500,000 Capital Securities
NB CAPITAL TRUST III
(a Delaware Trust)
Floating Rate Capital Securities
(Liquidation Amount of $1,000 per Capital Security)
UNDERWRITING AGREEMENT
---------------
January 22, 1997
NationsBanc Capital Markets, Inc.
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇ Brothers Inc.
as Representatives of the several Underwriters
c/o NationsBanc Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Director
Ladies and Gentlemen:
NB Capital Trust III (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. (S)(S) 3801 et
seq.), and NationsBank Corporation, a North Carolina corporation (the "Company"
and, together with the Trust, the "Offerors"), confirm their agreement (the
"Agreement") with NationsBanc Capital Markets, Inc., Bear, ▇▇▇▇▇▇▇ & Co. Inc.
and ▇▇▇▇▇▇ Brothers Inc. and each of the several Underwriters named in Schedule
A hereto (collectively, the "Underwriters," which term shall also include any
underwriter substituted as hereinafter provided in Section 9 hereof), for whom
NationsBanc Capital Markets, Inc., Bear, ▇▇▇▇▇▇▇ & Co. Inc. and ▇▇▇▇▇▇ Brothers
Inc. are acting as representatives (in such capacity, the "Representatives",
however, if the Underwriters named in Schedule A hereto include only NationsBanc
Capital Markets, Inc., Bear, ▇▇▇▇▇▇▇ & Co. Inc. and ▇▇▇▇▇▇ Brothers Inc., then
all references in this Agreement to the Representatives shall be deemed
references to the Underwriters), with respect to the sale by the Trust and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of Floating Rate Capital Securities (liquidation amount of
$1,000 per Capital security) of the Trust (the "Capital Securities") set forth
in Schedule A attached hereto. The Capital Securities will be guaranteed on a
subordinated basis by the Company, to the extent set forth in the Prospectus (as
defined herein), with respect to distributions and payments upon liquidation,
redemption and otherwise (the "Capital Securities Guarantee") pursuant to the
Capital Securities Guarantee Agreement, to be dated as of
February 3, 1997, (the "Capital Securities Guarantee Agreement"), between the
Company and The Bank of New York, as trustee (the "Guarantee Trustee"), and will
be entitled to the benefits of certain backup undertakings described in the
Prospectus (as defined herein) with respect to the Company's agreement pursuant
to the Supplemental Indenture (as defined herein) to pay all expenses relating
to administration of the Trust (other than payment obligations with respect to
the Capital Securities). The Capital Securities and the related Capital
Securities Guarantees are referred to herein as the "Securities."
The Offerors have filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-18273) and a
related prospectus for the registration under the Securities Act of 1933, as
amended (the "1933 Act") of (i) the Capital Securities, (ii) the Capital
Securities Guarantee, and (iii) the Junior Subordinated Notes (as defined below)
to be issued and sold to the Trust by the Company, have filed such amendments
thereto, if any, and such amended 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
Capital Securities which differs from the Prospectus on file at the Commission
at the time the Registration Statement became 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.
The Offerors understand that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered and the Declaration (as defined
herein), the Indenture (as defined herein) and the Capital Securities Guarantee
have been qualified under the Trust Indenture Act of 1939, as amended (the "1939
Act"). The entire proceeds to the Trust from the sale of the Capital
2
Securities will be combined with the entire proceeds from the sale by the Trust
to the Company of its common securities (the "Common Securities"), as guaranteed
on a subordinated basis by the Company, to the extent set forth in the
Prospectus, with respect to distributions and payments upon liquidation and
redemption thereof (the "Common Securities Guarantee" and together with the
Capital Securities Guarantee, the "Guarantees") pursuant to the Common
Securities Guarantee Agreement, to be dated as of February 3, 1997, (the "Common
Securities Guarantee Agreement" and, together with the Capital Securities
Guarantee Agreement, the "Guarantee Agreements") and will be used by the Trust
to purchase $515,500,000 aggregate principal amount of Floating Rate Junior
Subordinated Deferrable Interest Notes due 2027 (the "Junior Subordinated
Notes") issued by the Company, under the Indenture (as defined herein). The
Capital Securities and the Common Securities will be issued pursuant to the
Amended and Restated Declaration of Trust of the Trust, dated as of January 22,
1997 (the "Declaration"), among the Company, as Sponsor, ▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇, as trustees (the "Regular Trustees"), The Bank of
New York (Delaware), a Delaware banking corporation (as "Delaware Trustee"), and
The Bank of New York, a New York banking corporation, as property trustee (the
"Property Trustee" and, together with the Delaware Trustee and Regular Trustees,
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 November 27, 1996 (the "Base
Indenture"), between the Company and The Bank of New York, as trustee (the "Debt
Trustee"), and a supplement to the Base Indenture, to be dated as of February 3,
1997 (the "Supplemental Indenture," and together with the Base Indenture, the
"Indenture"), between the Company and the Debt Trustee.
SECTION 1. REPRESENTATIONS AND WARRANTIES. (a) The Offerors jointly and
severally represent and warrant to each Underwriter as of the date hereof and as
of the Closing Time (as hereinafter defined) as follows:
(i) At the time the Registration Statement became effective
and as of the date hereof, the Registration Statement complied in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations"), and did 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, dated 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 Securities and that differs from the
Prospectus on file at the Commission at the time the Registration
Statement became effective, in which case, at the time it is first
provided to the Underwriters for such use) and at Closing Time does not
include an untrue statement of a material fact or omit 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;
provided, however, the Offerors make no representations or warranties
as to (A) that part of the Registration Statement which constitutes the
Statements of Eligibility and Qualification (Forms T-1) under the 1939
Act of the Debt
3
Trustee, the Property Trustee or the Guarantee Trustee or (B) the
information contained in or omitted from the Registration Statement or
the Prospectus or any amendment thereof or supplement thereto in
reliance upon and in conformity with information furnished in writing
to the Offerors by or on behalf of any Underwriter through the
Representatives specifically for inclusion in the Registration
Statement and the Prospectus and actually included therein.
(ii) 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").
(iii) To the best knowledge of the Offerors, Price Waterhouse
LLP, the accountants who certified the financial statements and
supporting schedules included in or incorporated by reference into the
Registration Statement, are independent public accountants as required
by the 1933 Act and the 1933 Act Regulations.
(iv) 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 Capital
Securities, the Common Securities and the Declaration; 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.
(v) The Common Securities have been duly authorized by the
Trust pursuant to the Declaration and, when issued and delivered by the
Trust to the Company against payment therefor as 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.
(vi) This Agreement has been duly authorized, executed and
delivered by each of the Offerors.
(vii) The Declaration has been duly authorized by the Company,
as Sponsor, and 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 is
and will be a valid and binding obligation of the Company, the
4
Trust and the Regular Trustees, enforceable against the Company and the
Regular Trustees in accordance with its terms, subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium, fraudulent conveyance or other similar laws
affecting the rights of creditors now or hereafter in effect, and to
equitable principles that may limit the right to specific enforcement
of remedies, and further subject to 12 U.S.C. 1818(b)(6)(D) (or any
successor statute) and any bank regulatory powers now or hereafter in
effect and to the application of principles of public policy
(collectively, the "Permitted Exceptions") and will conform to all
statements relating thereto in the Prospectus; and the Declaration has
been duly qualified under the 1939 Act.
(viii) Each of the Guarantee Agreements has been duly
authorized by the Company and, when validly executed and delivered by
the Company, and, in the case of the Capital Securities Guarantee
Agreement, assuming due authorization, execution and delivery of the
Capital Securities Guarantee 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 Permitted Exceptions, and
each of the Guarantees and the Guarantee Agreements will conform to all
statements relating thereto contained in the Prospectus; and the Trust
pursuant to the Capital Securities Guarantee Agreement will have been
duly qualified under the 1939 Act.
(ix) The Capital Securities have been duly authorized by the
Trust pursuant to the Declaration and, when issued and delivered
pursuant to this Agreement against payment of the consideration
therefor set forth in Schedule B hereto 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 Capital
Securities is not subject to preemptive or other similar rights; and,
subject to the terms of the Declaration, holders of Capital Securities
will be entitled to the same limitation of personal liability under
Delaware law as extended to stockholders of private corporations for
profit.
(x) 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 Permitted Exceptions.
(xi) None of the Offerors is, and upon the issuance and sale
of the Capital Securities as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus none will be,
an "investment company" or a company
5
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "1940 Act).
(xii) 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 Capital Securities, the Junior Subordinated Notes or the Guarantees
hereunder, except such as may be required under the 1933 Act or the
1933 Act Regulations or state securities laws and the qualification of
the Declaration, the Capital Securities Guarantee Agreement and the
Indenture under the 1939 Act.
(b) The Company represents and warrants to each Underwriter as
of the date hereof and as of the Closing Time as follows:
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, there has been no 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.
(ii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of North Carolina with corporate power 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, as Sponsor, the Indenture and each of the Guarantee
Agreements and to purchase, own, and hold the Common Securities issued
by the Trust; the Company is duly registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended; 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 material to the
Company and its subsidiaries, considered as one enterprise.
(iii) NationsBank, National Association, NationsBank, National
Association (South) and NationsBank of Texas, National Association (or
the successors to such entities) (collectively, the "Principal
Subsidiary Banks") are national banking associations formed under the
laws of the United States and authorized thereunder to transact
business; all of the issued and outstanding capital stock of each
Principal Subsidiary Bank has been duly authorized and validly issued,
is fully paid and non-assessable; and the capital stock of each
Principal Subsidiary Bank owned by the Company, directly or through
subsidiaries, is owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
6
(iv) 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 the Company, enforceable
against the Company in accordance with its terms except to the extent
that enforcement thereof may be limited by the Permitted Exceptions;
the Indenture will conform to all statements relating thereto contained
in the Prospectus; and the Indenture has been duly qualified under the
1939 Act.
(v) The Junior Subordinated Notes have been duly authorized by
the Company and 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 Permitted Exceptions,
will be in the form contemplated by, and subject to the Permitted
Exceptions entitled to the benefits of, the Indenture and will conform
to all statements relating thereto in the Prospectus.
(vi) The Company's obligations under the Guarantee Agreements
are subordinate and junior in right of payment to all liabilities of
the Company and are pari passu with the most senior preferred stock
issued by the Company.
(vii) The Junior Subordinated Notes are subordinated and
junior in right of payment to all "Senior Obligations" (as defined in
the Indenture) of the Company.
(viii) Each holder of securities of the Company having rights
to the registration of such securities under the Registration Statement
has waived such rights or such rights have expired by reason of lapse
of time following notification of the Company's intention to file the
Registration Statement.
(ix) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein and
compliance by the Company with its obligations hereunder 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 Principal Subsidiary
Banks pursuant to, any contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company or any of the
Principal Subsidiary Banks 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 Principal Subsidiary Banks 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 materially adverse to the transactions contemplated
by this Agreement), nor will such action result in any material
violation of the provisions of the articles of incorporation or by-laws
of the Company, or any applicable law, administrative regulation or
administrative or court decree.
7
(c) Each certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to each Underwriter
as to the matters covered thereby.
(d) The Trust represents and warrants to each Underwriter as
of the date hereof and as of the Closing Time (as hereinafter defined) as
follows:
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings or
business affairs of the Trust, whether or not arising in the ordinary
course of business, and (B) there have been no transactions entered
into by the Trust, other than in the ordinary course of business, which
are material with respect to the Trust.
(ii) 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
best knowledge of the Trust, threatened, against or affecting the Trust
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, or in the earnings or business affairs of the
Trust, whether or not arising in the ordinary course of business; and
there are no transactions, contracts or documents of 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.
(iii) The Trust possesses adequate certificates, authorities
or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies to conduct the business now operated by
it, and the Trust has not 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 in the earnings or
business affairs of the Trust.
(iv) The execution, delivery and performance of this
Agreement, the Declaration and the Guarantee Agreements, the issuance
and sale of the Capital Securities and the Common Securities, and the
consummation of the transactions contemplated herein and therein and
compliance by the Trust with its obligations hereunder and thereunder
have been duly authorized by all necessary action (corporate or
otherwise) on the part of the Trust and do not and will not result in
any violation of 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 under (A) any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or
8
instrument to which the Trust is a party or by which it may be bound or
to which any of its properties may be subject 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, or any of its properties
(except for conflicts, breaches, violations or defaults which would
not, individually or in the aggregate, be materially adverse to the
Trust, or materially adverse to the transactions contemplated by this
Agreement).
(e) Each certificate signed by any Trustee of the Trust and
delivered to the Underwriters or counsel for the Underwriters shall be deemed
to be a representation and warranty by the Trust to each Underwriter as to the
matters covered thereby.
(f) No action has been taken or will be taken in any
jurisdiction by the Underwriters that would permit a public offering of the
Securities in any country or jurisdiction where action for that purpose is
required. Each Underwriter severally agrees with the Offerors that it will
observe all applicable laws and regulations in each jurisdiction in which it
may offer, sell or deliver the Securities. Each Underwriter severally agrees
that it will not, directly or indirectly, offer, sell or deliver Securities or
distribute the Prospectus or any other offering materials in relation to the
Securities except under circumstances that will to the best of its knowledge
and belief result in compliance with any applicable laws and regulations.
(g) Each Underwriter represents and agrees that (a) it has not
offered or sold and, prior to the expiry of six months from the Closing Time,
will not offer or sell in the United Kingdom any Securities to persons in the
United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (whether as principal
or agent) for the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulation 1995 or the Financial Services ▇▇▇ ▇▇▇▇ (the "1986 Act"), (b) it
has complied and will comply with all applicable provisions of the 1986 Act
with respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom, and (c) it has only issued or passed
on, and will only issue or pass on, in the United Kingdom any document
received by it in connection with the issue of the Securities, other than any
document which consists of or any part of listing particulars, supplementary
listing particulars or any other document required or permitted to be
published by listing rules under Part IV of the 1986 Act, to a person who is
of a kind described in Article 11(3) of the Financial Services ▇▇▇ ▇▇▇▇
(Investment Advertisements) (Exemptions) Order 1996 or is a person to whom the
document may otherwise lawfully be issued or passed on.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) 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 each Underwriter, severally and
9
not jointly, and each Underwriter, severally and not jointly, agrees to purchase
from the Trust, at the price per security set forth in the Schedule B, the
number of Capital Securities set forth in Schedule A opposite the name of such
Underwriter (except as otherwise provided in Schedule B), plus any additional
number of Capital Securities that such Underwriter may become obligated to
purchase pursuant to the provisions of Section 9 hereof.
The purchase price per security to be paid by the several Underwriters
for the Capital Securities shall be an amount equal to the initial public
offering price. The initial public offering price per Capital Security shall be
a fixed price to be determined by agreement between the Underwriter and the
Offerors. The initial public offering price and the purchase price are be set
forth in Schedule B. As compensation to the Underwriters for their commitments
hereunder and in view of the fact that the proceeds of the sale of the Capital
Securities will be used to purchase the Junior Subordinated Notes of the
Company, the Company hereby agrees to pay at Closing Time directly to the
Underwriters, a commission per Capital Security determined by agreement between
the Representatives and the Company for the Capital Securities to be delivered
by the Trust hereunder at Closing Time. The commission is set forth in Schedule
B.
(b) Payment of the purchase price for, and delivery of certificates
for, the Capital Securities shall be made at the office of Stroock & Stroock &
▇▇▇▇▇, or at such other place as shall be agreed upon by the Representatives,
the Company and the Trust, at 10:00 A.M. New York time on the fourth business
day (unless postponed in accordance with the provisions of Section 9) after the
date hereof, or such other time not later than ten business days after such date
as shall be agreed upon by the Representatives, the Trust and the Company (such
time and date of payment and delivery being herein called "Closing Time").
Payment shall be made to the Trust by wire transfer or certified or official
bank check or similar same day funds payable to the order of the Trust to an
account designated by the Trust, against delivery to the Representatives for the
respective accounts of the Underwriters of certificates for the Capital
Securities to be purchased by them. Unless otherwise agreed, certificates for
the Capital Securities shall be in the form set forth in the Declaration, and
such certificates shall be deposited with a custodian (the "Custodian") for The
Depository Trust Company ("DTC") and registered in the name of Cede & Co., as
nominee for DTC.
At the Closing Time, the Company will pay, or cause to be paid, the
commission payable at such time to the Underwriters under this Section 2 hereof
by wire transfer or certified or official bank check or checks payable to the
Representatives in same day funds.
SECTION 3. COVENANTS OF THE OFFERORS. Each of the Offerors jointly and
severally covenants with each Underwriter 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
10
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.
(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 Capital
Securities which differs from the prospectus on file at the Commission at the
time the Registration Statement became 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 Underwriters 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 as many 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 a conformed copy 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 1933 Act Regulations.
(e) If at any time when the Prospectus is required by the 1933 Act to
be delivered in connection with sales of the Capital Securities, any event shall
occur as a result of which the Prospectus as then amended or supplemented will
include any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in light of the circumstances
under which they were made not misleading or if it shall be necessary to amend
or supplement the Prospectus in order to comply with the requirements of the
1933 Act or the 1933 Act Regulations, the Offerors will, subject to paragraph
(b) above, promptly prepare and file with the Commission such amendment or
supplement which will correct such statement or omission
11
or an amendment which will effect such compliance and the Offerors will furnish
to the Underwriters a reasonable number of copies of such amendment or
supplement.
(f) The Offerors will endeavor, in cooperation with the Underwriters,
to qualify the Capital Securities (and the Capital 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
Underwriters 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
and to the Underwriters as soon as practicable, but not later than 90 days after
the close of the period covered thereby, an earnings statement (which need not
be audited) of the Company and its subsidiaries, covering an applicable period
beginning not later than the first day of the Company's fiscal quarter next
following the "Effective Date" (as defined in Rule 158(c) under the ▇▇▇▇ ▇▇▇) of
the Registration Statement, which will satisfy the provisions of Section 11(a)
of the 1933 Act.
(h) The Offerors will use best efforts to effect the listing of the
Capital Securities on the Luxembourg Stock Exchange; if the Capital 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 Capital Securities are then listed.
SECTION 4. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of each Offerors' obligations under this Agreement,
and will pay: (i) the printing and filing of the Registration Statement as
originally filed and of each amendment thereto, (ii) the preparation, issuance
and delivery of the certificates for the Capital Securities, (iii) the fees and
disbursements of the Company's and the Trust's counsel and accountants, (iv) the
qualification of the Capital Securities, the Capital Securities Guarantee and
the Junior Subordinated Notes under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the fees and
disbursements of Stroock & Stroock & ▇▇▇▇▇, counsel for the Underwriters, in
connection therewith and in connection with the preparation of any blue sky
survey, (v) the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment thereto, of
each preliminary prospectus, and of the Prospectus and any amendments or
supplements thereto, (vi) the printing and delivery to the Underwriters of
copies of any blue sky survey, (vii) the fee of the National Association of
Securities Dealers, Inc. (the "NASD"), if applicable, (viii) the fees and
expenses of the Debt Trustee, including the fees and disbursements of counsel
for the Debt Trustee in connection with the Indenture and the Junior
Subordinated Notes, (ix) the fees and expenses of the Property Trustee, the
Delaware Trustee and the Guarantee Trustee, including the fees and disbursements
of counsel for the Delaware Trustee in connection with the Declaration and the
Certificate of Trust; (x) any fees payable in connection with the rating of the
Capital Securities and Junior Subordinated Notes; (xi) the cost and charges of
any transfer agent or registrar
12
(xii) the cost of qualifying the Capital Securities with DTC, and (xiii) the
fees and expenses incurred in connection with the listing of the Capital
Securities and, if applicable, the Junior Subordinated Notes on the Luxembourg
Stock Exchange.
If this Agreement is terminated by the Representatives in accordance
with the provisions of Section 5 or Section 9 hereof, the Company shall
reimburse the Underwriters for all of their reasonable out-of-pocket expenses,
including the reasonable fees and disbursements of Stroock & Stroock & ▇▇▇▇▇,
counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Offerors herein contained or in certificates of officers
of the Company or trustees of the Trust, to the performance by the Offerors of
their obligations hereunder, and to the following further conditions:
(a) The Registration Statement shall have become effective prior to the
date hereof or at such later time and date as may be approved 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 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 of ▇▇▇▇▇ ▇▇▇▇▇ Mulliss & ▇▇▇▇▇,
L.L.P., counsel for the Company, dated as of the Closing Time, to the effect of
paragraphs (i) and (v) through (xvii) below, and the favorable opinion of ▇▇▇▇
▇. ▇▇▇▇▇▇▇, General Counsel to the Company, dated as of the Closing Time, to the
effect of paragraphs (ii), (iii) and (iv) below:
(i) The Company is a duly organized and validly existing
corporation in good standing under the laws of the State of North
Carolina, has the corporate power and authority to own its properties,
conduct its business as described in the Prospectus and perform its
obligations under this Agreement, and is duly registered as a bank
holding company under the Bank Holding Company Act of 1956, as amended;
the Principal Subsidiary Banks are national banking associations formed
under the laws of the United States and authorized thereunder to
transact business.
(ii) Except for those jurisdictions specifically enumerated in
such opinion, neither the Company nor any of the Principal Subsidiary
Banks is required to be qualified or licensed to do business as a
foreign corporation in any jurisdiction.
13
(iii) All the outstanding shares of capital stock of each
Principal Subsidiary Bank have been duly and validly authorized and
issued and are fully paid and (except as provided in 12 U.S.C. ss. 55,
as amended) non-assessable, and, except as otherwise set forth in the
Prospectus, all outstanding shares of capital stock of the Principal
Subsidiary Banks (except directors' qualifying shares) are owned,
directly or indirectly, by the Company free and clear of any perfected
security interest and, to the best knowledge of such counsel, any other
security interests, claims, liens or encumbrances.
(iv) To the best knowledge of such counsel, there is no
pending or threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries, of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise, contract, or
other document of a character required to be described in the
Registration Statement or Prospectus, or to be filed as an exhibit,
which is not described or filed as required.
(v) The Registration Statement has become effective under the
1933 Act; to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or
threatened; the Registration Statement, the Prospectus and each
amendment thereof or supplement thereto (other than the financial
statements and other financial and statistical information contained
therein or incorporated by reference therein, as to which such counsel
need express no opinion) comply as to form in all material respects
with the applicable requirements of the 1933 Act and the 1933 Act
Regulations and the 1934 Act and the 1934 Act Regulations.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a legal, valid and binding
instrument enforceable against the Company in accordance with its terms
(subject to the Permitted Exceptions, and except insofar as the
enforceability of the indemnity and contribution provisions contained
in this Agreement may be limited by federal and state securities laws).
(vii) 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 Capital Securities, the
Capital Securities Guarantee and the Junior Subordinated Notes by the
Offerors, except (A) such as may be required under the 1933 Act and the
1933 Act Regulations and such as may be required under the blue sky or
insurance laws of any jurisdiction, and (B) the qualification of the
Declaration, the Capital Securities Guarantee Agreement and the
Indenture under the 1939 Act.
(viii) The Declaration has been duly authorized, executed and
delivered by the Company and the Regular Trustees and has been duly
qualified under the 1939 Act.
14
(ix) Each of the Guarantee Agreements has been duly
authorized, executed and delivered by the Company; the Capital
Securities Guarantee Agreement, 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 that enforcement
thereof may be limited by the Permitted Exceptions; and the Capital
Securities Guarantee Agreement has been duly qualified under the 1939
Act. The Common Securities Guarantee Agreement constitutes 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 Permitted Exceptions.
(x) The Indenture has been duly 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
Permitted Exceptions; the Indenture has been duly qualified under the
1939 Act; and the Indenture conforms to the description thereof in the
Prospectus.
(xi) 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 Permitted
Exception; and the Junior Subordinated Notes conform to the description
thereof in the Prospectus.
(xii) Neither the Company nor the Trust is, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus neither will be, an "investment company" or a company
"controlled" by an "investment company" within the meaning of the 1940
Act.
(xiii) The Common Securities, the Capital Securities and the
Declaration conform in all material respects to all statements relating
thereto contained in the Prospectus.
(xiv) 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.
(xv) The Trust is not a party to or otherwise bound by any
agreement other than those described in the Prospectus.
(xvi) This Agreement has been duly executed and delivered by
the Trust.
15
(xvii) If the Capital Securities are to be listed on the
Luxembourg Stock Exchange, authorization therefor has been given, or
the Company, its agent, the Trust or its agent has filed a listing
application with respect to the Capital Securities with the Luxembourg
Stock Exchange and such counsel has no reason to believe that the
Capital Securities will not be authorized for listing.
In rendering such opinions, such counsels may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
North Carolina or the United States, to the extent deemed proper and specified
in such opinion, upon the opinion of other counsel of good standing believed to
be reliable and who are satisfactory to counsel for the Underwriters; and (B) as
to matters of fact, to the extent deemed proper, on the representations and
warranties of the Offerors contained herein or in the Declaration, the
Indenture, the Guarantee Agreements, that certain subscription agreement, of
even date herewith, between the Company and the Trust covering the Common
Securities and that certain note purchase agreement, of even date herewith,
between the Company and the Trust or on certificates of responsible officers of
the Company and its subsidiaries and public officials.
(2) The favorable opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger,
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 Prospectus and to enter into and perform its
obligations under this Agreement, the Capital Securities and the Common
Securities.
(ii) Assuming due authorization, execution and delivery by the
Company and the Trustees, the Declaration is 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 Permitted Exceptions.
(iii) The Common Securities have been duly authorized by the
Declaration and are validly issued and represent undivided beneficial
interests in the assets of the Trust.
(iv) The Capital 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 Capital 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
16
corporations for profit; and the issuance of the Capital Securities is
not subject to preemptive or other similar rights.
(v) This Agreement has been duly authorized by the Trust.
(vi) The issuance and sale by the Trust of the Capital
Securities and the Common Securities, the execution, delivery and
performance by the Trust of this Agreement, the consummation by the
Trust of the transactions contemplated hereby and the compliance by the
Trust with its obligations hereunder will not violate (A) any of the
provisions of the Certificate of Trust or the Declaration or (B) any
applicable Delaware law or administrative regulation.
(3) The favorable opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger,
Special Delaware counsel to The Bank of New York (Delaware), in form and
substance satisfactory to counsel for the Underwriters, to the effect that:
(i) The Bank of New York (Delaware) is a Delaware banking
corporation with trust powers, duly organized, validly existing and in
good standing under the laws of the State of Delaware with all
necessary power and authority to execute and deliver, and to carry out
and perform its obligations under the terms of the Declaration.
(ii) The execution, delivery and performance by the Delaware
Trustee of the Declaration has been duly authorized by all necessary
corporate action on the part of, the Delaware Trustee. The Declaration
has been duly executed and delivered by the Delaware Trustee, and
constitutes the legal, valid and binding obligation of the Delaware
Trustee, enforceable against the Delaware Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted Exceptions.
(iii) The execution, delivery and performance of the
Declaration by the Delaware Trustee does not conflict with or
constitute a breach of the articles of organization or bylaws of the
Delaware Trustee.
(iv) No consent, approval or authorization of, or registration
with or notice to, any Delaware or federal banking authority is
required for the execution, delivery or performance by the Delaware
Trustee of the Declaration.
(4) The favorable opinion, dated as of Closing Time, of
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, counsel of The Bank of New York, as Debt Trustee
under the Indenture, as Guarantee Trustee under the Capital Securities Guarantee
Agreement, and as Property Trustee under the Declaration, in form and substance
satisfactory to counsel for the Underwriters, to the effect that:
17
(i) The Bank of New York is a New York banking corporation
with trust powers, duly organized, validly existing and in good
standing under the laws of the State of New York with all necessary
power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of the Declaration, the
Indenture and the Capital Securities Guarantee Agreement.
(ii) The execution, delivery and performance by the Debt
Trustee of the Indenture, the execution, delivery and performance by
the Property Trustee of the Declaration, and the execution, delivery
and performance by the Guarantee Trustee of the Capital Securities
Guarantee Agreement have been duly authorized by all necessary
corporate action on the part of the Debt Trustee, the Property Trustee
and the Guarantee Trustee, respectively. The Indenture has been duly
executed and delivered by the Debt Trustee, and constitutes the legal,
valid and binding obligations of the Debt Trustee, enforceable against
the Debt Trustee in accordance with its terms, except as enforcement
thereof may be limited by the Permitted Exceptions. The Declaration has
been duly executed and delivered by the Property Trustee, and
constitutes the legal, valid and binding obligations of the Property
Trustee, enforceable against the Property Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted Exceptions. The Capital Securities Guarantee Agreement has
been duly executed and delivered by the Guarantee Trustee, and
constitutes the legal, valid and binding obligations of the Guarantee
Trustee, enforceable against the Guarantee Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted Exceptions.
(iii) The execution, delivery and performance of the Indenture
by the Debt Trustee, does not conflict with or constitute a breach of
the Articles of Organization or Bylaws of the Debt Trustee. The
execution, delivery and performance of the Declaration by the Property
Trustee does not conflict with or constitute a breach of the Articles
of Organization or Bylaws of the Property Trustee. The execution,
delivery and performance of the Capital Securities Guarantee Agreement
by the Guarantee Trustee does not conflict with or constitute a breach
of the Articles of Organization or Bylaws of the Guarantee Trustee.
(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 Debt Trustee
of the Indenture. 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 of the Declaration. 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 Guarantee Trustee of the Capital Securities
Guarantee Agreement.
18
(5) The favorable opinion, dated as of Closing Time, of
Stroock & Stroock & ▇▇▇▇▇, counsel for the Underwriters, in form and substance
satisfactory to the Underwriters with respect to the legal existence of the
Company and the Trust, the Capital Securities, the Indenture, the Capital
Securities Guarantee Agreement, this Agreement, the Registration Statement, the
Prospectus and other related matters as the Representatives may require.
In giving its opinion, Stroock & Stroock & ▇▇▇▇▇ may rely as
to certain matters of Delaware law upon the opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
Finger, counsel for the Offerors, which shall be delivered in accordance with
Section 5(b)(2) hereto.
(6) The favorable opinion of Stroock & Stroock & ▇▇▇▇▇,
special tax counsel to the Company and the Trust, as to certain Federal tax
matters set forth in the Prospectus under "United States Federal Income
Taxation."
(7) In giving their opinions required by subsection (b), of
this Section, ▇▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇ Mulliss & ▇▇▇▇▇, L.L.P. 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
reference, therein, as to which counsel need make no statement), at the time it
became effective or as of the date of their respective opinions, 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), as at the date hereof 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.
(8) 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
Regular 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 1 hereof are true and correct with the same force and
effect as though expressly made at and as of Closing Time, (iii) the Trust or
the Company, as the case may be, 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.
19
(9) At the Closing Time, Price Waterhouse LLP shall have
furnished to the Representatives a letter or letters (which may refer to letters
previously delivered to the Representatives), dated as of the Closing Time, in
form and substance satisfactory to the Representatives, confirming that the
response, if any, to Item 10 of the Registration Statement is correct insofar as
it relates to them and stating in effect that:
(i) They are independent accountants within the meaning of the
1933 Act and the 1934 Act and the 1933 Act Regulations and the 1934 Act
Regulations.
(ii) In their opinion, the consolidated financial statements
of the Company and its subsidiaries audited by them and included or
incorporated by reference in the Registration Statement and Prospectus
comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act Regulations
with respect to registration statements on Form S-3 and the 1934 Act
and the 1934 Act Regulations.
(iii) On the basis of procedures (but not an audit in
accordance with generally accepted auditing standards) consisting of:
(a) Reading the minutes of the meetings of the shareholders,
the board of directors, executive committee and audit committee of the
Company and the boards of directors and executive committees of its
subsidiaries as set forth in the minute books through a specified date
not more than five business days prior to the date of delivery of such
letter;
(b) Performing the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in SAS No. 71, Interim Financial
Information, on the unaudited condensed consolidated interim financial
statements of the Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement and Prospectus
and reading the unaudited interim financial data, if any, for the
period from the date of the latest balance sheet included or
incorporated by reference in the Registration Statement and Prospectus
to the date of the latest available interim financial data; and
(c) Making inquiries of certain officials of the Company who
have responsibility for financial and accounting matters regarding the
specific items for which representations are requested below;
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
(1) the unaudited condensed consolidated interim
financial statements, included or incorporated by reference in
the Registration Statement and Prospectus, do not comply as to
form in all material respects with the applicable
20
accounting requirements of the 1934 Act and the 1934 Act
Regulations thereunder;
(2) any material modifications should be made to the
unaudited condensed consolidated interim financial statements,
included or incorporated by reference in the Registration
Statement and Prospectus, for them to be in conformity with
generally accepted accounting principles;
(3) (i) at the date of the latest available interim
financial data and at the specified date not more than five
business days prior to the date of the delivery of such
letter, there was any change in the capital stock or the
long-term debt (other than scheduled repayments of such debt)
or any decreases in shareholders' equity of the Company and
the subsidiaries on a consolidated basis as compared with the
amounts shown in the latest balance sheet included or
incorporated by reference in the Registration Statement and
the Prospectus or (ii) for the period from the date of the
latest available financial data to a specified date not more
than five business days prior to the delivery of such letter,
there was any change in the capital stock or the long-term
debt (other than scheduled repayments of such debt) or any
decreases in shareholders' equity of the Company and the
subsidiaries on a consolidated basis, except in all instances
for changes or decreases which the Registration Statement and
Prospectus discloses have occurred or may occur, or Price
Waterhouse LLP shall state any specific changes or decreases.
(iv) The letter shall also state that Price Waterhouse LLP has
carried out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information which are included or incorporated by reference in the
Registration Statement and Prospectus and which are specified by the
Representatives and agreed to by Price Waterhouse LLP, and has found
such amounts, percentages and financial information to be in agreement
with the relevant accounting, financial and other records of the
Company and its subsidiaries identified in such letter.
In addition, at the time this Agreement is executed, Price
Waterhouse LLP shall have furnished to the Representatives a letter or
letters, dated the date of this Agreement, in form and substance
satisfactory to the Representatives, to the effect set forth in this
subsection 9.
(10) 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 Capital
Securities as herein
21
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 Capital Securities as herein
contemplated shall be satisfactory in form and substance to the Representatives
and Stroock & Stroock & ▇▇▇▇▇, counsel for the Underwriters.
(11) At Closing Time, at least one "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the 1933 Act), has rated the Capital Securities in one of its four highest
rating categories and there shall not have occurred any decrease in the ratings
of any of the securities of the Company or of the Capital Securities by any
nationally recognized statistical rating organization, and no such organization
shall have publicly announced that it has under surveillance or review its
rating of any of the Company's securities or any of the Capital Securities for a
possible downgrade.
If any condition specified in this Section shall not have been
fulfilled in all material respects when and as required to be fulfilled, this
Agreement may be terminated by the Representatives by notice to the Offerors, in
writing or by telephone or telegraph confirmed in writing, 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 4 hereof, and except that
Sections 1, 6, and 7 shall survive any such termination and will remain in full
force and effect.
SECTION 6. INDEMNIFICATION AND CONTRIBUTION
(a) The Offerors jointly and severally agree to indemnify and
hold harmless each Underwriter and each of its partners, officers, directors,
and employees and each person, if any, who controls any Underwriter within the
meaning of the 1933 Act or the 1934 Act against any losses, claims, damages or
liabilities, and any action in respect thereof (including, but not limited to,
any loss, claim, damage, liability or action relating to purchases and sales of
the Capital Securities), joint or several, which arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material fact
contained in (A) the Registration Statement, or any amendment or supplement
thereto, including information deemed to be part of the Registration Statement
pursuant to Rule 430A(b) of the 1933 Act Regulations, if applicable, (B) the
Prospectus and any amendment or supplement thereto, or (C) any application or
other document, any amendment or supplement thereto, executed by the Offerors or
based upon information furnished by or on behalf of the Offerors filed in any
jurisdiction in order to qualify the Capital Securities under the securities or
blue sky laws thereof (each, an "Application") or (ii) the omission or alleged
omission to state in the Registration Statement, or any amendment or supplement
thereto, the Prospectus or any amendment or supplement thereto, or any
Application, a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse as incurred each
Underwriter and each such controlling person for any legal and other expenses
incurred in investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that neither of the Offerors
shall be liable to any Underwriter in any such case to the extent that any such
loss, claim, damage or liability arises out of, or is based upon, any untrue
statement or alleged untrue statement made in the Prospectus, including any
amendment or supplement thereto, in reliance upon and in conformity with
22
information furnished in writing to the Offerors by or on behalf of such
Underwriter specifically for inclusion and actually included therein; and
provided further that, as to any Prospectus that has been amended or
supplemented as provided herein, this indemnity agreement shall not inure to the
benefit of any Underwriter, on account of any loss, claim, damage, liability or
action arising out of the sale of Capital Securities to any person by such
Underwriter if (A) such Underwriter failed to send or give a copy of the final
Prospectus as so amended or supplemented to that person at or prior to the
confirmation of the sale of such Capital Securities to such person in any case
where such delivery is required by the 1933 Act, and (B) the untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact in any preliminary Prospectus was corrected in an
amendment or supplement thereto (but only if the sale to such person occurred
after the Offerors provided such Underwriter and the Underwriter received copies
of such amendment or supplement for distribution). This indemnity agreement will
be in addition to any liability which the Offerors may otherwise have.
(b) Each Underwriter, severally and not jointly, will
indemnify and hold harmless the Company, the Trust, the Trustees and each of the
Company's directors, each of its officers and each person, if any, who controls
the Company or the Trust within the meaning of the 1933 Act or the 1934 Act, to
the same extent as the foregoing indemnity from the Offerors to each
Underwriter, but only with reference to written information relating to such
Underwriter furnished to the Offerors by such Underwriter and specifically
included in the Prospectus. This indemnity shall be in addition to any liability
which such Underwriter may otherwise have. The Offerors acknowledge that the
statements set forth in the last paragraph of the cover page (p. S-4) and under
the heading "Underwriting" or "Plan of Distribution" in the Prospectus
constitute the only information furnished in writing by the several Underwriters
for inclusion in the Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against one or more
indemnifying parties under this Section 6, notify such indemnifying party or
parties of the commencement thereof; but the omission so to notify the
indemnifying party or parties will not relieve it or them from any liability
which it or they may have to any indemnified party otherwise than under
subsection (a) or (b) of this Section 6 or to the extent that the indemnifying
party was not adversely affected by such omission. In case any such action is
brought against an indemnified party and it notifies an indemnifying party or
parties of the commencement thereof, the indemnifying party or parties against
which a claim is to be made will be entitled to participate therein and, to the
extent that it or they may wish, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party; provided, however, that if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnifying party shall not have the right to
direct the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and approval by such indemnified party
of counsel appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 6 for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in any
one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the lead Underwriter in the case of paragraph (a) of this Section
6, representing the indemnified parties under such paragraph (a) who are parties
to such action or actions), or (ii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party. After such notice from the
23
indemnifying party to such indemnified party, the indemnifying party will not be
liable for the costs and expenses of any settlement of such action effected by
such indemnified party without the consent of the indemnifying party, which will
not be unreasonably withheld, unless such indemnified party waived its rights
under this Section 6 in writing in which case the indemnified party may effect
such a settlement without such consent.
(d) The Company agrees to indemnify the Trust against all
losses, claims, damages or liabilities due from the Trust under Section 6(a)
hereof.
(e) If the indemnification provided for in the preceding
paragraphs of this Section 6 is unavailable or insufficient to hold harmless an
indemnified party under paragraph (a) or (b) above in respect of any losses,
claims, damages or liabilities (or actions in respect thereof) referred to
therein, then the Offerors or the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to which
the Offerors and one or more of the Underwriters may be subject in such
proportion so that the Underwriters are responsible for that portion represented
by the percentage that the total discounts and/or commissions received by the
Underwriters bears to the sum of such discounts and/or commissions and the
purchase price of the Capital Securities specified in Schedule B hereto and the
Offerors are responsible for the balance; provided, however, that (y) in no case
shall any Underwriter (except as may be provided in any agreement among
Underwriters relating to the offering of the Capital Securities) be responsible
for any amount in excess of the total discounts and/or commissions received by
it with respect to the Capital Securities purchased by such Underwriter under
this Agreement and (z) 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. For
purposes of this Section 6, each person who controls an Underwriter within the
meaning of the 1933 Act shall have the same rights to
24
contribution as such Underwriter, and each person who controls either of the
Offerors within the meaning of either the 1933 Act or the 1934 Exchange Act,
each officer or trustee of the Offerors who shall have signed the Registration
Statement and each director or trustee of the Offerors shall have the same
rights to contribution as the Offerors, subject in each case to clause (y) of
this paragraph (e). Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding against such
party in respect of which a claim for contribution may be made against another
party or parties under this paragraph (e), notify such party or parties from
whom contribution may be sought, but the omission to so notify such party or
parties shall not relieve the party or parties from whom contribution may be
sought from any other obligation it or they may have hereunder or otherwise than
under this paragraph (e).
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers or Trustees of the Offerors
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Offerors and shall survive
delivery of the Capital Securities to the Underwriters.
SECTION 8. TERMINATION OF AGREEMENT.
(a) The Representatives may terminate this Agreement, by
notice to the Offerors, at any time at or prior to Closing Time (i) if there has
been, since the date of this Agreement or since the respective dates as of which
information is given in the Registration Statement, 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, (ii) if there has
occurred any material adverse change in the financial markets in the United
States or elsewhere or any outbreak of hostilities or escalation thereof or
other calamity or crisis or any change or development involving a prospective
change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of the
Representatives, impracticable to market the Capital Securities or to enforce
contracts for the sale of the Capital Securities, (iii) if trading in any
securities of the Company or the Trust has been suspended or materially limited
by the Commission or the applicable exchange, or if trading generally on the New
York Stock Exchange, the American Stock Exchange or on the NASDAQ National
Market, has been suspended, limited or restricted or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices for securities have
been required, by said exchanges or such system or by order of the Commission,
the NASD or any governmental authority, (iv) if a banking moratorium has been
declared by either federal, New York, North Carolina or Delaware authorities, or
(v) if there has been any decrease in the ratings of any of the securities of
the Company or of the Capital Securities by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the ▇▇▇▇ ▇▇▇) or if any such organization shall have publicly announced that it
has under surveillance or review its rating of any of the Company's securities
or any of the Capital Securities for possible downgrade.
(b) If this Agreement is terminated pursuant to this Section
8, such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof,
25
and except that Sections 1, 6, and 7 shall survive any such termination and will
remain in full force and effect.
SECTION 9. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at Closing Time to purchase the Capital
Securities that it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representatives shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the Capital Securities each of the non-defaulting Underwriters shall
be obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
Capital Securities this Agreement shall terminate without liability on
the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives or the Offerors shall
have the right to postpone Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement or Prospectus
or in any other documents or arrangements.
SECTION 10. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to them at NationsBanc Capital Markets, Inc., ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of
▇▇▇▇ ▇. ▇▇▇▇▇▇, Director; notices to the Trust, and the Company shall be
directed to them at NationsBank Corporation, NationsBank Corporate Center, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, attention of ▇▇▇▇ ▇. ▇▇▇▇, Senior
Vice President and Treasurer.
SECTION 11. PARTIES. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the Trust, the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Trust and the Company and their respective successors and
the controlling persons and officers, directors and trustees referred to
26
in Section 6 and their heirs and legal representatives, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
herein contained. This Agreement and all conditions and provisions hereof are
intended to be for the sole and exclusive benefit of the Underwriters and the
Trust and the Company and their respective successors, and said controlling
persons and officers, directors and trustees and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Capital Securities from any Underwriter shall be deemed to be a
successor by reason merely of such purchase.
SECTION 12. GOVERNING LAW AND TIME. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed in said State. Except as otherwise set forth
herein, specified times of day refer to New York City time.
SECTION 13. COUNTERPARTS. This Agreement may be executed by any one or
more of the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
27
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Trust a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Trust and the Company in accordance
with its terms.
Very truly yours,
NATIONSBANK CORPORATION
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
NB CAPITAL TRUST III
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Regular Trustee
CONFIRMED AND ACCEPTED, as of the date first above written:
NATIONSBANC CAPITAL MARKETS, INC.
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
▇▇▇▇▇▇ BROTHERS INC.
For themselves and as Representatives
of the several Underwriters named in
Schedule A hereto.
By: NationsBanc Capital Markets, Inc.
By: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
28
===============================================================================
SCHEDULE A
===============================================================================
NUMBER OF CAPITAL
NAME OF UNDERWRITER SECURITIES
NationsBanc Capital Markets, Inc..................... 134,000
Bear, ▇▇▇▇▇▇▇ & Co. Inc.............................. 133,000
▇▇▇▇▇▇ Brothers Inc.................................. 133,000
Credit Suisse First Boston Corporation............... 20,000
▇.▇. ▇▇▇▇▇▇ Securities Inc........................... 20,000
Prudential Securities Incorporated................... 20,000
Salomon Brothers Inc................................. 20,000
UBS Securities LLC................................... 20,000
500,000,000
29
===============================================================================
SCHEDULE B
===============================================================================
Underwriting Agreement dated January 22, 1997
Registration Statement No. 333-18273
Underwriters: NationsBanc Capital Markets, Inc.
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇ Brothers Inc.
Address of Underwriters: c/o NationsBanc Capital Markets, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Director
Title, Purchase Price and Description of Securities:
Title: Floating Rate Capital Securities due 2027
1. The initial public offering price per security for the
Capital Securities, determined as provided in said Section 2, shall be
$984.90.
2. The purchase price per security for the Capital Securities
to be paid by the several Underwriters shall be $984.90, being an
amount equal to the initial public offering price set forth above.
3. The compensation per Capital Securities to be paid by the
Company to the several Underwriters in respect of their commitments
hereunder shall be $10.00.
30