1
EXHIBIT 1.1
PURCHASE AGREEMENT
2
Exhibit 1.1
$150,000,000
FIRST SECURITY CAPITAL I
8.41% SUBORDINATED CAPITAL INCOME SECURITIES
PURCHASE AGREEMENT
December 23, 1996
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
Three World Financial Center
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
First Security Capital I, a Delaware statutory business trust
(the "Trust"), proposes to sell to you (collectively, the "Initial Purchasers")
$150,000,000 8.41% Subordinated Capital Income Securities (liquidation amount
$1000 per Capital Security) (the "Capital Securities"), guaranteed (the
"Guarantee"; together with the Capital Securities, the "Securities") by the
Company (as defined herein) to the extent set forth in the Guarantee Agreement
(the "Guarantee Agreement") to be entered into between the Company and The Bank
of New York, as Guarantee Trustee (the "Guarantee Trustee"). First Security
Corporation, a Delaware corporation (the "Company"), will be the owner of all of
the beneficial ownership interests represented by common securities (the "Common
Securities") of the Trust. Concurrently with the issuance of the Securities and
the Company's purchase of all of the beneficial interests represented by common
securities of the Trust, the Trust will invest the proceeds of each thereof in
the Company's 8.41% Junior Subordinated Debentures (the "Junior Subordinated
Debentures"). The Junior Subordinated Debentures are to be issued pursuant to an
Indenture (the "Indenture") to be entered into between the Company and The Bank
of New York, as Indenture Trustee (the "Indenture Trustee").
The Securities will be offered without being registered under
the Securities Act of 1933, as amended (the "Securities Act"), in reliance on
exemptions therefrom.
In connection with the sale of the Securities, the Trust and
the Company will prepare a final offering memorandum (the "Memorandum") setting
forth or including a description of the terms of the Securities, the terms of
the offering, a description of the Company and the Trust and any material
developments relating to the Company occurring after the date of the most recent
financial statements included therein.
1. Representations, Warranties and Agreements of the
Company and the Trust. The Company and the Trust, jointly and
3
2
severally, represent and warrant to, and agree with each of the Initial
Purchasers that as of the date hereof:
(a) The Memorandum will not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading,
except that the representations and warranties set forth in
this Section 1(a) do not apply to statements or omissions in
the Memorandum based upon information furnished to the Company
or the Trust in writing by or on behalf of any Initial
Purchaser through you expressly for use therein. Reference
herein to the Memorandum shall be deemed to refer to and
include any document filed by the Company under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") which is
incorporated in the Memorandum by reference.
(b) It is not required by applicable law or
regulation in connection with the offer, sale and delivery of
the Securities to you in the manner contemplated by this
Agreement to register the Securities or the Junior
Subordinated Debentures under the Securities Act or to qualify
the Declaration (as defined herein), the Guarantee Agreement
or the Indenture in respect of the Securities or the Junior
Subordinated Debentures under the Trust Indenture Act of 1939,
as amended (the "Trust Indenture Act").
(c) The Company and each of its subsidiaries (as
defined in Section 14) have been duly incorporated and are
validly existing as corporations in good standing under the
laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as
foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of
their respective businesses requires such qualification, save
where the failure to be so qualified could not reasonably be
expected to have a material adverse effect on the business or
property of the Company and its subsidiaries taken as a whole,
and each has all power and authority necessary to own or hold
their respective properties and to conduct the businesses in
which they are engaged.
(d) The Company has an authorized capitalization as
set forth, or incorporated by reference, in the Memorandum,
and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained, or incorporated by reference, in the Memorandum;
and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly
authorized and issued and are
4
3
fully paid and non-assessable and are owned directly or
indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims, except that the Company only
owns in excess of 99.9% of the issued shares of capital stock
or First Security Bank, N.A. and First Security Bank of
Wyoming.
(e) The Trust has been duly created and is validly
existing as a statutory business trust in good standing under
the Business Trust Act of the State of Delaware (the "Delaware
Business Trust Act") with the trust power and authority to own
property and conduct its business as described in the
Memorandum, and has conducted and will conduct no business
other than the transactions contemplated by this Agreement as
described in the Memorandum; the Trust is not a party to or
bound by any agreement or instrument other than this
Agreement, the Registration Rights Agreement (the
"Registration Rights Agreement") to be entered into among the
Company, the Trust and the Initial Purchasers, the Amended and
Restated Declaration of Trust (the "Declaration") among the
Company, as sponsor, ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the "Trustees"), and the agreements and
instruments contemplated by the Declaration and described in
the Memorandum; the Trust has no liabilities or obligations
other than those arising out of the transactions contemplated
by this Agreement and the Declaration and described in the
Memorandum; and the Trust is not a party to or subject to any
action, suit or proceeding of any nature.
(f) The Declaration has been duly authorized and,
when duly executed and delivered by the Company, as Sponsor,
and the Trustees, and assuming due authorization, execution
and delivery of the Declaration by the Property Trustee and
the Delaware Trustee, the Declaration will be a valid and
binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing,
and will conform to all statements relating thereto in the
Memorandum.
(g) All of the outstanding beneficial interests in
the Trust have been, and the Capital Securities and the Common
Securities, upon issuance and delivery and payment therefor in
the manner described herein, will be, duly authorized, validly
issued, fully paid and non-assessable and will conform to the
descriptions of the Capital
5
4
Securities and the Common Securities contained in the
Memorandum.
(h) Each of the Indenture and the Guarantee Agreement
has been duly authorized and, when duly executed and delivered
by the proper officers of the Company (assuming, in the case
of the Indenture, due execution and delivery by the Indenture
Trustee and, in the case of the Guarantee Agreement, due
execution and delivery by the Guarantee Trustee) and delivered
by the Company, will each constitute a valid and legally
binding agreement of the Company enforceable against the
Company in accordance with its terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing;
and the Junior Subordinated Debentures and the Guarantee have
been duly authorized, and, when duly executed, authenticated,
issued and delivered as provided in the Indenture and the
Guarantee Agreement, respectively, and delivered against
payment of the purchase price therefor as provided in this
Agreement, will be duly and validly issued and outstanding,
and will constitute valid and legally binding obligations of
the Company entitled to the benefits of the Indenture and the
Guarantee Agreement, respectively, and enforceable against the
Company in accordance with their terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing;
and the Junior Subordinated Debentures and the Guarantee, when
issued and delivered, will conform to the descriptions thereof
contained in the Memorandum.
(i) This Agreement has been duly authorized, executed
and delivered by each of the Trust and the Company and the
Registration Rights Agreement has been duly authorized and
will be duly delivered and executed by each of the Trust and
the Company.
(j) The execution, delivery and performance of this
Agreement, the Declaration, the Registration Rights Agreement,
the Common Securities and the Capital Securities by the Trust,
the purchase of the Junior Subordinated Debentures by the
Trust from the Company, the distribution of the Junior
Subordinated Debentures upon the liquidation of the Trust in
the circumstances contemplated by the Declaration and
described in the
6
5
Memorandum, and the consummation of the transactions
contemplated herein and in the Declaration (the "Trust
Transactions"), will not conflict with or result in a
violation of any statute or order, rule or regulation of any
court or governmental agency or body having jurisdiction over
the Trust or any of its assets; and except for such consents,
approvals, authorizations, registrations or qualifications as
may be required under applicable state securities laws in
connection with the purchase and distribution of the Capital
Securities by the Initial Purchasers, no consent, approval,
authorization or order of or filing or registration with, any
such court or governmental agency or body is required for the
Trust Transactions.
(k) The execution, delivery and performance of this
Agreement, the Guarantee Agreement, the Registration Rights
Agreement, the Indenture and the Junior Subordinated
Debentures by the Company, the purchase of the Common
Securities by the Company from the Trust, and the consummation
by the Company of the transactions herein (the "Company
Transactions") will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of
the properties or assets of the Company or any of its
subsidiaries is subject, nor will such actions result in any
violation of the provisions of the charter or by-laws of the
Company or any of its subsidiaries or any statute or order,
rule or regulation of any court or governmental agency or body
having jurisdiction over the Company, any of its subsidiaries
or any of their properties or assets; and except for such
consents, approvals, authorizations, registrations or
qualifications as may be required under applicable state
securities laws in connection with the purchase and
distribution of the Capital Securities by the Initial
Purchasers, no consent, approval, authorization or order of,
or filing or registration with, any such court or governmental
agency or body is required for the Company Transactions.
(l) Neither the Company nor any of its subsidiaries
has sustained, since the date of the latest quarterly
financial statements included in the Memorandum, any material
loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated
in the Memorandum; and, since such date, there has not been
any change in the capital stock or long-term debt of the
Company or any of
7
6
its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change,
in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the
Company and its subsidiaries, otherwise than as set forth or
contemplated in the Memorandum.
(m) The financial statements (including the related
notes and supporting schedules) incorporated in the Memorandum
present fairly the financial condition and results of
operations of the entities purported to be shown thereby, at
the dates and for the periods indicated, and have been
prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the
periods involved.
(n) Deloitte & Touche LLP, who have certified certain
financial statements of the Company, whose report is
incorporated by reference in the Memorandum and who have
delivered the initial letter referred to in Section 7(e)
hereof, are independent public accountants as required by the
Securities Act and the Rules and Regulations during the
periods covered by the financial statements on which they
reported contained in the Memorandum.
(o) 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 or asset of the Company or any
of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, might
have a material adverse effect on the consolidated financial
position, stockholders' equity, results of operations,
business or prospects of the Company and its subsidiaries
taken as a whole; and to the best of the Company's knowledge,
no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(p) No relationship, direct or indirect, exists
between or among the Company and the Trust on the one hand,
and the directors, officers, stockholders, customers or
suppliers of the Company on the other hand, which is required
to be described in the Memorandum which is not so described.
(q) Since the date as of which information is given
in the Memorandum through the date hereof, and except as may
otherwise be disclosed in the Memorandum, neither the Company
nor the Trust has (i) issued or granted any securities, (ii)
incurred any liability or obligation, direct or contingent,
other than liabilities and obligations which were incurred in
the ordinary course of business, (iii) entered into any
transaction not in the
8
7
ordinary course of business or (iv) in the case of the
Company, declared or paid any dividend on its capital stock.
(r) Neither the Company nor any of its subsidiaries
(i) is in violation of its charter or by-laws, (ii) is in
default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any
term, covenant or condition contained in any material
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it
is bound or to which any of its properties or assets is
subject or (iii) is in violation in any material respect of
any law, ordinance, governmental rule, regulation or court
decree to which it or its properties or assets may be subject
or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or
permit necessary to the ownership of its properties or assets
or to the conduct of its business.
(s) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment
of toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries (or, to
the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the properties now or
previously owned or leased by the Company or its subsidiaries
in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit, except
for any violation or remedial action which would not have, or
could not be reasonably likely to have, singularly or in the
aggregate with all such violations and remedial actions, a
material adverse effect on the general affairs, management,
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries; there has been
no material spill, discharge, leak, emission, injection,
escape, dumping or release of any kind onto such property or
into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or
hazardous substances due to or caused by the Company or any of
its subsidiaries or with respect to which the Company or any
of its subsidiaries have knowledge, except for any such spill,
discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely
to have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings
and releases, a material adverse effect on the general
affairs,
9
8
management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries; and
the terms "hazardous wastes", "toxic wastes", "hazardous
substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign
laws or regulations with respect to environmental protection.
(t) Neither the Company nor any subsidiary nor the
Trust is an "investment company" within the meaning of such
term under the Investment Company Act of 1940, as amended, and
the rules and regulations of the Securities and Exchange
Commission (the "Commission") thereunder.
(u) The Company is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as amended
(the "BHC Act"); and the deposit accounts of First Security
Bank, N.A. and First Security Bank of New Mexico, N.A. are
insured by the Federal Deposit Insurance Corporation ("FDIC")
to the fullest extent permitted by law and the rules and
regulations of the FDIC, and no proceedings for the
termination of such insurance are pending or threatened.
(v) The Company and each of its subsidiaries are in
compliance in all material respects with all laws administered
by and regulations of the Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation, the
Utah Division of Financial Institutions and any other federal
or state bank regulatory authority with jurisdiction over the
Company or any of its subsidiaries (the "Bank Regulatory
Authorities"), other than where such failures to comply would
not have a material adverse effect on the Company and its
subsidiaries, taken as a whole. Neither the Company nor any of
its subsidiaries is a party to any written agreement or
memorandum of understanding with, or a party to any commitment
letter or similar undertaking to, or is subject to any order
or directive by, or is a recipient of any extraordinary
supervisory letter from, or has adopted any board resolutions
at the request of, any Bank Regulatory Authority which
restricts materially the conduct of its business, or in any
manner relates to its capital adequacy, its credit policies or
its management, nor have any of them been advised by any Bank
Regulatory Authority that it is contemplating issuing or
requesting (or is considering the appropriateness of issuing
or requesting) any such order, decree, agreement, memorandum
of understanding, extraordinary supervisory letter, commitment
letter or similar submission, or any such board resolutions.
(w) Neither the Company nor any of its
affiliates (as defined in Rule 501(b) of Regulation D under
the
10
9
Securities Act, an "Affiliate") has directly, or through any
agent, (i) sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as defined
in the Securities Act) which is or will be integrated with the
sale of the Capital Securities in a manner that would require
the registration under the Securities Act of the Securities or
(ii) engaged in any form of general solicitation or general
advertising in connection with the offering of the Securities
(as those terms are used in Regulation D under the Securities
Act), or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
2. Purchase of the Capital Securities by the Initial
Purchasers. (i) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, the Trust
agrees to sell to you, and each of you, severally and not jointly, agrees to
purchase from the Trust, the liquidation amount of the Capital Securities as set
forth opposite each Initial Purchaser's name in Schedule 1 hereto, at a purchase
price equal to 100% of their liquidation amount.
As compensation to the Initial Purchasers for their
commitments hereunder, the Company agrees to pay the Initial Purchasers a
commission of 1% of the purchase price of the Capital Securities set forth in
Schedule I opposite each Initial Purchaser's name.
(ii) The Company shall not be obligated to deliver any of the
Capital Securities, except upon payment for all of the Capital Securities to be
purchased as hereinafter provided.
3. Sale and Resale of the Capital Securities by the Initial
Purchasers. You have advised the Company that you propose to offer the Capital
Securities for resale upon the terms and conditions set forth in this Agreement
and in the Offering Memorandum. You hereby represent and warrant to, and agree
with, the Company that you (i) are purchasing the Capital Securities pursuant to
a private sale exempt from registration under the Securities Act, (ii) will not
solicit offers for, or offer or sell, the Capital Securities by means of any
form of general solicitation or general advertising or in any manner involving a
public offering within the meaning of Section 4(2) of the Securities Act, and
(iii) will solicit offers for the Capital Securities only from, and will offer,
sell or deliver the Capital Securities, as part of their initial offering, only
to (A) in the case of offers inside the United States, (1) persons whom you
reasonably believe to be qualified institutional buyers ("Qualified
Institutional Buyers") as defined in Rule 144A under the Securities Act, as such
rule may be amended from time to time ("Rule 144A") or, if any such person is
buying for one or more institutional accounts for which such person is acting as
fiduciary or agent, only when such person has represented to you that each such
account is a Qualified
11
10
Institutional Buyer, to whom notice has been given that such sale or delivery is
being made in reliance on Rule 144A or (2) institutional accredited investors
("Accredited Investors") as defined in Rule 501(a)(1)(2), (3) or (7) under
Regulation D who execute letters of representation in the form included as
Appendix A to the Offering Memorandum in private sales exempt from registration
under the Securities Act and (B) in the case of offers outside the United
States, to persons other than U.S. persons ("foreign purchasers", which term
shall include dealers or other professional fiduciaries in the United States
acting on a discretionary basis for foreign beneficial owners (other than an
estate or trust)).
4. Delivery of and Payment for the Capital Securities. (a)
Payment of the purchase price for, and delivery of, the Capital Securities shall
be made at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, New York, New York or at
such other place as shall be agreed upon by the Company and you, at 9:30 a.m.
(New York time), on December 20, 1996 or at such other time or date as you and
the Company shall determine (such date and time of payment and delivery being
herein called the "Closing Date").
(b) On the Closing Date, payment shall be made to the Company
in same-day funds by wire transfer to such account or accounts as the Company
shall specify prior to the Closing Date or by such means as the parties hereto
shall agree prior to the Closing Date against delivery to you of the
certificates evidencing the Capital Securities. Upon delivery, the Capital
Securities shall be registered in such names and in such denominations as the
Initial Purchasers shall request in writing not less than two full business days
prior to the Closing Date. For the purpose of expediting the checking and
packaging of certificates evidencing the Capital Securities, the Company agrees
to make such certificates available for inspection at least 24 hours prior to
the Closing Date.
5. Further Agreements of the Company. Each of the
Company and the Trust agrees:
(a) To furnish to you, without charge, as many copies
of the Memorandum and any supplements and amendments thereto
as you may reasonably request.
(b) Prior to making any amendment or supplement to
the Memorandum, the Company shall furnish a copy thereof to
the Initial Purchasers and counsel to the Initial Purchasers
and will not effect any such amendment or supplement to which
the Initial Purchasers shall reasonably object by notice to
the Company after a reasonable period to review, which shall
not in any case be longer than five business days after
receipt of such copy.
12
11
(c) If, at any time prior to completion of the
distribution of the Capital Securities by you to purchasers,
any event shall occur or condition exist as a result of which
it is necessary, in the opinion of counsel for you or counsel
for the Company, to amend or supplement the Memorandum in
order that the Memorandum will not include an untrue statement
of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in
light of the circumstances existing at the time it is
delivered to a purchaser, or if it is necessary to amend or
supplement the Memorandum to comply with applicable law, to
promptly prepare such amendment or supplement as may be
necessary to correct such untrue statement or omission or so
that the Memorandum, as so amended or supplemented, will
comply with applicable law and to furnish you such number of
copies as you may reasonably request.
(d) So long as the Capital Securities are outstanding
and are "Restricted Securities" within the meaning of Rule
144(a)(3) under the Securities Act, to furnish to holders of
the Capital Securities and prospective purchasers of Capital
Securities designated by such holders, upon request of such
holders or such prospective purchasers, the information
required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
(e) For a period of five years following the date of
the Memorandum, to furnish to the Initial Purchasers copies of
all materials furnished by the Company to its shareholders and
all public reports and all reports and financial statements
furnished by each of the Company and the Trust to the
principal national securities exchange upon which the Capital
Securities may be listed pursuant to requirements of or
agreements with such exchange or to the Commission pursuant to
the Exchange Act or any rule or regulation of the Commission
thereunder.
(f) Promptly from time to time to take such action as
the Initial Purchasers may reasonably request to qualify the
Capital Securities, the Guarantee Agreement and the Junior
Subordinated Debentures for offering and sale under the
securities laws of such jurisdictions as the Initial
Purchasers may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Capital Securities.
(g) Not to offer, sell, contract to sell or otherwise
dispose of any additional securities of the Trust or the
Company substantially similar to the Capital Securities or any
securities convertible into or
13
12
exchangeable for or that represent the right to receive any
such similar securities, without the consent (which consent
shall not be unreasonably withheld) of the Initial Purchasers
during the period beginning from the date of this Agreement
and continuing to and including the earlier of (i) the
termination of trading restrictions on the Capital Securities,
as communicated to the Company by the Initial Purchasers, and
(ii) 90 days following the Closing Date.
(h) To use its best efforts to permit the Capital
Securities to be designated Private Offerings, Resales and
Trading through Automated Linkages Market ("PORTAL")
securities in accordance with the rules and regulations
adopted by the National Association of Securities Dealers,
Inc. relating to trading in the PORTAL Market and to permit
the Capital Securities to be eligible for clearance and
settlement through The Depository Trust Company (the "DTC").
(i) To apply the net proceeds from the sale of the
Capital Securities being sold by the Trust as set forth in the
Memorandum.
(j) Except following the effectiveness of the
Registration Statement (as defined in the Registration Rights
Agreement), not to, and will cause its affiliates not to,
solicit any offer to buy or offer to sell the Capital
Securities by means of any form of general solicitation or
general advertising (as those terms are used in Regulation D
under the Securities Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities
Act.
(k) Not to, and will cause its affiliates not to,
sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the
Securities Act) in a transaction that could be integrated with
the sale of the Capital Securities in a manner that would
require the registration under the Securities Act of the
Capital Securities.
(l) To take such steps as shall be necessary to
ensure that neither the Company, any subsidiary of the Company
nor the Trust shall become an "investment company" within the
meaning of such term under the Investment Company Act of 1940
and the rules and regulations of the Commission thereunder.
6. Expenses. The Company agrees to pay (i) the costs
incident to the authorization, issuance, sale and delivery of the
Capital Securities and any taxes payable in that connection; (ii)
the costs incident to the preparation and printing of the
14
13
Memorandum and any amendments or supplements thereto; (iii) the costs of
distributing the Memorandum and any amendments or supplements thereto; (iv) the
fees and expenses of qualifying the Capital Securities under the securities laws
of the several jurisdictions as provided in Section 5(f) and of preparing,
printing and distributing a Blue Sky Memorandum and a Legal Investment Survey
(including related fees and expenses of counsel to the Initial Purchasers); (v)
any fees charged by securities rating services for rating the Capital
Securities; (vi) all fees and expenses, if any, incurred in connection with the
admission of such Securities for trading in PORTAL; (vii) the fees and expenses
of the Property Trustee (as defined in the Declaration), the Guarantee Trustee
and the Indenture Trustee; and (viii) all other costs and expenses incident to
the performance of the obligations of the Company and the Trust.
7. Conditions to the Initial Purchasers' Obligations. The
respective obligations of the Initial Purchasers hereunder are subject to the
accuracy, when made and on the Closing Date, of the representations and
warranties of the Company and the Trust contained herein, to the performance by
the Company and the Trust of their respective obligations hereunder, and to each
of the following additional terms and conditions:
(a) No Initial Purchaser shall have discovered and
disclosed to the Company and the Trust on or prior to the
Closing Date that the Memorandum or any amendment or
supplement thereto contains any untrue statement of a fact
which, in the opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel
for the Initial Purchasers, is material or omits to state any
fact which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to made the
statements therein not misleading.
(b) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this
Agreement, the Indenture, the Junior Subordinated Debentures,
the Guarantee Agreement, the Capital Securities, the Common
Securities, the Memorandum, and all other legal matters
relating to this Agreement and the transactions contemplated
hereby shall be satisfactory in all respects to counsel for
the Initial Purchasers, and the Company and the Trust shall
have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon
such matters.
(c) Ray, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ shall have furnished to
the Initial Purchasers their written opinion, as counsel to
the Company, addressed to the Initial Purchasers and dated the
Closing Date, in form and substance satisfactory to the
Initial Purchasers, to the effect set forth in Exhibit A
hereto and to such further effect as counsel to the Initial
Purchasers may reasonably request.
15
14
(d) ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger shall have furnished to
the Initial Purchasers their written opinion, on certain
matters of Delaware law relating to the validity of the
Capital Securities, addressed to the Initial Purchasers and
dated the Closing Date, in form and substance satisfactory to
the Initial Purchasers, to the effect set forth in Exhibit B
hereto and to such further effect as counsel to the Initial
Purchasers may reasonably request.
(e) You shall have received on the Closing Date a
letter, dated the date hereof and the Closing Date, as the
case may be, in form and substance satisfactory to you, from
Deloitte & Touche LLP, independent public accountants,
containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information, including the financial information, contained or
incorporated by reference in the Memorandum as identified by
you.
(f) The Company and the Trust shall have furnished to
the Initial Purchasers a certificate, dated the Closing Date,
of the Chairman of the Board, President or a Vice President of
the Company and its chief financial officer stating that:
(i) The representations, warranties and
agreements of the Company and the Trust in Section 1
are true and correct as of the Closing Date and the
Company has complied with all its agreements
contained herein;
(ii) (A) Neither the Company nor any of its
subsidiaries has sustained since the date of the
latest quarterly financial statements included or
incorporated by reference in the Memorandum any
material loss or interference with its business from
fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute
or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the
Memorandum or (B) since such date there has not been
any change in the capital stock or long-term debt of
the Company or any of its subsidiaries or any change,
or any development involving a prospective change, in
or affecting the general affairs, management,
financial position, stockholders' equity or results
of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the
Memorandum; and
(iii) They have carefully examined the
Memorandum and, in their opinion (A) the
16
15
Memorandum, as of its date, did not include any
untrue statement of a material fact and did not omit
to state any material fact necessary to make the
statements therein, in the light of the circumstances
under which they were made, not misleading, and (B)
since the date of the Memorandum no event has
occurred which should have been set forth in a
supplement or amendment to the Memorandum.
(g) (i) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the latest
audited financial statements included or incorporated by
reference in the Memorandum any loss or interference with its
business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Memorandum or (ii)
since such date there shall not have been any change in the
capital stock or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Memorandum,
the effect of which, in any such case described in clause (i)
or (ii), is, in the judgment of the Initial Purchasers, so
material and adverse as to make it impracticable or
inadvisable to proceed with the offering or the delivery of
the Capital Securities on the terms and in the manner
contemplated in the Memorandum.
(h) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the
Trust's Capital Securities by any "nationally recognized statistical
rating organization", as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and Regulations and (ii) no
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of the Trust's Capital Securities.
(i) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority
having jurisdiction, (ii) a banking moratorium shall
17
16
have been declared by Federal or state authorities, (iii) the United
States shall have become engaged in hostilities, there shall have been
an escalation in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the United
States or (iv) there shall have occurred such a material adverse change
in general economic, political or financial conditions (or the effect
of international conditions on the financial markets in the United
States shall be such) as to make it, in the judgment of a majority in
interest of the Initial Purchasers, impracticable or inadvisable to
proceed with the offering or delivery of the Capital Securities on the
terms and in the manner contemplated in the Memorandum.
(j) The Initial Purchasers shall have received on the
date hereof the Registration Rights Agreement executed by the Company
and the Trust.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance satisfactory to
counsel for the Initial Purchasers.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Initial
Purchaser, its officers and employees and each person, if any, who controls any
Initial Purchaser within the meaning of the Securities Act, from and against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof (including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of Capital Securities), to which that
Initial Purchaser, officer, employee or controlling person may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in the Memorandum or
in any amendment or supplement thereto, or (B) in any blue sky application or
other document prepared or executed by the Company or the Trust (or based upon
any written information furnished by the Company or the Trust) specifically for
the purpose of qualifying any or all of the Capital Securities under the
securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "Blue Sky Application"), or
(ii) the omission or alleged omission to state in the Memorandum or in any
amendment or supplement thereto, or in any Blue Sky Application any material
fact required to be stated therein or necessary to make the statements therein
not misleading or the offering contemplated hereby, and which is included as
part of or referred to in any loss, claim, damage, liability or action arising
out of or based upon matters covered by clause (i) or (ii) above and shall
reimburse each Initial Purchaser and each such officer, employee and controlling
person promptly
18
17
upon demand for any legal or other expenses reasonably incurred by that Initial
Purchaser, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged omission
made in the Memorandum or in any such amendment or supplement, or in any Blue
Sky Application in reliance upon and in conformity with the written information
furnished to the Company or the Trust by or on behalf of any Initial Purchaser
specifically for inclusion therein and described in Section 8.(e). The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Initial Purchaser or to any officer, employee or
controlling person of that Initial Purchaser.
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company, its officers and employees, each of its
directors and each Trustee, and each person, if any, who controls the Company or
the Trust within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof,
to which the Company, any such director or officer, or any such Trustee or any
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in the Memorandum or in any amendment or supplement thereto,
or (B) in any Blue Sky Application or (ii) the omission or alleged omission to
state in the Memorandum or in any amendment or supplement thereto, or in any
Blue Sky Application any material fact required to be stated therein or
necessary to make the statements therein not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with the written
information furnished to the Company or the Trustee by or on behalf of that
Initial Purchaser specifically for inclusion therein and described in Section
8.(e), and shall reimburse the Company and any such director or officer, or the
Trust or any such Trustee, or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director or officer, or the Trust
or any such Trustee, or any controlling person in connection with investigating
or defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred. The foregoing indemnity
agreement is in addition to any liability which any Initial Purchaser may
otherwise have to the Company or any such director or officer, or the Trust or
any such Trustee, or any controlling person.
(c) Promptly after receipt by an indemnified party under this
Section of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof
19
18
is to be made against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that action;
provided, however, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have under this Section 8 except to
the extent it has been materially prejudiced by such failure and, provided
further, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party otherwise than
under this Section 8. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, that the Initial Purchasers shall have the right to employ counsel to
represent jointly the Initial Purchasers and their respective officers,
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Initial Purchasers
against the Company under this Section 8 if, in the reasonable judgment of the
Initial Purchasers, it is advisable for the Initial Purchasers and those
officers, employees and controlling persons to be jointly represented by
separate counsel, and in that event the fees and expenses of such separate
counsel shall be paid by the Company. Each indemnified party, as a condition of
the indemnity agreements contained in Sections 8.(a) and 8.(b), shall use its
best efforts to cooperate with the indemnifying party in the defense of any such
action or claim. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with its written consent or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss of liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold
20
19
harmless an indemnified party under Section 8.(a) or 8.(b) in respect of any
loss, claim, damage or liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company and the Trust on the one hand and the Initial
Purchasers on the other from the offering of the Capital Securities or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Trust on the one hand and the Initial Purchasers on the other with respect
to the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Trust on
the one hand and the Initial Purchasers on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Capital Securities purchased under this Agreement
(before deducting expenses) received by the Trust on the one hand, and the total
underwriting commissions received by the Initial Purchasers with respect to the
Capital Securities purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of the Capital
Securities under this Agreement, in each case as set forth in the table on the
cover page of the Memorandum. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company and the Trust on the one hand or the Initial Purchasers,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Initial Purchasers agree that it would not be just and equitable if
contributions pursuant to this Section 8.(d) were to be determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 8.(d) shall be
deemed to include, for purposes of this Section 8.(d), 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 8.(d), no Initial Purchaser shall be required to
contribute any amount in excess of the amount by which the total price at which
the Capital Securities sold and distributed by it was offered to the purchasers
exceeds the amount of any damages which such Initial Purchaser has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No
21
20
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Initial Purchasers'
obligations to contribute as provided in this Section 8.(d) are several in
proportion to their respective underwriting obligations and not joint.
(e) The Initial Purchasers severally confirm that the
statements with respect to the offering of the Capital Securities set forth in
the bottom paragraph on the cover page of, and under the caption "Plan of
Distribution" in, the Memorandum are correct and constitute the only information
furnished in writing to the Company or the Trust by or on behalf of the Initial
Purchasers specifically for inclusion in the Memorandum.
9. Termination. The obligations of the Initial Purchasers
hereunder may be terminated by them by notice given to and received by the
Company or the Trust prior to delivery of and payment for the Capital Securities
if, prior to that time, any of the events described in Sections 7(h), 7(i) or
7(j) shall have occurred or if the Initial Purchasers shall decline to purchase
the Capital Securities for any reason permitted under this Agreement.
10. Reimbursement of Initial Purchasers' Expenses. If (a) the
Trust shall fail to tender the Capital Securities for delivery to the Initial
Purchasers for any reason, or (b) the Initial Purchasers shall decline to
purchase the Capital Securities for any reason permitted under this Agreement,
the Company shall reimburse the Initial Purchasers for the reasonable fees and
expenses of their counsel and for such other out-of-pocket expenses as shall
have been incurred by them in connection with this Agreement and the proposed
purchase of the Capital Securities, and upon demand the Company shall pay the
full amount thereof to the Initial Purchasers.
11. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered
or sent by mail, telex or facsimile transmission to
▇▇▇▇▇▇ Brothers Inc., Three World Financial Center, New
York, New York 10285, Attention: Syndicate Department
(Fax: ▇▇▇-▇▇▇-▇▇▇▇);
(b) if to the Company or the Trust shall be
delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in
the Memorandum, Attention: Chief Financial Officer (Fax:
801-359-6928).
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof. The Company and the Trust shall be entitled to act and
rely upon any request, consent, notice
22
21
or agreement given or made on behalf of the Initial Purchasers by
▇▇▇▇▇▇ Brothers Inc.
12. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Initial Purchasers, the
Company, the Trust and their respective successors. This Agreement and the terms
and provisions hereof are for the sole benefit of only those persons, except
that (x) the representations, warranties, indemnities and agreements of the
Company and the Trust contained in this Agreement shall also be deemed to be for
the benefit of the officers and employees of each Initial Purchaser and the
person or persons, if any, who control each Initial Purchaser within the meaning
of Section 15 of the Securities Act and (y) the indemnity agreement of the
Initial Purchasers contained in Section 8.(b) of this Agreement shall be deemed
to be for the benefit of directors, officers and employees of the Company and
the Trust and any person controlling the Company or the Trust within the meaning
of Section 15 of the Securities Act. Nothing in this Agreement is intended or
shall be construed to give any person, other than the persons referred to in
this Section 12, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein.
13. Survival. The respective indemnities, representations,
warranties and agreements of the Company, the Trust and the Initial Purchasers
contained in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Capital Securities and shall remain in full force and effect, regardless of any
investigation made by or on behalf of any of them or any person controlling any
of them.
14. Definition of the Terms "Business Day" and "Subsidiary".
For purposes of this Agreement, (a) "business day" means any day on which the
New York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
15. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of New York.
16. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
17. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
23
If the foregoing correctly sets forth the agreement among the
Company, the Trust and the Initial Purchasers, please indicate your acceptance
in the space provided for that purpose below.
Very truly yours,
FIRST SECURITY CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
FIRST SECURITY CAPITAL I
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
Regular Trustee
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
By /s/ ▇▇▇▇▇▇ ▇. (?)
----------------------------------
For itself and the several other Initial Purchasers
named in Schedule 1 hereto
24
SCHEDULE 1
Liquidation
Amount of
Initial Purchasers Capital Securities
------------------ ------------------
▇▇▇▇▇▇ Brothers Inc. $112,500,000
▇.▇. ▇▇▇▇▇▇ Securities Inc. $ 37,500,000
------------
Total $150,000,000
25
EXHIBIT A
December 23, 1996
▇▇▇▇▇▇ Brothers Inc., as representative of the several Purchasers
named in Schedule I to the Purchase Agreement,
dated December 23, 1996, with First Security Capital I
and First Security Corporation
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: 8.41% $150,000,000 Subordinated Capital Income Securities of First
Security Capital I, a Delaware Business Trust, and 8.41% of Related
First Security Corporation Junior Subordinated Debentures
Ladies and Gentlemen:
We have acted as counsel to First Security Corporation, a Delaware
corporation (the "Company"), and First Security Capital I, a Delaware business
trust (the "Trust"), in connection with the Trust's offering and issuance to
the Initial Purchasers of $150,000,000 8.41% Subordinated Capital Income
Securities (the "Capital Securities"), which offer is more fully described in
that certain final offering memorandum dated December 23, 1996 (the
"Memorandum"), and with respect to the Trust's subsequent investment in the
Company's 8.41% Junior Subordinated Debentures, maturing on December 15, 2026,
which shall be issued under, and shall be subject to the terms of, that certain
Indenture, dated as of December 23, 1996 (the "Indenture") between the Company
and Bank of New York, as Indenture Trustee (the "Indenture Trustee"). This
opinion is delivered pursuant to Section 7(c) of that certain Purchase
Agreement, dated December 23, 1996, between the Company and the Trust and
accepted by you as representative of the Initial Purchasers (the "Purchase
Agreements"). Unless otherwise indicated herein, capitalized terms used herein
without definition shall have the respective meanings set forth in the Purchase
Agreement.
26
▇▇▇▇▇▇ Brothers, Inc.
December __, 1996
Page 2
In connection with this opinion, we have investigated such questions of
law, examined such corporate documents and records of the Company and the
Trust, and certificates of public officials and other documents concerning the
Company and/or the Trust, and received such information from officers and
representatives of the Company and the Trust as we have deemed necessary or
appropriate for the purposes of this opinion. We have examined, among other
documents, the Memorandum, the Purchase Agreement, the Declaration, the
Indenture, the Junior Subordinated Debentures and the Guarantee Agreement
(collectively, the "Transaction Documents"), and certificates of responsible
officers of the Company and the Trust concerning matters of fact within the
respective areas of responsibility of such officers.
Based upon the foregoing, and subject to the qualifications and
exceptions heretofore and hereinafter set forth, we are of the opinion that:
1. The Company has been duly incorporated and is a validly
existing corporation in good standing under the laws of the State of Delaware,
with all corporate power and authority necessary to own or holds its properties
and conduct its business as described in the memorandum; and the Company is
duly qualified to do business and is in good standing as a foreign corporation
in each jurisdiction in which it owns or leases substantial properties or in
which the conduct of its business otherwise requires such qualification, other
than such jurisdictions where the failure to be so qualified or in good
standing would not have a material adverse effect upon the Company.
2. Each of the Company's subsidiaries, including the Trust, has
been duly incorporated and is validly existing as a corporation or other legal
entity in good standing under the laws of its jurisdiction of incorporation or
organization, with all corporate power and authority to own or hold its
properties and conduct its business, and has been duly qualified to do business
as a foreign corporation or entity in good standing in each jurisdiction in
which it owns or leases substantial properties or in which the conduct of its
business otherwise requires such qualification, other than such jurisdictions
where the failure to be so qualified or in good standing would not have a
material adverse effect on the Company and its subsidiaries taken as a whole.
3. Each of the Purchase Agreement and the Registration Rights
Agreement has been duly authorized, executed and delivered by the Company and
has been duly executed and delivered by the Trust.
4. The Indenture has been duly authorized, executed and delivered
by the Company and, when duly authorized, executed and delivered by the
Indenture Trustee, will constitute a valid and legally binding obligation of
the Company, enforceable against the Company, in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles, (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing.
27
▇▇▇▇▇▇ Brothers, Inc.
December __, 1996
Page 3
5. The Junior Subordinated Debentures have been duly authorized,
executed and delivered by the Company and, when duly authenticated by the
Indenture Trustee and upon payment and delivery as described in the Purchase
Agreement, will constitute valid and legally binding obligations of the
Company, enforceable against the Company, in accordance with their terms,
subject to the efforts of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles, (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing.
6. The Guarantee Agreement has been duly authorized, executed and
delivered by the Company and, assuming due authorization, execution and
delivery by the Guarantee Trustee, will constitute a valid and legally binding
obligation of the Company, enforceable against the Company, in accordance with
its terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles, (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
7. The Declaration has been duly authorized, executed and
delivered by the Company.
8. The execution, delivery and performance of the Transaction
Documents by the Company and the Trust, as applicable, will not (a) constitute
a material breach of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument which has been
identified to us by management as material to the business of the Company and
to which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, the effect of which
breach or default would be material to the Company and its subsidiaries taken
as a whole; (b) result in any violation of any provision of the Certificate of
Incorporation, or the bylaws, of the Company or any such subsidiary, the effect
of which violation would be material to the Company and its subsidiaries taken
as a whole; or (c) result in a violation of any Federal or State of Utah
statute, order, rule or regulation of any court or governmental agency having
jurisdiction over the Company or any of its subsidiaries or any of their
respective properties or assets, the effects of which violation would be
material to the Company and its subsidiaries taken as a whole.
9. All of the outstanding shares of capital stock of First
Security Bank, N.A. and First Security Bank of New Mexico, N.A. have been duly
authorized and validly issued, and are fully-paid and non-assessable, and the
Company owns directly or indirectly, free and clear of any pledge, lien,
encumbrance, security interest, charge, claim, equitable right or encumbrance
of any kind, 100% of the capital stock of First Security Bank of New Mexico,
N.A. and in excess of 99.9% of the capital stock of First Security Bank, N.A.
28
▇▇▇▇▇▇ Brothers, Inc.
December __, 1996
Page 4
10. No consent, approval, authorization, order, registration or
qualification of any Federal or Utah governmental agency or body, or any
Delaware governmental agency or body acting pursuant to the Delaware General
Corporation Law or, to our knowledge, any Federal or Utah court or any Delaware
court acting pursuant to the Delaware General Corporation Law is required for
the issue and sale by the Trust of the Capital Securities, the issuance by the
Company of the Junior Subordinated Debentures, the issuance of the Guarantee
Agreement by the Company and the compliance by the Company with all of the
provisions of the Purchase Agreement, except for such consents, approvals,
authorizations, registrations or qualifications as have been obtained and made
and such as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Capital Securities and the
Guarantee Agreement by the Initial Purchasers.
11. The statements made in the Memorandum under the captions
"Description of Junior Subordinated Debentures", "The Trust", "Description of
Capital Securities", "Description of Guarantee" and "Relationship Among the
Capital Securities, the Junior Subordinated Debentures and the Guarantee",
insofar as such statements purport to constitute summaries of the terms of the
Capital Securities, the Junior Subordinated Debentures and the Guarantee,
constitute accurate summaries of the terms of the Capital Securities, the
Junior Subordinated Debentures and the Guarantee.
12. a. The Trust will be characterized as a grantor trust for
United States Federal income tax purposes and not as an association taxable as
a corporation.
b. The Junior Subordinated Debentures will constitute
indebtedness of the Company for United States Federal income tax purposes; and
c. Subject to the qualifications set forth therein, the
statements made in the Memorandum under the caption "Certain United States
Federal Income Tax Consequences" fairly present in all material respects the
principal United States Federal income tax consequences of an investment in the
Capital Securities.
13. All descriptions in the Memorandum of contracts and other
documents which the Company or its subsidiaries are a party are accurate in all
material respects; to the best of our knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the Memorandum other
than those described or referred to therein.
14. To our knowledge, there is not pending or threatened any legal
or governmental proceeding required to be described in the Memorandum which is
not described as required.
15. To our knowledge, the Trust is not a party to or otherwise bound
by any agreement other than those described in the Memorandum.
29
▇▇▇▇▇▇ Brothers Inc.
December __, 1996
Page 5
16. Neither the Company nor the Trust is required to be registered as
an "investment company" under the Investment Company Act of 1940, as amended.
17. The Company is duly registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended (the "BHC Act"); and the deposit
accounts of First Security Bank, N.A. and First Security Bank of New Mexico,
N.A. are insured by the Federal Deposit Insurance Corporation ("FDIC") to the
fullest extent permitted by law and the rules and regulations of the FDIC, and,
to our knowledge, no proceedings for the termination of such insurance are
pending or threatened.
18. The Company, First Security Bank, N.A. and First Security Bank of
New Mexico, N.A. are in compliance in all material respects with all laws
administered by and regulations of the Board of Governors of the Federal
Reserve System, the FDIC, the Comptroller of the Currency, the banking
authority in the states in which such banks do business, as applicable, and any
other Federal or state bank regulatory authority with jurisdiction over the
Company, First Security Bank, N.A. and First Security Bank of New Mexico, N.A.
(the "Bank Regulatory Authorities"), other than where such failures to comply
would not have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
19. To our knowledge, neither the Company, First Security Bank, N.A.
nor First Security Bank of New Mexico, N.A. is a party to any written agreement
or memorandum or understanding with, or a party to any commitment letter or
similar undertaking to, or is subject to any order or directive by, or is a
recipient of any extraordinary supervisory letter from, or has adopted any
board resolutions at the request of, any Bank Regulatory Authority which
restricts materially the conduct of its business, or in any manner relates to
its capital adequacy, its credit policies or its management, nor have any of
them been advised by any Bank Regulatory Authority that it is contemplating
issuing or requesting (or is considering the appropriateness of issuing or
requesting) any such order, decree, agreement, memorandum of understanding,
extraordinary supervisory letter, commitment letter or similar submission, or
any such board resolutions.
20. No registration of the Securities, the Guarantee or the Junior
Subordinated Debentures under the Securities Act of 1933, as amended (the
"Act"), and no qualification of the Declaration, the Guarantee or the Indenture
under the Trust Indenture Act of 1939, as amended, is required for the offer
and sale of the Securities by the Company to the Initial Purchasers or the
initial reoffer and resale of the Securities by the Initial Purchasers solely
in the manner contemplated by the Memorandum.
The foregoing opinions are subject to the following assumptions,
exceptions, qualifications and limitations:
a. In rendering our opinions we have assumed the genuineness of
all signatures on all documents, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals and the conformity
with original documents of all
30
▇▇▇▇▇▇ Brothers Inc.
December __, 1996
Page 6
documents submitted to us as copies, the authenticity of the originals of such
copies, the due authorization, execution and delivery of all instruments and
documents by parties other than the Company, and that such instruments and
documents are the valid, binding and enforceable obligations of such persons.
b. We are members of the Bar of the State of Utah, and except
as to matters governed by the Delaware General Corporation Law with respect to
our opinions expressed in paragraphs 1, 2 and 10 above, we render no opinion
herein as to matters involving the laws of any jurisdiction other than the
State of Utah and the United States of America. Although we are not members of
the Bar of the State of Delaware, we are generally familiar with the Delaware
General Corporation Law and, for the limited purpose of our opinions in
paragraphs 1, 2 and 10 above, we did not deem it necessary to obtain the
opinion of Delaware counsel, although we have relied with your permission on
the opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, special counsel, with respect to
matters concerning the Trust discussed in this opinion.
c. As to factual matters material to the opinions rendered
herein, with your permission we have relied upon certificates of responsible
officers of the Company concerning matters of fact within the respective areas
of responsibility of such officers, and upon certificates of public officials.
We have made no independent factual inquiries or investigation as to the
matters covered by any of the aforesaid certificates. However, in the course of
our representation of the Company, nothing has come to our attention that would
cause us to believe that such certificates contain any material misstatement of
fact or omit to state any material fact necessary to make the facts set forth
therein not materially misleading, and we believe that we and you are entitled
to rely upon such certificates. In this connection, please note that we have not
undertaken to apprise or inform all members of our firm who have performed
legal service for the Company on other matters, of the details of this set of
transactions and accordingly, the representation in the immediately preceding
sentence is limited in scope to those attorneys in our firm having detailed
knowledge of the subject transactions and the substance of this Opinion.
d. This opinion is limited to the present laws of the States of
Utah and Delaware and the United States of America, and to the facts bearing
upon this opinion as they presently exist. We assume no obligation to revise or
supplement this opinion.
e. We express no opinion on the enforceability of any choice of
law or choice of venue provisions contained in any of the documents.
f. The opinions set forth in paragraph 14 of this letter is,
with your permission, rendered solely in reliance upon our examination on
November 21, 1996, of the records of the Third District Court, Salt Lake County,
State of Utah, the United States District Court, District of Utah, and United
States Bankruptcy Court, State of Utah for cases involving the Company and
First Security Bank, N.A., a review of our internal docket system, and the
certificate of an officer of the Company referenced in paragraph c. of this
letter. With your
31
▇▇▇▇▇▇ Brothers Inc.
December __, 1996
Page 7
permission, we have not examined the records of any other court, administrative
tribunal, governmental agency or authority, or other similar entity in
connection with this opinion.
g. We have not independently verified the accuracy,
completeness or fairness of, and render no opinion on, the statements made or
included in the Memorandum or in the documents incorporated by reference
therein (the "Exchange Act Documents") and take no responsibility therefor,
except as and to the extent set forth in paragraphs 10 and 12c above. In the
course of the preparation by the Company of the Memorandum, we participated in
conferences with certain officers and employees of the Company, with
representatives of the Initial Purchasers and with counsel to the Initial
Purchasers. Based only on our examination of the Memorandum and the Exchange
Act Documents, our investigations made in connection with the preparation of
the Memorandum and our participation in the conferences referred to above, we
have no reason to believe that the Memorandum (including the Exchange Act
Documents) contains any untrue statement of a material fact or omits to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that, with your permission, we express no opinion as to the financial
statements and other financial data contained in the Offering Memorandum or any
amendment of supplement thereto.
h. In rendering our opinions, we have assumed that the
transactions contemplated in the Transaction Documents will occur fully in
accordance with the terms and provisions thereof insofar as they are pertinent
to this opinion.
i. The opinions and conclusions set forth in paragraph 12 are
based upon the Federal income tax laws of the United States, including the
Internal Revenue Code of 1986, as amended, Treasury Regulations and judicial
and administrative interpretations thereof, as they exist as of the date of this
opinion. There can be no assurance that the legal authorities upon which our
opinion is based will not be modified, revoked, supplemented or otherwise
changed. To the extent of any such changes, our opinion is not applicable.
Furthermore, we undertake no obligation to reexamine or in any way revise our
opinion in the light of any such changes.
This opinion is rendered to you in connection with the Purchase
Agreement and the transactions related thereto and may not be relied upon by
any other person or by you in any other context or for any other purpose. This
opinion may not be quoted in whole or in part, nor may copies thereof be
furnished or delivered to any other person without the prior written consent of
this Firm.
Very truly yours,
RAY, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
32
EXHIBIT B
[Letterhead of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger]
December __, 1996
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: First Security Capital I
------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for First Security
Corporation, a Delaware corporation (the "Company"), and First Security Capital
I, a Delaware business trust (the "Trust"), in connection with the matters set
forth herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of December 13,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on December 13, 1996;
(b) The Declaration of Trust of the Trust, dated as of December 13,
1996, by and among the Company and the trustees of the Trust named therein;
(c) The Amended and Restated Declaration of Trust of the Trust,
dated as of December __, 1996 (including Exhibits A and B thereto) (the
"Declaration"), among the Company, as depositor, the trustees of the Trust
named therein (the "Trustees") and the holders, from time to time, of undivided
beneficial interests in the assets of the Trust;
33
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
December __, 1996
Page 2
(d) The Purchase Agreement, dated December 23, 1996 (the "Purchase
Agreement"), among the Company, the Trust, and ▇▇▇▇▇▇ Brothers Inc. and ▇.▇.
▇▇▇▇▇▇ Securities Inc. (the "Initial Purchasers");
(e) The Registration Rights Agreement, dated as of December __,
1996 (the "Registration Rights Agreement"), among the Trust, the Company and
the Initial Purchasers;
(f) The Offering memorandum, dated December 23, 1996 (the
"Memorandum"), relating to the $150,000,000 8.41% Subordinated Capital Income
Securities of the Trust, representing undivided beneficial interests in the
assets of the Trust (each, a "Capital Security" and collectively, the "Capital
Securities"); and
(g) A Certificate of Good Standing for the Trust, dated December
__, 1996, obtained from the Secretary of State.
Capitalized terms used herein and not otherwise defined are used as
defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (g) above. In particular,
we have not reviewed any document (other than the documents listed in paragraphs
(a) through (g) above) that is referred to in our incorporated by reference in
to the documents reviewed by us. We have assumed that there exists no provision
in any document that we have not reviewed that is inconsistent with the
opinions stated herein. We have conducted no independent factual investigation
of our own but rather have relied solely upon the foregoing documents, the
statements and information set forth therein and the additional matters recited
or assumed herein, all of which we have assumed to be true, complete and
accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
34
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
December __, 1996
Page 3
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation, and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation, due formation or due
organization, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation, formation or organization, (iii) the legal capacity of
each natural person who is a party to the documents examined by us, (iv) except
to the extent set forth in paragraph 1 below, that each of the parties to the
documents examined by us has the power and authority to execute and deliver,
and to perform its obligations under, such documents (v) except to the extent
provided in paragraph 4 below, that each of the parties to the documents
examined by us has duly authorized, executed and delivered such documents, (vi)
the receipt by each Person to whom a Capital Security is to be issued by the
Trust (the "Capital Security Holders") of a Capital Security Certificate for
the Capital Security and the payment for the Capital Security acquired by it,
in accordance with the Declaration, and as described in the Memorandum, (vii)
that the Capital Securities are issued and sold by the Capital Security Holders
in accordance with the Declaration, and as described in the Memorandum, (viii)
the receipt by the Company (the "Common Security Holder") to whom an 8.41%
Common Security of the Trust representing common undivided beneficial interests
in the assets of the Trust (each, a "Common Security" and collectively, the
"Common Securities") (the Capital Securities and the Common Securities being
hereinafter collectively referred to as "Trust Securities") is to be issued by
the Trust of a Common Security Certificate for the Common Security and the
payment for the Common Security acquired by it, in accordance with the
Declaration, and as described in the Memorandum, (ix) that the Common
Securities are issued and sold to the Common Security Holder in accordance with
the Declaration, and as described in the Memorandum, and (x) that the trust
derives no income from or connected with sources within the State of Delaware
and has no assets, activities (other than having a Delaware trustee as required
by the Delaware Business Trust Act and filing documents with the Secretary of
State) or employees in the State of Delaware. We have not participated in the
preparation of the Memorandum and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal
laws and rules and
35
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
December __, 1996
Page 4
regulations relating thereto. Our opinions are rendered only with respect to
Delaware laws and rules, regulations and orders thereunder that are currently
in effect.
Based upon the foregoing, and upon our examination of such questions of
law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, and, under
the Declaration and the Delaware Business Trust Act, has the trust power and
authority to own its properties and conduct its business, all as described in
the Memorandum, and to enter into and perform its obligations under each of the
Purchase Agreement, the Registration Rights Agreement, the Trust Securities and
the Declaration.
2. The Common Securities have been duly and validly authorized by
the Declaration, and, when issued and delivered by the Trust to the Common
Security Holder as described in the Memorandum and the Declaration, will be
validly issued undivided beneficial interests in the assets of the Trust. Under
the Declaration and the Delaware Business Trust Act, the issuance of the Common
Securities is not subject to preemptive or other similar rights.
3. The Capital Securities have been duly authorized by the
Declaration and are duly and validly issued and, subject to the qualifications
set forth herein, fully paid and nonassessable undivided beneficial interests
in the assets of the Trust and will be entitled to the benefits of the
Declaration. Under the Declaration and the Delaware Business Trust Act, the
issuance of the Capital Securities is not subject to any preemptive or similar
rights. The Capital Security Holders, 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. We note that the Capital Security
Holders may be obligated, pursuant to the Declaration, (A) to provide indemnity
and/or security in connection with and pay taxes or governmental charges
arising from transfers or exchanges of Capital Security Certificates and the
issuance of replacement Capital Security Certificates, and (B)
to provide security or indemnity in connection with requests of or directions
to the Property Trustee to exercise its rights and powers under the Declaration.
36
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
December __, 1996
Page 5
4. Under the Declaration and the Delaware Business Trust Act, all
necessary trust action has been taken on the part of the Trust to duly
authorize the execution and delivery of the Purchase Agreement and the
Registration Rights Agreement by the Trust.
5. The Declaration constitutes a valid and binding obligation of
the Company and the Trustees, and is enforceable against the Company and the
Trustees, in accordance with its terms.
6. The execution, delivery and performance of the Purchase
Agreement and Registration Rights Agreement by the Trust and the consummation
of the transactions contemplated therein do not violate the Declaration or the
Certificate. After due inquiry on December __, 1996 limited to, and solely to
the extent disclosed thereby, court dockets for active cases of the Court of
Chancery of the State of Delaware in and for New Castle County, Delaware, of
the Superior Court of the State of Delaware in and for New Castle County,
Delaware, and of the United States District Court sitting in the State of
Delaware, we are not aware of any legal or governmental proceeding pending
against the Trust.
7. No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any Delaware court or Delaware
governmental authority or Delaware agency is necessary or required solely in
connection with the due authorization, execution and delivery of the Purchase
Agreement and the Registration Rights Agreement by the Trust or for the
offering, issuance, sale or delivery of the Capital Securities by the Trust in
accordance with the Declaration and the Memorandum.
The opinion expressed in paragraph 5 above is subject, as to
enforcement, to the effect upon the Declaration of (i) bankruptcy, insolvency,
moratorium, receivership, reorganization, liquidation, fraudulent conveyance or
transfer or 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.
We consent to your relying at to matters of Delaware law upon this
opinion in connection with the Purchase Agreement. We also consent to Ray,
▇▇▇▇▇▇▇ & Nebeker's and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇'▇ relying as to matters of
Delaware law upon this opinion in connection with opinions to be rendered by
them on the date hereof
37
▇▇▇▇▇▇ Brothers Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
December __, 1996
Page 6
pursuant to the Purchase Agreement. Except as stated above, without our prior
written consent, this opinion may not be furnished or quoted to, or relied
upon by, any other Person for any purpose.
Very truly yours,
CDK/BJK
