EXHIBIT 1.1
Floating Rate Cumulative Trust Preferred Securities
(Liquidation Amount of $1,000 per Capital Security)
United Bancorp Capital Trust I
PLACEMENT AGREEMENT
Effective as of June 27, 2002
SAMCO Capital Markets
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
United Bancorp Capital Trust I (the "Trust"), a statutory business
trust organized under the Delaware Business Trust Act, 12 Del. C. Section 3801
et seq. (the "Delaware Act"), and United Bancorporation of Alabama, Inc. (the
"Company" and together with the Trust, the "Offerors"), confirm their agreement
(the "Agreement") with SAMCO Capital Markets, a division of Service Asset
Management Company, as agent of the Offerors (the "Placement Agent"), with
respect to the issue and sale by the Trust and the placement by the Placement
Agent of United Bancorp Capital Trust I Floating Rate Cumulative Trust Preferred
Securities (liquidation amount of $1,000 per security) of the Trust bearing a
variable distribution rate per annum, reset quarterly, equal to LIBOR (as
defined in the Indenture) plus 3.65% (the "Capital Securities"). The Capital
Securities will be guaranteed by the Company to the extent provided in the Trust
Preferred Securities Guarantee Agreement, to be dated as of the Closing Time (as
defined in Section 2 hereof (the "Guarantee Agreement"), between the Company and
▇▇▇▇▇ Fargo Bank, National Association, as trustee (the "Guarantee Trustee"),
with respect to distributions and payments upon liquidation, redemption and
otherwise.
The entire proceeds from the sale of the Capital Securities will be
combined with the entire proceeds from the sale by the Trust to the Company of
its common securities (the "Common Securities"), and will be used by the Trust
to purchase Four Million One Hundred Twenty-Five Thousand Dollars ($4,125,000)
aggregate principal amount of Floating Rate Junior Subordinated Debt Securities
due June 30, 2032 (the "Subordinated Debt Securities") issued by the Company.
The Capital Securities and the Common Securities will be issued pursuant to the
Amended and Restated Trust Agreement, to be dated as of the Closing Time (the
"Declaration"), among the Company, as depositor, the Administrative Trustees
named therein (the "Administrators"), ▇▇▇▇▇ Fargo Delaware Trust Company as
Resident Trustee (the "Resident Trustee"), ▇▇▇▇▇ Fargo Bank, National
Association, as Property Trustee and the holders, from time to time, of
undivided beneficial interests in the assets of the Trust. The Subordinated Debt
Securities
will be issued pursuant to the Indenture, to be dated as of the Closing Time
(the "Indenture"), between the Company and ▇▇▇▇▇ Fargo Bank, National
Association, as indenture Trustee (the "Indenture Trustee").
The Indenture, the Guarantee Agreement, the Declaration, this Agreement
and the Subscription Agreement (as defined in Section 2(a) hereof) are
hereinafter referred to collectively as the "Operative Documents."
SECTION 1. Representations and Warranties.
(a) The Trust and the Company, jointly and severally, represent and
warrant to the Placement Agent and the Purchaser (as defined in Section 2(a)
hereof) of Capital Securities as of the date hereof and as of the Closing Time,
and agree with the Placement Agent and the Purchaser (as defined below), as
follows:
i. Similar Offerings. The Offerors have not, directly or
indirectly, solicited any offer to buy or offered to sell, and will not,
directly or indirectly, solicit any offer to buy or offer to sell, in the United
States or to any United States citizen or resident, any security which is or
would be integrated with the sale of the Capital Securities in a manner that
would require the Capital Securities to be registered under the Securities Act
of 1933, as amended (the "Act").
ii. Financial Statements and Information. The consolidated
balance sheets of the Company and all of its subsidiaries as of December 31,
2001 and December 31, 2000 and related consolidated income statements and
statements of changes in shareholders' equity for the 2 years ended December 31,
2001 together with the notes thereto, copies of each of which have been provided
to the Placement Agent (together, the "Financial Statements"), have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis (except as may be disclosed therein) and fairly present in
all material respects the financial position and the results of operations and
changes in shareholders' equity of the Company and all of its subsidiaries as of
the dates and for the periods indicated (subject to normal recurring year-end
adjustments, none of which shall be material). The books and records of the
Company and all of its subsidiaries have been, and are being, maintained in all
material respects in accordance with generally accepted accounting principles
and any other applicable legal and accounting requirements.
iii. No Material Adverse Change. Except as previously
disclosed to the Placement Agent in writing, since December 31, 2001, there have
not been any material adverse changes or developments with respect to the
condition (financial or otherwise), earnings, affairs, business, prospects or
results of operations of the Offerors on a consolidated basis.
iv. Regulatory Enforcement Matters. Neither the Company or any
of its subsidiaries is subject or is party to, or has received any notice or
advice that any of them may become subject or party to, any investigation with
respect to, any cease-and-desist order, agreement, consent agreement, memorandum
of understanding or
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other regulatory enforcement action, proceeding or order with or by, or is a
party to any commitment letter or similar undertaking to, or is subject to any
directive by, or has been, a recipient of any supervisory letter from, or has
adopted any board resolutions at the request of, any Regulatory Agency (as
defined below) that currently restricts in any material respect the conduct of
their business or that in any material manner relates to their capital adequacy,
their credit policies, their management or their business (each, a "Regulatory
Agreement"), nor has the Company or any of its subsidiaries been advised by any
Regulatory Agency that it is considering issuing or requesting any such
Regulatory Agreement; and there is no unresolved violation, criticism or
exception by any Regulatory Agency with respect to any report or statement
relating to any examinations of the Company or any of its subsidiaries taken as
a whole which, in the reasonable judgment of the Company, is expected to result
in a material adverse effect. As used herein, the term "Regulatory Agency" means
any federal or state agency charged with the supervision or regulation of
depositary institutions or holding companies of depositary institutions, or
engaged in the insurance of depositary institution deposits, or any court,
administrative agency or commission or other governmental agency, authority or
instrumentality having supervisory or regulatory authority with respect to the
Company or any of its subsidiaries.
v. No Undisclosed Liabilities. Neither the Company nor any of
its subsidiaries has any material liability, whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become due,
including any liability for taxes (and there is no past or present fact,
situation, circumstance, condition or other basis for any present or future
action, suit, proceeding, hearing, charge, complaint, claim or demand against
the Company or its subsidiaries giving rise to any such liability), except (i)
for liabilities set forth in the Financial Statements and (ii) normal
fluctuations in the amount of the liabilities referred to in clause (i) above
occurring in the ordinary course of business of the Company and all of its
subsidiaries since the date of the most recent balance sheet included in such
Financial Statements.
vi. Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under the
laws of the State of Delaware and has full power and authority under such laws
to own, lease and operate its properties and to conduct its business and to
enter into and perform its obligations under each of the Operative Documents to
which it is a party; and the Company is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as amended.
vii. Good Standing of the Subsidiaries. Each "significant
subsidiary" (as defined in Rule 1-02 of Regulation S-X) of the Company ( a
"Significant Subsidiary") has been duly organized and is validly existing as an
entity in good standing under the laws of the jurisdiction in which it is
chartered and has full power and authority under such laws to own, lease and
operate its properties and to conduct its current and contemplated business; and
the deposit accounts of each of the Company's subsidiary banks are insured up to
the applicable limits by the Bank Insurance Fund or Savings Association
Insurance Fund of the Federal Deposit Insurance Corporation (the "FDIC")
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to the fullest extent permitted by law and the rules and regulations of the
FDIC, and no proceeding for the revocation or termination of such insurance is
pending or, to the knowledge of the Company, threatened.
viii. Foreign Qualifications. The Company and its significant
subsidiaries are each duly qualified as a foreign corporation to transact
business and are each in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing, in the reasonable judgment of the Company, is not expected
to result in a material adverse effect.
ix. Capital Stock Duly Authorized and Validly Issued. All of
the issued and outstanding capital stock of the Company has been duly authorized
and validly issued and is fully paid and nonassessable; all of the issued and
outstanding capital stock of each significant subsidiary of the Company has been
duly authorized and validly issued, is fully paid and nonassessable and is owned
by the Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equitable right, except
as otherwise disclosed in writing to the Placement Agent; and none of the issued
and outstanding capital stock of the Company or its Significant Subsidiaries was
issued in violation of any preemptive or similar rights arising by operation of
law, under the charter, by-laws or code of regulations of the Company or any of
its Significant Subsidiaries or under any agreement to which the Company or any
of its Significant Subsidiaries is a party.
x. Good Standing of the Trust. The Trust has been duly created
and is validly existing in good standing as a business trust under the Delaware
Act with the power and authority to own property and to conduct its business as
provided in the Declaration, to enter into and perform its obligations under the
Operative Documents to which it is a party, as applicable, and to issue the
Capital Securities and the Common Securities; the Trust is not a party to or
otherwise bound by any agreement other than the Operative Documents to which it
is a party; and the Trust is, and will be, under current law, classified for
United States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation.
xi. Authorization of Common Securities. At the Closing Time,
the Common Securities will have been duly authorized for issuance by the Trust
pursuant to the Declaration and, when duly issued and executed in accordance
with the Declaration and delivered by the Trust to the Company against payment
therefor in accordance with the subscription agreement therefor, will be validly
issued and fully paid and nonassessable undivided common beneficial ownership
interests in the assets of the Trust; the issuance of the Common Securities is
not subject to preemptive or other similar rights; and at the Closing Time, all
of the issued and outstanding Common Securities of the Trust will be owned
directly by the Company, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equitable right.
xii. Authorization of Capital Securities. At the Closing Time,
the Capital Securities will have been duly authorized for issuance by the Trust
pursuant to the
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Declaration, and when duly issued, executed and authenticated in accordance with
the Declaration and delivered by the Trust against payment therefor as provided
herein and in the Subscription Agreement, will be validly issued and fully paid
and nonassessable undivided preferred beneficial ownership interests in the
assets of the Trust; the issuance of the Capital Securities will not be subject
to preemptive or other similar rights; and the Capital Securities will be in the
form contemplated by, and entitled to the benefits of, the Declaration.
xiii. Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by each of the Offerors.
xiv. Authorization of Declaration. The Declaration has been
duly authorized by the Company and, at the Closing Time, will have been duly
executed and delivered by the Company and the Administrators, and assuming due
authorization, execution and delivery of the Declaration by the Resident
Trustee, the Declaration will be, at the Closing Time, a valid, legal and
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforceability may be limited by (a)
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws now or hereafter in effect relating to creditors' rights
generally and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity) (collectively,
the "Enforceability Exceptions").
xv. Authorization of Guarantee Agreement. The Guarantee
Agreement has been duly authorized by the Company; and, at the Closing Time, the
Guarantee Agreement will have been duly executed and delivered by the Company
and will constitute a valid, legal and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except to the
extent that enforceability may be limited by the Enforceability Exceptions.
xvi. Authorization of Indenture. The Indenture has been duly
authorized by the Company and, at the Closing Time, will have been duly executed
and delivered by the Company and will constitute a valid, legal and binding
agreement of the Company, enforceable against the Company in accordance with its
terms, except to the extent that enforceability may be limited by the
Enforceability Exceptions.
xvii. Authorization of Subordinated Debt Securities. The
Subordinated Debt Securities have been duly authorized by the Company; at the
Closing Time, the Subordinated Debt Securities will have been duly executed by
the Company and, when authenticated in the manner provided for in the Indenture
and delivered by the Company to the Trust against payment therefor as
contemplated in the subscription agreement therefor, will constitute valid,
legal and binding obligations of the Company, enforceable against the Company in
accordance with their terms, except to the extent that enforceability may be
limited by the Enforceability Exceptions; the Subordinated Debt Securities will
be in the form contemplated by, and entitled to the benefits of, the Indenture;
and the Company has no present intention to exercise its option to defer
payments of interest on the Subordinated Debt Securities as provided in the
Indenture.
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xviii. Authorization of Administrators. Each of the
Administrators of the Trust is an officer or employee of the Company and has
been duly authorized by the Company to execute and deliver the Declaration.
xix. Not an Investment Company Neither the Trust nor the
Company is, and immediately following consummation of the transactions
contemplated hereby and the application of the net proceeds therefrom neither
the Trust nor the Company will be, an "investment company" required to be
registered under the Investment Company Act of 1940, as amended (the "1940
Act").
xx. Absence of Defaults and Conflicts. The Trust is not in
violation of the trust certificate of the Trust filed with the State of Delaware
(the "Trust Certificate") or the Declaration, and neither the Company nor any of
its Significant Subsidiaries is in violation of its charter, by-laws or code of
regulations; none of the Trust, the Company or any significant subsidiary of the
Company is in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement or
instrument to which it is a party or by which it or any of them may be bound or
to which any of its properties or assets is subject (collectively, "Agreements
and Instruments"), except for such defaults under Agreements and Instruments
that, in the reasonable judgment of the Company, are not expected to result in a
material adverse effect; and the execution, delivery and performance of the
Operative Documents by the Trust or the Company, as the case may be, the
issuance, sale and delivery of the Capital Securities and the Subordinated Debt
Securities, the consummation of the transactions contemplated by the Operative
Documents, and compliance by the Offerors with the terms of the Operative
Documents to which they are a party have been duly authorized by all necessary
corporate action on the part of the Company and, at the Closing Time, will have
been duly authorized by all necessary action on the part of the Trust, and do
not and will not, whether with or without the giving of notice or passage of
time or both, violate, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or
imposition of any, security interest, mortgage, pledge, lien, charge,
encumbrance, claim or equitable right upon any properties or assets of the
Trust, the Company or any of its Significant Subsidiaries pursuant to, any of
the Agreements and Instruments, nor will such action result in any violation of
the provisions of the charter, by-laws or code of regulations of the Company or
any of its Significant Subsidiaries or the Declaration or the Trust Certificate,
or violation by the Company or any of its Significant Subsidiaries of any
applicable law, statute, rule, regulation, judgment, order, writ or decree of
any government, government authority, agency or instrumentality or court,
domestic or foreign, having jurisdiction over the Trust or the Company or any of
its Significant Subsidiaries or their respective properties or assets
(collectively, "Governmental Entities"). As used herein, a "Repayment Event"
means any event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Trust or the Company or any of its Significant
Subsidiaries prior to its scheduled maturity.
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xxi. Absence of Labor Dispute. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the knowledge
of the executive officers of the Company, is imminent, which, in the reasonable
judgment of the Company, is expected to result in a material adverse effect.
xxii. Absence of Proceedings. Except as otherwise disclosed to
the Placement Agent in writing, there is no action, suit, proceeding, inquiry or
investigation before or brought by any Governmental Entity, now pending, or, to
the knowledge of the Trust or the Company, threatened, against or affecting the
Trust or the Company or any of its subsidiaries, which, in the reasonable
judgment of the Trust or the Company, is expected to result in a material
adverse effect or materially and adversely affect the consummation of the
transactions contemplated by the Operative Documents or the performance by the
Trust or the Company of its obligations hereunder or thereunder; and the
aggregate of all pending legal or governmental proceedings to which the Trust or
the Company or any of its subsidiaries is a party or of which any of their
respective properties or assets is the subject, including ordinary routine
litigation incidental to the business, are not, in the reasonable judgment of
the Company or the Trust, expected to result in a material adverse effect.
xxiii. Possession of Licenses and Permits. Each of the Trust,
the Company and the significant subsidiaries of the Company possesses such
permits, licenses, approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate Governmental Entities
necessary to conduct the business now operated by them that is material to the
Trust or the Company and its significant subsidiaries considered as one
enterprise; each of the Trust, the Company and the significant subsidiaries of
the Company is in compliance with the terms and conditions of all of its
Governmental Licenses, except where the failure so to comply, in the reasonable
judgment of the Company, is not expected to, singularly or in the aggregate,
have a material adverse effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect, in the reasonable judgment of the Company, is not expected to have a
material adverse effect; and none of the Trust, the Company or any significant
subsidiary of the Company has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singularly
or in the aggregate, in the reasonable judgment of the Company or the Trust, is
expected to result in a material adverse effect.
xxiv. Title to Property. Except as otherwise disclosed in
writing to the Placement Agent or in the Financial Statements and except for
pledges of securities in the ordinary course of business, each of the Trust, the
Company and the significant subsidiaries of the Company has good and marketable
title to all of their respective real and personal properties, in each case free
and clear of all liens, encumbrances and defects, except such as, in the
reasonable judgment of the Trust or the Company, singularly or in the aggregate,
are not expected to result in a material adverse effect; and all of the leases
and subleases under which the Trust, the Company or any significant subsidiary
of the Company holds properties, are in full force and effect, except when the
failure of such leases and subleases to be in full force and effect, in the
reasonable
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judgment of the Company, singularly or in the aggregate, is not expected to have
a material adverse effect, and none of the Trust the Company or any significant
subsidiary of the Company has any notice of any claim of any sort that has been
asserted by anyone adverse to the rights of the Trust, the Company or any
significant subsidiary of the Company under any of the leases or subleases under
which the Trust, the Company or any significant subsidiary of the Company holds
properties, or affecting or questioning the rights of such entity to the
continued possession of the leased or subleased premises under any such lease or
sublease, except when such claim, in the reasonable judgment of the Company,
singularly or in the aggregate, is not expected to have a material adverse
effect.
xxv. Stabilization. The Company has not taken and will not
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of the
price of the Capital Securities.
xxvi. No General Solicitation. Neither the Trust or the
Company nor any of their Affiliates (as defined in Rule 501(b) under the 1933
Act) or any person acting on its or any of their behalf (other than the
Placement Agent, as to whom the Offerors make no representation) has engaged or
will engage, in connection with the offering of the Capital Securities, in any
form of general solicitation or general advertising within the meaning of Rule
502(c) under the 1933 Act.
xxvii. No Directed Selling Efforts. Neither the Trust or the
Company nor any of their Affiliates or any person acting on its or any of their
behalf (other than Bear, ▇▇▇▇▇▇▇ & Co, Inc. and the Placement Agent, as to whom
the Offerors make no representation) has engaged or will engage in any directed
selling efforts within the meaning of Regulation S under the 1933 Act
("Regulation S") with respect to the offering of the Capital Securities.
xxviii. No Registration. Subject to compliance by the
Placement Agent with the relevant provisions of Section 6 hereof, it is not
necessary in connection with the offer, sale and delivery of the Capital
Securities by the Trust in the manner contemplated by this Agreement to register
the Capital Securities, the guarantee as described in the Guarantee Agreement or
the Subordinated Debt Securities under the 1933 Act or to qualify the
Declaration, the Guarantee Agreement or the Indenture under the Trust Indenture
Act of 1939, as amended.
(b) Any certificate signed by any Trustee of the Trust or any duly
authorized officer of the Company or any of its subsidiaries and delivered to
you or to counsel for the Placement Agent shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Placement Agent
as to the matters covered thereby.
SECTION 2. Sale and Delivery through Placement Agent: Closing.
(a) The Offerors propose to issue and sell the Capital Securities on
June 27, 2002 (or such other time mutually agreed to by the Offerors and the
Placement Agent) (the "Closing Time") to Bear, ▇▇▇▇▇▇▇ & Co, Inc. (the
"Purchaser"), pursuant to the terms
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of the Subscription Agreement, to be entered into on or prior to the Closing
Time (the "Subscription Agreement"), between the Offerors and the Purchaser. The
Offerors agree to execute the Subscription Agreement with the Purchaser and to
return the same to the Placement Agent. In addition, the Offerors agree that the
Purchaser shall be entitled to the benefit of, and to rely on, the provisions of
this Agreement to the extent such provisions address or relate to the Purchaser
or the Capital Securities to be purchased by the Purchaser.
(b) The Offerors hereby grant to the Placement Agent the exclusive
right to arrange the placement of the Capital Securities with the Purchaser on
their behalf. The Placement Agent accepts such right and agrees to use its best
efforts, on and prior to the Closing Time, to effect such placement.
(c) Deliveries of certificates for the Capital Securities shall be made
by the Trust to or on behalf of the Purchaser at the offices of Bear, ▇▇▇▇▇▇▇ &
Co., Inc. at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇
▇▇▇▇▇▇▇, and payment of the purchase price for the Capital Securities shall be
made by the Purchaser to the Trust by wire transfer of immediately available
funds to a bank designated by the Company contemporaneous with closing at the
Closing Time.
Certificates for the Capital Securities in the aggregate liquidation amount
thereof shall be registered in the name of the Purchaser.
(d) As compensation to the Placement Agent for its placement of the
Capital Securities, including any portion of such compensation due to any other
members of the Regional Advisors Alliance represented by the Placement Agent,
and in view of the fact that the proceeds of the sale of the Capital Securities
will be used to purchase the Subordinated Debt Securities of the Company, the
Company hereby agrees to pay at the Closing Time to the Placement Agent in
immediately available funds a commission equal to 3% of the aggregate value of
the Floating Rate Cumulative Trust Preferred Securities to be delivered by the
Trust hereunder at the Closing Time. The Company further agrees that, upon
request of the Placement Agent, the Purchaser shall be permitted to cause the
amount of the aforesaid compensation, plus any expenses otherwise due to be
reimbursed by the Company to the Placement Agent or its counsel with respect to
sale of the Capital Securities, to be deducted from the amount of the purchase
price payable to the Company by the Purchaser under the immediately preceding
paragraph (c) and thereupon to cause such deducted amount to be paid directly to
the Placement Agent at the Closing Time.
(e) In performing its duties under this Agreement, the Placement Agent
shall be entitled to rely upon any notice, signature or writing which the
Placement Agent shall in good faith believe to be genuine and to be signed or
presented by a proper party or parties. The Placement Agent may rely upon any
opinions or certificates or other documents delivered by the Offerors or their
counsel or designees either to it or the Purchaser. In addition, in connection
with the performance of its duties under this Agreement, the Placement Agent
shall not be liable for any error of judgment or any action taken or omitted to
be taken unless it was grossly negligent or engaged in willful misconduct in
connection with such performance or non-performance. No provision of
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this Agreement shall require the Placement Agent to expend or risk its own funds
or otherwise incur any financial liability on behalf of the Purchaser in
connection with the performance of any of its duties hereunder. The Placement
Agent shall be under no obligation to exercise any of the rights or powers
vested in it by this Agreement.
SECTION 3. Notice of Material Events. The Offerors covenant with the
Placement Agent and the Purchaser that prior to the completion of the initial
placement of the Capital Securities through the Placement Agent, the Offerors
will immediately notify the Placement Agent, and confirm such notice in writing,
of any event or development that, in the reasonable judgment of the Company, is
expected to result in a material adverse effect.
SECTION 4. Payment of Expenses. Whether or not this Agreement or the
Subscription Agreement is terminated or the sale of the Capital Securities is
consummated, the Company, as borrower under the Subordinated Debt Securities,
will pay all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, issuance and delivery of the
certificates for the Capital Securities and Subordinated Debt Securities, (ii)
the fees and disbursements of the Company's counsel, accountants and other
advisors, and (iii) the fees and expenses of any trustee appointed under any of
the Operative Documents, including the fees and disbursements of counsel for
such trustees.
SECTION 5. Conditions of Placement Agent's Obligations. The obligations
of the Placement Agent and the Purchaser at the Closing Time, are subject to the
accuracy of the representations and warranties of the Offerors contained in
Section 1 hereof or in certificates of any Administrator of the Trust or any
officer of the Company or any of its subsidiaries delivered pursuant to the
provisions hereof, to the performance by the Offerors of their obligations
hereunder, and to the following further conditions:
(a) Opinion of Counsel for Offerors. At the Closing Time, the Placement
Agent shall have received the favorable opinion, dated as of the Closing Time,
of ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, in form and substance reasonably
satisfactory to counsel for the Placement Agent. Such counsel may state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of Administrators of the Trust,
officers of the Company or any of its subsidiaries and public officials.
(b) Opinion of Special Delaware Counsel for the Trust. At the Closing
Time, the Placement Agent shall have received the favorable opinion, dated as of
the Closing Time, of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, special counsel for the
Company and the Trust, in form and substance reasonably satisfactory to counsel
for the Placement Agent.
(c) Opinion of Counsel to the Guarantee Trustee, the Resident Trustee,
and the Indenture Trustee. At the Closing Time, the Placement Agent shall have
received the favorable opinion, dated as of the Closing Time, of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇ LLP, counsel for the Guarantee Trustee, the Resident Trustee, and the
Indenture Trustee in substantially the form reasonably satisfactory to counsel
for the Placement Agent.
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(d) Certificates. At the Closing Time, there shall not have been, since
the date hereof, any material adverse effect, and the Placement Agent shall have
the right to receive upon request a certificate of the Chairman, the Chief
Executive Officer, the President, any Executive Vice President or any Vice
President of the Company and of the Chief Financial Officer or Chief Accounting
Officer of the Company and a certificate of an Administrator of the Trust, dated
as of the Closing Time, to the effect that (i) there has been no such material
adverse effect, (ii) the representations and warranties in Section 1 hereof were
true and correct when made and are true and correct with the same force and
effect as though expressly made at and as of the Closing Time, and (iii) the
Offerors have complied with all agreements and satisfied all conditions on their
part to be performed or satisfied at or prior to the Closing Time.
(e) Sale of Securities. The Purchaser shall have sold securities issued
by it in such an amount that the net proceeds therefrom shall be available at
the Closing Time and shall be sufficient to purchase the Capital Securities and
all other capital securities contemplated in agreements similar to this
Agreement and the Subscription Agreement.
(f) Additional Documents. At the Closing Time, the Placement Agent and
the Purchaser shall have been furnished such documents and opinions as they may
reasonably request in connection with the issue, sale and placement of the
Capital Securities; and all proceedings taken by the Offerors in connection with
the issuance, sale and placement of the Capital Securities shall be satisfactory
in form and substance to the Placement Agent and the Purchaser.
SECTION 6. Offers and Sales of the Capital Securities.
(a) Offer and Sale Procedures. The Placement Agent and the Offerors
hereby establish and agree to observe the following provisions with respect to
the offer, issue, sale and placement of the Capital Securities:
i. Offers and Sales only to the Purchaser. Offers and sales of
the Capital Securities will be made in the United States or pursuant to
Regulation S outside the United States only to the Purchaser in a transaction
not requiring registration under the 1933 Act.
ii. No General Solicitation. No general solicitation or
general advertising (within the meaning of Rule 502(c) under the 1933 Act) will
be used in connection with the offering of the Capital Securities.
iii. No Directed Selling Efforts. No directed selling efforts
(within the meaning of Regulation S) will be used with respect to the offering
of the Capital Securities.
iv. Purchaser Notification. Prior to or contemporaneously with
the purchase of the Capital Securities by the Purchaser, the Placement Agent
will take reasonable steps to inform the Purchaser that the Capital Securities
(A) have not been and will not be registered under the 1933 Act, (B) are being
sold to it without registration under the 1933 Act in accordance with an
exemption from registration under the 1933
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Act and (C) may not be offered, sold or otherwise transferred except (1) to the
Company or (2) in accordance with (x) Rule 144A to a person whom the seller
reasonably believes is a Qualified Institutional Buyer (as defined in Rule 144A
under the Securities Act ("Rule 144A")) that is purchasing such Securities for
its own account or for the account of a Qualified Institutional Buyer to whom
notice is given that the offer, sale or transfer is being made in reliance on
Rule 144A, (y) Regulation S to a non-U.S. person in an offshore transaction or
(z) any other available exemption from registration under the 1933 Act
(including the exemption provided by Rule 144).
(b) Covenants of the Offerors. Each of the Offerors, jointly and
severally, covenant with the Placement Agent and the Purchaser as follows:
i. Due Diligence. In connection with the initial placement of
the Capital Securities, the Offerors agree that, prior to any offer or sale of
the Capital Securities through the Placement Agent, the Placement Agent and the
Purchaser shall have the right to make reasonable inquiries into the business of
the Trust, the Company and the subsidiaries of the Company. The Offerors also
agree to provide answers to the Placement Agent and the Purchaser, if requested,
concerning the Trust, the Company and the subsidiaries of the Company (to the
extent that such information is available or can be acquired and made available
without unreasonable effort or expense and to the extent the provision thereof
is not prohibited by applicable law) and the terms and conditions of the
offering of the Capital Securities and the Subordinated Debt Securities.
ii. Integration. The Offerors agree that they will not, and
will cause their Affiliates not to, make any offer or sale of securities of the
Offerors of any class if, as a result of the doctrine of "integration" referred
to in Rule 502 under the 1933 Act, such offer or sale would render invalid the
exemption of the offering of the capital Securities from the registration
requirements of the 1933 Act provided by Section 4(2) thereof or by Rule 144A or
otherwise.
iii. Restriction on Repurchases. Until the expiration of two
(2) years (or such shorter period as may hereafter be referred to in Rule 144(k)
(or similar successor rule)) after the original issuance of the Capital
Securities, the Offerors will not, and will cause their Affiliates not to,
purchase or agree to purchase or otherwise acquire any Capital Securities which
are "restricted securities" (as such term is defined under Rule 144(a)(3) under
the 1933 Act), whether as beneficial owner or otherwise unless, immediately upon
any such purchase, the Offerors or any Affiliate shall submit such Capital
Securities to the Resident Trustee for cancellation.
SECTION 7. Indemnification
(a) Indemnification of the Placement Agent and the Purchaser. The
Offerors agree, jointly and severally, to indemnify and hold harmless: (x) the
Placement Agent and the Purchaser, (y) each person, if any, who controls (within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act) the
Placement Agent or the Purchaser (each such person, a "controlling person") and
(z) the respective partners, directors, officers,
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employees and agents of the Placement Agent and the Purchaser or any such
controlling person, as follows:
i. against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, relating to or arising out of, or based upon,
in whole or in part (A) any untrue statement or alleged untrue statement of
material fact contained in any information (whether written or oral) or
documents executed in favor of or furnished or made available to the Placement
Agent or the Purchaser by the Offerors; (B) any omission or alleged omission to
state in any information (whether written or oral) or documents executed by the
Offerors or furnished or made available to the Placement Agent or the Purchaser
by the Offerors of a material fact necessary to make the statements therein not
misleading; or (C) the breach or alleged breach of any representation, warranty
or agreement of any Offeror contained herein or in the Subscription Agreement;
ii. against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission or breach or alleged breach of any such representation,
warranty or agreement; provided that (subject to Section 7(c) hereof) any such
settlement is effected with the written consent of the Offerors; and
iii. against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by the
Placement Agent), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, or breach or alleged breach of any such representation, warranty or
agreement, to the extent that any such expense is not paid under (i) or (ii)
above;
provided, however, that the Company shall indemnify and hold harmless the Trust
against any and all loss, liability, claim, damage and expense whatsoever, as
incurred, which is due from the Trust pursuant to the foregoing.
(b) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof, and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. Counsel to the indemnified parties shall be selected by the Placement
Agent. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the indemnified party) also be counsel to
the
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indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 7 or Section 8 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(c) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have validly requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 7(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement, provided, however, that an indemnifying party shall
not be liable for any such settlement effected without its consent if such
indemnifying party (1) reimburses such indemnified party with respect to those
fees and expenses of counsel that it determines in good faith are reasonable and
(2) provides written notice within ten (10) days after receipt of the request
for reimbursement to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement.
SECTION 8. Contribution. In order to provide for just and equitable
contribution in circumstances under which the indemnification provided for in
Section 7 hereof is for any reason held to be unenforceable for the benefit of
an indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors, on the
one hand, and the Placement Agent, on the other hand, from the offering of the
Capital Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Offerors, on the one hand, and the
Placement Agent, on the other hand, in connection with the statements, omissions
or breaches which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
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The relative benefits received by the Offerors, on the one hand, and
the Placement Agent, on the other hand, in connection with the offering of the
Capital Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Capital Securities pursuant to this Agreement (before deducting expenses)
received by the Offerors and the total commission received by the Placement
Agent bear to the aggregate of such net proceeds and commissions.
The Offerors and the Placement Agent agree that it would not be just
and equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 8. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 8 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement, omission or alleged omission or breach or alleged breach.
Notwithstanding the provisions of this Section 8, the Placement Agent
shall not be required to contribute any amount in excess of the total
commissions received by it.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or Trustees of the Trust
submitted pursuant hereto shall remain operative and in full force and effect,
and shall survive delivery of the Capital Securities by the Trust.
SECTION 10. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Placement
Agent shall be directed to the Attention of ▇▇▇▇ ▇▇▇▇▇▇ as follows: SAMCO
Capital Markets, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and
notices to the Offerors shall be directed to United Bancorporation of Alabama,
Inc. as follows: P. O. Box ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇.
SECTION 11. Parties. This Agreement shall inure to the benefit of and
be binding upon each of the Placement Agent and the Offerors and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Placement Agent, the Purchaser and the Offerors, and their respective
successors and the controlling persons and other persons referred to in Sections
1, 7 and 8 hereof and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this
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Agreement or any provision herein contained. This Agreement and all conditions
and provisions hereof are intended to be for the sole and exclusive benefit of
the Placement Agent, the Purchaser and the Offerors and their respective
successors, and said controlling persons and other persons and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation.
SECTION 12. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF Delaware WITHOUT REGARD TO
CONFLICT OF LAW PRINCIPLES.
EACH OF THE TRUST AND THE COMPANY, ON BEHALF OF ITSELF AND ITS
SUBSIDIARIES (INCLUDING, WITHOUT LIMITATION, THE TRUST), HEREBY IRREVOCABLY
SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND TEXAS STATE COURTS
LOCATED IN THE CITY OF DALLAS IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
RELATED TO THIS AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY
WAIVES ANY DEFENSE OF LACK OF PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT. EACH OF THE TRUST AND THE COMPANY, ON BEHALF OF
ITSELF AND ITS SUBSIDIARIES (INCLUDING, WITHOUT LIMITATION, THE TRUST),
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER
APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND
ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
SECTION 13. Effect of Headings. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
* * *
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Placement Agent and the Offerors in accordance with its terms.
Very truly yours,
UNITED BANCORPORATION OF ALABAMA, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
UNITED BANCORP CAPITAL TRUST I
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Administrative Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
SAMCO CAPITAL MARKETS,
A DIVISION OF SERVICE ASSET MANAGEMENT COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Title: Managing Director
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