7.80% Trust Issued Preferred Securities
(Liquidation amount $25 per Preferred Security)
of Bear ▇▇▇▇▇▇▇ Capital Trust III
fully and unconditionally guaranteed by
The Bear ▇▇▇▇▇▇▇ Companies Inc.
Underwriting Agreement
----------------------
May 3, 2001
To the Several Underwriters named
in Schedule I hereto
c/o Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Bear ▇▇▇▇▇▇▇ Capital Trust III, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), and The Bear ▇▇▇▇▇▇▇
Companies Inc., a Delaware corporation (the "Guarantor"), as depositor of the
Trust and as Guarantor under the Guarantee referred to herein, propose to sell
to the several underwriters named in Schedule I hereto (the "Underwriters"), the
number of shares of preferred securities referred to in Schedule I hereto (the
"Securities") in the aggregate amount set forth in such Schedule I. The proceeds
of the sale of the Securities and of the common securities of the Trust (the
"Common Securities") to be sold by the Trust to the Guarantor are to be invested
in the 7.80% junior subordinated deferrable interest debentures of the Guarantor
(the "Subordinated Debentures") referred to in Schedule II hereto, to be issued
pursuant to an indenture (and any supplements and/or amendments thereto) (the
"Indenture") between the Guarantor and the trustee named in Schedule II (the
"Debenture Trustee"). The Securities will be guaranteed on a subordinated basis
by the Guarantor to the extent set forth in the guarantee agreement referred in
Schedule I hereto (the "Guarantee") between the Guarantor and the guarantee
trustee named in Schedule II (the "Guarantee Trustee").
1. Representations and Warranties. Each of the Guarantor and the
Trust jointly and severally represents and warrants to, and agrees with, the
Underwriters that:
(a) Each of the Trust and the Guarantor meet the requirements for
the use of Form S-3 under the Securities Act of 1933, as amended (the
"1933 Act"), and has prepared and filed with the Securities and Exchange
Commission (the "Commission") pursuant to the 1933 Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations promulgated by the Commission thereunder (the
"Regulations"), a Registration Statement (the file number of which is set
forth in Schedule II hereto) on such Form, including a Basic Prospectus,
for registration under the 1933 Act of the offering and sale of securities
that include the Securities. The Trust and the Guarantor have filed one or
more amendments to such Registration Statement as may have been required
to be filed through the date hereof and may have used a Preliminary Final
Prospectus, each of which, if any, has previously been furnished to you.
Such Registration Statement, as so amended (if applicable), has become
effective. The offering of the Securities is a Delayed Offering and,
accordingly, it is not necessary that any further information with respect
to the Securities and the offering thereof required by the 1933 Act and
the Regulations thereunder be included in an amendment to such
Registration Statement prior to the Effective Date. Each of the Trust and
the Guarantor will file with the Commission pursuant to Rules 415 and
424(b)(2), (3) or (5) a final prospectus supplement to the form of
prospectus included in such Registration Statement relating to the
Securities and the offering thereof. As filed, such final prospectus
supplement shall include all required information with respect to the
Securities and the offering thereof and, except to the extent the
Underwriters shall agree, in writing, to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution
Time or, to the extent not completed at the Execution Time, shall contain
only such specific additional information and other changes (beyond that
contained in the Basic Prospectus and any Preliminary Final Prospectus) as
either the Trust or the Guarantor has advised you, prior to the Execution
Time, will be included or made therein.
(b) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "Effective Date" shall mean each date
that the Registration Statement and any post-effective amendment or
amendments thereto became or become effective. "Execution Time" shall mean
the date and time that this Agreement is executed and delivered by the
parties hereto. "Basic Prospectus" shall mean the prospectus referred to
in paragraph (a) above contained in the Registration Statement at the
Effective Date including any Preliminary Final Prospectus. "Preliminary
Final Prospectus" shall mean any preliminary prospectus supplement to the
Basic Prospectus which describes the Securities and the offering thereof
and is used prior to the filing of the Final Prospectus. "Final
Prospectus" shall mean the prospectus supplement relating to the
Securities that is first filed pursuant to Rule 424(b) after the Execution
Time, together with the Basic Prospectus. "Registration Statement" shall
mean the registration statement referred to in paragraph (a) above,
including all exhibits, documents and financial statements incorporated by
reference, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in
the event any post-effective amendment thereto becomes effective prior to
the Closing Date (as such term is hereinafter defined), shall also mean
such registration statement as so amended. "Rule 415," "Rule 424" and
"Regulation S-K" refer to such rules or regulation under the 1933 Act. Any
reference herein to the Registration Statement, the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Securities
Exchange Act of 1934, as amended, or the rules and regulations promulgated
thereunder (the "1934 Act") on or before the effective date of the
Registration Statement, or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus, or the Final Prospectus, as the case may be;
and any reference herein to the terms "amend," "amendment," or
-2-
"supplement" with respect to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus, or the Final Prospectus
shall be deemed to refer to and include the filing of any document under
the 1934 Act after the Effective Date of the Registration Statement or the
issue date of the Basic Prospectus, any Preliminary Final Prospectus, or
the Final Prospectus, as the case may be, deemed to be incorporated
therein by reference. A "Delayed Offering" shall mean an offering of
securities pursuant to Rule 415 which does not commence promptly after the
effective date of a registration statement, with the result that only
information required pursuant to Rule 415 need be included in such
registration statement at the effective date thereof with respect to the
securities so offered.
(c) The Guarantor has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware
with corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Final
Prospectus and any amendment or supplement thereto; and the Guarantor is
duly qualified as a foreign corporation to transact business, and is in
good standing, in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify would not have
a material adverse effect on the financial condition, results of
operations, business or properties of the Guarantor and its subsidiaries
considered as one enterprise (any such material adverse effect being
hereinafter referred to as a "Material Adverse Effect").
(d) The Trust has been duly created and is validly existing as a
statutory business trust in good standing under the laws of the State of
Delaware with the trust power and authority to own its property and
conduct its business as described in the Final Prospectus and any
amendment or supplement thereto. The Trust has conducted no business to
date and will conduct no business other than the transactions contemplated
by this Agreement and the amended and restated trust agreement among the
Guarantor, as depositor, and the trustees named therein (the "Trustees"),
the administrators named therein and the holders, from time to time, of
the Securities and the Common Securities (as amended and restated from
time to time, the "Trust Agreement") and as described in the Final
Prospectus and any amendment or supplement thereto. The Trust is not a
party to or bound by any agreement or instrument other than this
Agreement, the Trust Agreement and the agreements and instruments
contemplated by the Trust Agreement and described in the Final Prospectus
and any amendment or supplement thereto. The Trust has no liabilities or
obligations other than those arising out of the transactions contemplated
by this Agreement and the Trust Agreement and described in the Final
Prospectus and any amendment or supplement thereto. The Trust is not a
party to or subject to any action, suit or proceeding of any nature. The
Trust is a "grantor trust" and is not and will not be classified as an
association taxable as a corporation for United States federal income tax
purposes.
(e) The Securities have been duly authorized, and, when issued,
delivered and paid for pursuant to this Agreement and the Trust Agreement,
will be validly issued and fully paid and non-assessable undivided
beneficial interests in the assets of the Trust entitled to the benefits
of the Trust Agreement. The Securities will conform in all material
respects to the description thereof in the Final Prospectus and any
-3-
amendment or supplement thereto. The Subordinated Debentures, this
Agreement, the Indenture, the Guarantee and the Trust Agreement have each
been duly authorized and, at the Closing Date (as defined in Section 3
hereof), when executed and delivered by the Guarantor against payment
therefor as of the Closing Date, and, (i) in the case of the Subordinated
Debentures, when issued by the Guarantor and duly authenticated by the
Debenture Trustee, (ii) in the case of the Indenture, by the Trustee named
therein, (iii) in the case of the Guarantee, by the Guarantee Trustee (as
defined in the Guarantee), (iv) in the case of this Agreement, by the
Depositor (as defined in the Trust Agreement), and (v) in the case of
the Trust Agreement, by the Trustees and Administrators (each as defined
in the Trust Agreement), will constitute valid and legally binding
obligations of the Guarantor and the Trust, as applicable, and in the case
of the Subordinated Debentures, will also be entitled to the benefits
provided by the Indenture, enforceable in accordance with their respective
terms, subject, as to enforcement, to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles. The Subordinated Debentures, the Indenture, this
Agreement, the Guarantee and the Trust Agreement will conform in all
material respects to the descriptions thereof in the Final Prospectus; the
Indenture and the Guarantee substantially comply with the Trust Indenture
Act.
(f) The holders of the Securities will be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware; provided that the holders of the Securities may be
obligated, pursuant to the Trust Agreement, to (a) provide indemnity
and/or security in connection with and pay taxes or governmental charges
arising from transfers or exchanges of Securities certificates and the
issuance of replacement Securities certificates and (b) provide security
and indemnity in connection with requests of or directions to the Property
Trustee (as defined in the Trust Agreement) to exercise its rights and
remedies under the Trust Agreement.
(g) The Trust has all trust power and authority necessary to execute
and deliver this Agreement, and the Securities and to perform its
obligations hereunder and thereunder. The issuance and sale of the
Securities and the Common Securities by the Trust, the purchase of the
Subordinated Debentures by the Trust and the compliance by the Trust with
the provisions of the Securities, the Trust Agreement and this Agreement
and the consummation of the transactions herein and therein contemplated
do not, as of the date hereof, and will not as of the Closing Date, (A)
conflict with or result in a breach of any of the terms and provisions of,
or constitute a default (or an event which with notice or lapse of time,
or both, would constitute a default) or require consent under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Trust pursuant to, the terms of any contract,
agreement, indenture, mortgage, loan agreement, note, lease or other
instrument, franchise, license or permit to which the Trust is a party or
by which the Trust or its properties or assets may be bound or subject, or
(B) violate or conflict with any provisions of the Trust Agreement, or any
law, judgment, decree, order, statute, rule or regulation of any court or
any public, governmental or regulatory agency or body or any arbitrator
having jurisdiction over the Trust, or any of its properties or assets. No
consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any public,
-4-
governmental or regulatory agency or body having jurisdiction over the
Trust, or any of its properties or assets, is required for the execution,
delivery and performance of this Agreement, and the Trust Agreement and
the compliance with the provisions hereby and thereby, the issuance, sale
and delivery of the Securities and Common Securities by the Trust and the
purchase of the Subordinated Debentures by the Trust, except such as may
be required under applicable state securities or "blue sky" laws.
(h) On the Effective Date, and at all times subsequent thereto to
and including the Closing Date (as such term is defined in Section 3), and
during such longer period as the Final Prospectus may be required to be
delivered in connection with sales by the Underwriters or a dealer, and
during such longer period until any post-effective amendment to the
Registration Statement shall become effective, the Registration Statement
(including any post effective amendment) and the Final Prospectus (as
amended or as supplemented if the Guarantor and the Trust shall have filed
with the Commission any amendment or supplement to the Registration
Statement or the Final Prospectus) will comply with the requirements of
the 1933 Act, the 1934 Act, the Trust Indenture Act and the Regulations
promulgated under each of the 1933 Act, the 1934 Act and the Trust
Indenture Act, and will 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 the light of the circumstances
in which they were made not misleading, and no event will have occurred
which should have been set forth in an amendment or supplement to the
Registration Statement or the Final Prospectus which has not then been set
forth in such an amendment or supplement; and each Basic Prospectus and
each Preliminary Final Prospectus, as of the date filed with the
Commission, 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 in which they
were made not misleading; provided, however, that neither Guarantor nor
the Trust makes any representation and warranty as to information
contained in or omitted from (i) the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus, or the Final Prospectus made
in reliance upon and in conformity with information furnished to the
Guarantor or the Trust, in writing, by any Underwriter expressly for use
in the Registration Statement or such Basic Prospectus, any Preliminary
Final Prospectus, or the Final Prospectus and (ii) the Statement of
Eligibility and Qualification on Form T-1 of the Debenture Trustee, the
Property Trustee under the Trust Agreement and the Guarantee Trustee under
the Trust Indenture Act, except statements or omissions in such statements
made in reliance upon information furnished to such trustees by or on
behalf of the Guarantor or the Trust for inclusion therein.
(i) Neither the Commission nor the "blue sky" or securities
authority of any jurisdiction has issued an order (a "Stop Order")
suspending the effectiveness of the Registration Statement, preventing or
suspending the use of the Basic Prospectus, any Preliminary Final
Prospectus, the Final Prospectus, the Registration Statement, or any
amendment or supplement thereto, refusing to permit the effectiveness of
the Registration Statement, or suspending the registration or
qualification of the Securities, nor has any of such authorities
instituted or, to the knowledge of either the Guarantor or the Trust,
threatened to institute any proceedings with respect to a Stop Order in
-5-
any jurisdiction in which the Securities are to be sold, nor, with respect
to accuracy at the Closing Date, has there been any Stop Order issued or
proceedings with respect to a Stop Order instituted or, to the knowledge
of either the Guarantor or the Trust, threatened on or after the effective
date of the Registration Statement in any jurisdiction.
(j) The documents incorporated by reference in the Final Prospectus
and any amendment or supplement thereto (the "Incorporated Documents"), at
the time they were or hereafter are filed with the Commission, complied or
when so filed will comply, in all material respects, with the requirements
of the 1933 Act, or the 1934 Act, the Trust Indenture Act, as applicable,
and the Regulations promulgated under each of the 1933 Act, the 1934 Act
and the Trust Indenture Act, and on the Effective Date and through and
including the Closing Date, did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they are made, not misleading.
(k) Since the respective dates as of which information is given in
the Registration Statement and the Final Prospectus, except as otherwise
stated therein or contemplated thereby, there has been no material adverse
change in, or any adverse development which materially affects, the
financial condition, results of operations, business or properties of the
Guarantor and its subsidiaries considered as one enterprise.
(l) Since the respective dates as of which information is given in
the Registration Statement and the Final Prospectus, except as otherwise
stated therein or contemplated thereby, there has been no material adverse
change in, or any adverse development which materially affects, the
financial condition, results of operations, business or properties of the
Trust.
(m) The Guarantor has all corporate power and authority necessary to
execute and deliver this Agreement, the Indenture, the Subordinated
Debentures, the Guarantee and the Trust Agreement and to perform its
obligations hereunder and thereunder; the execution, delivery and
performance of this Agreement, the Indenture, the Guarantee and the Trust
Agreement, the issuance, authentication, and sale of the Subordinated
Debentures by the Guarantor, and compliance with the provisions hereof and
thereof by the Guarantor, do not, as of the date hereof, and will not, as
of the Closing Date, (A) conflict with or result in a breach of any of the
terms and provisions of, or constitute a default (or an event which with
notice or lapse of time, or both, would constitute a default) or require
consent under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Guarantor or any of its
subsidiaries considered as one enterprise pursuant to, the terms of any
contract, agreement, indenture, mortgage, loan agreement, note, lease or
other instrument, franchise, license or permit to which the Guarantor or
any of its subsidiaries is a party or by which the Guarantor or any of its
subsidiaries or their respective properties or assets may be bound or
subject and that is material to the Guarantor and its subsidiaries
considered as one enterprise, or (B) violate or conflict with any
provision of the certificate of incorporation or by-laws of the Guarantor
or any of its subsidiaries, or any law, judgment, decree, order, statute,
rule or regulation of any court or any public, governmental or regulatory
agency or body or any arbitrator having jurisdiction over the Guarantor or
any of its subsidiaries, or any of their respective properties or assets.
No consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any public,
-7-
governmental or regulatory agency or body having jurisdiction over the
Guarantor or any of its subsidiaries, or any of their respective
properties or assets, is required for the execution, delivery and
performance of this Agreement, the Indenture, the Guarantee and the Trust
Agreement and the compliance with the provisions hereof and thereof,
including the issuance, authentication, sale and delivery of the
Subordinated Debentures, except such as may be required under applicable
state securities or "blue sky" laws.
(n) The Common Securities have been duly authorized and when issued
and delivered at the Closing Date against payment therefor, will be
validly issued and fully paid and non-assessable undivided beneficial
interests in the assets of the Trust and will conform in all material
respects to the description thereof contained in the Final Prospectus; the
issuance of the Common Securities is not subject to preemptive or other
similar rights; on the Closing Date, all of the issued and outstanding
Common Securities of the Trust will be directly owned by the Guarantor,
free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or other defect of title whatsoever; and the Common
Securities and the Securities are the only interests authorized to be
issued by the Trust.
(o) Neither the Trust nor the Guarantor is or, after giving effect
to the offering and sale of the Securities, will be an "investment
company" or an entity "controlled" by an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(p) Except for Bear, ▇▇▇▇▇▇▇ & Co. Inc. ("Bear ▇▇▇▇▇▇▇"), Bear,
▇▇▇▇▇▇▇ Securities Corp. ("BSSC"), Bear, ▇▇▇▇▇▇▇ International Limited
("BSIL") and Bear ▇▇▇▇▇▇▇ Holdings Limited ("BSHL"), no subsidiary of the
Guarantor is a "significant subsidiary" as defined in Rule 405 of
Regulation C of the Regulations; each of Bear ▇▇▇▇▇▇▇, BSSC, BSIL and BSHL
has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation, has
the corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Final Prospectus and any
amendment or supplement thereto and is duly qualified as a foreign
corporation to transact business, and is in good standing, in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure to so qualify would not have a Material Adverse Effect;
and all of the issued and outstanding capital stock of Bear ▇▇▇▇▇▇▇, BSSC,
BSIL and BSHL has been duly authorized and validly issued and is fully
paid and non-assessable and was not issued in violation of or subject to
preemptive rights, and, except for directors' qualifying shares, is owned,
directly or indirectly, by the Guarantor free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or other defect of
title whatsoever.
(q) There are no holders of securities of either the Guarantor or
the Trust or any of their respective subsidiaries who, pursuant to any
-7-
agreement, understanding or otherwise, have any right to have securities
of the Guarantor, the Trust or any of their respective subsidiaries
registered under the 1933 Act in connection with the offering contemplated
by the Final Prospectus.
(r) The Securities have been rated investment grade by at least
one nationally recognized rating agency.
(s) Deloitte & Touche LLP, the accountants who certified the
financial statements included or incorporated by reference in the
Guarantor's most recent Annual Report on Form 10-K which is incorporated
by reference in the Final Prospectus, were independent public accountants
at the time such statements were certified and during the periods covered
by such statements as required by the 1933 Act and the Regulations.
(t) The financial statements of the Guarantor and its consolidated
subsidiaries included or incorporated by reference in the Registration
Statement and the Final Prospectus, and any amendment or supplement
thereto, present fairly the consolidated financial position of the
Guarantor and its consolidated subsidiaries as at the dates indicated and
the consolidated results of their operations for the periods specified;
and said financial statements have been prepared in conformity with
generally accepted accounting principles in the United States (except to
the extent that certain footnote disclosures regarding any stub period may
have been omitted in accordance with the 1934 Act and the Regulations
promulgated thereunder) applied on a consistent basis.
(u) Except as may be set forth in the Final Prospectus, there is no
action, suit or proceeding before or by any court or governmental agency
or body or arbitrator, domestic or foreign, now pending, or, to the
knowledge of the Guarantor, threatened against or affecting, the
Guarantor, the Trust, Bear ▇▇▇▇▇▇▇, BSSC, BSIL or BSHL which is required
to be disclosed in the Registration Statement or Final Prospectus, or
would have a Material Adverse Effect or would otherwise be expected to
materially and adversely affect the consummation of the transactions
contemplated hereby or by the Indenture, the Guarantee or the Trust
Agreement.
(v) The Guarantor, the Trust, Bear ▇▇▇▇▇▇▇, BSSC, BSIL and BSHL
possess such certificates, authorities or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them, except where the
failure to obtain such certificates, authorities or permits, individually
or in the aggregate, would not have a Material Adverse Effect. None of the
Guarantor, the Trust, Bear ▇▇▇▇▇▇▇, BSSC, BSIL and BSHL has received any
notice of proceedings relating to the revocation or modification of any
such certificate, authority or permit which, singly or in the aggregate,
if the subject of any unfavorable decision, ruling or finding, would
materially and adversely affect the financial condition, results of
operations, business or properties of the Guarantor and its subsidiaries
considered as one enterprise. There are no contracts or documents of the
Guarantor, the Trust, Bear ▇▇▇▇▇▇▇, BSSC, BSIL or BSHL which are required
to be filed as exhibits to, disclosed in or summarized in the Registration
Statement or the Final Prospectus by the 1933 Act or the Regulations which
have not been (or which will not be, as the case may be) so filed,
disclosed or summarized.
-8-
2. Purchase and Sale. On the basis of the terms and conditions and
in reliance upon the representations, warranties, covenants and agreements
herein set forth, the Guarantor and the Trust agree that the Trust will sell to
the Underwriters, and the Underwriters agree to purchase from the Trust, in the
respective amounts set forth opposite their names on Schedule I hereto and at
the purchase price set forth in Schedule II hereto, the Securities. The
obligations of the Underwriters under this Section 2 are several and not joint.
In addition, the Trust hereby grants to the Underwriters an option
to purchase up to an additional 1,500,000 Securities (the "Option Securities").
This option may be exercised only to cover over-allotments in the sale of
Securities by the Underwriters. The Option Securities shall be purchased
severally for the account of the Underwriters in proportion to the number of
Securities set forth opposite the name of such Underwriter in Schedule I hereto,
subject in each case to such adjustments as Bear ▇▇▇▇▇▇▇ in its sole discretion
shall make to eliminate any sales or purchases of fractional shares and at the
purchase price set forth in Schedule II hereto. This option may be exercised by
Bear ▇▇▇▇▇▇▇ on the basis of the representations, warranties, covenants, and
agreements of each of the Guarantor and the Trust herein contained, but subject
to the terms and conditions herein set forth, at any time and from time to time
on or before the thirtieth (30th) day following the date hereof, by written
notice by Bear ▇▇▇▇▇▇▇ to the Trust. Such notice shall set forth the aggregate
number of Option Securities as to which the option is being exercised and the
time and date, as determined by Bear ▇▇▇▇▇▇▇, when such Option Securities are to
be delivered (such time and date are herein called the "Second Closing Date").
As compensation to the Underwriters for their commitment hereunder,
and in view of the fact that the proceeds from the sale of the Securities and
the Option Securities, if any, will be used by the Trust to purchase the
Subordinated Debentures, upon payment of the purchase price for the Securities
and the Option Securities, if any, as contemplated in the two immediately
preceding paragraphs, the Guarantor on the Closing Date and on the Second
Closing Date, if any, will pay by wire transfer of immediately available funds
to the Underwriters the amount per Security and Option Security, if any, set
forth in Schedule II hereto in respect of the Securities and the Option
Securities, if any, to be delivered by the Trust hereunder on the Closing Date
and on the Second Closing Date, if any.
3. Delivery and Payment. Delivery of and payment for the Securities
shall be made at the office, on the date and at the time specified in Schedule
II hereto, which date and time may be postponed by agreement among the
Underwriters, the Trust and the Guarantor (such date and time of delivery of and
payment for the Securities being herein called the "Closing Date"). The
Securities to be purchased by the Underwriters hereunder will be represented by
one or more global Securities which will be deposited by or on behalf of the
Trust with The Depository Trust Company ("DTC") or its designated custodian.
Delivery of the Securities shall be made by causing DTC to credit the Securities
to the account of the Underwriters at DTC, against payment by the Underwriters
of the purchase price thereof to or upon the order of the Trust in the manner
and type of funds specified in Schedule II.
In addition, in the event that any or all of the Option Securities
are purchased by the Underwriters, payment of the purchase price for, and the
delivery of certificates for, such Option Securities shall be made at the
office, on the Second Closing Date and at the time specified in Schedule II
-9-
hereto, which date and time may be postponed by agreement among the
Underwriters, the Trust and the Guarantor.
The Trust and the Guarantor agree to have the certificates
representing the Securities available for checking in New York, New York, on the
business day prior to the Closing Date and agree to have the certificates
representing the Option Securities available for checking in New York, New York,
on the business day prior to the Second Closing Date.
4. Covenants of the Guarantor and the Trust. Each of the Guarantor
and the Trust covenant and agree with the several Underwriters as follows:
(a) Each of the Guarantor and the Trust will use its best efforts
to cause the Registration Statement, if not effective at the Execution
Time, to become effective as promptly as possible. The Guarantor will
notify you immediately, and confirm such notice in writing, (i) when the
Registration Statement (including any amendments thereto) becomes
effective, (ii) of any request by the Commission for any amendment of or
supplement to the Registration Statement or the Final Prospectus or for
any additional information, (iii) of the issuance by the Commission of a
Stop Order suspending the effectiveness of the Registration Statement
(including any post-effective amendment thereto) or of the initiation, or
the threatening, of any proceedings therefor, (iv) of the receipt of any
comments from the Commission and (v) of the receipt by either the Trust or
the Guarantor of any notification with respect to the suspension of the
qualification of the Securities for sale in any jurisdiction or the
initiation, or threatening, of any proceeding for that purpose. If the
Commission shall propose or enter a Stop Order at any time, each of the
Guarantor and the Trust will make every reasonable effort to prevent the
issuance of any such Stop Order and, if issued, to obtain the withdrawal
of such order as soon as possible. Neither the Guarantor nor the Trust
will file any amendment to the Registration Statement or supplement
(including the Final Prospectus or any Preliminary Final Prospectus) to
the Basic Prospectus before or after the Effective Date unless the
Guarantor or the Trust, as applicable, has furnished you with a copy for
your review prior to filing and will not file any such proposed amendment
or supplement to which you reasonably object.
(b) During the time when a prospectus relating to the Securities is
required to be delivered hereunder or under the 1933 Act or the
Regulations, the Guarantor and the Trust will comply with all requirements
imposed upon it by the 1933 Act and the Trust Indenture Act as now
existing and as hereafter amended, and by the Regulations promulgated
under each of the 1933 Act and the Trust Indenture Act, as from time to
time in force, so far as necessary to permit the continuance of sales of
or dealing in the Securities in accordance with the provisions thereof and
the Final Prospectus. If at any time when a prospectus relating to the
Securities is required to be delivered under the 1933 Act or the
Regulations, any event shall have occurred as a result of which, in the
judgment of the Guarantor and the Trust, you or your counsel, the Final
Prospectus as then amended or supplemented includes an untrue statement of
a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it shall
be necessary at any time to amend or supplement the Final Prospectus or
-10-
Registration Statement to comply with the 1933 Act, the Trust Indenture
Act or the Regulations promulgated thereunder, and the Guarantor and the
Trust will notify you promptly and prepare and file with the Commission an
appropriate amendment or supplement (in form and substance satisfactory to
you) which will correct such statement or omission and will use its best
efforts to have any amendment to the Registration Statement declared
effective as soon as possible and will deliver to the several
Underwriters, without charge, such number of copies thereof as may be
reasonably requested by the Underwriters; provided that the Guarantor and
the Trust will promptly notify you if such judgment has been reached by
them.
(c) The Guarantor and the Trust will promptly deliver to you a copy
of the Registration Statement, including exhibits and all amendments
thereto, and the Guarantor and the Trust will promptly deliver without
charge to you such number of copies of the Basic Prospectus, any
Preliminary Final Prospectus, the Final Prospectus, the Registration
Statement, and all amendments of and supplements to such documents, if
any, as may be reasonably requested by the Underwriters.
(d) Each of the Guarantor and the Trust will endeavor in good
faith, in cooperation with you, to timely qualify the Securities for
offering and sale under the securities laws of such jurisdictions as you
may designate and to maintain such qualification in effect for so long as
required for the distribution thereof; provided that in no event shall
either the Guarantor or the Trust be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take action
which would subject it to general service of process in any jurisdiction
where it is not now so subject or to conduct its business in a manner in
which it is not currently so conducting its business.
(e) Each of the Guarantor and the Trust will make generally
available (within the meaning of Section 11(a) of the 1933 Act and Rule
158 of the Regulations) to its security holders and to you as soon as
practicable an earnings statement which need not be audited but which
shall satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158
of the Regulations.
(f) Each of the Guarantor and the Trust, during the period when the
Final Prospectus is required to be delivered under the 1933 Act, will file
promptly all documents required to be filed with the Commission pursuant
to Section 13 or 14 of the 1934 Act and the Regulations promulgated
thereunder.
(g) During the period of one year after the date hereof, the
Guarantor and the Trust will furnish to you (i) as soon as publicly
available, a copy of each Annual Report on Form 10-K, Quarterly Report on
Form 10-Q, Current Report on Form 8-K, annual report to stockholders and
definitive proxy statement of the Guarantor and the Trust filed with the
Commission under the 1934 Act and the Regulations promulgated thereunder
or mailed to stockholders and (ii) from time to time, such other
information concerning the Guarantor and the Trust as you may reasonably
request.
(h) Each of the Guarantor and the Trust will apply the proceeds
from the sale of the Securities as set forth under the caption "Use of
Proceeds" in the Final Prospectus.
-11-
(i) Prior to the Closing Date, the Guarantor and the Trust shall
furnish to you, as soon as they have been prepared, copies of any
unaudited interim consolidated financial statements of the Guarantor and
its subsidiaries, for any periods subsequent to the periods covered by the
financial statements appearing or incorporated by reference in the
Registration Statement and the Final Prospectus.
(j) The Securities have been approved for listing, subject to
official notice of issuance, on the New York Stock Exchange (the "NYSE").
(k) Each of the Guarantor and the Trust will comply with all
provisions of all undertakings contained in the Registration Statement.
(l) Each of the Guarantor and the Trust consent to the use of the
Final Prospectus or any amendment or supplement thereto by you and by all
dealers to whom the Securities may be sold, both in connection with the
offering or sale of the Securities and for such period of time thereafter
as the Final Prospectus is required by law to be delivered in connection
therewith.
(m) Prior to the Closing Date, the Guarantor and the Trust will
not, without the consent of the Underwriters, offer, sell or contract to
sell, or announce the offering of, shares of any class of capital stock of
either the Guarantor or the Trust (other than the Securities) which is
ranked prior as to the payment of dividends, or as to the distribution of
assets upon any liquidation, dissolution or winding up of either the
Guarantor or the Trust over shares of any other class of capital stock of
either of the Guarantor and the Trust.
5. Payment of Expenses. Whether or not the transactions contemplated
in this Agreement are consummated or this Agreement is terminated, each of the
Guarantor and the Trust hereby covenant and agree with the several Underwriters
that the Guarantor and the Trust will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of the Guarantor's and the Trust's counsel
and accountants in connection with the registration of the Securities under the
1933 Act, the qualification of the Indenture and the Guarantee under the Trust
Indenture Act, and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, the Basic Prospectus, any
Preliminary Final Prospectus, the Final Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) all costs and expenses related to the issuance,
transfer and delivery of the Securities to the Underwriters, including any
transfer or other taxes payable thereon; (iii) the cost of printing or producing
this Agreement, any "blue sky" and legal investment memoranda and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iv) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as provided in
Section 4(d) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
"blue sky" and legal investment memoranda; (v) any fees charged by securities
rating agencies for rating the Securities and the Subordinated Debentures; (vi)
any filing fees incident to any required reviews by the National Association of
Securities Dealers, Inc. (the "NASD") of the terms of the sale of the
Securities; (vii) the costs and expenses of any qualified independent
underwriter which may be required by the rules and regulations of the NASD;
-12-
(viii) all costs and expenses incident to listing the Securities on the NYSE or
other national securities exchange; (ix) the cost of preparing certificates for
the Securities and the cost and charges of any Trustee and its nominee for
acting as a depository for the Securities and otherwise effecting any book entry
ownership system for the Securities; (x) the cost and charges of the Trustee,
any transfer agent, calculation agent, registrar or disbursing agent; and (xi)
all other costs and expenses incident to the performance of the Guarantor's and
the Trust's obligations hereunder which are not otherwise specifically provided
for in this Section. It is understood, however, that, except as provided in this
Section and Sections 6 and 7 hereof, the Underwriters will pay all of their own
costs and expenses, including the fees of their counsel, transfer taxes on
resale of any of the Securities by them and any advertising expenses connected
with any offers they may make.
If this Agreement is entered into and the purchase of Securities by
the Underwriters pursuant to this Agreement is not consummated because any
condition to the obligations of the Underwriters set forth in Section 6 hereof
is not satisfied, because of any termination pursuant to Section 11(b) hereof or
because of any refusal, inability or failure on the part of the Guarantor or the
Trust to perform any agreement herein or comply with any provision hereof other
than by reason of a default by the Underwriters, the Guarantor or the Trust will
reimburse the Underwriters severally upon demand for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the
Securities.
6. Conditions to the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Securities
shall be subject to the continuing accuracy of the representations and
warranties on the part of each of the Guarantor and the Trust contained herein
as of the date hereof and the Closing Date, to the accuracy of the statements of
the Guarantor and the Trust made in any certificates delivered pursuant to the
provisions hereof, to the performance by each of the Guarantor and the Trust of
its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, the Registration Statement shall have become effective
not later than 6:00 p.m., New York City time, on the date of this
Agreement or such later date and time as shall be consented to, in
writing, by you, and, if filing of the Final Prospectus, or any supplement
thereto, is required pursuant to Rule 424(b), the Final Prospectus, and
any such supplement, shall have been filed in the manner and within the
time period required by Rule 424(b).
(b) At the Closing Date (i) no Stop Order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued under the 1933 Act, and no proceeding under the 1933 Act or
the 1934 Act therefor shall have been initiated or threatened by the
Commission, or, with respect to the filing of any Form 8-A under the 1934
Act, by any national securities exchange; and all requests for additional
information on the part of the Commission shall have been complied with or
such requests shall have been otherwise satisfied; (ii) the rating
assigned by any nationally recognized securities rating agency to any debt
securities, preferred stock or other obligations of the Guarantor and the
Trust as of the date of this Agreement shall not have been lowered since
-13-
the execution of this Agreement and no such agency shall have publicly
announced since the execution of this Agreement that it has under
surveillance or review, with possible negative implications, its rating of
any of the debt securities or preferred stock of either of the Guarantor
or the Trust; and (iii) since the respective dates as of which information
is given in the Registration Statement and the Final Prospectus, except as
otherwise stated therein or contemplated thereby, there shall not have
been any material adverse change in, or any adverse development which
materially affects, the financial condition, results of operations,
business or properties of either of the Guarantor or the Trust or their
respective subsidiaries, the effect of which is in your reasonable
judgment so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities on the terms and in the manner contemplated in the Final
Prospectus.
(c) At the Closing Date, you shall have received the opinion of
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, counsel for the Guarantor and the Trust,
dated the date of delivery and substantially in the form set forth in
Schedule III hereto, addressed to the Underwriters and in form and scope
reasonably satisfactory to Underwriters' Counsel.
(d) At the Closing Date, you shall have received the opinion of ▇▇▇▇
▇. ▇▇▇▇▇▇, Esq., Senior Managing Director of the Guarantor's Legal &
Compliance Department, dated the date of delivery and substantially in the
form set forth in Schedule IV, addressed to the Underwriters and in form
and scope reasonably satisfactory to Underwriters' Counsel.
(e) At the Closing Date, you shall have received a certificate of
the Chief Financial Officer or the Controller of each of the Guarantor and
the Trust, dated the date of delivery, to the effect that the conditions
set forth in subsections (a) and (b) of this Section 6 have been
satisfied, that as of the date hereof and at the date of delivery, the
representations and warranties of each of the Guarantor and the Trust set
forth in Section 1 hereof are accurate, and that at the date of delivery,
the obligations of each of the Guarantor and the Trust to be performed
hereunder on or prior thereto have been duly performed in all material
respects.
(f) At each of the Execution Time and the Closing Date, you shall
have received a letter (which may be an update or "bringdown" letter) from
Deloitte & Touche LLP, independent public accountants for the Guarantor
and its subsidiaries, and the Trust dated the date of delivery,
substantially in the form set forth in Schedule VI hereto, addressed to
the Underwriters and in form and scope reasonably satisfactory to you.
(g) The Underwriters shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇ LLP ("Underwriters' Counsel") an opinion, dated the Closing
Date, with respect to the issuance and sale of the Securities, the
Registration Statement, the Final Prospectus, and any amendments or
supplements to the Registration Statement or Final Prospectus and such
other related matters, as you may reasonably require, and either the Trust
or the Guarantor shall have furnished to Underwriters' Counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
-14-
(h) All proceedings taken in connection with the offering and sale
of the Securities as contemplated herein shall be satisfactory in form and
scope to you and to Underwriters' Counsel, and, prior to the Closing Date,
either the Trust or the Guarantor shall have furnished to you such further
information, certificates and documents as you may reasonably request.
(i) The NASD, upon review of the terms of the public offering of
the Securities, shall have no objections to the fairness of the
underwriting terms and arrangements of the offering.
(j) At the Closing Date, Form 8-A under the 1934 Act (the "Form
8-A") shall have become effective.
(k) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.A., special Delaware counsel to the
Guarantor and the Trust, shall have furnished to the several Underwriters
an opinion dated the Closing Date, substantially in the form set forth in
Schedule V hereto, addressed to the several Underwriters and in form and
scope reasonably satisfactory to Underwriters' Counsel.
(l) ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, tax counsel for the Guarantor,
shall have furnished to the several Underwriters an opinion, dated the
Closing Date, to the effect that such firm confirms its opinion set forth
in the Final Prospectus under the caption "Certain Federal Income Tax
Consequences."
(m) The Guarantor shall have furnished to the several Underwriters
such further information, certificates and documents as they may
reasonably request prior to the Closing Date.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this Agreement
shall not be reasonably satisfactory in form and substance to the several
Underwriters and counsel for the several Underwriters, this Agreement and
all obligations of the several Underwriters, hereunder may be cancelled
at, or at any time prior to, the Closing Date by the several Underwriters.
Notice of such cancellation shall be given to the Guarantor and the Trust
in writing or by telephone or telegraph confirmed in writing.
7. Indemnification.
---------------
(a) Each of the Guarantor and the Trust agree, jointly and
severally, to indemnify and hold harmless each Underwriter and their
affiliates, if any, and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20(a) of the
1934 Act, against any and all losses, liabilities, claims, damages and
out-of-pocket expenses whatsoever (including but not limited to attorneys'
fees and any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in
settlement of any claim or litigation), to which you or any such person
-15-
may become subject under the 1933 Act, the 1934 Act or otherwise, insofar
as such losses, liabilities, claims, damages or expenses (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement or any related Basic Prospectus, Preliminary Final
Prospectus, or Final Prospectus, or in any supplement thereto or amendment
thereof, 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 (in the case of the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, in
light of the circumstances under which they were made) not misleading or
(ii) any breach of any representation, warranty, covenant or agreement of
the Guarantor or the Trust contained in this Agreement; provided, however,
that neither the Guarantor nor the Trust will be liable to any Underwriter
or any person so controlling such Underwriter in any such case to the
extent, but only to the extent, that any such loss, liability, claim,
damage or expense arises out of or is based upon (x) any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information
furnished to either the Guarantor or the Trust by or on behalf of any
Underwriter through you expressly for use therein, such written
information being as set forth in penultimate sentence of subsection (b)
below, or (y) any failure of such Underwriter to deliver the Final
Prospectus to a purchaser of Securities as required by applicable law.
This indemnity agreement will be in addition to any liability which the
Guarantor or the Trust may otherwise have including under this Agreement.
(b) Each Underwriter severally, and not jointly, agrees to
indemnify and hold harmless each of the Guarantor and the Trust, each of
its directors, each of its officers who shall have signed the Registration
Statement, and each other person, if any, who controls either of the
Guarantor or the Trust within the meaning of Section 15 of the 1933 Act or
Section 20(a) of the 1934 Act against any losses, liabilities, claims,
damages and expenses whatsoever (including but not limited to attorneys'
fees and any and all out-of-pocket expenses whatsoever reasonably incurred
in investigating, preparing or defending against any litigation, commenced
or threatened, or any claim whatsoever and any and all amounts paid in
settlement of any claim or litigation), joint and several, to which they
or any of them may become subject under the 1933 Act, the 1934 Act or
otherwise, insofar as such losses, liabilities, claims, damages or
expenses (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, or any related Basic Prospectus,
Preliminary Final Prospectus or Final Prospectus, or in any amendment
thereof or supplement thereto, 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 (in the case
of a Basic Prospectus, Preliminary Final Prospectus or Final Prospectus,
in light of the circumstances under which they were made) not misleading,
in each case to the extent, but only to the extent, that any such loss,
liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to either of the Guarantor or the Trust by or on
behalf of such Underwriter through you expressly for use therein. For all
purposes of this Agreement, the identification of the name of, and the
number of shares of Preferred Securities to be purchased by, each of the
-16-
Underwriters, amounts of the selling concession and reallowance, and the
stabilization language set forth under the heading "Underwriting" in the
Final Prospectus constitute the only information furnished in writing by
or on behalf of any Underwriter expressly for inclusion in any Basic
Prospectus or Preliminary Final Prospectus, the Final Prospectus, or the
Registration Statement (as from time to time amended or supplemented), or
any amendment or supplement thereto. This indemnity will be in addition to
any liability which any Underwriter may otherwise have, including under
this Agreement; provided, however, that in no case shall any Underwriter
be liable or responsible for any amount in excess of the underwriting
discounts and commissions received by such Underwriter.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify each party
against whom indemnification is to be sought in writing of the
commencement thereof (but the failure so to notify an indemnifying party
shall not relieve it from any liability which it may have under this
Section 7 except to the extent that it has been prejudiced in any material
respect by such failure or from any liability which it may have
otherwise). In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein, and to the
extent it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof with counsel satisfactory to such
indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any
such case, but the fees and expenses of such counsel shall be at the
expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by one of the
indemnifying parties in connection with the defense of such action, (ii)
the indemnifying parties shall not have employed counsel to have charge of
the defense of such action within a reasonable time after notice of
commencement of the action, or (iii) such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it
or them which are different from or additional to those available to one
or all of the indemnifying parties (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of
the indemnified party or parties, it being understood, however, that the
indemnifying party shall not, in connection with any one such claim,
action or proceeding or separate but substantially similar or related
claims, actions or proceedings in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm (together with appropriate local
counsel) at any time for the indemnified party or parties, which firm
shall be designated in writing by the indemnified party or parties, unless
such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to one or all of the other indemnified party
or parties (in which case the indemnifying party shall be liable for the
fees and expenses of only one additional separate firm (together with
appropriate local counsel) for such indemnified party or parties at any
time)), in any of which events such fees and expenses shall be borne by
the indemnifying parties. Anything in this Section 7 to the contrary
-17-
notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent;
provided, however, that such consent was not unreasonably withheld.
8. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 7 hereof is
for any reason held to be unavailable from the Trust or the Guarantor or is
insufficient to hold harmless a party indemnified thereunder, the Guarantor and
the Trust, on one hand, and the Underwriters, on the other hand, shall
contribute to the aggregate losses, claims, damages, liabilities and
out-of-pocket expenses of the nature contemplated by such indemnification
provision (including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted, but after deducting in the case of losses,
claims, damages, liabilities and expenses suffered by the Guarantor and the
Trust, any contribution received by the Guarantor and the Trust from persons,
other than the Underwriters, who may also be liable for contribution, including
persons who control the Guarantor or the Trust within the meaning of Section 15
of the 1933 Act or Section 20(a) of the 1934 Act, officers of the Guarantor and
the Trust who signed the Registration Statement and directors of the Guarantor
and the Trust) to which the Guarantor and the Trust and one or more of the
Underwriters may be subject, in such proportions as is appropriate to reflect
the relative benefits received by the Guarantor and the Trust, on the one hand,
and the Underwriters, on the other hand, from the offering of the Securities or,
if such allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 7 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Guarantor and the Trust, on the one hand, and the Underwriters, on the other
hand, in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Guarantor and
the Trust, on the one hand, and the Underwriters, on the other hand, shall be
deemed to be in the same proportion as the total proceeds from the offering (net
of underwriting discounts and commissions but before deducting expenses)
received by the Guarantor and the Trust, bear to the underwriting discounts and
commissions received by the Underwriters, respectively, in each case as set
forth in the table on the cover page of the Final Prospectus. The relative fault
of the Guarantor and the Trust, on the one hand, and of the Underwriters, on the
other hand, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Guarantor and the Trust, on the one hand, or the Underwriters, on the other
hand, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Guarantor and
the Trust, on the one hand, and the Underwriters, on the other hand, agree that
it would not be just and equitable if contribution pursuant to this Section 8
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above. Notwithstanding
the provisions of this Section 8, (i) in no case shall any Underwriter be liable
or responsible for any amount in excess of the underwriting discounts and
commissions applicable to the Securities purchased by such Underwriter
hereunder, and (ii) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For purposes
-18-
of this Section 8, each person, if any, who controls an Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20(a) of the 1934 Act shall
have the same rights to contribution as such Underwriter, and each person, if
any, who controls the Guarantor or the Trust within the meaning of Section 15 of
the 1933 Act or Section 20(a) of the 1934 Act, each officer of the Guarantor and
the Trust who shall have signed the Registration Statement and each director of
the Guarantor and the Trust shall have the same rights to contribution as the
Guarantor and the Trust, subject in each case to clauses (i) and (ii) of the
preceding sentence of this Section 8. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 8, notify such party
or parties from whom contribution may be sought, but the omission to so notify
such party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may have under this
Section 8 or otherwise. No party shall be liable for contribution with respect
to any action or claim settled without its consent; provided, however, that such
consent was not unreasonably withheld.
9. Default by an Underwriter.
-------------------------
(a) If any Underwriter or Underwriters shall default at the Closing
Date in its or their obligation to purchase the Securities hereunder and
if the number of shares of the Securities to which such default relates
does not (after giving effect to arrangements, if any, made by you
pursuant to subsection (b) below) exceed in the aggregate 10% of the total
number of shares of the Securities that all Underwriters have agreed to
purchase hereunder, then such shares of the Securities to which the
default relates shall be purchased by the non-defaulting Underwriters in
proportion to their respective commitments hereunder.
(b) If such default relates to more than 10% of the total number of
shares of the Securities that all the Underwriters have agreed to
purchase, you may in your discretion arrange for yourself or for another
party or parties (including any other non-defaulting Underwriter or
Underwriters who so agree) to purchase the shares of the Securities to
which such default relates on the terms contained herein. If within five
calendar days after such a default you do not arrange for the purchase of
the shares of the Securities to which such default relates as provided in
this Section 9, this Agreement shall thereupon terminate, without
liability on the part of the Guarantor or the Trust with respect thereto
(except in each case as provided in Sections 5, 7 and 8 hereof) or the
several Underwriters, but nothing in this Agreement shall relieve a
defaulting Underwriter or Underwriters of its or their liability, if any,
to the other several Underwriters and the Guarantor or the Trust for
damages occasioned by its or their default hereunder.
(c) If the shares of the Securities to which the default relates
are to be purchased by the non-defaulting Underwriters, or are to be
purchased by another party or parties as aforesaid, you or the Guarantor
shall have the right to postpone the Closing Date for a period, not
exceeding five business days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Final
Prospectus or in any other documents and arrangements, and each of the
Guarantor and the Trust
-19-
agrees to file promptly any amendment or supplement to the Registration
Statement or the Final Prospectus which, in the opinion of Underwriters'
Counsel, may thereby be made necessary or advisable. The term
"Underwriter" as used in this Agreement shall include any party
substituted under this Section 9 with like effect as if it had originally
been a party to this Agreement with respect to such Securities.
10. Survival of Representations and Agreements. All representations
warranties, covenants and agreements of the Underwriters and the Guarantor and
the Trust contained in this Agreement, including the representations and
warranties contained in Section 1, the agreements contained in Sections 4 and 5,
the indemnity agreements contained in Section 7 and the contribution agreements
contained in Section 8, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any Underwriter or any
controlling person thereof or by or on behalf of the Guarantor and the Trust,
any of its officers and directors or any controlling person thereof, and shall
survive delivery of and payment for the Securities to and by the several
Underwriters. The representations contained in Section 1 and the agreements
contained in Sections 5, 7, 8, 10 and 11 hereof shall survive the termination of
this Agreement including pursuant to Section 11 hereof.
11. Effective Date of this Agreement and Termination.
------------------------------------------------
(a) This Agreement shall become effective as of the time, after the
Registration Statement becomes effective, of the release by you for
publication of the first newspaper advertisement which is subsequently
published relating to the Securities or the time, after the Registration
Statement becomes effective, when the Securities are first released by you
for offering by you or dealers by letter or telegram, whichever shall
first occur. You or the Guarantor and the Trust may prevent this Agreement
from becoming effective without liability of any party to any other party,
except as noted below in this Section 11, by giving the notice indicated
in Section 11(c) before the time this Agreement becomes effective.
(b) You shall have the right to terminate this Agreement at any
time prior to the Closing Date if, after the date hereof: (i) any domestic
or international event or act or occurrence has materially disrupted, or
in your opinion will in the immediate future materially disrupt, the
securities markets; (ii) a general suspension of, or a general limitation
on prices for, trading in securities on the NYSE or the American Stock
Exchange or in the over-the-counter market; (iii) a banking moratorium
shall have been declared either by Federal or New York State authorities;
(iv) there shall have occurred any outbreak or material escalation of
hostilities or other calamity or crisis the effect of which on the
financial markets of the United States or on the United States is such as
to make it, in the judgment of the Underwriters, impracticable to market
the Securities; (v) any restriction materially adversely affecting the
distribution of the Securities which was not in effect on the date hereof
shall have become effective; or (vi) there shall have been such change in
the market for the securities of either the Trust or the Guarantor or
securities in general or in political, financial or economic conditions as
in your judgment makes it inadvisable to proceed with the offering, sale
and delivery of the Securities on the terms contemplated by the Final
Prospectus.
-20-
(c) Any notice of termination pursuant to this Section 11 shall be
by telephone, telex, or telegraph, confirmed in writing by letter.
12. Notice. All communications hereunder, except as may be
otherwise specifically provided herein, shall be in writing and, if sent to you
shall be mailed, delivered, or telexed or telecopied and confirmed in writing,
to such Underwriter c/o Bear, ▇▇▇▇▇▇▇ & Co. Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Finance Department; if sent to the Guarantor or
the Trust, shall be mailed, delivered, or telexed or telecopied and confirmed in
writing to the Guarantor, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Chief
Financial Officer.
13. Parties. This Agreement shall inure solely to the benefit of,
and shall be binding upon, the several Underwriters, the Guarantor and the Trust
and the controlling persons, directors, officers, employees and agents referred
to in Sections 7 and 8, and their respective successors and assigns, and no
other person shall have or be construed to have any legal or equitable right,
remedy or claim under or in respect of or by virtue of this Agreement or any
provision herein contained. The term "successors and assigns" shall not include
a purchaser, in its capacity as such, of Securities from any of the
Underwriters. Notwithstanding anything contained in this Agreement to the
contrary, all of the obligations of the Underwriters hereunder are several and
not joint.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15. Construction. This Agreement shall be construed in accordance
with the laws of the State of New York without regard to principles of conflict
of law.
-21-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us four counterparts hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Trust,
the Guarantor and the several Underwriters.
Very truly yours,
BEAR ▇▇▇▇▇▇▇ CAPITAL TRUST III
By: THE BEAR ▇▇▇▇▇▇▇ COMPANIES INC.,
AS DEPOSITOR
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
Chief Operating Officer and
Senior Vice President - Finance
THE BEAR ▇▇▇▇▇▇▇ COMPANIES INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
Chief Operating Officer and
Senior Vice President - Finance
The foregoing Agreement is hereby
confirmed and accepted as of the date
first above written on behalf of
themselves and as Representatives of
the several underwriters listed in
Schedule I hereto.
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
▇▇▇▇▇▇ BROTHERS INC.
▇▇▇▇▇▇▇ LYNCH, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
UBS WARBURG LLC
BANC OF AMERICA SECURITIES LLC
BANC ONE CAPITAL MARKETS, INC.
FIRST UNION SECURITIES, INC.
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
QUICK & ▇▇▇▇▇▇, INC.
▇▇▇▇▇ FARGO ▇▇▇ ▇▇▇▇▇▇, LLC
By: BEAR, ▇▇▇▇▇▇▇ & CO. INC.
By: /s/ ▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
Senior Managing Director
SCHEDULE I
Number of Shares
of Securities
Underwriters to be Purchased
------------ ---------------
▇▇▇▇, ▇▇▇▇▇▇▇ & Co. Inc................................................977,000
Leham Brothers Inc.....................................................973,000
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated.....................973,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated......................................973,000
Prudential Securities Incorporated.....................................973,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc...............................................973,000
UBS Warburg LLC........................................................973,000
Banc of America Securities LLC.........................................275,000
Banc One Capital Markets, Inc..........................................275,000
First Union Securities, Inc............................................275,000
▇.▇. ▇▇▇▇▇▇ Securities Inc.............................................275,000
Quick & ▇▇▇▇▇▇, Inc....................................................275,000
▇▇▇▇▇ Fargo Van Kasper, LLC............................................275,000
ABN AMRO Incorporated..................................................106,000
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc...............................................106,000
BB&T Capital Markets, A division of ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. ......106,000
CIBC World Markets Corp................................................106,000
▇▇▇▇ ▇▇▇▇▇▇▇▇ Wessles..................................................106,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co....................................................106,000
HSBC Securities (USA) Inc..............................................106,000
McDonald Investments Inc., A KeyCorp Company...........................106,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc...........................................106,000
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc.........................................106,000
Advest Inc..............................................................25,000
▇▇▇▇▇▇▇▇ & Partners, L.P................................................25,000
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Inc................................................25,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Co....................................................25,000
▇▇▇▇▇▇▇▇▇▇ & Co. Inc....................................................25,000
Fifth Third Securities Inc..............................................25,000
H&R BLOCK Financial Advisors, Inc.......................................25,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC.............................................25,000
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Inc.............................................25,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Inc................................................25,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.........................................25,000
The ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company, LLC......................................25,000
▇▇▇▇▇▇▇▇ Inc............................................................25,000
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company Incorporated.................................25,000
TD Securities (USA) Inc.................................................25,000
-24-
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Incorporated.............................................25,000
▇▇▇▇▇▇▇▇ Capital Partners, L.P..........................................25,000
Wachovia Securities, Inc................................................25,000
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.........................................25,000
Total...10,000,000
==========
-25-
SCHEDULE II
Registration Statement No. 333-66861; ▇▇▇-▇▇▇▇▇-▇▇
TITLE OF SECURITIES
7.80% Trust Issued Preferred Securities
NUMBER OF SECURITIES:
10,000,000 shares to be purchased on the Closing Date
Up to an additional 1,500,000 shares to be purchased on the Second Closing
Date
PURCHASE PRICE BY UNDERWRITERS PER SECURITY:
$25.00
UNDERWRITERS' COMPENSATION PER SECURITY:
$.7875
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Immediately available funds by wire transfer
AMOUNT OF COMMON SECURITIES:
309,279 shares
TRUST AGREEMENT:
Trust Agreement, dated as of May 10, 2001, between The Bear ▇▇▇▇▇▇▇
Companies Inc. and the trustees named therein, as amended and restated by
the Amended and Restated Trust Agreement, to be dated as of May 10, 2001,
among The Bear ▇▇▇▇▇▇▇ Companies Inc., as Depositor, The Chase Manhattan
Bank, as Property Trustee, and Chase Manhattan Bank USA, National
Association, as Delaware Trustee, the administrators named therein and the
holders, from time to time, of the Securities and the Common Securities.
DESIGNATION OF SUBORDINATED DEBENTURES:
7.80% Junior Subordinated Deferrable Interest Debentures due 2031
AGGREGATE PRINCIPAL AMOUNT OF SUBORDINATED DEBENTURES:
$257,731,975
-26-
INDENTURE:
Indenture, dated as of December 16, 1998, between The Bear ▇▇▇▇▇▇▇
Companies Inc. and The Chase Manhattan Bank, as Trustee; the First
Supplemental Indenture, dated as of December 16, 1998, between The Bear
▇▇▇▇▇▇▇ Companies Inc. and The Chase Manhattan Bank, as Trustee; and the
Second Supplemental Indenture, dated as of May 10, 2001, between The Bear
▇▇▇▇▇▇▇ Companies Inc. and The Chase Manhattan Bank, as Trustee.
GUARANTEE:
Guarantee Agreement, dated as of May 10, 2001, between The Bear ▇▇▇▇▇▇▇
Companies Inc. as Guarantor, and The Chase Manhattan Bank, as Guarantee
Trustee.
CLOSING DATE:
May 10, 2001 at 10:00 a.m. (New York City time)
CLOSING LOCATION:
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
-27-
SCHEDULE III
(i) Each of the Guarantor, Bear, ▇▇▇▇▇▇▇ & Co. Inc. ("Bear
▇▇▇▇▇▇▇"), Bear, ▇▇▇▇▇▇▇ Securities Corp. ("BSSC"), Bear, ▇▇▇▇▇▇▇
International Limited ("BSIL") and Bear ▇▇▇▇▇▇▇ Holdings Limited
("BSHL") is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation,
and has all requisite corporate power and authority to own, lease
and operate its properties and to carry on its business as described
in the Final Prospectus. Each of the Guarantor, Bear ▇▇▇▇▇▇▇, BSSC,
BSIL, BSHL and Bear ▇▇▇▇▇▇▇ Capital Trust III is duly qualified to
transact business and is in good standing as a foreign corporation
in each jurisdiction in which such qualification is required,
whether by reason of ownership or leasing of property or conduct of
business, except where the failure to so qualify would not have a
Material Adverse Effect. All of the outstanding shares of capital
stock of Bear ▇▇▇▇▇▇▇, BSSC, BSIL and BSHL is owned of record and,
to our knowledge, beneficially by the Guarantor and by Bear ▇▇▇▇▇▇▇,
respectively, in each case free and clear, to our knowledge, of any
lien, security interest or other encumbrance.
(ii) The execution, delivery and performance by the Guarantor
of the Indenture, the Guarantee and the Trust Agreement and the
consummation by the Guarantor of the transactions contemplated
thereby have been duly authorized by all necessary corporate action
on the part of the Guarantor. Each of the Indenture, the Guarantee
and the Trust Agreement has been duly and validly executed and
delivered by the Guarantor and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes the
legal, valid and binding obligation of the Guarantor, enforceable
against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors' rights and remedies
generally and subject, as to enforceability, to general principles
of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought
in a proceeding at law or in equity).
(iii) The Guarantor has all requisite corporate power to
authorize, create and issue the Subordinated Debentures, and the
Subordinated Debentures, when duly executed by the Guarantor,
authenticated by the Debenture Trustee pursuant to the terms of the
Indenture, and sold and delivered by the Guarantor pursuant to the
Indenture, will be duly authorized and legally issued and will
constitute binding obligations of the Guarantor entitled to the
benefits of the Indenture in accordance with the terms of such
Subordinated Debentures, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and
subject, as to enforceability, to general principles of equity,
including principles of commercial reasonableness, good faith and
fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity). The statements in the Final
-28-
Prospectus insofar as they purport to summarize certain provisions
of documents specifically referred to therein, are accurate
summaries in all material respects.
(iv) The Guarantor has all requisite corporate power and
authority to execute and deliver the Underwriting Agreement and to
perform its obligations thereunder. The execution, delivery and
performance by the Guarantor of the Underwriting Agreement and the
consummation by the Guarantor of the transactions contemplated
thereby have been duly authorized by all necessary corporate action
on the part of the Guarantor. The Underwriting Agreement has been
duly and validly executed and delivered by the Guarantor and
(assuming the due authorization, execution and delivery by the other
parties hereto), constitutes the legal, valid and binding obligation
of the Guarantor, enforceable against it in accordance with its
terms, subject to the applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and subject, as to
enforceability, to general principles of equity, including
principles of commercial reasonableness, good faith and fair dealing
(regardless of whether enforcement is sought in a proceeding at law
or in equity), and except to the extent that rights to
indemnification and contribution thereunder may be limited by
federal or state securities laws or public policy relating thereto.
(v) The execution and delivery of the Underwriting Agreement,
the Indenture, the Guarantee and the Trust Agreement, the
consummation of the transactions contemplated thereby and compliance
by the Guarantor with any of the provisions thereof will not (i)
conflict with or violate any of the terms, conditions or provisions
of the Certificate of Incorporation or By-Laws of the Guarantor,
(ii) conflict with, or result in a breach of any of the terms of, or
constitute a default (or an event which with notice or lapse of
time, or both, would constitute a default) or require consent under,
or result in imposition of, any lien or encumbrance upon any
property or assets of the Guarantor pursuant to the terms of, any
material document, agreement or other instrument of which we are
aware to which the Guarantor is a party or by which it is bound,
(iii) conflict with or violate any New York, Delaware corporate or
federal law or regulation (other than federal and state securities
or "blue sky" laws, as to which we express no opinion in this
sentence), or (iv) conflict with or violate any judgment, writ,
injunction, decree, order or ruling of any court or governmental
authority binding on the Guarantor of which we are aware. No
consent, approval, waiver, license or authorization or other action
by or filing with any New York, Delaware corporate or federal
governmental authority is required in connection with the execution
and delivery by the Guarantor of the Underwriting Agreement, the
Indenture, the Guarantee, and the Trust Agreement or the
consummation by the Guarantor of the transactions contemplated
thereby except for those that (i) may be required by Rule 424(b)
promulgated under the 1933 Act, (ii) may be required under federal
and state securities or blue sky laws, as to which we express no
opinion or (iii) have been made under the 1933 Act or the Trust
Indenture Act.
-29-
(vi) Neither the Trust nor the Guarantor is or, after giving
effect to the offering and sale of the Securities, will be an
"investment company" or an entity "controlled" by an "investment
company", as such terms are defined in the Investment Company Act.
(vii) The Registration Statement, as of its effective date,
and the Final Prospectus, as of its issue date and as of the date
hereof, complied and comply as to form in all material respects with
the requirements of the 1933 Act and the Trust Indenture Act and the
rules and regulations thereunder (except that no opinion is
expressed herein with respect to the financial statements and notes
thereto, the financial statement schedules and the other financial,
statistical and accounting data included or incorporated by
reference therein or that should have been included therein).
(viii) To our knowledge, based upon telephonic confirmation
from the Commission, the Registration Statement was declared
effective under the 1933 Act and, to our knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings therefor have been initiated or threatened
by the Commission. Any required filing of the Basic Prospectus, any
Preliminary Final Prospectus and the Final Prospectus, and any
amendments thereto, pursuant to Rule 424(b) has been made in the
manner and within the time period required by Rule 424(b).
(ix) To our knowledge, based on telephone confirmation from
the Commission, the Indenture and the Guarantee have been qualified
under the Trust Indenture Act.
We have participated in conferences with directors, officers
and other representatives of the Guarantor, representatives of the
Underwriters and representatives of ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
counsel for the Underwriters, at which conferences the contents of the
Registration Statement or the Final Prospectus and related matters were
discussed, and, although we have not independently verified and are not
passing upon and assume no responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
the Final Prospectus, no facts have come to our attention that lead us to
believe that the Registration Statement, on the effective date thereof,
contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact required to be stated therein or necessary
to make the statements contained therein, in light of the circumstances
under which they were made, not misleading (it being understood that we
express no view with respect to the financial statements and notes
thereto, the financial statement schedules and the other financial,
statistical and accounting data included or incorporated by reference in
the Registration Statement or the Final Prospectus).
-30-
SCHEDULE IV
To the best of my knowledge, there are no legal or governmental
proceedings pending or threatened that are required to be disclosed in the Final
Prospectus, other than those disclosed therein, and there is no pending legal or
governmental proceeding to which the Guarantor or any subsidiary of the
Guarantor is a party or of which any of their property is the subject that is
not described in the Final Prospectus, including ordinary routine litigation
incidental to the business, which, if adversely decided, will have a material
adverse effect upon the operations, business or assets of the Guarantor and its
subsidiaries considered as one enterprise.
-31-
SCHEDULE V
(i) The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Business
Trust Act, and all filings required under the laws of the State of
Delaware with respect to the creation and valid existence of the
Trust as a business trust have been made.
(ii) Under the Delaware Business Trust Act and the Trust
Agreement, the Trust has the trust power and authority to own
property and conduct its business, all as described in the Final
Prospectus.
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Guarantor and the Trustees, and is enforceable
against the Guarantor and the Trustees, in accordance with its
terms, subject to the effect upon the Trust Agreement of (i)
bankruptcy, insolvency, moratorium, receivership, reorganization,
liquidation, fraudulent conveyance or transfer and other similar
laws relating to or affecting the rights and remedies of creditors
generally, (ii) principles of equity, including applicable law
relating to fiduciary duties (regardless of whether considered and
applied in a proceeding in equity or at law), and (iii) the effect
of applicable public policy on the enforceability of provisions
relating to indemnification or contribution.
(iv) Under the Delaware Business Trust Act and the Trust
Agreement, the Trust has the trust power and authority to (a)
execute and deliver this Agreement and to perform its obligations
hereunder and (b) issue and perform its obligations under the
Securities and the Common Securities.
(v) Under the Delaware Business Trust Act and the Trust
Agreement, the execution and delivery by the Trust of this Agreement
and the performance by the Trust of its obligations hereunder, have
been duly authorized by all necessary trust action on the part of
the Trust.
(vi) The Securities have been duly authorized by the Trust
Agreement and duly and validly issued and, subject to the
qualifications set forth herein, are fully paid and nonassessable
undivided beneficial interests in the assets of the Trust and are
entitled to the benefits provided by the Trust Agreement; the
holders of the Securities (the "Securityholders"), as beneficial
owners of the Trust, will be entitled to the same limitation of
personal liability extended to stockholders of private corporations
for profit organized under the General Corporation Law of the State
of Delaware; provided that such counsel may note that the
Securityholders may be obligated, pursuant to the Trust Agreement,
to (a) provide indemnity and/or security in connection with and pay
taxes or governmental charges arising from transfers or exchanges of
Securities certificates and the issuance of replacement Securities
certificates and (b) provide security and indemnity in connection
-32-
with requests of or directions to the Property Trustee (as defined
in the Trust Agreement) to exercise its rights and remedies under
the Trust Agreement.
(vii) The Common Securities have been duly authorized by the
Trust Agreement and represent validly issued undivided beneficial
interests in the assets of the Trust.
(viii) Under the Delaware Business Trust Act and the Trust
Agreement, the issuance of the Securities and the Common Securities
is not subject to preemptive rights.
(ix) The issuance and sale by the Trust of the Securities and
the Common Securities, the execution, delivery and performance by
the Trust of this Agreement, the consummation by the Trust of the
transactions contemplated hereby and compliance by the Trust with
its obligations hereunder and thereunder do not violate (a) any of
the provisions of the Certificate of Trust of the Trust or the Trust
Agreement, or (b) any applicable Delaware law or administrative
regulation.
(x) Assuming that the Trust derives no income from or
connected with services provided within the State of Delaware and
has no assets, activities (other than maintaining the Delaware
Trustee (as defined in the Trust Agreement) and the filing of
documents with the Secretary of State of the State of Delaware) or
employees in the State of Delaware, no authorization, approval,
consent or order of any Delaware court or governmental authority or
agency is required to be obtained by the Trust solely in connection
with the issuance and sale of the Securities and the Common
Securities. In rendering the opinion expressed in this paragraph
(xi), such counsel need express no opinion concerning the securities
laws of the State of Delaware.
(xi) Assuming that the Trust derives no income from or
connected with services provided within the State of Delaware and
has no assets, activities (other than maintaining the Delaware
Trustee and the filing of documents with the Secretary of State of
the State of Delaware) or employees in the State of Delaware and
that the Trust is treated as a grantor trust for federal income tax
purposes, the Securityholders (other than those holders of the
Securities who reside or are domiciled in the State of Delaware)
will have no liability for income taxes imposed by the State of
Delaware solely as a result of their participation in the Trust, and
the Trust will not be liable for any income tax imposed by the State
of Delaware.
-33-
SCHEDULE VI
(i) They are independent certified public accountants with respect
to the Guarantor and its subsidiaries within the meaning of the Securities Act,
the Exchange Act and the applicable published rules and regulations thereunder.
(ii) In their opinion, the consolidated financial statements and
any supplementary financial information and schedules examined or audited by
them and included in the Final Prospectus as amended or supplemented comply as
to form in all material respects with the applicable accounting requirements of
the 1933 Act or the 1934 Act, as applicable, and the published rules and
regulations thereunder.
(iii) They have performed certain specified procedures, not
constituting an audit, including a reading of the unaudited interim consolidated
financial statements of the Guarantor incorporated by reference in the Final
Prospectus, as amended or supplemented, and of the latest available unaudited
interim consolidated financial data of the Guarantor; a reading of the minutes
of the meetings and consents of the stockholders, the Board of Directors and the
Executive Committee of the Board of Directors of the Guarantor and of each of
the Significant Subsidiaries (as such term defined in Rule 405 of Regulation C
of the Regulations) of the Guarantor since the end of the most recent fiscal
year with respect to which an audit report has been issued; inquiries of certain
officials of the Guarantor who have responsibility for financial and accounting
matters with respect to the unaudited consolidated financial statements
incorporated by reference in the Final Prospectus, as and the latest available
unaudited interim consolidated financial data of the Guarantor.
(iv) Nothing came to their attention as a result of the foregoing
procedures that caused them to believe that:
(a)(i) The unaudited consolidated financial statements
described in paragraph (iii) above incorporated by reference in the
Final Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Acts and with the related
published rules and regulations and (ii) any material modifications
should be made to the unaudited consolidated financial statements
for them to be conformity with generally accepted accounting
principles; or
(b) as of a specified date not more than five days prior to
the date of such letter and as of the date of the latest available
unaudited consolidated monthly financial data of the Guarantor,
there was any change in the capital stock or long-term indebtedness
of the Guarantor and its subsidiaries or any decrease in the
stockholders' equity of the Guarantor, in each case as compared with
the amounts shown on the most recent unaudited consolidated
statement of financial condition of the Guarantor included and
incorporated by reference in the Final Prospectus, or during the
period from the date of such statement of financial condition to the
date of the latest available unaudited consolidated financial data
of the Guarantor, there were any decreases, as compared with the
corresponding period in the preceding year, in consolidated
-34-
revenues, revenue net of interest expense, if any, and net income of
the Guarantor and its subsidiaries, except in each such case for
changes or decreases set forth in or contemplated by the Final
Prospectus, or except for such changes or decreases set forth in
such letter.
(v) They have performed certain other specified procedures as a
result of which they determined that certain information of an accounting,
financial or statistical nature (which is limited to accounting, financial or
statistical information derived from the general accounting records of the
Guarantor and its subsidiaries) set forth in the Final Prospectus, including the
information included or incorporated in certain specified Items of the
Guarantor's Annual Report on Form 10-K, incorporated in the Final Prospectus, as
amended or supplemented, and the information included in the "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
included or incorporated in the Guarantor's Quarterly Reports on Form 10-Q,
incorporated in the Final Prospectus, agrees with the accounting records of the
Guarantor and its subsidiaries, excluding any questions of legal interpretation.
(vi) In addition to the examination referred to in their report
included or incorporated by reference in the Final Prospectus, and the limited
procedures referred to in paragraph (iii) above, they have provided such
additional information as the Underwriters reasonably request with respect to
certain amounts, percentages and financial information which are included or
incorporated by reference in the Final Prospectus, and have found such amounts,
percentages and financial information to be in agreement with the relevant
accounting records or computations therefrom.
-35-