EXHIBIT 1
Household Capital Trust VII
and
Household International, Inc.
Trust Preferred Securities
UNDERWRITING AGREEMENT
October __, 2001
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇. ▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Prudential Securities Incorporated
UBS Warburg LLC
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Household Capital Trust VII (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Code, 12 Del. C. Sections 3801
et seq.), proposes, upon the terms and conditions set forth herein, to issue and
sell 12,000,000 ___% Trust Preferred Securities with an aggregate liquidation
amount equal to $300,000,000 (the "Preferred Securities") to the several
Underwriters named in Schedule I hereto (the "Underwriters").
The Preferred Securities will be guaranteed by Household International,
Inc., a Delaware corporation (the "Company"), with respect to distributions and
payments upon liquidation, redemption and otherwise (the "Preferred Securities
Guarantee") pursuant to the Preferred Securities Guarantee Agreement (the
"Preferred Securities Guarantee Agreement"), dated as of _______________, 2001,
between the Company and BNY Midwest Trust Company, as trustee (the "Guarantee
Trustee"). The entire proceeds from the sale of the Preferred Securities will be
combined with the entire proceeds from the sale by the Trust to the Company of
its common securities (the "Common Securities"), and will be used by the Trust
to purchase the $__________ of ___% Junior Subordinated Deferrable Interest
Notes due _____________, 2031 (the "Junior Subordinated Notes") issued by the
Company. The Preferred Securities and the Common Securities will be issued
pursuant to the amended and restated declaration of trust of the Trust, dated as
of _____________, 2001 (the "Declaration"), among the Company, as Sponsor,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the "Regular
Trustees"), BNY Midwest Trust Company, as property trustee (the "Property
Trustee") and The Bank of New York (Delaware), as Delaware trustee (the
"Delaware Trustee" and together with the Regular Trustees and the Property
Trustee, the "Trustees"), and the holders from time to time
of undivided beneficial interests in the assets of the Trust. The Junior
Subordinated Notes will be issued pursuant to an indenture, dated as of May 15,
1995 (the "Base Indenture"), between the Company and Bank One, National
Association (formerly known as The First National Bank of Chicago), as trustee
(the "Debt Trustee"), and a supplement to the Base Indenture, dated as of
______________, 2001 (the "Supplemental Indenture" and together with the Base
Indenture and any other amendments or supplements thereto, the "Indenture"),
between the Company and the Debt Trustee.
The Trust and the Company (together, the "Offerors") wish to confirm as
follows their agreement with you and the other several Underwriters on whose
behalf you are acting as representatives (the "Representatives") in connection
with the several purchases of the Preferred Securities by the Underwriters.
1. REGISTRATION STATEMENT AND PROSPECTUS. The Offerors have filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-3 (Nos. 333-70744 and 333-70744-01) and a related preliminary
prospectus for the registration under the Securities Act of 1933 (the "1933
Act") of (i) the Preferred Securities, (ii) the Preferred Securities Guarantee,
and (iii) the Junior Subordinated Notes to be issued and sold to the Trust by
the Company, have filed such amendments thereto, if any, and such amended
preliminary prospectuses as may have been required to the date hereof, and will
file such additional amendments thereto and such amended prospectuses as may
hereafter be required. Such registration statement (as amended) and the
prospectus constituting a part thereof (including, in each case, all documents
incorporated or deemed to be incorporated by reference therein pursuant to Item
12 of Form S-3 under the 1933 Act and the information, if any, deemed to be part
thereof pursuant to Rule 430A(b) of the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations")), as from time to time amended
or supplemented pursuant to the 1933 Act, the Securities Exchange Act of 1934,
as amended (the "1934 Act"), or otherwise, are hereinafter referred to as the
"Registration Statement" and the "Prospectus", respectively, except that, if any
revised prospectus shall be provided to the Underwriters by the Offerors for use
in connection with the offering of the Preferred Securities which differs from
the Prospectus on file at the Commission at the time the Registration Statement
becomes effective (whether or not such revised prospectus is required to be
filed by the Offerors pursuant to Rule 424(b) of the 1933 Act Regulations), the
term "Prospectus" shall refer to such revised prospectus from and after the time
it is first provided to the Underwriters for such use. All references in this
Agreement to financial statements and schedules and other information that is
"contained," "included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information that
are or are deemed to be incorporated by reference in the Registration Statement
or the Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement or the Prospectus shall
be deemed to mean and include the filing of any document under the 1934 Act that
is or is deemed to be incorporated by reference in the Registration Statement or
the Prospectus, as the case may be.
2. AGREEMENTS TO SELL AND PURCHASE. The Trust hereby agrees, subject to all
the terms and conditions set forth herein, to issue and sell to each Underwriter
and, upon the basis of the
2
representations, warranties and agreements of the Offerors herein contained and
subject to all the terms and conditions set forth herein, each Underwriter
agrees, severally and not jointly, to purchase from the Trust, at a purchase
price of $______ per Preferred Security, plus accrued distributions, if any,
from ____________, 2001, to the Closing Time (as hereinafter defined), the
number of Preferred Securities set forth opposite the name of such Underwriter
in Schedule I hereto (or such number of Preferred Securities increased as set
forth in Section 10 hereof).
In consideration of such purchases at the Closing Time (as defined
below), the Company shall pay to the Underwriters as compensation (in
immediately available funds), at the Closing Time, $_____ per Preferred
Security. The Underwriters shall inform the Company in writing at the Closing
Time of the number of Preferred Securities so sold.
3. TERMS OF PUBLIC OFFERING. The Offerors have been advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Preferred Securities as soon as the Underwriters deem advisable after the
Registration Statement has become effective, this Agreement has been executed
and delivered, and the Declaration, the Preferred Securities Guarantee Agreement
and the Indenture have been qualified under the Trust Indenture Act of 1939 (the
"1939 Act").
4. DELIVERY OF THE PREFERRED SECURITIES AND PAYMENT THEREFOR. Delivery to
the Underwriters of and payment for the Preferred Securities shall be made at
the offices of Household International, Inc., Prospect Heights, Illinois, at
9:00 A.M., Central Time, on January 30, 2001 (the "Closing Time"). The place of
closing for the Preferred Securities and the Closing Time may be varied by
agreement between you and the Company.
The Preferred Securities shall be delivered to you for the accounts of the
several Underwriters against payment of the purchase price therefor in
immediately available funds and registered in the name of CEDE & Co., as nominee
for the Depository Trust Company. The Preferred Securities to be delivered to
the Underwriters shall be made available to you in New York City for inspection
and packaging not later than 9:30 A.M., Eastern Time, on the business day next
preceding the Closing Time.
5. AGREEMENTS OF OFFERORS. The Offerors jointly and severally agree with
the several Underwriters as follows:
(a) The Offerors will notify the Representatives promptly, and confirm
the notice in writing, (i) of the effectiveness of the Registration
Statement and any amendment thereto (including any post-effective
amendment), (ii) of the receipt of any comments from the Commission, (iii)
of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose. The Offerors will make
every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest
possible moment.
3
(b) The Offerors will give the Representatives notice of their
intention to file or prepare (i) any amendment to the Registration
Statement (including any post-effective amendment), (ii) any amendment or
supplement to the Prospectus (including any revised prospectus which the
Offerors propose for use by the Underwriters in connection with the
offering of the Preferred Securities which differs from the prospectus on
file at the Commission at the time the Registration Statement becomes
effective, whether or not such revised prospectus is required to be filed
pursuant to Rule 424(b) of the 1933 Act Regulations), or (iii) any document
that would as a result thereof be incorporated by reference in the
Prospectus whether pursuant to the 1933 Act, the 1934 Act or otherwise,
will furnish the Representatives with copies of any such amendment,
supplement or other document within a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file any such
amendment, supplement or other document or use any such prospectus to which
the Representatives or counsel for the Underwriters shall reasonably
object. Subject to the foregoing, the Offerors will file the Prospectus
pursuant to Rule 424(b) and Rule 430A under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement.
(c) The Offerors will deliver to the Representatives signed copies of
the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein and documents incorporated or deemed to be incorporated by
reference therein) as the Representatives may reasonably request and will
also deliver to the Representatives as many conformed copies of the
Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters.
(d) The Offerors will furnish to each Underwriter, from time to time
during the period when the Prospectus is required to be delivered under the
1933 Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request for the purposes
contemplated by the 1933 Act or the respective applicable rules and
regulations of the Commission thereunder.
(e) If at any time when the Prospectus is required by the 1933 Act to
be delivered in connection with sales of the Preferred Securities, any
event shall occur as a result of which it is necessary, in the opinion of
counsel for the Underwriters or counsel to the Company and the Trust, to
amend or supplement the Prospectus in order to make the Prospectus not
misleading in the light of the circumstances existing at the time it is to
be delivered to a purchaser, or if it shall be necessary at any such time,
to amend the Registration Statement or amend or supplement the Prospectus
in order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Offerors will promptly prepare and file with the
Commission, subject to paragraph (b) above, such amendment or supplement as
may be necessary to correct such untrue statement or omission or to make
the Registration Statement or the Prospectus comply with such requirements;
and the Offerors will furnish to the Underwriters a reasonable number of
copies of such amendment or supplement.
4
(f) The Offerors will endeavor, in cooperation with the Underwriters,
to qualify the Preferred Securities, the Preferred Securities Guarantee and
the Junior Subordinated Notes for offering and sale under the applicable
securities laws of such states and the other jurisdictions of the United
States as the Representatives may designate; provided, however, that none
of the Offerors shall be obligated to qualify as a foreign corporation in
any jurisdiction in which it is not so qualified.
(g) The Company will make generally available to its security holders
as soon as practicable but not later than 45 days after the close of the
period covered thereby, an earnings statement of the Company (in form
complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve-month period beginning not later than the first day of
the Company's fiscal quarter next following the "effective date" (as
defined in said Rule 158) of the Registration Statement.
(h) The Offerors will use best efforts to effect the listing of the
Preferred Securities (including the Preferred Securities Guarantee with
respect thereto) on the New York Stock Exchange; if the Preferred
Securities are exchanged for Junior Subordinated Notes, the Company will
use its best efforts to effect the listing of the Junior Subordinated Notes
on the exchange on which the Preferred Securities were then listed.
(i) During a period of 30 days from the date of this Agreement,
neither the Trust nor the Company will, without the prior written consent
of the Representatives, directly or indirectly, sell, offer to sell,
contract to sell, grant any option for the sale of, or otherwise dispose
of, any Preferred Securities, any security convertible into or exchangeable
into or exercisable for Preferred Securities or the Junior Subordinated
Notes or any debt securities substantially similar to the Junior
Subordinated Notes or equity securities substantially similar to the
Preferred Securities (except for the Junior Subordinated Notes and the
Preferred Securities issued pursuant to this Agreement).
6. REPRESENTATIONS AND WARRANTIES OF THE OFFERORS. The Offers jointly and
severally represent and warrant to, and agree with, each Underwriter that:
(a) At the time the Registration Statement became or becomes
effective, the Registration Statement complied or will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rule and regulations of the Commission
under the 1939 Act (the "1939 Act Regulations"), and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. The Prospectus, at the date hereof (unless the term
"Prospectus" refers to a prospectus that has been provided to the
Underwriters by the Trust for use in connection with the offering of the
Preferred Securities and that differs from the Prospectus on file at the
Commission at the time the Registration Statement becomes effective, in
which case, at the time it is first provided to the Underwriters for such
use) and at Closing Time referred to in Section 2 hereof, will not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statement therein, in the light of the
5
circumstances under which they were made, not misleading; provided,
however, that the representations and warranties in this subsection shall
not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information
furnished to the Offerors in writing by any Underwriter through the
Representatives expressly for use in the Registration Statement or
Prospectus.
(b) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement or Prospectus, at the time they
were or hereafter are filed with the Commission complied and will comply in
all material respects with the requirements of the 1934 Act and the rules
and regulations of the Commission under the 1934 Act (the "1934 Act
Regulations"), and, when read together with the other information in the
Prospectus, at the time the Registration Statement and any amendments
thereto become effective and at the Closing Time, 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 were made, not
misleading.
(c) To the best of the Company's knowledge, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, the
accountants who certified the financial statements and supporting schedules
included in the Registration Statement, are independent public accountants
as required by the 1933 Act and the 1933 Act Regulations.
(d) The financial statements included in the Registration Statement
and the Prospectus present fairly the financial position of the Company and
its consolidated subsidiaries as at the dates indicated and the results of
their operations for the periods specified; except as otherwise stated in
the Registration Statement, said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis; and the supporting schedules included in the Registration
Statement present fairly the information required to be stated therein.
(e) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus (exclusive of any amendments or
supplements after the date hereof), except as otherwise stated therein, (A)
there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, financial position or business affairs of
the Company and its subsidiaries, considered as one enterprise, or the
Trust, whether or not arising in the ordinary course of business, and (B)
there have been no transactions entered into by the Trust or by the Company
or any of its subsidiaries, other than those in the ordinary course of
business, which are material with respect to the Trust or the Company and
its subsidiaries, considered as one enterprise.
(f) The Company 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 Prospectus, to enter into and
perform its obligations under this Agreement, the Declaration, the
Indenture and the Preferred Securities Guarantee and to
6
purchase, own, and hold the Common Securities issued by the Trust; and the
Company is duly qualified as a foreign corporation to transact business and
is in good standing in each jurisdiction in which the character or location
of its properties or the nature or the conduct of its business requires
such qualification, except for any failures to be so qualified or in good
standing which, taken as a whole, are not materially adverse to the Company
and its subsidiaries considered as one enterprise.
(g) Each subsidiary of the Company which is a significant subsidiary
(a "Subsidiary") as defined in Rule 405 of the 1933 Act Regulations, has
been duly organized or incorporated and is validly existing in good
standing under the laws of the jurisdiction of its incorporation,
association or organization, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described
in the Prospectus and is duly qualified as a foreign entity to transact
business and is in good standing in each jurisdiction in which the
character or location of its properties or the nature or the conduct of its
business requires such qualification, except for any failures to be so
qualified or in good standing which, taken as a whole, are not materially
adverse to the Company and its subsidiaries considered as one enterprise;
all of the issued and outstanding capital stock of each such Subsidiary has
been duly authorized and validly issued, is fully paid and non-assessable;
and the capital stock of each such Subsidiary owned by the Company,
directly or through subsidiaries, is owned free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity.
(h) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus (except for subsequent issuances,
if any, pursuant to reservations, agreements, employee benefit plans or the
exercise of convertible securities referred to in the Prospectus); and all
of the issued and outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and
non-assessable.
(i) The Trust has been duly created and is validly existing and in
good standing as a business trust under the Delaware Act with the power and
authority to own property and to conduct its business as described in the
Registration Statement and Prospectus and to enter into and perform its
obligations under this Agreement, the Preferred Securities, the Common
Securities and the Declaration; the Trust is duly qualified to transact
business as a foreign company and is in good standing in any other
jurisdiction in which such qualification is necessary, except to the extent
that the failure to so qualify or be in good standing would not have a
material adverse effect on the Trust; the Trust is not a party to or
otherwise bound by any agreement other than those described in the
Prospectus; the Trust is and will be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as
a corporation; and the Trust is and will be treated as a consolidated
subsidiary of the Company pursuant to generally accepted accounting
principles.
(j) The Common Securities have been duly authorized by the Declaration
and, when issued and delivered by the Trust to the Company against payment
therefor as
7
described in the Registration Statement and Prospectus, will be validly
issued and (subject to the terms of the Declaration) fully paid and
non-assessable undivided beneficial interests in the assets of the Trust
and will conform to all statements relating thereto contained in the
Prospectus; the issuance of the Common Securities is not subject to
preemptive or other similar rights: and at the Closing Time all of the
issued and outstanding Common Securities of the Trust will be directly
owned by the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(k) This Agreement has been duly authorized, executed and delivered by
each of the Offerors.
(l) The Declaration has been duly authorized by the Company and, at
the Closing Time, will have been duly executed and delivered by the Company
and the Trustees, and assuming due authorization, execution and delivery of
the Declaration by the Property Trustee, the Declaration will, at the
Closing Time, be a valid and binding obligation of the Company and the
Regular Trustees, enforceable against the Company and the Regular Trustees
in accordance with its terms, except to the extent that enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors rights generally or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding at law or in equity) (the "Bankruptcy Exceptions") and will
conform to all statements relating thereto in the Prospectus; and at the
Closing Time, the Declaration will have been duly qualified under the 1939
Act.
(m) The Preferred Securities Guarantee Agreement has been duly
authorized by the Company and, when validly executed and delivered by the
Company and, assuming due authorization, execution and delivery thereof by
the Guarantee Trustee, will constitute a valid and binding obligation of
the Company, enforceable against the Company in accordance with its terms
except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions, and the Preferred Securities Guarantee and the
Preferred Securities Guarantee Agreement will conform to all statements
relating thereto contained in the Prospectus; and the Preferred Securities
Guarantee Agreement, at the Closing Time, will have been duly qualified
under the 1939 Act.
(n) The Preferred Securities have been duly authorized by the
Declaration and, when issued and delivered pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued and (subject to the terms of the Declaration) fully paid and
non-assessable undivided beneficial interests in the Trust, will be
entitled to the benefits of the Declaration and will conform to all
statements relating thereto contained in the Prospectus; the issuance of
the Preferred Securities is not subject to preemptive or other similar
rights; and (subject to the terms of the Declaration) holders of Preferred
Securities will be entitled to the same limitation of personal liability
under Delaware law as extended to stockholders of private corporations for
profit.
(o) The Indenture has been duly authorized by the Company and, when
validly executed and delivered by the Company, will constitute a valid and
binding agreement of
8
the Company, enforceable against the Company in accordance with its terms
except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions; the Indenture will conform to all statements
relating thereto contained in the Prospectus; and at the Closing Time, the
Indenture will have been duly qualified under the 1939 Act.
(p) The Junior Subordinated Notes have been duly authorized by the
Company and, at the Closing Time, will have been duly executed by the
Company and, when authenticated in the manner provided for in the Indenture
and delivered against payment therefor as described in the Prospectus, will
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms except to the extent
that enforcement thereof may be limited by the Bankruptcy Exceptions, will
be in the form contemplated by, and entitled to the benefits of, the
Indenture and will conform to all statements relating thereto in the
Prospectus.
(q) The Company's obligations under the Preferred Securities Guarantee
are subordinate and junior in right of payment to all liabilities of the
Company and are pari passu with the preferred stock issued by the Company.
(r) The Junior Subordinated Notes are subordinated and junior in right
of payment to all "senior indebtedness" (as defined in the Indenture) of
the Company.
(s) Each of the Regular Trustees of the Trust is an employee of the
Company and has been duly authorized by the Company to execute and deliver
the Declaration; the Declaration has been duly executed and delivered by
the Regular Trustees and is a valid and binding obligation of each Regular
Trustee, enforceable against such Regular Trustee in accordance with its
terms except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions.
(t) None of the Offerors is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "1940 Act").
(u) The execution, delivery and performance of this Agreement, the
Declaration, the Preferred Securities, the Common Securities, the
Indenture, the Junior Subordinated Notes , the Preferred Securities
Guarantee Agreement and the Preferred Securities Guarantee and the
consummation of the transactions contemplated herein and therein and
compliance by the Offerors with their respective obligations hereunder and
thereunder have been duly authorized by all necessary action (corporate or
otherwise) on the part of the Offerors and do not and will not result in
any violation of the charter or by-laws of the Company or any subsidiary,
or the Declaration or Certificate of Trust and do not and will not conflict
with, or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Trust, the
Company or any Subsidiary under (A) any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which the Trust,
the Company or any Subsidiary is a party or by which it may be bound or to
which any of its properties may be subject (except for conflicts,
9
breaches or defaults which would not, individually or in the aggregate, be
materially adverse to the Trust or the Company and its subsidiaries
considered as one enterprise, or materially adverse to the transactions
contemplated by this Agreement), or (B) any existing applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, or any regulatory body or
administrative agency or other governmental body having jurisdiction over
the Trust, the Company, or any Subsidiary or any of their respective
properties.
(v) Except as disclosed in the Prospectus, there is no action, suit or
proceeding before or by any government, governmental instrumentality or
court, domestic or foreign, now pending or, to the knowledge of the Trust
or the Company, threatened, against or affecting the Trust, the Company or
any of its subsidiaries that is required to be disclosed in the Prospectus,
other than actions, suits or proceedings which are not reasonably expected,
individually or in the aggregate, to have a material adverse effect on the
condition, financial or otherwise, of the Trust or the Company and its
subsidiaries considered as one enterprise, or on the earnings, financial
position or business affairs of the Trust or the Company and its
subsidiaries considered as one enterprise; and there are no contracts or
documents of the Company, any of its subsidiaries or the Trust that are
required to be filed as exhibits to the Registration Statement by the 1933
Act or by the 1933 Act Regulations that have not been so filed.
(w) No authorization, approval, consent or order of any court or
governmental authority or agency is necessary in connection with the
issuance and sale of the Common Securities or the offering of the Preferred
Securities, the Junior Subordinated Notes or the Preferred Securities
Guarantee hereunder, except such as may be required under the 1933 Act or
the 1933 Act Regulations, the 1934 Act or the 1934 Act Regulations or state
or foreign securities laws and the qualification of the Declaration, the
Preferred Securities Guarantee Agreement and the Indenture under the 1939
Act.
(x) The Company and the Subsidiaries and the Trust possess adequate
certificates, authorities or permits issued by the appropriate state,
federal or foreign regulatory agencies or bodies to conduct the business
now operated by them, and neither the Company nor any of the Subsidiaries
nor the Trust 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 an unfavorable
decision, ruling or finding would materially and adversely affect the
condition, financial or otherwise, or the earnings or business affairs of
the Company and its subsidiaries considered as one enterprise or of the
Trust.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) Each of the Trust and the Company jointly and severally agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
1933 Act or Section 20 of the 1934 Act, from and against any and all
losses, claims, damages and liabilities (including,
10
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except insofar as such losses, claims, damages or liabilities
are caused by any such untrue statement or omission or alleged untrue
statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you
expressly for use therein; provided, however, that the foregoing indemnity
agreement with respect to any preliminary prospectus shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased Preferred Securities, or any
person controlling such Underwriter, if a copy of the Prospectus (as then
amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Preferred
Securities to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses,
claims, damages or liabilities, unless such failure is the result of
noncompliance by the Company with Section 6(a) hereof.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Trust, the Company, its directors, its officers who
sign the Registration Statement, the trustees of the Trust and each person,
if any, who controls the Company within the meaning of either Section 15 of
the 1933 Act or Section 20 of the 1934 Act to the same extent as the
foregoing indemnity from the Trust and the Company to such Underwriter, but
only with reference to information relating to such Underwriter furnished
to the Company in writing by such Underwriter through you expressly for use
in the Registration Statement, any preliminary prospectus, the Prospectus
or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to paragraph (a) or (b) of this Section 7, such person
(the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless
(i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any
such
11
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall
not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all such indemnified parties
and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated in the case of parties indemnified pursuant to paragraph (a)
of this Section 7, and by the Company, in the case of parties indemnified
pursuant to paragraph (b) of this Section 7. The indemnifying party shall
not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of
the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to
the date of such settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a) or
(b) of this Section 7 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such paragraph, in
lieu of indemnifying such indemnified party thereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Trust and the
Company on the one hand and the Underwriters on the other hand from the
offering of the Preferred Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Trust and the Company
on the one hand and of the Underwriters on the other hand in connection
with the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Trust and the Company
on the one hand and the Underwriters on the other hand in connection with
the offering of the Preferred Securities shall be deemed to be in the same
respective proportions as the net
12
proceeds from the offering of the Preferred Securities (before deducting
expenses) received by the Trust and the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the
table on the cover of the Prospectus, bear to the aggregate public offering
price of the Preferred Securities. The relative fault of the Trust and the
Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Trust and the Company or by the Underwriters and the parties, relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in
proportion to the respective number of Preferred Securities they have
purchased hereunder, and not joint.
(e) The Trust, the Company and the Underwriters agree that it would
not be just or equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in paragraph
(d) of this Section 7. The amount paid or payable by an indemnified party
as a result of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Preferred
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies provided for in this
Section 7 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Trust and the Company contained in this Agreement shall remain operative
and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any Underwriter
or any person controlling any Underwriter or by or on behalf of the
Company, its officers or directors or any person controlling the Company
and (iii) acceptance of and payment for any of the Preferred Securities.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of the
Underwriters to purchase the Preferred Securities hereunder are subject to the
following conditions:
13
(a) The Registration Statement shall have become effective not later
than 5:30 P.M. on the date hereof, or at such later time and date as may be
approved in writing by the Representatives; and at Closing Time no stop
order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission. The Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the 1933 Act Regulations and in accordance
with Section 3(b) and prior to Closing Time the Offerors shall have
provided evidence satisfactory to the Representatives of such timely
filing.
(b) At Closing Time the Representatives shall have received:
(1) The favorable opinion, dated as of Closing Time, of ▇▇▇▇ ▇.
▇▇▇▇▇▇, Vice President-Corporate Law and Assistant Secretary of the
Company, in form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and to enter into and
perform its obligations under this Agreement, except where the
failure to have such power and authority would not be material to
the Company and its subsidiaries considered as one enterprise.
(iii) To the best of his knowledge and information, the
Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which
such qualification is required, except where the failure to so
qualify or be in good standing would not be material to the
Company and its subsidiaries considered as one enterprise.
(iv) To the best of his knowledge and information, the Trust
is duly qualified and in good standing as a foreign entity in any
jurisdiction in which such qualification is necessary, except to
the extent that the failure to so qualify or be in good standing
would not have a material adverse effect on the Trust; and the
Trust is not a party to or otherwise bound by any agreement other
than those described in the Prospectus.
(v) Each Subsidiary has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Registration Statement and, to
the best of his knowledge and
14
information, is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in
which the character or location of its properties or the nature
or conduct of its business requires such qualification, except
where the failure to have such power and authority or to so
qualify or be in good standing would not be material to the
Company and its subsidiaries considered as one enterprise; all of
the issued and outstanding capital stock of each Subsidiary has
been duly authorized and validly issued, is fully paid and
non-assessable and, to the best of his knowledge and information,
the capital stock of each such Subsidiary owned by the Company,
directly or through subsidiaries, is owned free and clear of any
perfected security interest, mortgage, pledge, lien, encumbrance,
claim or equity.
(vi) The Company has an authorized capitalization as set
forth in the Prospectus and all outstanding shares of its common
and preferred stock have been duly and validly authorized and
issued and are fully paid and nonassessable.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company.
(viii) The Registration Statement is effective under the
1933 Act and, and to the best of his knowledge and information,
no stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceeding
therefor initiated or threatened by the Commission.
(ix) At the time the Registration Statement became effective
and at the Closing Time, the Registration Statement (other than
the financial statements and supporting schedules and other
financial or statistical data included therein, as to which no
opinion need be rendered) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(x) To the best of his knowledge and information, there are
no contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred
to in the Registration Statement or to be filed as exhibits
thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto.
(xi) No authorization, approval, consent or order of any
court or governmental authority or agency is required in
connection with the offering, issuance or sale of the Preferred
Securities, the Preferred Securities Guarantee and the Junior
Subordinated Notes to the Underwriters, except (a) such as may be
required under the 1933 Act and the 1933 Act Regulations, the
1934 Act and the 1934 Act Regulations or
15
state securities laws and (b) the qualification of the
Declaration, the Preferred Securities Guarantee Agreement and the
Indenture under the 1939 Act; and, to the best of his knowledge
and information, the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated
herein and compliance by the Company and the Trust with their
obligations hereunder and will not conflict with or constitute a
breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any of the Subsidiaries or the Trust
pursuant to, any contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company or any of
the Subsidiaries or the Trust is a party or by which it or any of
them may be bound, or to which any of the property or assets of
the Company or any of the Subsidiaries or the Trust is subject
(except for conflicts, breaches and defaults which would not,
individually or in the aggregate, be materially adverse to the
Company and its subsidiaries taken as a whole or the Trust or
materially adverse to the transactions contemplated by this
Agreement), nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company, or any applicable law, administrative regulation or
administrative or court decree.
(xii) Each document filed pursuant to the 1934 Act (other
than the financial statements and supporting schedules and other
financial or statistical data included therein, as to which no
opinion need be rendered) and incorporated or deemed to be
incorporated by reference in the Prospectus complied when so
filed as to form in all material respects with the 1934 Act and
the 1934 Act Regulations.
(xiii) To the best of his knowledge and information and
other than as disclosed in the Registration Statement, there are
no legal or governmental proceedings pending to which the Company
or any of its subsidiaries is a party or of which any property of
the Company or any of its subsidiaries is the subject which
individually or in the aggregate is material, and, to the best of
his knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others.
(xiv) The Declaration has been duly qualified under the 1939
Act.
(xv) The Preferred Securities Guarantee Agreement has been
duly authorized, executed and delivered by the Company and,
assuming it is duly authorized, executed and delivered by the
Guarantee Trustee, constitutes a valid and binding obligation of
the Company, enforceable against the Company in accordance with
its terms, except to the extent
16
that enforcement thereof may be limited by the Bankruptcy
Exceptions; and the Preferred Securities Guarantee Agreement has
been duly qualified under the ▇▇▇▇ ▇▇▇.
(xvi) To the best of his knowledge, all of the issued and
outstanding Common Securities of the Trust are directly owned by
the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equitable right.
(xvii) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming due authorization,
execution, and delivery thereof by the Debt Trustee, is a valid
and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except to the extent that
enforcement thereof may be limited by the Bankruptcy Exceptions;
the Indenture has been duly qualified under the 1939 Act; and the
Indenture conforms to the description thereof in the Prospectus.
(xviii) The Junior Subordinated Notes have been duly
authorized and executed by the Company and, when authenticated by
the Trustee in the manner provided in the Indenture and delivered
against payment therefor, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except to the extent that
enforcement thereof may be limited by the Bankruptcy Exceptions;
and the Junior Subordinated Notes conform to the description
thereof in the Prospectus.
(xix) Neither the Company nor the Trust is an "investment
company" or a company "controlled" by an "investment company"
within the meaning of the 1940 Act.
(xx) The Common Securities, the Preferred Securities and the
Declaration conform in all material respects to all statements
relating thereto contained in the Prospectus.
(2) The favorable opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, P.A.,
Special Delaware counsel to the Offerors, in form and substance
satisfactory to counsel for the Underwriters, to the effect that:
(i) The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Act; all
filings required under the laws of the State of Delaware with
respect to the formation and valid existence of the Trust as a
business trust have been made; the Trust has all necessary power
and authority to own property and to conduct its business as
described in the Registration Statement and the
17
Prospectus and to enter into and perform its obligations under
this Agreement, the Preferred Securities and the Common
Securities.
(ii) The Declaration constitutes a valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be
limited by the Bankruptcy Exceptions.
(iii) The Common Securities have been duly authorized by the
Declaration and are validly issued beneficial interests in the
assets of the Trust, and the issuance of the Common Securities is
not subject to preemptive or other similar rights.
(iv) The Preferred Securities have been duly authorized by
the Declaration and are validly issued and (subject to the terms
of the Declaration), when delivered to and paid for by the
Underwriters pursuant to this Agreement, will be validly issued,
fully paid and non-assessable beneficial interests in the assets
of the Trust; the holders of the Preferred Securities will
(subject to the terms of the Declaration) be entitled to the same
limitation of personal liability under Delaware law as is
extended to stockholders of private corporations for profit; and
the issuance of the Preferred Securities is not subject to
preemptive or other similar rights.
(v) This Agreement has been duly authorized, executed and
delivered by the Trust.
(vi) The execution, delivery and performance of this
Agreement, the Declaration, the Preferred Securities and the
Common Securities, the consummation of the transactions
contemplated herein and therein, and the compliance by the Trust
with its obligations hereunder and thereunder do not and will not
result in any violation of the Declaration or Certificate of
Trust, or any applicable law, rule or regulation of the State of
Delaware.
(3) The favorable opinion, dated as of Closing Time, of ▇▇▇▇▇,
▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, counsel for BNY Midwest Trust Company, as
Property Trustee under the Declaration, and Guarantee Trustee under
the Preferred Securities Guarantee Agreement, in form and substance
satisfactory to counsel for the Underwriters, to the effect that:
(i) BNY Midwest Trust Company is an Illinois corporation
with trust powers, duly organized, validly existing and in good
standing under the laws of the State of Illinois with all
necessary power and authority to execute and deliver, and to
carry out and perform its obligations under the terms of the
Declaration and the Preferred Securities Guarantee Agreement.
18
(ii) The execution, delivery and performance by the Property
Trustee of the Declaration and the execution, delivery and
performance by the Guarantee Trustee of the Preferred Securities
Guarantee Agreement have been duly authorized by all necessary
corporate action on the part of the Property Trustee and the
Guarantee Trustee, respectively. The Declaration and the
Preferred Securities Guarantee Agreement have been duly executed
and delivered by the Property Trustee and the Guarantee Trustee,
respectively, and constitute the legal, valid and binding
obligations of the Property Trustee and the Guarantee Trustee,
respectively, enforceable against the Property Trustee and the
Guarantee Trustee, respectively, in accordance with their terms,
except as enforcement thereof may be limited by the Bankruptcy
Exceptions.
(iii) The execution, delivery and performance of the
Declaration and the Preferred Securities Guarantee Agreement by
the Property Trustee and the Guarantee Trustee, respectively,
does not conflict with or constitute a breach of the Articles of
Incorporation or Bylaws of the Property Trustee and the Guarantee
Trustee, respectively.
(iv) No consent, approval or authorization of, or
registration with or notice to, any New York or federal banking
authority is required for the execution, delivery or performance
by the Property Trustee and the Guarantee Trustee of the
Declaration and the Preferred Securities Guarantee Agreement.
(4) The favorable opinion, dated as of Closing Time, of
▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇, counsel for the Underwriters, in form and
substance satisfactory to the Underwriters with respect to the legal
existence of the Company, the Preferred Securities, the Indenture, the
Junior Subordinated Notes, the Preferred Securities Guarantee
Agreement, this Agreement, the Registration Statement, the Prospectus
and other related matters as the Representatives may require.
In giving its opinion, ▇▇▇▇▇▇▇▇▇ Will & ▇▇▇▇▇ may rely as to certain
matters of Delaware law upon the opinion of, counsel for the Offerors, which
shall be delivered in accordance with Section 8(b)(1) and (2) hereto.
(5) The favorable opinion of Sidley & Austin, special tax counsel
to the Company and the Trust, as to certain Federal tax matters set
forth in the Prospectus under "Certain Federal Income Tax
Consequences", in form and substance satisfactory to the
Representatives.
(6) In giving their opinions required by subsections (b) (1) and
(b)(4), respectively, of this Section, ▇▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇, Will
& ▇▇▇▇▇ shall each additionally state that nothing has come to their
attention that has caused them to believe that the Registration
Statement (except for financial statements and schedules and other
financial or statistical data included or incorporated by
19
reference, therein, as to which counsel need make no statement), at
the time it became effective or at the Closing Time, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus (except for financial
statements and schedules and other financial or statistical data
included or incorporated by reference therein, as to which counsel
need make no statement), at the date thereof or at Closing Time,
included an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading.
(7) At Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given
in the Registration Statement and the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings or
business affairs of the Trust or the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary
course of business, and the Representatives shall have received a
certificate of a Vice President of the Company and of the chief
financial or chief accounting officer of the Company and a certificate
of a Trustee of the Trust, and dated as of Closing Time, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 6 hereof are true and
correct with the same force and effect as though expressly made at and
as of Closing Time, (iii) the Trust and the Company have complied with
all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, and (iv) no stop
order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been initiated or
threatened by the Commission.
(8) At Closing Time, the Representatives shall have received from
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, a letter dated such date, in form and substance
satisfactory to the Representatives.
(9) At Closing Time, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the
Preferred Securities as herein contemplated and related proceedings,
or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Offerors, in connection
with the issuance and sale of the Preferred Securities as herein
contemplated shall be satisfactory in form and substance to the
Representatives and ▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇, counsel for the
Underwriters.
(10) At Closing Time, there shall not have occurred any decrease
in the ratings of any of the debt securities of the Company or of the
Preferred Securities
20
by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act).
(11) At Closing Time, the Preferred Securities shall have been
approved for listing on the New York Stock Exchange upon notice of
issuance.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
Representatives by notice to the Offerors at any time at or prior to Closing
Time, and such termination shall be without liability of any party to any other
party except as provided in Section 9 hereof.
9. EXPENSES. The Company agrees to pay the following costs and expenses and
all other costs and expenses incident to the performance by it and by the Trust
of its and the Trust's respective and joint obligations hereunder: (i) the
preparation, printing (or reproduction), and filing with the Commission of the
Registration Statement (including financial statements and exhibits thereto),
each preliminary prospectus, the Prospectus, each amendment or supplement to any
of them, this Agreement, the Declaration, the Preferred Securities Guarantee,
the Indenture and the Statement of Eligibility and Qualification of each of the
Property Trustee, the Guarantee Trustee and the Debt Trustee; (ii) the printing
(or reproduction) and delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of the Registration
Statement, each preliminary prospectus, the Prospectus, the documents
incorporated therein by reference, and all amendments or supplements to any of
them, as may be reasonably requested for use in connection with the offering and
sale of the Preferred Securities; (iii) the preparation, printing (or
reproduction), execution and delivery of the Declaration, the Preferred
Securities Guarantee and the Indenture and the preparation, printing,
authentication, issuance and delivery of the Preferred Securities, including any
stamp taxes in connection with the original issuance of the Preferred
Securities; (iv) the printing (or reproduction) and delivery of this Agreement,
the Blue Sky Memorandum and all other agreements or documents printed (or
reproduced) and delivered in connection with the offering the Preferred
Securities; (v) the registration of the Preferred Securities under the Exchange
Act and the listing of the Securities on the New York Stock Exchange; (vi) the
registration or qualification of the Preferred Securities for offer and sale
under the securities or Blue Sky laws of the several states as provided in
Section 5(g) hereof (including the reasonable fees, expenses and disbursements
of counsel for the Underwriters relating to the preparation, printing (or
reproduction), and delivery of the Blue Sky Memorandum and such registration and
qualification); (vii) the filing fees and the fees and expenses of counsel for
the Underwriters in connection with any filing required to be made with the
National Association of Securities Dealers, Inc.; (viii) the fees and expenses
of the Property Trustee, the Guarantee Trustee and the Debt Trustee; (ix) the
fees and expenses associated with obtaining ratings for the Preferred Securities
and the Junior Subordinated Notes from nationally recognized statistical rating
organizations; and (x) the fees and expenses of the Company's accountants and
the fees and expenses of counsel (including local and special counsel) for the
Offerors.
10. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective: (i)
upon the execution and delivery hereof by the parties hereto; or (ii) if, at the
time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective
21
amendment thereto to be declared effective before the offering of the Preferred
Securities may commence, when notification of the effectiveness of the
registration statement or such post-effective amendment has been released by the
Commission. Until such time as this Agreement shall have become effective, it
may be terminated by the Company or the Trust, by notifying you, or by you, as
Representatives of the several Underwriters, by notifying the Offerors.
If any one or more of the Underwriters shall fail or refuse to purchase
Preferred Securities which it or they are obligated to purchase hereunder, and
the aggregate number of Preferred Securities which such defaulting Underwriter
or Underwriters are obligated but fail or refuse to purchase is not more than
one-tenth of the aggregate number of the Preferred Securities, each
non-defaulting Underwriter shall be obligated, severally, in the proportion
which the number of Preferred Securities set forth opposite its name in Schedule
I hereto bears to the aggregate number of Preferred Securities set forth
opposite the names of all non-defaulting Underwrites, to purchase the Preferred
Securities which such defaulting Underwriter or Underwriters are obligated, but
failed or refused, to purchase. If any Underwriter or Underwriters shall fail or
refuse to purchase Preferred Securities and the aggregate number of Preferred
Securities with respect to which such default occurs is more than one-tenth of
the aggregate number of the Preferred Securities and arrangements satisfactory
to you and the Offerors for the purchase of such Preferred Securities by one or
more non-defaulting Underwriters or other party or parties approved by you and
the Offerors are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Offerors. In any such case which does not result in termination of this
Agreement, either you or the Offerors shall have the right to postpone the
Closing Time, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and the Prospectus or
any other documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any such default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I hereto who, with your approval and
the approval of the Offerors, purchases Preferred Securities which a defaulting
Underwriter is obligated, but fail or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. TERMINATION. This Agreement shall be subject to termination by notice
given by you to the Offerors, if (a) after the execution and delivery of this
Agreement and prior to the Closing Time (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, either of the New
York Stock Exchange or the National Association of Securities Dealers, Inc.,
(ii) trading of any securities of the Company shall have been suspended on any
exchange, (iii) a general moratorium on commercial banking activities in New
York shall have been declared by either Federal or New York State authorities or
(iv) there shall have occurred any outbreak or escalation of hostilities or any
calamity or crisis that, in your judgment, is material and adverse and (b) in
the case of any of the events specified in clauses (a)(i) through (iv), such
event, singly or together with any other such event, makes it, in your judgment,
22
impracticable to market the Preferred Securities on the terms and in the manner
contemplated in the Prospectus.
12. MISCELLANEOUS. Except as otherwise provided in Sections 5, 10 and 11
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Offerors, to the Company, or to the
Trust, care of the Company, at the office of the Company at the address
specified in the Prospectus, Attention: Secretary; or (ii) if to you, as
Representatives of the several Underwriters, care of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Trust, the Company, the Company's directors and officers, the
Trustees, and the other controlling persons referred to in Section 7 hereof and
their respective successors and assigns, to the extent provided herein, and no
other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and assigns" as
used in this Agreement shall include a purchaser from any Underwriter of any of
the Preferred Securities in his status as such purchaser.
13. APPLICABLE LAW; COUNTERPARTS. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
23
Please confirm that the foregoing correctly sets forth the agreement among
the Trust, the Company and the several Underwriters.
Very truly yours,
HOUSEHOLD CAPITAL TRUST VII
By:
-------------------------------------
as Regular Trustee
By:
-------------------------------------
as Regular Trustee
By:
-------------------------------------
as Regular Trustee
HOUSEHOLD INTERNATIONAL, INC.
By:
-------------------------------------
Name:
Title:
Confirmed as of the date first above mentioned on
behalf of themselves and the other several
Underwriters named in Schedule I hereto.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇. ▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Prudential Securities Incorporated
UBS Warburg LLC
As Representatives of the Underwriters
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
By:
--------------------------------------
24
SCHEDULE I
HOUSEHOLD CAPITAL TRUST VII
___% Preferred Securities
NUMBER OF
UNDERWRITER PREFERRED SECURITIES
----------- ---------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇. ▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Prudential Securities Incorporated
UBS Warburg LLC
Total.................................................. 12,000,000
==========
25