1
Exhibit 1
4,000,000 SHARES
AMERICAN FINANCIAL GROUP, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
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December __, 1995
CS FIRST BOSTON CORPORATION
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
XXXXXX XXXX INCORPORATED
As Representatives of the Several Underwriters,
c/o CS First Xxxxxx Xxxxxxxxxxx,
Xxxx Xxxxxx Xxxxx,
Xxx Xxxx, X.X. 00000
Dear Sirs:
1. Introductory. American Financial Group, Inc., an Ohio corporation
("Company"), proposes to issue and sell 4,000,000 shares ("Firm Securities") of
its common stock, $1.00 par value ("Securities"), and also proposes to issue
and sell to the Underwriters, at the option of the Underwriters, an aggregate
of not more than 600,000 additional shares ("Optional Securities") of its
Securities as set forth below. The Firm Securities and the Optional Securities
are herein collectively called the "Offered Securities". The Company hereby
agrees with the several Underwriters named in Schedule A hereto
("Underwriters") as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 33- ) relating to the
Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("Commission") and either (i)
has been declared effective under the Securities Act of 1933 ("Act")
and is not proposed to be amended or (ii) is proposed to be amended by
amendment or post-effective amendment. If such registration statement
("initial registration statement") has been declared effective, either
(i) an additional registration statement ("additional registration
statement") relating to the Offered Securities may have been filed with
the Commission pursuant to Rule 462(b) ("Rule 462(b)") under the Act
and, if so filed, has become effective upon filing pursuant to such
Rule and the Offered Securities all have been duly registered under the
Act pursuant to the initial registration statement and, if applicable,
the additional registration statement or (ii) such an additional
registration statement is proposed to be filed with the Commission
pursuant to Rule 462(b) and will become effective upon filing pursuant
to such Rule and upon such filing the Offered Securities will all have
been duly registered under the Act pursuant to the initial registration
statement and such additional registration statement. If the Company
does not propose to amend the initial registration statement or if an
additional registration statement has been filed and the Company does
not propose to amend it, and if any post-effective amendment
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to either such registration statement has been filed with the
Commission prior to the execution and delivery of this Agreement, the
most recent amendment (if any) to each such registration statement has
been declared effective by the Commission or has become effective upon
filing pursuant to Rule 462(c) ("Rule 462(c)") under the Act or, in the
case of the additional registration statement, Rule 462(b). For
purposes of this Agreement, "Effective Time" with respect to the
initial registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement means
(i) if the Company has advised the Representatives that it does not
propose to amend such registration statement, the date and time as of
which such registration statement, or the most recent post-effective
amendment thereto (if any) filed prior to the execution and delivery of
this Agreement, was declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c), or (ii) if the Company
has advised the Representatives that it proposes to file an amendment
or post-effective amendment to such registration statement, the date
and time as of which such registration statement, as amended by such
amendment or post-effective amendment, as the case may be, is declared
effective by the Commission. If an additional registration statement
has not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Representatives that it
proposes to file one, "Effective Time" with respect to such additional
registration statement means the date and time as of which such
registration statement is filed and becomes effective pursuant to Rule
462(b). "Effective Date" with respect to the initial registration
statement or the additional registration statement (if any) means the
date of the Effective Time thereof. The initial registration statement,
as amended at its Effective Time, including all material incorporated
by reference therein, including all information contained in the
additional registration statement (if any) and deemed to be a part of
the initial registration statement as of the Effective Time of the
additional registration statement pursuant to the General Instructions
of the Form on which it is filed and including all information (if any)
deemed to be a part of the initial registration statement as of its
Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act,
is hereinafter referred to as the "Initial Registration Statement". The
additional registration statement, as amended at its Effective Time,
including the contents of the initial registration statement
incorporated by reference therein and including all information (if
any) deemed to be a part of the additional registration statement as of
its Effective Time pursuant to Rule 430A(b), is hereinafter referred to
as the "Additional Registration Statement". The Initial Registration
Statement and the Additional Registration Statement are herein referred
to collectively as the "Registration Statements" and individually as a
"Registration Statement". The form of prospectus relating to the
Offered Securities, as first filed with the Commission pursuant to and
in accordance with Rule 424(b) ("Rule 424(b)") under the Act or (if no
such filing is required) as included in a Registration Statement,
including all material incorporated by reference in such prospectus, is
hereinafter referred to as the "Prospectus". No document has been or
will be prepared or distributed in reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (i)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the Commission
("Rules and Regulations") and did not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (ii) on the
Effective Date of the Additional Registration Statement (if any), each
Registration Statement conformed, or will conform, in all respects to
the requirements of the Act and the Rules and Regulations and did not
include, or will not include, any untrue statement of a material fact
and did not omit, or will not 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
and (iii) on the date of this Agreement, the Initial Registration
Statement and, if the Effective Time of the Additional Registration
Statement is prior
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to the execution and delivery of this Agreement, the Additional
Registration Statement each conforms, and at the time of filing of the
Prospectus pursuant to Rule 424(b) or (if no such filing is required)
at the Effective Date of the Additional Registration Statement in which
the Prospectus is included, each Registration Statement and the
Prospectus will conform, in all respects to the requirements of the Act
and the Rules and Regulations, and neither of such documents includes,
or will include, any untrue statement of a material fact or omits, or
will 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. If the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all respects to the requirements of the Act
and the Rules and Regulations, neither of such documents will include
any untrue statement of a material fact or will 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, and no Additional Registration Statement has been
or will be filed. The two preceding sentences do not apply to
statements in or omissions from a Registration Statement or the
Prospectus based upon written information furnished to the Company by
any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(b).
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Ohio, with
power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus; and the Company is
duly qualified to do business as a foreign corporation in good standing
in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification, except
where the failure to so qualify will not, individually or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries taken as a whole.
(d) Each subsidiary of the Company listed on Schedule A
annexed hereto has been duly incorporated and is an existing
corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Prospectus;
and each such subsidiary of the Company is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to so qualify will not, individually or in the aggregate, have
a material adverse effect on the Company and its subsidiaries taken as
a whole; all of the issued and outstanding capital stock of each
subsidiary of the Company has been duly authorized and validly issued
and is fully paid and nonassessable; and the capital stock of each such
subsidiary owned by the Company, directly or through subsidiaries, is
owned free from liens, encumbrances and defects.
(e) The Offered Securities and all other outstanding shares
of capital stock of the Company have been duly authorized; all
outstanding shares of capital stock of the Company are, and, when the
Offered Securities have been delivered and paid for in accordance with
this Agreement on each Closing Date (as defined below), such Offered
Securities will have been, validly issued, fully paid and nonassessable
and will conform to the description thereof contained in the
Prospectus; and the stockholders of the Company have no preemptive
rights with respect to the Securities.
(f) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against
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the Company or any Underwriter for a brokerage commission, finder's fee
or other like payment with respect to the Offered Securities.
(g) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(h) The Offered Securities have been approved for listing on
the New York Stock Exchange subject to notice of issuance.
(i) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplated by this Agreement
in connection with the issuance and sale of the Offered Securities by
the Company, except such as have been obtained and made under the Act
and such as may be required under state securities laws.
(j) The execution, delivery and performance of this
Agreement, and the issuance and sale of the Offered Securities will not
result in a breach or violation of any of the terms and provisions of,
or constitute a default under, any statute, any rule, regulation or
order of any governmental agency or body or any court, domestic or
foreign, having jurisdiction over the Company or any subsidiary of the
Company or any of their properties, or any agreement or instrument to
which the Company or any such subsidiary is a party or by which the
Company or any such subsidiary is bound or to which any of the
properties of the Company or any such subsidiary is subject, or the
charter or Code of Regulations or by-laws of the Company or any such
subsidiary, and the Company has full power and authority to authorize,
issue and sell the Offered Securities as contemplated by this
Agreement.
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) Except as disclosed in the Prospectus, the Company and
its subsidiaries have good and marketable title to all real properties
and all other properties and assets owned by them, in each case free
from liens, encumbrances and defects that would materially affect the
value thereof or materially interfere with the use made or to be made
thereof by them; and except as disclosed in the Prospectus, the Company
and its subsidiaries hold any leased real or personal property under
valid and enforceable leases with no exceptions that would materially
interfere with the use made or to be made thereof by them.
(m) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the businesses now operated by
them and have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the Company and its subsidiaries taken as a whole.
(n) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent that
might have a material adverse effect on the Company and its
subsidiaries taken as a whole.
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(o) The Company and its subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and other
rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively,
"intellectual property rights") necessary to conduct the business now
operated by them, or presently employed by them, and have not received
any notice of infringement of or conflict with asserted rights of
others with respect to any intellectual property rights that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
Company and its subsidiaries taken as a whole.
(p) Except as disclosed in the Prospectus, neither the
Company nor any of its subsidiaries is in violation of any statute, any
rule, regulation, decision or order of any governmental agency or body
or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "environmental laws"), owns or
operates any real property contaminated with any substance that is
subject to any environmental laws, is liable for any off-site disposal
or contamination pursuant to any environmental laws, or is subject to
any claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a material adverse effect on the Company and its
subsidiaries taken as a whole; and the Company is not aware of any
pending investigation which might lead to such a claim.
(q) Except as disclosed in the Prospectus, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
condition (financial or other), business, prospects or results of
operations of the Company and its subsidiaries taken as a whole, or
would materially and adversely affect the ability of the Company to
perform its obligations under this Agreement, or which are otherwise
material in the context of the sale of the Offered Securities; and no
such actions, suits or proceedings are threatened or, to the Company's
knowledge, contemplated.
(r) The financial statements included in each Registration
Statement and the Prospectus present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates shown and
their results of operations and cash flows for the periods shown, and,
except as noted thereon, such financial statements have been prepared
in conformity with the generally accepted accounting principles in the
United States applied on a consistent basis; and the schedules included
in each Registration Statement present fairly the information required
to be stated therein.
(s) Except as disclosed in the Prospectus, since the date of
the latest audited financial statements included in the Prospectus,
there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole, and, except as
disclosed in or contemplated by the Prospectus, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(t) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940.
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(u) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida Statutes
and the Company agrees to comply with such Section if prior to the
completion of the distribution of the Offered Securities it commences
doing such business.
(v) Except as set forth in the Prospectus, (i) all of the
outstanding shares of capital stock and other ownership interests of
the Company and any of its subsidiaries in Xxxxxxxx Brands
International, Inc. ("Xxxxxxxx"), Citicasters Inc. ("Citicasters") and
American Financial Enterprises, Inc. ("AFEI") (each of Xxxxxxxx,
Citicasters and AFEI, an "AFG Affiliate" and, collectively, the "AFG
Affiliates") have been validly issued and are fully paid and
nonassessable and are beneficially owned by either the Company or
American Financial Corporation ("AFC") or by one of their directly or
indirectly wholly owned subsidiaries free and clear of all liens,
charges, claims or encumbrances, (ii) except as disclosed in the
Affiliate SEC Filings (as defined in Section 2(x) hereof), there are no
outstanding subscriptions, options, warrants, calls, rights,
convertible securities or other agreements or commitments of any
character relating to the issued or unissued capital stock or other
ownership interest of any of the AFG Affiliates or securities
convertible into, exchangeable for or evidencing the right to subscribe
for any shares of such capital stock or other ownership interest, or
otherwise obligating any such AFG Affiliate to issue, transfer or sell
any such capital stock or other securities or other ownership interest
and (iii) there are no voting trusts or other arrangements or
understandings to which the Company, any subsidiary of the Company or
any of the AFG Affiliates is a party with respect to the voting of the
capital stock or other ownership interest of the AFG Affiliates.
(w) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not
(i) constitute a breach or violation of or default under the Articles
of Incorporation or Code of Regulations or by-laws or other charter
documents of any AFG Affiliate or any of its subsidiaries or (ii)
violate, conflict with or result in a breach of any provisions of, or
constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or result in
a right of termination or acceleration under, or result in the creation
of any lien, security interest, charge or encumbrance upon any of the
properties or assets of any AFG Affiliate or any of its subsidiaries
under any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, deed of trust, license, lease, agreement or other
instrument or obligation to which any AFG Affiliate or any of its
subsidiaries is a party or to which they or any of their respective
properties or assets may be subject, other than, in the case of clause
(ii), breaches, conflicts or violations that would not have a material
adverse effect on the Company and its subsidiaries taken as a whole.
The execution, delivery and performance by the Company of this
Agreement and the consummation by the Company of the transactions
contemplated hereby will not constitute a breach or violation of or
default under any law, rule or regulation or any judgment, decree,
order, governmental permit or license to which any AFG Affiliate or any
of its subsidiaries is subject, except to the extent the same would not
have a material adverse effect on the Company and its subsidiaries
taken as a whole.
(x) The Company has previously delivered to you true and
complete copies of each AFG Affiliate's (i) Annual Report on Form 10-K
for the year ended December 31, 1994, as filed with the Commission, and
all amendments thereto; (ii) Quarterly Reports on Form 10- Q for the
periods ended March 31, 1995, June 30, 1995 and September 30, 1995, as
filed with the SEC: (iii) proxy statements relating to all meetings of
its shareholders (whether annual or special) held or scheduled to be
held since January 1, 1995; and (iv) all other reports, statements and
registration statements (including Current Reports on Form 8-K) filed
by it with the Commission since December 31, 1994 (collectively, the
"Affiliate SEC Filings"). As of their respective dates,
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the Affiliate SEC Filings did not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The
financial statements of each AFG Affiliate included in the Affiliate
SEC Filings present fairly, in all materials respects, the financial
condition, results of operations and changes in financial position of
such AFG Affiliate as at the dates or for the periods indicated therein
in conformity with generally accepted accounting principles applied on
a consistent basis.
(y) Except as set forth in the Affiliate SEC Filings or the
Prospectus, since December 31, 1994, each AFG Affiliate and its
subsidiaries has conducted business only in the ordinary and usual
course and there has not occurred any adverse change in the financial
condition, business, results of operations, prospects, properties or
assets of the AFG Affiliates and their subsidiaries taken as a whole
that, in the aggregate, may reasonably be expected to have a material
adverse effect on the Company and its subsidiaries taken as a whole.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Company, at a purchase price of $ per share, the
respective numbers of shares of Firm Securities set forth opposite the names of
the Underwriters in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives for
the accounts of the Underwriters, against payment of the purchase price by
certified or official bank check or checks in New York Clearing House (next
day) funds drawn to the order of the Company at the office of
, at A.M., New York time, on , or at such other
time not later than seven full business days thereafter as CS First Boston
Corporation ("CS First Boston") and the Company determine, such time being
herein referred to as the "First Closing Date". For purposes of Rule 15c6-1
under the Securities Exchange Act of 1934, the First Closing Date (if later
than the otherwise applicable settlement date) shall be the settlement date for
payment of funds and delivery of securities for all the Offered Securities sold
pursuant to the offering. The certificates for the Firm Securities so to be
delivered will be in definitive form, in such denominations and registered in
such names as CS First Boston requests and will be made available for checking
and packaging at the above office of at least 24
hours prior to the First Closing Date.
In addition, upon written notice from CS First Boston given to the
Company from time to time not more than 30 days subsequent to the date of the
Prospectus, the Underwriters may purchase all or less than all of the Optional
Securities at the purchase price per Security to be paid for the Firm
Securities. The Company agrees to sell to the Underwriters the number of shares
of Optional Securities specified in such notice and the Underwriters agree,
severally and not jointly, to purchase such Optional Securities. Such Optional
Securities shall be purchased for the account of each Underwriter in the same
proportion as the number of shares of Firm Securities set forth opposite such
Underwriter's name bears to the total number of shares of Firm Securities
(subject to adjustment by CS First Boston to eliminate fractions) and may be
purchased by the Underwriters only for the purpose of covering over-allotments
made in connection with the sale of the Firm Securities. No Optional Securities
shall be sold or delivered unless the Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CS First Boston to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each
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Optional Closing Date, if any, being sometimes referred to as a "Closing
Date"), shall be determined by CS First Boston but shall be not later than five
full business days after written notice of election to purchase Optional
Securities is given. The Company will deliver the Optional Securities being
purchased on each Optional Closing Date to the Representatives for the accounts
of the several Underwriters, against payment of the purchase price therefor by
certified or official bank check or checks in New York Clearing House (next
day) funds drawn to the order of the Company, at the above office of
. The certificates for the Optional Securities being purchased
on each Optional Closing Date will be in definitive form, in such denominations
and registered in such names as CS First Boston requests upon reasonable written
notice prior to such Optional Closing Date and will be made available for
checking and packaging at the above office of at a
reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, the
Company will file the Prospectus with the Commission pursuant to and in
accordance with subparagraph (1) (or, if applicable and if consented to
by CS First Boston, subparagraph (4)) of Rule 424(b) not later than the
earlier of (A) the second business day following the execution and
delivery of this Agreement or (B) the fifteenth business day after the
Effective Date of the Initial Registration Statement. The Company will
advise CS First Boston promptly of any such filing pursuant to Rule
424(b). If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement and an additional
registration statement is necessary to register a portion of the
Offered Securities under the Act but the Effective Time thereof has not
occurred as of such execution and delivery, the Company will file the
additional registration statement or, if filed, will file a
post-effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 P.M., New York time,
on the date of this Agreement or, if earlier, on or prior to the time
the Prospectuses is printed and distributed to any Underwriter, or will
make such filing at such later date as shall have been consented to by
CS First Boston.
(b) The Company will advise CS First Boston promptly of any
proposal to amend or supplement the initial or any additional
registration statement as filed or the related prospectus or the
Initial Registration Statement, the Additional Registration Statement
(if any) or the Prospectus and will not effect such amendment or
supplementation without CS First Boston's consent; and the Company will
also advise CS First Boston promptly of the effectiveness of each
Registration Statement (if its Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or the Prospectus and of
the institution by the Commission of any stop order proceedings in
respect of a Registration Statement and will use its best efforts to
prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act,
the Company will promptly notify CS First Boston of such event and will
promptly prepare and file with the
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Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect
such compliance. Neither CS First Boston's consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will make generally
available to its securityholders an earnings statement covering a
period of at least 12 months beginning after the Effective Date of the
Initial Registration Statement (or, if later, the Effective Date of the
Additional Registration Statement) which will satisfy the provisions of
Section 11(a) of the Act. For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "Availability Date" means the
90th day after the end of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of
each Registration Statement (four of which will be signed and will
include all exhibits), each related preliminary prospectus, and, so
long as delivery of a prospectus relating to the Offered Securities is
required to be delivered under the Act in connection with sales by any
Underwriter or dealer, the Prospectus and all amendments and
supplements to such documents, in each case in such quantities as CS
First Boston reasonably requests. The Prospectus shall be so furnished
on or prior to 3:00 P.M., New York time, on the business day following
the later of the execution and delivery of this Agreement or the
Effective Time of the Initial Registration Statement. All other
documents shall be so furnished as soon as available. The Company will
pay the expenses of printing and distributing to the Underwriters all
such documents.
(f) The Company will arrange for the qualification of the
Offered Securities for sale under the laws of such jurisdictions as CS
First Boston designates and will continue such qualifications in effect
so long as required for the distribution.
(g) During the period of five years hereafter, the Company
will furnish to the Representatives and, upon request, to each of the
other Underwriters, as soon as practicable after the end of each fiscal
year, a copy of its annual report to shareholders for such year; and
the Company will furnish to the Representatives (i) as soon as
available, a copy of each report and any definitive proxy statement of
the Company filed with the Commission under the Securities Exchange Act
of 1934 or mailed to shareholders, and (ii) from time to time, such
other information concerning the Company as CS First Boston may
reasonably request.
(h) The Company will pay all expenses incident to the
performance of its obligations under this Agreement and will reimburse
the Underwriters (if and to the extent incurred by them) for any filing
fees and other reasonable expenses (including fees and disbursements
of counsel which attorneys' fees shall not, in the aggregate, exceed
Fifteen Thousand Dollars ($15,000)) incurred by them in connection with
qualification of the Offered Securities for sale under the laws of such
jurisdictions as CS First Boston designates and the printing of
memoranda relating thereto, for the filing fee of the National
Association of Securities Dealers, Inc. relating to the Offered
Securities, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Offered Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including any amendments
and supplements thereto) to the Underwriters.
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(i) For a period of 90 days after the date of the initial
public offering of the Offered Securities, the Company will not, and
will cause its directors and executive officers not to, offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under
the Act relating to, any additional shares of the Company's Securities
or securities convertible into or exchangeable or exercisable for any
shares of the Company's Securities, or publicly disclose the intention
to make any such offer, sale, pledge, disposal or filing, without the
prior written consent of CS First Boston, except issuances of
Securities pursuant to the conversion or exchange of convertible or
exchangeable securities in connection with the Plan of Reorganization
of the Penn Central Transportation Company, or the exercise of warrants
or options, in each case outstanding on the date hereof, grants of
employee stock options pursuant to the terms of a plan in effect on the
date hereof, issuances of Securities pursuant to the exercise of such
options or the exercise of any other employee stock options outstanding
on the date hereof or issuances of Securities pursuant to the Company's
dividend reinvestment plan or existing employee stock purchase plans or
other existing employee benefit plans of the Company or its
subsidiaries.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter, dated
the date of delivery thereof (which, if the Effective Time of the
Initial Registration Statement is prior to the execution and delivery
of this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time of the Initial Registration Statement is
subsequent to the execution and delivery of this Agreement, shall be
prior to the filing of the amendment or post-effective amendment to the
registration statement to be filed shortly prior to such Effective
Time), of Ernst & Young LLP confirming that they are independent public
accountants within the meaning of the Act and the applicable published
Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and
schedules of AFC and American Premier Underwriters, Inc.
examined by them and included in the Registration Statements
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published
Rules and Regulations;
(ii) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements of the
Company included in the Registration Statements;
(iii) on the basis of the review referred to in clause
(ii) above, a reading of the latest available interim
financial statements of the Company, inquiries of officials of
the Company who have responsibility for financial and
accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements of the
Company included in the Registration Statements do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the
related published Rules and Regulations or any
material modifications should be made to such
unaudited financial statements for them to be in
conformity with generally accepted accounting
principles;
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(B) at the date of the latest available
balance sheet of the Company read by such accountants,
or at a subsequent specified date not more than five
days prior to the date of this Agreement, there was
any change in the capital stock or any increase in
short-term indebtedness or long-term debt of the
Company and its consolidated subsidiaries or, at the
date of the latest available balance sheet of the
Company read by such accountants, there was any
decrease in consolidated net assets, as compared with
amounts shown on the latest balance sheet included in
the Prospectus; or
(C) for the period from the closing date of
the latest income statement of the Company included in
the Prospectus to the closing date of the latest
available income statement read by such accountants
there were any decreases, as compared with the
corresponding period of the previous year and with the
period of corresponding length ended the date of the
latest income statement included in the Prospectus, in
net operating income or in the total or per share
amounts of consolidated income before extraordinary
items or net income,
except in all cases set forth in clauses (B) and (C) above for
changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such
letter;
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Registration Statements
(in each case to the extent that such dollar amounts,
percentages and other financial information are derived from
the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and
other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise
specified in such letter; and
(v) While they do not express any opinion on the
unaudited pro forma condensed consolidated financial
statements included in the Registration Statement or on the
pro forma adjustments applied to the historical amounts
included in those statements, they have:
(A) Read the unaudited pro forma condensed
consolidated statements of income for the year ended
December 31, 1994, and the nine-month period ended
September 30, 1995, included in the Registration
Statement;
(B) Made inquires of certain officials of
the Company who have responsibility for financial and
accounting matters about:
(i) The basis for their determination
of the pro forma adjustments, and
(ii) Whether the unaudited pro forma
condensed consolidated financial
statements referred to in (v)(A)
comply in form in all material
respects with the applicable
accounting requirements of Rule 11-02
of Regulation S-X; and
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(C) Checked the arithmetic accuracy of the
application of the pro forma adjustments to the
historical amounts in the unaudited pro forma
condensed consolidated financial statements,
and nothing has come to their attention as a
result of the procedures specified in this paragraph
(v) that has caused them to believe that the
unaudited pro forma condensed consolidated financial
statements referred to in (v)(A) do not comply in
form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation
S-X or that the pro forma adjustments have not been
properly applied to the historical amounts in the
compilation of those statements.
For purposes of this subsection 6(a), (i) if the Effective
Time of the Initial Registration Statement is subsequent to
the execution and delivery of this Agreement, "Registration
Statements" shall mean the initial registration statement as
proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time,
(ii) if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this
Agreement but the Effective Time of the Additional
Registration is subsequent to such execution and delivery,
"Registration Statements" shall mean the Initial Registration
Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its
Effective Time, and (iii) "Prospectus" shall mean the
prospectus included in the Registration Statements. All
financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed
included in the Registration Statements for purposes of this
subsection.
(b) If the Effective Time of the Initial Registration
Statement is not prior to the execution and delivery of this
Agreement, such Effective Time shall have occurred not later than
10:00 P.M., New York time, on the date of this Agreement or such later
date as shall have been consented to by CS First Boston. If the
Effective Time of the Additional Registration Statement (if any) is
not prior the execution and delivery of this Agreement, such Effective
Time shall have occurred not later than 10:00 P.M., New York time, on
the date of this Agreement or, if earlier, the time the Prospectus is
printed and distributed to any Underwriter, or shall have occurred at
such later date as shall have been consented to by CS First Boston.
If the Effective Time of the Initial Registration Statement is prior
to the execution and delivery of this Agreement, the Prospectus shall
have been filed with the Commission in accordance with the Rules and
Regulations and Section 5(a) of this Agreement. Prior to such Closing
Date, no stop order suspending the effectiveness of a Registration
Statement shall have been issued and no proceedings for that purpose
shall have been instituted or, to the knowledge of the Company or the
Representatives, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company or its subsidiaries which, in the judgment of a majority
in interest of the Underwriters including the Representatives, is
material and adverse and makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and
payment for the Offered Securities; (ii) any downgrading in the rating
of any debt securities or preferred stock of the Company by any
"nationally recognized statistical rating organization" (as defined
for purposes of Rule 436(g) under the Act), or any public announcement
that any such organization has under surveillance or review its rating
of any debt securities or preferred stock of the Company (other than
an
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announcement with positive implications of a possible upgrading, and
no implication of a possible downgrading, of such rating); (iii) any
suspension or limitation of trading in securities generally on the New
York Stock Exchange, or any setting of minimum prices for trading on
such exchange, or any suspension of trading of any securities of the
Company on any exchange or in the over-the-counter market; (iv) any
banking moratorium declared by U.S. Federal or New York authorities;
or (v) any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency if,
in the judgment of a majority in interest of the Underwriters
including the Representatives, the effect of any such outbreak,
escalation, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated
such Closing Date, of Xxxxxxx, Xxxxxxxx & Xxxxxxx, counsel for the
Company, to the effect that:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the
State of Ohio, with corporate power and authority to own its
properties and conduct its business as described in the
Prospectus; and, to such counsel's knowledge, the Company is
duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification;
(ii) Each subsidiary of the Company listed on
Schedule A annexed hereto (for purposes of this Section 6(d),
the "Subsidiaries") has been duly incorporated and is an
existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus; and, to such
counsel's knowledge, each Subsidiary is duly qualified to do
business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such
qualification, except when the failure to be so qualified
would not have a material adverse effect on the condition
(financial or otherwise) of the Company and its subsidiaries
taken as a whole; all of the issued and outstanding capital
stock of each Subsidiary has been duly authorized and validly
issued and is fully paid and nonassessable; and, to such
counsel's knowledge, the capital stock of each Subsidiary
owned by the Company, directly or through Subsidiaries, is
owned free from liens, encumbrances and defects.
(iii) The Offered Securities delivered on such
Closing Date and all other outstanding shares of the Common
Stock of the Company have been duly authorized and validly
issued, are fully paid and nonassessable and conform to the
description thereof contained in the Prospectus; and the
shareholders of the Company have no preemptive rights with
respect to the Securities;
(iv) There are no contracts, agreements or
understandings known to such counsel between the Company and
any person granting such person the right to require the
Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned
by such person or to require the Company to include such
securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the
Company under the Act;
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(v) The Company and its subsidiaries possess
adequate certificates, authorizations or permits issued by
appropriate governmental agencies or bodies necessary to
conduct the business now operated by them and have not
received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a
material adverse effect on the Company and its subsidiaries
taken as a whole.
(vi) The Company is not and, after giving effect to
the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the
Prospectus, will not be an "investment company" as such term
is defined in the Investment Company Act of 1940;
(vii) No consent, approval, authorization or order
of, or filing with, any governmental agency or body or any
court is required for the consummation of the transactions
contemplated by this Agreement in connection with the issuance
or sale of the Offered Securities by the Company, except such
as have been obtained and made under the Act and the Rules and
Regulations and such as may be required under state securities
laws (as to which state securities laws counsel need express
no opinion);
(viii) The execution, delivery and performance of this
Agreement and the issuance and sale of the Offered Securities
will not result in a breach or violation of any of the terms
and provisions of, or constitute a default under, any statute,
rule, regulation or order of any governmental agency or body
or any court having jurisdiction over the Company or any
Subsidiary or any of their properties, or any agreement or
instrument known to such counsel to which the Company or any
such Subsidiary is a party or by which the Company or any such
Subsidiary is bound or to which any of the properties of the
Company or any such Subsidiary is subject, or the charter or
Code of Regulations or by-laws or other charter documents of
the Company or any such Subsidiary, and the Company has full
power and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement;
(ix) Except as disclosed in the Prospectus, such
counsel knows of no actions, suits or proceedings pending
against or affecting the Company, the Subsidiaries or any of
their respective properties that, if determined adversely to
the Company or any of the Subsidiaries, would individually or
in the aggregate have a material adverse effect on the
condition (financial or other), business, prospects or results
of operations of the Company and its subsidiaries taken as a
whole, or would materially and adversely affect the ability of
the Company to perform its obligations under this Agreement,
or which are otherwise material in the context of the sale of
the Offered Securities; and no such actions, suits or
proceedings are, to such counsel's knowledge, threatened or
contemplated.
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(x) The Initial Registration Statement was declared
effective under the Act as of the date and time specified in
such opinion, the Additional Registration Statement (if any)
was filed and became effective under the Act as of the date
and time (if determinable) specified in such opinion, the
Prospectus either was filed with the Commission pursuant to
the subparagraph of Rule 424(b) specified in such opinion on
the date specified therein or was included in the Initial
Registration Statement or the Additional Registration
Statement (as the case may be), and, to the best of the
knowledge of such counsel, no stop order suspending the
effectiveness of a Registration Statement or any part thereof
has been issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the Act, and
each Registration Statement and the Prospectus, and each
amendment or supplement thereto, as of their respective
effective or issue dates, complied as to form in all material
respects with the requirements of the Act and the Rules and
Regulations; such counsel have no reason to believe that any
part of a Registration Statement or any amendment thereto, as
of its effective date or as of such Closing Date, 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 not misleading or that the
Prospectus or any amendment or supplement thereto, as of its
issue date or as of such Closing Date, contained any untrue
statement of a material fact or omitted to state any material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; the descriptions in the Registration Statements
and Prospectus of statutes, legal and governmental proceedings
and contracts and other documents are accurate and fairly
present the information required to be shown; and such counsel
do not know of any legal or governmental proceedings required
to be described in a Registration Statement or the Prospectus
which are not described as required or of any contracts or
documents of a character required to be described in a
Registration Statement or the Prospectus or to be filed as
exhibits to a Registration Statement which are not described
and filed as required; it being understood that such counsel
need express no opinion as to the financial statements or
other financial data contained in the Registration Statements
or the Prospectus; and
(xi) This Agreement has been duly authorized,
executed and delivered by the Company.
(xii) The Offered Securities have been approved for
listing on the New York Stock Exchange subject to notice of
issuance.
(xiii) To the best of such counsel's knowledge after
due inquiry, except as set forth in the Prospectus, (i) all
of the outstanding shares of capital stock and other ownership
interests of the Company and any of its subsidiaries in
Xxxxxxxx, Citicasters and AFEI have been validly issued and
are fully paid and nonassessable and are beneficially owned by
either the Company or AFC or one of its directly or indirectly
wholly owned subsidiaries free and clear of all liens,
charges, claims or encumbrances, (ii) except as disclosed in
the Affiliate SEC Filings, there are no outstanding
subscriptions, options, warrants, calls, rights, convertible
securities or other agreements or commitments of any character
relating to the issued or unissued capital stock or other
ownership interest of any of the AFG Affiliates or securities
convertible into, exchangeable for or evidencing the right to
subscribe for any shares of such capital stock or other
ownership interest, or otherwise obligating any such AFG
Affiliate to issue, transfer or sell any such capital stock or
other securities or other ownership interest and (iii) there
are no voting trusts or other arrangements or understandings
to which the Company, any subsidiary of the Company or any of
the
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AFG Affiliates is a party with respect to the voting of the
capital stock or other ownership interest of the AFG
Affiliates.
(xiv) The execution, delivery and performance of this
Agreement and the consummation of the transactions
contemplated hereby will not (i) constitute a breach or
violation of or default under the Articles of Incorporation,
Code of Regulations, by-laws or other charter documents of any
AFG Affiliate or any of the Subsidiaries or (ii) violate,
conflict with or result in a breach of any provisions of, or
constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result
in the termination of, or accelerate the performance required
by, or result in a right of termination or acceleration under,
or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of
any AFG Affiliate or any of the Subsidiaries under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other
instrument or obligation to which any AFG Affiliate or any of
the Subsidiaries is a party or to which they or any of their
respective properties or assets may be subject, other than, in
the case of clause (ii), breaches, conflicts or violations
that would not have a material adverse effect on the Company
and its subsidiaries taken as a whole. The execution,
delivery and performance by the Company of this Agreement and
the consummation by the Company of the transactions
contemplated hereby will not constitute a breach or violation
of or default under any law, rule or regulation or any
judgment, decree, order, governmental permit or license to
which any AFG Affiliate or any of the Subsidiaries is subject,
except to the extent the same would not have a material
adverse effect on the Company and its subsidiaries taken as a
whole.
In rendering the foregoing opinion, such counsel may rely, to
the extent they deem such reliance proper, on the opinions (in form
and substance reasonably satisfactory to Underwriters' counsel) of
other counsel reasonably acceptable to Underwriters' counsel as to
matters governed by the laws of jurisdictions other than the United
States, the State of Ohio or the General Corporation Law of the State
of Delaware and, as to matters of fact, upon certificates of officers
of the Company and of government officials; provided that such counsel
shall state that the opinion of any other counsel is in form
satisfactory to such counsel and, in such counsel's opinion, such
counsel and the Representatives are justified in relying on such
opinions of other counsel. Copies of all such opinions and
certificates shall be furnished to counsel to the Underwriters on each
Closing Date. Such counsel may state that they are not passing on
matters relating to patents and trademarks.
(e) The Representatives shall have received from Xxxx,
Stettinius & Hollister, counsel for the Underwriters, such opinion or
opinions, dated such Closing Date, with respect to the incorporation
of the Company, the sufficiency of all corporate proceedings, the
validity of the Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related matters as
the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they reasonably request
for the purpose of enabling them to pass upon such matters.
(f) The Representatives shall have received a certificate,
dated such Closing Date, of the President or any Vice-President and a
principal financial or accounting officer of the Company in which such
officers, to the best of their knowledge after reasonable
investigation, shall state that: the representations and warranties of
the Company in this Agreement are true and correct; the Company has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to such Closing
Date, that no stop order suspending
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the effectiveness of any Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated
by the Commission; the Additional Registration Statement (if any)
satisfying the requirements of subparagraphs (1) and (3) of Rule
462(b) was filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b) under the
Act, prior to the time the Prospectus was printed and distributed to
any Underwriter; and, subsequent to the date of the most recent
financial statements in the Prospectus, there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole except as set forth in or contemplated
by the Prospectus or as described in such certificate.
(g) The Representatives shall have received a letter, dated
such Closing Date, of Ernst & Young LLP which meets the requirements
of subsection (a) of this Section, except that the specified date
referred to in such subsection will be a date not more than five days
prior to such Closing Date for the purposes of this subsection.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CS First Boston may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement in or
omission or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any Underwriter consists
of the information described as such in subsection (b) below; and provided,
further, that with respect to any untrue statement or omission or alleged
untrue statement or omission made in any preliminary prospectus the indemnity
agreement contained in this subsection (a) shall not inure to the benefit of
any Underwriter from whom the person asserting any such losses, claims, damages
or liabilities purchased the Offered Securities concerned, to the extent that a
prospectus relating to such Offered Securities was required to be delivered by
such Underwriter under the Act in connection with such purchase and any such
loss, claim, damage or liability of such Underwriter results from the fact that
there was not sent or given to such person, at or prior to the written
confirmation of the sale of such Offered Securities to such person, a copy of
the Prospectus (exclusive of material incorporated by reference) if the Company
had previously furnished copies thereof to such Underwriter.
(b) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained
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in any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through the Representatives specifically for
use therein, and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses
are incurred, it being understood and agreed that the only such information
furnished by any Underwriter consists of the following information in the
Prospectus furnished on behalf of each Underwriter: the last paragraph at the
bottom of the cover page concerning the terms of the offering by the
Underwriters, the legends concerning over-allotments and stabilizing on the
inside front cover page, the concession and reallowance figures appearing in
the fourth paragraph under the caption "Underwriting" and the information
appearing in the seventh paragraph under the caption "Underwriting."
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above or to the extent the indemnifying party is
not prejudiced as a proximate result of such failure. In case any such action
is brought against any indemnified party and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action. An indemnifying party will not be liable for any settlement of
any action or claim effected without its prior written consent, provided that
such consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters. The
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relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company, to each officer of the
Company who has signed a Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters
default in their obligations to purchase Offered Securities hereunder on either
the First or any Optional Closing Date and the aggregate number of shares of
Offered Securities that such defaulting Underwriter or Underwriters agreed but
failed to purchase does not exceed 10% of the total number of shares of Offered
Securities that the Underwriters are obligated to purchase on such Closing
Date, CS First Boston may make arrangements satisfactory to the Company for the
purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to
their respective commitments hereunder, to purchase the Offered Securities that
such defaulting Underwriters agreed but failed to purchase on such Closing
Date. If any Underwriter or Underwriters so default and the aggregate number of
shares of Offered Securities with respect to which such default or defaults
occur exceeds 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date and arrangements
satisfactory to CS First Boston and the Company for the purchase of such
Offered Securities by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company, except as provided in Section 9
(provided that if such default occurs with respect to Optional Securities after
the First Closing Date, this Agreement will not terminate as to the Firm
Securities or any Optional Securities purchased prior to such termination). As
used in this Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and
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will survive delivery of and payment for the Offered Securities. If this
Agreement is terminated pursuant to Section 8 or if for any reason the purchase
of the Offered Securities by the Underwriters is not consummated, the Company
shall remain responsible for the expenses to be paid or reimbursed by it
pursuant to Section 5 and the respective obligations of the Company and the
Underwriters pursuant to Section 7 shall remain in effect, and if any Offered
Securities have been purchased hereunder the representations and warranties in
Section 2 and all obligations under Section 5 shall also remain in effect. If
the purchase of the Offered Securities by the Underwriters is not consummated
for any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause (iii),
(iv) or (v) of Section 6(c), the Company will reimburse the Underwriters for
all out-of-pocket expenses (including fees and disbursements of counsel)
reasonably incurred by them in connection with the offering of the Offered
Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to the Representatives, c/o CS First Boston Corporation, Park Avenue
Plaza, New York, N.Y. 10055, Attention: Investment Banking
Department-Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at American Financial
Group, Inc., Xxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000, Attention: Xxxxx
X. Xxxxxxx, Corporate Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 7 will be mailed, delivered or telegraphed and
confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and no
other person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for
the several Underwriters in connection with this financing, and any action
under this Agreement taken by the Representatives jointly or by CS First Boston
will be binding upon all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
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If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company one of
the counterparts hereof, whereupon it will become a binding agreement between
the Company and the several Underwriters in accordance with its terms.
Very truly yours,
AMERICAN FINANCIAL GROUP, INC.
By
------------------------------
[Title]
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
CS FIRST BOSTON CORPORATION
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
XXXXXX XXXX INCORPORATED
Acting on behalf of themselves and
as the Representatives of the several
Underwriters.
By CS FIRST BOSTON CORPORATION
By
---------------------------
[Title]
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SCHEDULE A
Underwriter Number of
----------- Firm Securities
---------------
CS First Boston Corporation.......................
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation..........................
Xxxxxx Xxxx Incorporated..........................
________________________
Total
========================
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