banks or any of their properties, before or
by any court or governmental official, commission, board or other
administrative agency, authority or body, or any arbitrator, wherein an
unfavorable decision, ruling or finding could have a material adverse
effect on the consummation of this Agreement or the issuance and sale of
the Designated Preferred Securities as contemplated herein or the
condition (financial or otherwise), earnings, affairs, business, or
results of operations of the Offerors and the Banks on a consolidated
basis or which is required to be disclosed in the Registration Statement
or the Prospectus and is not so disclosed.
27
28
(xi) No authorization, approval, consent or order of or filing,
registration or qualification with, any person (including, without
limitation, any court, governmental body or authority) is required in
connection with the transactions contemplated by this Agreement, the Trust
Agreement, the Registration Statement and the Prospectus, except such as
have been obtained under the 1933 Act, and except such as may be required
under state securities laws or Interpretations or Rules of the NASD in
connection with the purchase and distribution of the Designated Preferred
Securities by the Underwriter.
(xii) The Registration Statement and the Prospectus and any
amendments or supplements thereto (other than the financial statements or
other financial data included therein or omitted therefrom and
Underwriter's Information, as to which such counsel need express no
opinion) comply as to form in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations as of their respective dates
of effectiveness.
(xiii) To the best of such counsel's knowledge, there are no
contracts, agreements, leases or other documents of a character required to
be disclosed in the Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement that are not so disclosed or filed.
(xiv) The statements under the captions "Description of Capital
Stock", "Supervision and Regulation", "Description of Preferred
Securities", "Description of Subordinated Debentures", "Description of the
Guarantee", "Relationship Among the Preferred Securities, the Subordinated
Debentures and the Guarantee", "Certain Federal Income Tax Consequences"
and "ERISA Considerations" in the Prospectus, insofar as such statements
constitute a summary of legal and regulatory matters, documents or
proceedings referred to therein are accurate in all material respects and
fairly present the information called for with respect to such legal
matters, documents and proceedings, other than financial and statistical
data as to which said counsel expresses no opinion or belief.
(xv) Such counsel has been advised by the staff of the
Commission that the Registration Statement has become effective under the
1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has
been made within the time period required by Rule 424(b); to the best of
such counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for a stop order
are pending or threatened by the Commission.
(xvi) Except as set forth in the Prospectus, to the best of such
28
29
counsel's knowledge, there are no contractual encumbrances or restrictions,
or material legal restrictions on the ability of the Banks (A) to pay
dividends or make any other distributions on its capital stock or to pay
indebtedness owed to the Offerors, (B) to make any loans or advances to, or
investments in, the Offerors or (C) to transfer any of its property or
assets to the Offerors.
(xvii) To the best of such counsel's knowledge, (A) the business
and operations of the Offerors and the Banks comply in all material
respects with all statutes, ordinances, laws, rules and regulations
applicable thereto and which are material to the Offerors and the Banks on
a consolidated basis, except in those instances where non-compliance would
not materially impair the ability of the Offerors and the Banks to conduct
their business; and (B) the Offerors and the Banks possess and are
operating in all material respects in compliance with the terms, provisions
and conditions of all permits, consents, licenses, franchises and
governmental and regulatory authorizations ("Permits") and required to
conduct their businesses as described in the Prospectus and which are
material to the Offerors and the Banks on a consolidated basis, except in
those instances where the loss thereof or non-compliance therewith would
not have a material adverse effect on the condition (financial or
otherwise), earnings, affairs, business, prospects or results of operations
of the Offerors and the Banks on a consolidated basis; to the best of such
counsel's knowledge, all such Permits are valid and in full force and
effect, and, to the best of such counsel's knowledge, no action, suit or
proceeding is pending or threatened which may lead to the revocation,
termination, suspension or non-renewal of any such Permit, except in those
instances where the loss thereof or non-compliance therewith would not
materially impair the ability of the Offerors or the Banks to conduct their
businesses.
In giving the above opinion, such counsel may state that, insofar
as such opinion involves factual matters, they have relied upon certificates of
officers of the Offerors including, without limitation, certificates as to the
identity of any and all material contracts, indentures, mortgages, deeds of
trust, loans or credit agreements, notes, leases, franchises, licenses or other
agreements or instruments, and all material permits, easements, consents,
licenses, franchises and government regulatory authorizations, for purposes of
paragraphs (viii), (xiii) and (xvii) hereof and certificates of public
officials.
Such counsel shall also confirm that, in connection with the
preparation of the Registration Statement and Prospectus, such counsel has
participated in conferences with officers and representatives of the Offerors
and with their independent public accountants and with the Underwriter and the
Underwriter's counsel, at which conferences such counsel made inquiries of such
29
30
officers, representatives and accountants and discussed in detail the contents
of the Registration Statement and Prospectus and such counsel has no reason to
believe (A) that the Registration Statement or any amendment thereto (except
for the financial statements and related schedules and statistical data
included therein or omitted therefrom or Underwriter's Information, as to which
such counsel need express no opinion), at the time the Registration Statement
or any such amendment became effective, contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (B) that the
Prospectus or any amendment or supplement thereto (except for the financial
statements and related schedules and statistical data included therein or
omitted therefrom or Underwriter's Information, as to which such counsel need
express no opinion), at the time the Registration Statement became effective
(or, if the term "Prospectus" refers to the prospectus first filed pursuant to
Rule 424(b) of the 1933 Act Regulations, at the time the Prospectus was
issued), at the time any such amended or supplemented Prospectus was issued, at
the Closing Date and, if applicable, the Option Closing Date, contained or
contains any untrue statement of a material fact or omitted or omits to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading.
(e) Xxxxxxxx, Xxxxxx and Finger, special Delaware counsel to the
Offerors, shall have furnished to the Underwriter their signed opinion, dated as
of Closing Date or the Option Closing Date, as the case may be, in form and
substance satisfactory to such counsel, to the effect that:
(i) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business
Trust Act and, under the Trust Agreement and the Delaware
Business Trust Act, has the trust power and authority to conduct
its business as described in the Prospectus.
(ii) The Trust Agreement is a legal, valid and binding agreement
of the Company and the Trustees, and is enforceable against the
Company and the Trustees, in accordance with its terms.
(iii) Under the Trust Agreement and the Delaware Business Trust
Act, the execution and delivery of the Underwriting Agreement by
the Trust, and the performance by the Trust of its obligations
thereunder, have been authorized by all requisite trust action on
the part of the Trust.
(iv) The Designated Preferred Securities have been duly
authorized by the Trust Agreement, and when issued and sold in
accordance with
30
31
the Trust Agreement, the Designated Preferred Securities will be,
subject to the qualifications set forth in paragraph (v) below,
fully paid and nonassessable beneficial interest in the assets of
the Trust and entitled to the benefits of the Trust Agreement.
(v) Holders of Designated Preferred Securities, as beneficial
owners of the Trust, will be entitled to the same limitation of
personal liability extended to stockholders of private,
for-profit corporations organized under the General Corporation
Law of the State of Delaware. Such opinion may note that the
holders of Designated Preferred Securities may be obligated to
make payments as set forth in the Trust Agreement.
(vi) Under the Delaware Business Trust Act and the Trust
Agreement, the issuance of the Designated Preferred Securities is
not subject to preemptive rights.
(vii) The issuance and sale by the Trust of the Designated
Preferred Securities and the Common Securities, the execution,
delivery and performance by the Trust of this Agreement, and the
consummation of the transactions contemplated by this Agreement,
do not violate (a) the Trust Agreement, or (b) any applicable
Delaware law, rule or regulation.
Such opinion may state that it is limited to the laws of the State of
Delaware and that the opinion expressed in paragraph (ii) above is subject
to the effect upon the Trust Agreement of (i) bankruptcy, insolvency,
moratorium, receivership, reorganization, liquidation, fraudulent
conveyance and other similar laws relating to or affecting the rights and
remedies of creditors generally, (ii) principles of equity, including
applicable law relating to fiduciary duties (regardless of whether
considered and applied in a proceeding in equity or at law), and (iii) the
effect of applicable public policy on the enforceability of provisions
relating to indemnification or contribution.
(f) Xxxxx Xxxx LLP, counsel for the Underwriter, shall have
furnished the Underwriter their signed opinion, dated the Closing Date or
the Option Closing Date, as the case may be, with respect to the
sufficiency of all corporate procedures and other legal matters relating to
this Agreement, the validity of the Designated Preferred Securities, the
Registration Statement, the Prospectus and such other related matters as
the Underwriter may reasonably request and there shall have been furnished
to such counsel such documents and other information as they may request to
enable them to pass on such matters. In giving such opinion, Xxxxx Xxxx
LLP may rely as to matters of fact upon statements and certifications of
officers of the Offerors and of other appropriate persons and may rely as
to
31
32
matters of law, other than law of the United States and the State of Missouri,
and upon the opinions of Varnum, Riddering, Xxxxxxx & Xxxxxxx LLP and Xxxxxxxx,
Xxxxxx and Finger described herein.
(g) On the date of this Agreement and on the Closing Date (and, if
applicable, any Option Closing Date), the Underwriter shall have received from
KPMG Peat Marwick LLP a letter, dated the date of this Agreement and the Closing
Date (and, if applicable, the Option Closing Date), respectively, in form and
substance satisfactory to the Underwriter, confirming that they are independent
public accountants with respect to Company, within the meaning of the 1933 Act
and the 1933 Act Regulations, and stating in effect that:
(i) In their opinion, the consolidated financial statements of
the Company audited by them and included in the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations.
(ii) On the basis of the procedures specified by the American
Institute of Certified Public Accountants as described in SAS No. 71,
"Interim Financial Information", inquiries of officials of the Company
responsible for financial and accounting matters, and such other inquiries
and procedures as may be specified in such letter, which procedures do not
constitute an audit in accordance with U.S. generally accepted auditing
standards, nothing came to their attention that caused them to believe
that, if applicable, the unaudited interim consolidated financial
statements of the Company included in the Registration Statement do not
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act and 1933 Act Regulations or are not in
conformity with U.S. generally accepted accounting principles applied on a
basis substantially consistent, except as noted in the Registration
Statement, with the basis for the audited consolidated financial statements
of the Company included in the Registration Statement.
(iii) On the basis of limited procedures, not constituting an
audit in accordance with U.S. generally accepted auditing standards,
consisting of a reading of the unaudited interim financial statements and
other information referred to below, a reading of the latest available
unaudited condensed consolidated financial statements of the Company,
inspection of the minute books of the Company since the date of the latest
audited financial statements of the Company included in the Registration
Statement, inquiries of officials of the Company responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
32
33
(A) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock of the Company, any increase in the
consolidated debt of the Company, any decreases in consolidated
total assets or shareholders equity of the Company, or any changes,
decreases or increases in other items specified by the Underwriter,
in each case as compared with amounts shown in the latest unaudited
interim consolidated statement of financial condition of the
Company included in the Registration Statement except in each case
for changes, increases or decreases which the Registration
Statement specifically discloses, have occurred or may occur or
which are described in such letter; and
(B) for the period from the date of the latest unaudited
interim consolidated financial statements included in the
Registration Statement to the specified date referred to in Clause
(iii)(A), there were any decreases in the consolidated interest
income, net interest income, or net income of the Company or in the
per share amount of net income of the Company, or any changes,
decreases or increases in any other items specified by the
Underwriter, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding
length specified by the Underwriter, except in each case for
increases or decreases which the Registration Statement discloses
have occurred or may occur, or which are described in such letter.
(iv) In addition to the audit referred to in their report
included in the Registration Statement and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (ii) and (iii) above, they have carried out certain specified
procedures, not constituting an audit in accordance with U.S. generally
accepted auditing standards, with respect to certain amounts, percentages
and financial information specified by the Underwriter which are derived
from the general accounting records and consolidated financial statements
of the Company which appear in the Registration Statement specified by the
Underwriter in the Registration Statement, and have compared such amounts,
percentages and financial information with the accounting records and the
material derived from such records and consolidated financial statements of
the Company have found them to be in agreement.
In the event that the letters to be delivered referred to above set
forth any such changes, decreases or increases as specified in Clauses (iii)(A)
or (iii)(B) above, or any exceptions from such agreement specified in Clause
(iv) above, it
33
34
shall be a further condition to the obligations of the Underwriter that the
Underwriter shall have determined, after discussions with officers of the
Company responsible for financial and accounting matters, that such changes,
decreases, increases or exceptions as are set forth in such letters do not (x)
reflect a material adverse change in the items specified in Clause (iii)(A)
above as compared with the amounts shown in the latest unaudited consolidated
statement of financial condition of the Company included in the Registration
Statement, (y) reflect a material adverse change in the items specified in
Clause (iii)(B) above as compared with the corresponding periods of the prior
year or other period specified by the Underwriter, or (z) reflect a material
change in items specified in Clause (iv) above from the amounts shown in the
Preliminary Prospectus distributed by the Underwriter in connection with the
offering contemplated hereby or from the amounts shown in the Prospectus.
(h) At the Closing Date and, if applicable, the Option Closing Date, the
Underwriter shall have received certificates of the chief executive officer and
the chief financial and accounting officer of the Company, which certificates
shall be deemed to be made on behalf of the Company dated as of the Closing
Date and, if applicable, the Option Closing Date, evidencing satisfaction of
the conditions of Section 6(a) and stating that (i) the representations and
warranties of the Company set forth in Section 2(a) hereof are accurate as of
the Closing Date and, if applicable, the Option Closing Date, and that the
Offerors have complied with all agreements and satisfied all conditions on
their part to be performed or satisfied at or prior to such Closing Date; (ii)
since the respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any material adverse change in
the condition (financial or otherwise), earnings, affairs, business, prospects
or results of operations of the Offerors and the Banks on a consolidated basis;
(iii) since such dates there has not been any material transaction entered into
by the Offerors or the Banks other than transactions in the ordinary course of
business; and (iv) they have carefully examined the Registration Statement and
the Prospectus as amended or supplemented and nothing has come to their
attention that would lead them to believe that either the Registration
Statement or the Prospectus, or any amendment or supplement thereto as of their
respective effective or issue dates, contained, and the Prospectus as amended
or supplemented at such Closing Date (and, if applicable, the Option Closing
Date), contains any untrue statement of a material fact, or omits to state 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; and (v) covering such other matters as the Underwriter
may reasonably request. The officers' certificate of the Company shall further
state that no stop order affecting the Registration Statement is in effect or,
to their knowledge, threatened.
(i) At the Closing Date and, if applicable, the Option Closing Date, the
Underwriter shall have received a certificate of an authorized representative
of
34
35
the Trust to the effect that to the best of his or her knowledge based upon a
reasonable investigation, the representations and warranties of the Trust in
this Agreement are true and correct as though made on and as of the Closing
Date (and, if applicable, the Option Closing Date); the Trust has complied with
all the agreements and satisfied all the conditions required by this Agreement
to be performed or satisfied by the Trust on or prior to the Closing Date and
since the most recent date as of which information is given in the Prospectus,
except as contemplated by the Prospectus, the Trust has not incurred any
material liabilities or obligations, direct or contingent, or entered into any
material transactions not in the ordinary course of business and there has not
been any material adverse change in the condition (financial or otherwise) of
the Trust.
(j) On the Closing Date, the Underwriter shall have received duly
executed counterparts of the Trust Agreement, the Guarantee, the Indenture and
the Expense Agreement.
(k) The NASD, upon review of the terms of the public offering of the
Designated Preferred Securities, shall not have objected to the Underwriter's
participation in such offering.
(l) Prior to the Closing Date and, if applicable, the Option Closing
Date, the Offerors shall have furnished to the Underwriter and the Underwriter's
counsel all such other documents, certificates and opinions as they have
reasonably requested.
All opinions, certificates, letters and other documents shall be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to the Underwriter. The Offerors shall furnish the
Underwriter with conformed copies of such opinions, certificates, letters and
other documents as the Underwriter shall reasonably request.
If any of the conditions referred to in this Section 6 shall not have
been fulfilled when and as required by this Agreement, this Agreement and all of
the Underwriter's obligations hereunder may be terminated by the Underwriter on
notice to the Company at, or at any time before, the Closing Date or the Option
Closing Date, as applicable. Any such termination shall be without liability of
the Underwriter to the Offerors.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Offerors agree to jointly and severally indemnify and hold
harmless the Underwriter, each of its directors, officers and agents, and each
person, if any, who controls the Underwriter within the meaning of the 1933 Act,
against any and all losses, claims, damages, liabilities and expenses (including
35
36
reasonable costs of investigation and reasonable attorney fees and expenses),
joint or several, arising out of or based (i) upon any untrue statement or
alleged untrue statement of a material fact made by the Company or the Trust
contained in Section 2(a) of this Agreement (or any certificate delivered by
the Company or the Trust pursuant hereto Section 6(l) hereto) or the
registration statement as originally filed or the Registration Statement, any
Preliminary Prospectus or the Prospectus, or in any amendment or supplement
thereto, (ii) upon any blue sky application or other document executed by the
Company or the Trust specifically for that purpose or based upon written
information furnished by the Company or the Trust filed in any state or other
jurisdiction in order to qualify any of the Designated Preferred Securities
under the securities laws thereof (any such application, document or
information being hereinafter referred to as a "Blue Sky Application"), (iii)
any omission or alleged omission to state a material fact in the registration
statement as originally filed or the Registration Statement, any Preliminary
Prospectus or the Prospectus, or in any amendment or supplement thereto, or in
any Blue Sky Application) required to be stated therein or necessary to make
the statements therein not misleading, and against any and all losses, claims,
damages, liabilities and expenses (including reasonable costs of investigation
and attorney fees), joint or several, arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus or the Prospectus, or in any amendment of supplement
thereto, or arising out of or based upon any omission or alleged omission to
state therein 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 made, not misleading or (iv) the enforcement of this indemnification
provision or the contribution provisions of Section 7(d); and shall reimburse
each such indemnified party for any reasonable legal or other expenses as
incurred, but in no event less frequently than 30 days after each invoice is
submitted, incurred by them in connection with investigating or defending
against or appearing as a third-party witness in connection with any such loss,
claim, damage, liability or action, notwithstanding the possibility that
payments for such expenses might later be held to be improper, in which case
such payments shall be promptly refunded; provided, however, that the Offerors
shall not be liable in any such case to the extent, but only to the extent,
that any such losses, claims, damages, liabilities and expenses arise out of or
are based upon any untrue statement or omission or allegation thereof that has
been made therein or omitted therefrom in reliance upon and in conformity with
information furnished in writing to the Offerors through the Underwriter
expressly for use therein beneath the heading "Underwriting;" provided, that
the indemnification contained in this paragraph with respect to any Preliminary
Prospectus shall not inure to the benefit of the Underwriter (or of any person
controlling the Underwriter) to the extent any such losses, claims, damages,
liabilities or expenses directly results from the fact that the Underwriter
sold Designated Preferred Securities to a person to whom there was not sent or
given, at or prior to the written confirmation of such sale, a copy of the
Prospectus (as amended or supplemented if any amendments or
36
37
supplements thereto shall have been furnished to the Underwriter in sufficient
time to distribute same with or prior to the written confirmation of the sale
involved), if required by law, and if such loss, claim, damage, liability or
expense would not have arisen but for the failure to give or send such person
such document. The foregoing indemnity agreement is in addition to any
liability the Company or the Trust may otherwise have to any such indemnified
party.
(b) The Underwriter, agrees to indemnify and hold harmless each
Offeror, each of its directors, each of its officers who signed the Registration
Statement and each person, if any, who controls an Offeror within the meaning of
the 1933 Act, to the same extent as required by the foregoing indemnity from the
Company to the Underwriter, but only with respect to information relating to the
Underwriter furnished in writing to an Offeror through the Underwriter by or on
behalf of it expressly for use in connection with the registration statement as
originally filed, the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, beneath the heading
"Underwriting" or in a Blue Sky Application. The foregoing indemnity agreement
is in addition to any liability which the Underwriter may otherwise have to any
such indemnified party.
(c) If any action or claim shall be brought or asserted against any
indemnified party or any person controlling an indemnified party in respect of
which indemnity may be sought from the indemnifying party, such indemnified
party or controlling person shall promptly notify the indemnifying party in
writing, and the indemnifying party shall assume the defense thereof, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all expenses; provided, however, that the failure so to notify
the indemnifying party shall not relieve it from any liability which it may have
to an indemnified party otherwise than under such paragraph, and further, shall
only relieve it from liability under such paragraph to the extent prejudiced
thereby. Any indemnified party or any such controlling person shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such indemnified party or such controlling person unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) the indemnifying party has failed to assume the defense or to
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
such indemnified party or such controlling person and the indemnifying party and
such indemnified party or such controlling person shall have been advised by
such counsel that there may be one or more legal defenses available to it that
are different from or in addition to those available to the indemnifying party
(in which case, if such indemnified party or controlling person notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the
37
38
defense of such action on behalf of such indemnified party or such controlling
person) it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time and for all such
indemnified party and controlling persons, which firm shall be designated in
writing by the indemnified party. Each indemnified party and each controlling
person, as a condition of such indemnity, shall use reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. The indemnifying party shall not be liable for any settlement of any
such action effected without its written consent, but if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party and any such controlling
person from and against any loss, claim, damage, liability or expense by reason
of such settlement or judgment.
An indemnifying party shall not, without the prior written consent of
each indemnified party, settle, compromise or consent to the entry of any
judgment in any pending or threatened claim, action, suit or proceeding in
respect of which indemnity may be sought hereunder (whether or not such
indemnified party or any person who controls such indemnified party within the
meaning of the 1933 Act is a party to such claim, action, suit or proceeding),
unless such settlement, compromise or consent includes a release of each such
indemnified party reasonably satisfactory to each such indemnified party and
each such controlling person from all liability arising out of such claim,
action, suit or proceeding or unless the indemnifying party shall confirm in a
written agreement with each indemnified party, that notwithstanding any federal,
state or common law, such settlement, compromise or consent shall not alter the
right of any indemnified party or controlling person to indemnification or
contribution as provided in this Agreement.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
paragraphs (a), (b) or (c) hereof in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities or expenses (i) in such proportion as is appropriate to
reflect the relative benefits received by the Offerors on the one hand and the
Underwriter on the other from the offering of the Designated Preferred
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Offerors on the one hand and the Underwriter on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities
38
39
or expenses, as well as any other relevant equitable considerations. The
relative benefits received by the Offerors on the one hand and the Underwriter
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Designated Preferred Securities (before
deducting expenses) received by the Offerors bear to the total underwriting
discounts, commissions and compensation received by the Underwriter, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault of the Offerors on the one hand and of the Underwriter on the
other 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 Offerors or by the Underwriter and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. Each Offeror and the Underwriter agrees that it would
not be just and equitable if contribution pursuant to this paragraph (d) were
determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in the first sentence of
this paragraph (d) shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this paragraph (d), the
Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which the Designated Preferred Securities
underwritten by such Underwriter and distributed to the public were offered to
the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 0000 Xxx) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
For purposes of this paragraph (d), each person who controls the
Underwriter within the meaning of the 1933 Act shall have the same rights to
contribution as such Underwriter, and each person who controls an Offeror within
the meaning of the 1933 Act, each officer and trustee of an Offeror who shall
have signed the Registration Statement and each director of an Offeror shall
have the same rights to contribution as the Offerors subject in each case to the
preceding sentence. The obligations of the Offerors under this paragraph (d)
shall be in addition to any liability which the Offerors may otherwise have and
the obligations of the Underwriter under this paragraph (d) shall be in addition
to any liability that the Underwriter may otherwise have.
(e) The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Offerors set forth in
this
39
40
Agreement shall remain operative and in full force and effect, regardless of
(i) any investigation made by or on behalf of the Underwriter or any person
controlling the Underwriter or by or on behalf of the Offerors, or such
directors, trustees or officers (or any person controlling an Offeror, (ii)
acceptance of any Designated Preferred Securities and payment therefor
hereunder and (iii) any termination of this Agreement. A successor of the
Underwriter or of an Offeror, such directors, trustees or officers (or of any
person controlling the Underwriter or an Offeror) shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 7.
(f) The Company agrees to indemnify the Trust against any and all
losses, claims, damages or liabilities that may become due from the Trust under
this Section 7.
8. TERMINATION. The Underwriter shall have the right to terminate
this Agreement at any time at or prior to the Closing Date or, with respect to
the Underwriter's obligation to purchase the Option Preferred Securities, at any
time at or prior to the Option Closing Date, without liability on the part of
the Underwriter to the Offerors, if:
(a) Either Offeror shall have failed, refused, or been unable to
perform any agreement on its part to be performed under this Agreement, or any
of the conditions referred to in Section 6 shall not have been fulfilled, when
and as required by this Agreement;
(b) The Offerors or the Banks shall have sustained any material loss
or interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree which in the judgment of the Underwriter
materially impairs the investment quality of the Designated Preferred
Securities;
(c) There has been since the respective dates as of which information
is given in the Registration Statement or the Prospectus, any materially adverse
change in, or any development which is reasonably likely to have a material
adverse effect on, the condition (financial or otherwise), earnings, affairs,
business, prospects or results of operations of the Offerors and the Banks on a
consolidated basis, whether or not arising in the ordinary course of business;
(d) There has occurred any outbreak of hostilities or other calamity
or crisis or material change in general economic, political or financial
conditions, or internal conditions, the effect of which on the financial markets
of the United States is such as to make it, in the Underwriter's reasonable
judgment, impracticable to market the Designated Preferred Securities or enforce
contracts for the sale of the Designated Preferred Securities;
40
41
(e) Trading generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market shall have been suspended, or
minimum or maximum prices for trading shall have been fixed, or maximum ranges
for prices for securities shall have been required, by any of said exchanges or
market system or by the Commission or any other governmental authority;
(f) A banking moratorium shall have been declared by either federal or
Michigan authorities; or
(g) Any action shall have been taken by any government in respect of
its monetary affairs which, in the Underwriter's reasonable judgment, has a
material adverse effect on the United States securities markets.
If this Agreement shall be terminated pursuant to this Section 8, the
Offerors shall not then be under any liability to the Underwriter except as
provided in Sections 5 and 7 hereof.
9. EFFECTIVE DATE OF AGREEMENT. If the Registration Statement is not
effective at the time of execution of this Agreement, this Agreement shall
become effective on the Effective Date at the time the Commission declares the
Registration Statement effective. The Company shall immediately notify the
Underwriter when the Registration Statement becomes effective.
If the Registration Statement is effective at the time of execution of
this Agreement, this Agreement shall become effective at the earlier of 11:00
a.m. St. Louis time, on the first full business day following the day on which
this Agreement is executed, or at such earlier time as the Underwriter shall
release the Designated Preferred Securities for initial public offering. The
Underwriter shall notify the Offerors immediately after it has taken any action
which causes this Agreement to become effective.
Until such time as this Agreement shall have become effective, it may
be terminated by the Offerors, by notifying the Underwriter, or by the
Underwriter by notifying either Offeror, except that the provisions of Sections
5 and 7 shall at all times be effective.
10. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
The representations, warranties, indemnities, agreements and other statements of
the Offerors and their officers and trustees set forth in or made pursuant to
this Agreement and the agreements of the Underwriter contained in Section 7
hereof shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of the Offerors or controlling persons of
either
41
42
Offeror, or by or on behalf of the Underwriter or controlling persons of the
Underwriter or any termination or cancellation of this Agreement and shall
survive delivery of and payment for the Designated Preferred Securities.
11. NOTICES. Except as otherwise provided in this Agreement, all
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if delivered by hand, mailed by registered or
certified mail, return receipt requested, or transmitted by any standard form of
telecommunication and confirmed. Notices to either Offeror shall be sent to 000
Xxxx Xxxx Xxxxxx, X.X. Xxx 000, Xxxxx, Xxxxxxxx 00000, Attention: Xxxxxxx X.
Xxxxx (with a copy to Varnum, Riddering, Xxxxxxx & Xxxxxxx LLP, 000 Xxxxxx
Xxxxxx, X.X., X.X. Xxx 000, Xxxxx Xxxxxx, Xxxxxxxx 00000-0000, Attention:
Xxxxxxx X. Xxxxxxxxxx, Esq.); and notices to the Underwriter shall be sent to
Xxxxxx, Xxxxxxxx & Company, Incorporated, 000 Xxxxx Xxxxxxxx, Xxxxx 0000, Xx.
Xxxxx, Xxxxxxxx 00000, Attention: Xxxx X. Xxxxxx (with a copy to Xxxxx Xxxx
LLP, 000 Xxxxx Xxxxxxxx, Xxxxx 0000, Xx. Xxxxx, Xxxxxxxx 00000, Attention: Xxxxx
X. Xxxxx, Xx., Esq.).
12. PARTIES. The Agreement herein set forth is made solely for the
benefit of the Underwriter and the Offerors and, to the extent expressed,
directors, trustees and officers of the Offerors, any person controlling the
Offerors or the Underwriter, and their respective successors and assigns. No
other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any purchaser,
in his status as such purchaser, from the Underwriter of the Designated
Preferred Securities.
13. GOVERNING LAW. This Agreement shall be governed by the laws of
the State of Missouri, without giving effect to the choice of law or conflicts
of law principles thereof.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and when a counterpart has been executed by each party hereto all
such counterparts taken together shall constitute one and the same Agreement.
42
43
If the foregoing is in accordance with the your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
shall become a binding agreement between the Company, the Trust and you in
accordance with its terms.
Very truly yours,
INDEPENDENT BANK CORPORATION
By:
-------------------------
Name:
Title:
IBC CAPITAL FINANCE
By:
----------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of December __, 1996.
XXXXXX, XXXXXXXX & COMPANY, INCORPORATED
By:
-------------------------------
Name:
Title:
43
