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Exhibit 10.1
ACE LIMITED
(a Cayman Islands company)
6,000,000 FELINE PRIDES
initially consisting of
6,000,000 Income PRIDES
UNDERWRITING AGREEMENT
Dated: April 6, 2000
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TABLE OF CONTENTS
Section 1. Representations and Warranties................................3
(a) Representations and Warranties by the Company..................3
(1) Compliance with Registration Requirements...............3
(2) Incorporated Documents..................................4
(3) Independent Accountants.................................5
(4) Financial Statements....................................5
(5) No Material Adverse Change in Business..................5
(6) Good Standing of the Company............................6
(7) Good Standing of Corporate Subsidiaries.................6
(8) Good Standing of Partnership Subsidiaries...............7
(9) Capitalization..........................................7
(10) Authorization of the Purchase Contract Agreement........7
(11) Authorization of the Pledge Agreement...................8
(12) Authorization of FELINE PRIDES..........................8
(13) Authorization of Preferred Shares.......................8
(14) Authorization of the Ordinary Shares....................8
(15) Authorization of this Agreement, the Pricing
Agreement and the Remarketing Agreement...............8
(16) Descriptions of the Securities and the Operative
Agreements............................................9
(17) Non-Taxation of Current Payments........................9
(18) Reserves...............................................10
(19) Absence of Defaults and Conflicts......................10
(20) Absence of Proceedings.................................11
(21) Accuracy of Exhibits...................................11
(22) Absence of Further Requirements........................11
(23) Possession of Licenses and Permits.....................11
(24) Insurance Laws.........................................12
(25) Governmental Authorization.............................12
(26) Commodity Exchange Act.................................12
(27) Investment Company Act.................................12
(b) Officers' Certificates..........................................13
Section 2. Sale and Delivery to Underwriters; Closing....................13
(a) Initial Securities.............................................13
(b) Option Securities..............................................13
(c) Pledge of Securities...........................................13
(d) Payment........................................................13
(e) Compensation...................................................14
(e) Denominations; Registration....................................14
Section 3. Covenants of the Company......................................14
(a) Compliance with Securities Regulations and Commission
Requests......................................................14
(b) Filing of Amendments..........................................15
(c) Delivery of Registration Statements...........................15
(d) Delivery of Prospectuses......................................15
(e) Continued Compliance with Securities Laws.....................15
(f) Blue Sky Qualifications.......................................16
(g) Earnings Statement............................................16
(h) Use of Proceeds...............................................16
(i) Restriction on Sale of Securities.............................16
(j) Reporting Requirements........................................17
(k) Documentary, Stamp or Similar Issue Taxes.....................17
(l) Reserve of Ordinary Shares....................................17
Section 4. Payment of Expenses..........................................17
(a) Expenses......................................................17
(b) Termination of Agreement......................................18
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Section 5 Conditions of Underwriters' Obligations......................18
(a) Effectiveness of Registration Statement.......................18
(b) Opinions of Counsel for the Company...........................18
(c) Opinion of Counsel for Purchase Contract Agent................19
(d) Opinion of Counsel for Underwriters...........................19
(e) Officers' Certificate.........................................19
(f) Accountant's Comfort Letters..................................20
(g) Bring-down Comfort Letters....................................20
(h) Ratings.......................................................21
(i) Conditions to Purchase of Option Securities...................21
(j) Additional Documents..........................................22
(k) Termination of Agreement......................................22
Section 6. Indemnification..............................................23
(a) Indemnification of Underwriters..............................23
(b) Indemnification of the Company, Directors and Officers........23
(c) Actions against Parties; Notification.........................24
(d) Settlement without Consent if Failure to Reimburse............24
Section 7. Contribution.................................................24
Section 8. Representations, Warranties and Agreements to Survive
Delivery....................................................26
Section 9. Termination...................................................26
(a) Underwriting Agreement........................................26
(b) Liabilities...................................................27
Section 10. Default by One or More of the Underwriters....................27
Section 11. Notices.......................................................27
Section 12. Parties.......................................................28
Section 13. Consent to Jurisdiction; Miscellaneous........................28
Section 14. Waiver of Immunities..........................................28
Section 15. Judgment Currency.............................................29
Section 16. GOVERNING LAW AND TIME........................................29
Section 17. Effect of Headings............................................29
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SCHEDULE A
SCHEDULE B
EXHIBIT A Form of Opinion of ▇▇▇▇▇▇ and ▇▇▇▇▇▇, the Company's Cayman
Islands Counsel, to be Delivered Pursuant to Section 5(b)
EXHIBIT B Form of Opinion of ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇, the Company's
Bermuda Counsel, to be Delivered Pursuant to Section 5(b)
EXHIBIT C Form of Opinion of ▇▇▇▇▇ ▇. ▇▇▇▇, Esq., General Counsel of
the Company, to be Delivered Pursuant to Section 5(b)
EXHIBIT D Form of Opinion of ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, United States
Counsel for the Company, to be Delivered Pursuant to
Section 5(b)
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ACE LIMITED
(a Cayman Islands Company)
6,000,000 FELINE PRIDES
consisting of
6,000,000 Income PRIDES
UNDERWRITING AGREEMENT
April 6, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION
c/o Merrill ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
World Financial Center
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
ACE Limited, a Cayman Islands company (the "Company"), confirms
its agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇"), Banc of America Securities LLC and
▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation (collectively, the
"Underwriters," which term shall also include any underwriter substituted
as provided in Section 10 hereof), with respect to the issue and sale by
the Company and the purchase by the Underwriters, acting severally and not
jointly, of 6,000,000 FELINE PRIDESSM or the "Initial Securities" which
will initially consist of units (referred to as "Income PRIDESSM") with a
Stated Amount of $50 comprised of (a) a stock purchase contract (the
"Purchase Contract") under which the holder will purchase from the Company
on May 16, 2003 a number of ordinary shares, $0.041666667 par value per
share, of the Company (the "Ordinary Shares") equal to the Settlement Rate
as set forth in the Purchase Contract Agreement (as defined below), and (b)
beneficial ownership of one 8.25% Cumulative Redeemable Preferred Share,
Series A, of the Company, having a liquidation preference of $50 (the
"Preferred Shares") and with respect to the grant by the Company to the
Underwriters, acting severally and not jointly, of an option to purchase up
to an additional 900,000 FELINE PRIDES (the "Option Securities" and,
together with the Initial Securities, being referred to herein as the
"Securities"). In accordance with the terms of the Purchase Contract
Agreement, to be dated as of April 12, 2000, between the Company and The
Bank of New York, as purchase contract agent (the "Purchase Contract
Agent"), the Preferred Shares will be pledged by the Purchase Contract
Agent, on behalf of the holders of the Securities, to The Bank of New York,
as collateral agent (the "Collateral Agent"), pursuant to the Pledge
Agreement, to be dated as of April 12, 2000 (the "Pledge Agreement"), among
the Company, the Purchase Contract Agent and the Collateral Agent, to
secure such holders' obligation to purchase Ordinary Shares under the
Purchase Contracts. Under the terms of the Purchase Contract Agreement and
Pledge Agreement, holders of Income PRIDES are permitted to substitute
certain treasury securities ("Treasury Securities") for the Preferred
Shares as collateral in order to create "Growth PRIDESSM" ("Growth
PRIDES"). Growth PRIDES will consist of a unit with a Stated Amount of $50
comprised of (a) a Purchase Contract and (b) a 1/20th undivided beneficial
interest in a zero-coupon U.S. Treasury Security maturing on May 16, 2003.
The rights and obligations of (i) a holder of Income PRIDES in respect of
Preferred Shares, subject to the pledge thereof, and Purchase Contracts,
(ii) a holder of Growth PRIDES in respect of a beneficial interest in the
Treasury Securities, subject to the pledge thereof, and Purchase Contracts
and (iii) a holder of separately trading Preferred Shares resulting from
the creation of Growth PRIDES ("Separate Preferred Shares") will, in each
case, be evidenced by Security Certificates (the "Security Certificates").
Pursuant to a remarketing agreement (the "Remarketing Agreement")
to be dated as of April 12, 2000, among the Company, the Purchase Contract
Agent and a nationally recognized investment banking firm chosen by the
Company, certain Preferred Shares may be remarketed, subject to certain
terms and conditions.
The Company and certain other entities affiliated therewith have
filed with the Securities and Exchange Commission (the "Commission") a
joint registration statement on Form S-3 (No. 333-78841) and pre-effective
amendments nos. 1 and 2 thereto, for the registration of the Securities and
certain other securities described therein under the Securities Act of
1933, as amended (the "1933 Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations"). Such
registration statement has been declared effective by the Commission. Such
registration statement, in the form in which it became effective, is
referred to herein as the "Registration Statement"; and the final
prospectus and the final prospectus supplement relating to the offering of
the Securities, in the form first furnished to the Underwriters by the
Company for use in connection with the offering of the Securities, are
collectively referred to herein as the "Prospectus"; provided, however,
that all references to the "Registration Statement" and the "Prospectus"
shall also be deemed to include all documents incorporated therein by
reference pursuant to the Securities Exchange Act of 1934, as amended (the
"1934 Act"), prior to the time the applicable final prospectus and the
final prospectus supplement were first furnished to the Underwriters by the
Company; provided, further, that if the Company files a registration
statement with the Commission pursuant to Rule 462(b) of the 1933 Act
Regulations (the "Rule 462(b) Registration Statement"), then, after such
filing, all references to "Registration Statement" shall also be deemed to
include the Rule 462 Registration Statement. A "preliminary prospectus"
shall be deemed to refer to any prospectus relating to the offering of the
Securities that omitted information to be included upon pricing in a form
of prospectus filed with the Commission pursuant to Rule 424(b) of the 1933
Act Regulations and was used after the Registration Statement became
effective and prior to the execution and delivery of this Underwriting
Agreement. For purposes of this Underwriting Agreement, all references to
the Registration Statement, Prospectus or preliminary prospectus or to any
amendment or supplement to any of the foregoing shall be deemed to include
any copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("▇▇▇▇▇").
All references in this Underwriting Agreement to financial
statements and schedules and other information which is "contained,"
"included" or "stated" (or other references of like import) in the
Registration Statement, Prospectus or preliminary prospectus shall be
deemed to mean and include all such financial statements and schedules and
other information which is incorporated by reference in the Registration
Statement, Prospectus or preliminary prospectus, as the case may be, prior
to the execution of this Underwriting Agreement; and all references in this
Underwriting Agreement to amendments or supplements to the Registration
Statement, Prospectus or preliminary prospectus shall be deemed to mean and
include the filing of any document under the 1934 Act which is incorporated
by reference in the Registration Statement, Prospectus or preliminary
prospectus, as the case may be, after the execution of this Underwriting
Agreement.
The Remarketing Agreement, the Purchase Contract Agreement, the
Pledge Agreement and this Agreement are referred to collectively as the
"Operative Agreements."
The Company understands that the Underwriters propose to make a
public offering of the Securities as soon as the Underwriters deem
advisable after this Agreement has been executed and delivered.
Section 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to the Underwriters as of the date hereof, as of the Closing
Time and, if applicable, as of each Date of Delivery (as defined below) (in
each case, a "Representation Date"), as follows:
(1) Compliance with Registration Requirements. The Company meets
the requirements for use of Form S-3 under the 1933 Act. The
Registration Statement (including any Rule 462(b) Registration
Statement) has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement (or such
Rule 462(b) Registration Statement) has been issued under the 1933 Act
and no proceedings for that purpose have been instituted or are
pending or, to the knowledge of the Company, are contemplated by the
Commission, and any request on the part of the Commission for
additional information with respect to the Registration Statement (or
any document incorporated therein by reference pursuant to the ▇▇▇▇
▇▇▇) has been complied with.
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At the respective times the Registration Statement (including any
Rule 462(b) Registration Statement) and any post-effective amendments
thereto (including the filing of the Company's Annual Report on Form 10-K
for the year ended December 31, 1999 with the Commission (the "Annual
Report on Form 10-K")) became effective and at each Representation Date,
the Registration Statement (including any Rule 462(b) Registration
Statement) and any amendments thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading. At the date of the Prospectus, at the Closing Time and
at each Date of Delivery, if any, neither the Prospectus nor any
amendments and supplements thereto included or will include an
untrue statement of a material fact or omitted or will 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. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply
to statements in or omissions from the Registration Statement (or
any amendment thereto) or the Prospectus made in reliance upon and
in conformity with information furnished to the Company in writing
by any Underwriter expressly for use in the Registration Statement
(or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto).
Each preliminary prospectus and prospectus filed as part
of the Registration Statement as originally filed or as part of
any amendment thereto, or filed pursuant to Rule 424 under the
1933 Act, complied when so filed in all material respects with the
1933 Act Regulations and each preliminary prospectus and the
Prospectus delivered to the Underwriters for use in connection
with the offering of the Securities will, at the time of such
delivery, be identical to any electronically transmitted copies
thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(2) Incorporated Documents. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement and the
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 thereunder (the "1934 Act Regulations") and, when
read together with the other information in the Prospectus, at the
date of the Prospectus, at the Closing Time and at each Date of
Delivery, if any, did not and 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, in the light of the
circumstances under which they were made, not misleading.
(3) Independent Accountants. The accountants who certified or shall
certify the financial statements and any supporting schedules thereto of
the Company included in the Registration Statement and the Prospectus are
independent public accountants with respect to the Company and its
subsidiaries as required by the 1933 Act and the 1933 Act Regulations.
(4) Financial Statements. The financial statements of the Company
included in the Registration Statement and the Prospectus,
together with the related schedules and notes, as well as those
financial statements, schedules and notes of any other entity
included therein, present fairly the financial position of the
Company and its consolidated subsidiaries, or such other entity,
as the case may be, at the dates indicated and the statement of
operations, stockholders' equity and cash flows of the Company and
its consolidated subsidiaries, or such other entity, as the case
may be, for the periods specified. Such financial statements have
been prepared in conformity with United States generally accepted
accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved, except as indicated therein or in
the notes thereto. The supporting schedules, if any, included in
the Registration Statement and the Prospectus present fairly in
accordance with GAAP the information required to be stated
therein. The selected financial data and the summary financial
information, if any, included in the Prospectus present fairly the
information shown therein and have been compiled on a basis
consistent with that of the related audited financial statements
included in the Registration Statement and the Prospectus. The pro
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forma financial statements of the Company and its subsidiaries and
the related notes thereto included in the Registration Statement
and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements and have
been properly compiled on the basis described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(5) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein (i) neither the
Company nor any of its subsidiaries has sustained any material
loss or material interference with its business from any action,
notice, order or decree from an insurance regulatory authority and
(ii) there has been (A) no material adverse change in case
reserves or losses or loss expense of the Company and its
consolidated subsidiaries and (B) no material adverse change, nor
any development or event involving a prospective material adverse
change, in the financial condition, business, or results of
operations of the Company and its subsidiaries considered as one
enterprise, in either case whether or not arising in the ordinary
course of business (a "Material Adverse Change").
(6) Good Standing of the Company. The Company has been duly
organized and is subsisting and in good standing under the laws of the
Cayman Islands, with corporate power and authority to own, lease
and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its
obligations under, or as contemplated under, the Operative
Agreements to which it is a party. The Company is duly qualified
to transact business as a foreign corporation and is in good
standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except where the failure to so qualify or be in
good standing would not reasonably be expected to result in a
Material Adverse Change.
(7) Good Standing of Corporate Subsidiaries. Each subsidiary of the
Company, other than such subsidiaries as would not, individually
or in the aggregate, constitute a "significant subsidiary" as such
term is defined in Rule 1-02 of Regulation S-X promulgated under
the 1933 Act (each, a "Significant Subsidiary") which is a
corporation has been duly incorporated or organized and is an
existing corporation in good standing (with respect to
jurisdictions which recognize such concept) under the laws of the
jurisdiction of its incorporation, with corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus; and each such
Significant Subsidiary of the Company is duly qualified to
transact business as a foreign corporation and is in good standing
(with respect to jurisdictions which recognize such concept) in
all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such
qualification, except where the failure to so qualify or be in
good standing would not reasonably be expected to result in a
Material Adverse Change; all of the issued and outstanding capital
stock of each such Significant Subsidiary of the Company has been
duly authorized and validly issued and is fully paid and
nonassessable; and all of the issued and outstanding capital stock
of each such Significant Subsidiary is owned by the Company,
directly or through subsidiaries, except for de minimis
shareholdings as required to comply with applicable law, and such
capital stock is owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity (except for
restrictions on transferability of the shares of insurance
subsidiaries under applicable law).
4
(8) Good Standing of Partnership Subsidiaries. Each Significant
Subsidiary of the Company which is a partnership has been duly
formed and is an existing partnership in good standing (with
respect to jurisdictions which recognize such concept) under the
laws of the jurisdiction of its formation, with power and
authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus; and each such
Significant Subsidiary of the Company is duly qualified to
transact business and is in good standing (with respect to
jurisdictions which recognize such concept) in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where
the failure to so qualify or be in good standing would not
reasonably be expected to result in a Material Adverse Change; all
of the outstanding equity interests of each such Significant
Subsidiary of the Company have been duly authorized and validly
issued; and all of the equity interests of each such Significant
Subsidiary are owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity (other than immaterial
amounts necessary to comply with applicable law).
(9) Capitalization. The authorized, issued and outstanding shares of
capital stock of the Company set forth in the Prospectus in the
column entitled "Actual" under the caption "Capitalization"
(except for subsequent issuances thereof, if any, pursuant to
reservations, agreements or employee benefit plans or pursuant to
the exercise of convertible securities or options). Such shares of
capital stock have been duly authorized and validly issued by the
Company and are fully paid and non-assessable, and none of such
shares of capital stock was issued in violation of preemptive or
other similar rights of any securityholder of the Company.
(10) Authorization of the Purchase Contract Agreement. The Purchase
Contract Agreement has been duly authorized by the Company and,
when validly executed and delivered by the Company and assuming
due authorization, execution and delivery of the Purchase Contract
Agreement by the Purchase Contract Agent, the Purchase Contract
Agreement will constitute a valid and binding agreement of the
Company, enforceable against the Company in accordance with its
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights
generally or by general equitable principles (regardless of
whether enforcement is considered in a proceeding at law or in
equity).
(11) Authorization of the Pledge Agreement. The Pledge Agreement
has been duly authorized by the Company and, when validly executed and
delivered by the Company and assuming due authorization, execution
and delivery of the Pledge Agreement by the Collateral Agent and
the Purchase Contract Agent, the Pledge Agreement will constitute
a valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by
general equitable principles (regardless of whether enforcement is
considered in a proceeding at law or in equity).
(12) Authorization of the FELINE PRIDES. The FELINE PRIDES have
been duly authorized for issuance and sale to the Underwriters and,
when issued and delivered against payment therefor as provided
herein, will be validly issued and fully paid and non-assessable.
The issuance of the FELINE PRIDES is not subject to preemptive or
other similar rights. All corporate action required to be taken
for the authorization, issuance and delivery of the FELINE PRIDES
have been validly taken.
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(13) Authorization of Preferred Shares. The Preferred Shares have
been duly authorized for issuance by the company and, when issued and
delivered against payment therefor as provided herein, will be
validly issued and fully paid and non-assessable. The issuance of
the Preferred Shares will not be subject to preemptive or other
similar rights. All corporate action required to be taken for the
authorization, issuance and delivery of the Preferred Shares has
been validly taken.
(14) Authorization of the Ordinary Shares. The Ordinary Shares have
been duly authorized and validly reserved for issuance by the Company
and, when issued and delivered in accordance with the provisions of
the Purchase Contract Agreement and the Pledge Agreement, will be
validly issued and fully paid and non-assessable. The issuance of the
Ordinary Shares will not be subject to preemptive or other similar
rights. All corporate action required to be taken for the
authorization, issuance and delivery of the Ordinary Shares has been
validly taken.
(15) Authorization of this Agreement and the Remarketing Agreement.
This Agreement and Remarketing Agreement have been duly authorized,
executed and delivered by the Company.
(16) Descriptions of the Securities and the Operative Agreements.
The Securities and the Operative Agreements, as of each Representation
Date, will conform in all material respects to the statements
relating thereto contained in the Prospectus and will be in
substantially the form filed or incorporated by reference, as the
case may be, as an exhibit to the Registration Statement.
(17) Non-Taxation of Current Payments. Except as disclosed in the
Prospectus, under current laws and regulations of the Cayman Islands and
Bermuda and any political subdivision thereof, all current payments in
respect of Income PRIDES or Growth PRIDES may be paid by the Company to
the holders thereof in United States dollars and freely transferred out of
the Cayman Islands or Bermuda and all such payments made to holders
thereof or therein who are non-residents of the Cayman Islands or Bermuda
will not be subject to income, withholding or other taxes under laws and
regulations of the Cayman Islands or Bermuda or any political
subdivision or taxing authority thereof or therein and will
otherwise be free and clear of any other tax, duty, withholding or
deduction in the Cayman Islands or Bermuda or any political
subdivision or taxing authority thereof or therein and without the
necessity of obtaining any governmental authorization in the
Cayman Islands or Bermuda or any political subdivision or taxing
authority thereof or therein.
(18) Reserves. The description of the Company's reserves and
reserving methodology and assumptions described in the Prospectus is
accurate and fairly presents the information set forth therein in
all material respects and, since the date of the latest financial
statements included in the Prospectus, no loss experience has
developed which would require or make it appropriate for the
Company to alter or modify such methodology.
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(19) Absence of Defaults and Conflicts. None of the Company or any
subsidiary thereof is in violation of its charter or by-laws,
partnership agreement or other constitutive documents or in default in
the performance or observance of any obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any subsidiary thereof is a party
or by which it or any of them may be bound, or to which any of the
assets, properties or operations of the Company or any subsidiary
thereof is subject (collectively, "Agreements and Instruments"),
except for such defaults that would not reasonably be expected to
result in a Material Adverse Change. The entry by the Company into the
Purchase Contacts underlying the Income PRIDES, the offer of the
Securities as contemplated herein and in the Prospectus, the issuance
of the Ordinary Shares and the sale of the Ordinary Shares pursuant to
the Purchase Contracts, the execution, delivery and performance by the
Company of each of the Operative Agreements and any other agreement or
instrument entered into or issued or to be entered into or issued by
the Company in connection with the transactions contemplated hereby or
thereby or in the Registration Statement and the Prospectus, and the
consummation of the transactions contemplated herein and in the
Registration Statement and the Prospectus (including, without
limitation, the issuance and sale of the Securities, and the use of
the proceeds from the sale of the Securities as described under the
caption "Use of Proceeds") and compliance by the Company with its
obligations hereunder and thereunder do not and will not, whether with
or without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any assets, properties or operations
of the Company or any subsidiary thereof pursuant to, any Agreements
and Instruments (except for such conflicts, breaches, defaults or
Repayment Events or liens, charges or encumbrances that would not
reasonably be expected to result in a Material Adverse Change), nor
will such action result in any violation of the provisions of the
charter or by-laws, partnership agreement or other constitutive
documents of the Company or any subsidiary thereof or, to the best
knowledge of the Company, any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any subsidiary thereof or over any of
their assets, properties or operations, except for such violations
under any applicable law, statute, rule, regulation, judgement, order,
writ or decree as would not reasonably be expected to result in a
Material Adverse Change. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any
subsidiary thereof.
(20) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending or, to the knowledge of
the Company, threatened, against or affecting the Company or any
subsidiary thereof which is required to be disclosed in the Registration
Statement and the Prospectus (other than as disclosed therein), or which
would reasonably be expected to result in a Material Adverse Change, or
which would reasonably be expected to materially and adversely affect the
ability of the Company to perform its obligations any of the Operative
Agreements to which it is a party.
7
(21) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or
to be filed as exhibits thereto which have not been so described
and filed as required.
(22) Absence of Further Requirements. No consent, approval,
authorization, or order of, or filing with, any governmental
agency or body or any court, domestic or foreign, is required for
the entry into the Purchase Contracts underlying the Income PRIDES
or in connection with the issuance, offering and sale of the
Securities and the issuance and sale of the Ordinary Shares by the
Company pursuant to such Purchase Contracts, for the due
authorization, execution or delivery by the Company of the
Operative Agreements or for the performance by the Company of its
obligations under any of the Operative Agreements, except such as
have been obtained or made prior to the Closing Date, such as have
been obtained and made under the 1933 Act, such filing of the
Prospectus as has been made with the Bermuda Registrar of
Companies under the Companies ▇▇▇ ▇▇▇▇ of Bermuda and such as may
be required under state securities laws.
(23) Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses")
issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business
now operated by them, except where the failure to so possess any
such Governmental Licenses would not, singly or in aggregate,
reasonably be expected to result in a Material Adverse Change. The
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate,
reasonably be expected to result in a Material Adverse Change.
Neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification
of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to result in a Material
Adverse Change.
(24) Insurance Laws. Each of the Company and its insurance
subsidiaries (including insurance holding companies) is duly registered,
licensed or admitted as an insurer or an insurance holding company
(as applicable) in each jurisdiction where it is required to be so
licensed or admitted to conduct its business as presently
conducted, except where the failure to be so registered, licensed
or admitted would not reasonably be expected to result in a
Material Adverse Change; each of the Company and its insurance
subsidiaries (including insurance holding companies) is in
compliance with all applicable insurance statutes and regulations
and has filed all reports, documents or other information required
to be filed under such statutes and regulations, except where the
failure to comply or file would not reasonably be expected to
result in a Material Adverse Change.
(25) Governmental Authorization. Except as set forth in the
Registration Statement and the Prospectus, no authorization,
approval or consent of any governmental authority or agency is
required (other than any license as an insurer or insurance
holding company and other than those which have already been
obtained) under the laws of any jurisdiction in which the Company
or any of its subsidiaries conduct their respective businesses in
connection with the ownership, directly or indirectly, by the
Company of equity interests in any subsidiary or the repatriation
of any amount from or to the Company or any of its subsidiaries,
except to the extent that the failure to obtain such
authorization, approval or consent would not reasonably be
expected to result in a Material Adverse Change.
8
(26) Commodity Exchange Act. The Securities, upon issuance, will be
excluded or exempted under, or beyond the purview of, the Commodity
Exchange Act, as amended (the "Commodity Exchange Act"), and the rules
and regulations of the Commodity Futures Trading Commission under the
Commodity Exchange Act (the "Commodity Exchange Act Regulations").
(27) Investment Company Act. The Company is not, 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 will not be, an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "1940
Act").
(b) Officers' Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries and delivered to the Underwriters or to
counsel for the Underwriters in connection with the offering of the
Securities shall be deemed a representation and warranty by the Company or
such subsidiary, as the case may be, to each Underwriter as to the matters
covered thereby on the date of such certificate and, unless subsequently
amended or supplemented, at each Representation Date subsequent thereto.
Section 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations, warranties
and agreements herein contained and subject to the terms and conditions herein
set forth, the Company agrees to sell to each Underwriter, severally and
not jointly, and each Underwriter, severally and not jointly, agrees to
purchase from the Company, at the price per security set forth in Schedule
B, the number of Initial Securities set forth in Schedule A hereto opposite
the name of such Underwriter, plus any additional number of Initial
Securities that such Underwriter may become obligated to purchase pursuant
to the provisions of Section 10 hereof.
(b) Option Securities. On the basis of the representations, warranties
and agreements herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters,
severally and not jointly, to purchase at their election up to an
additional 900,000 FELINE PRIDES, consisting solely of Income PRIDES, at
the price per Security set forth in Schedule B. The option will expire
automatically at the close of business on the 30th calendar day after the
date hereof and may be exercised in whole or in part from time to time only
for the purpose of covering over-allotments which may be made in connection
with the offering and distribution of the Initial Securities upon notice by
the Underwriters to the Company setting forth the aggregate number of
additional Option Securities as to which the several Underwriters are then
exercising the option and the time, date and place of payment and delivery
for such Option Securities. Any such time and date of payment and delivery
(a "Date of Delivery") shall be determined by the Underwriters and the
Company, but shall not be later than seven full business days after the
exercise of said options, nor in any event prior to the Closing Time,
unless otherwise agreed upon by the Underwriters and the Company. If the
option is exercised as to all or any portion of the Option Securities, each
of the Underwriters, severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased
which the number of Initial Securities each such Underwriter has severally
agreed to purchase bears to the total number of Initial Securities, subject
to such adjustments as the Underwriters in their discretion shall make to
eliminate any sales or purchases of a fractional number of Option
Securities.
9
(c) Pledge of Securities. The Preferred Shares will be pledged with the
Collateral Agent to secure the obligations of holders of the Income PRIDES
to purchase Ordinary Shares under the Purchase Contracts. Such pledge shall
be effected by the transfer to the Collateral Agent of the Preferred
Securities at the Closing Time and appropriate Date of Delivery, if any, in
accordance with the Pledge Agreement.
(d) Payment. Payment of the purchase price for, and delivery of, the
Initial Securities shall be made at the offices of ▇▇▇▇▇ & ▇▇▇▇ LLP, One
World Trade Center, New York, New York, or at such other place as shall be
agreed upon by the Underwriters and the Trust, at 9:00 A.M. (Eastern time)
on the third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time)
on any given day) business day after the date of this Underwriting
Agreement (unless postponed in accordance with the provisions of Section 10
hereof), or such other time not later than ten business days after such
date as shall be agreed upon by the Underwriters and the Company (such time
and date of payment and delivery being herein called "Closing Time"). In
addition, in the event that the Underwriters have exercised their option to
purchase any or all of the Option Securities, payment of the purchase price
for, and delivery of such Option Securities, shall be made at the
above-mentioned offices of ▇▇▇▇▇ & Wood LLP, or at such other place as
shall be agreed upon by the Underwriters and the Company, on the relevant
Date of Delivery as specified in the notice from the Underwriters to the
Company.
Payment shall be made to the Company by wire transfer of
immediately available funds to a bank account designated by the Company,
against delivery to the Underwriters for the respective accounts of the
Underwriters of the Securities to be purchased by them. It is understood
that each Underwriter has authorized ▇▇▇▇▇▇▇ ▇▇▇▇▇, for its account, to
accept delivery of, receipt for, and make payment of the purchase price
for, the Securities which it has severally agreed to purchase. ▇▇▇▇▇▇▇
▇▇▇▇▇, individually and not as representative of the Underwriters, may (but
shall not be obligated to) make payment of the purchase price for the
Initial Securities or the Option Securities, if any, to be purchased by any
Underwriter whose funds have not been received by the Closing Time or the
relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(e) Denominations; Registration. The Securities and certificates for the
Securities shall be in such denominations and registered in such names as
the Underwriters may request in writing at least one full business day
prior to the Closing Time or the relevant Date of Delivery, as the case may
be. The Securities and certificates for the Securities will be made
available for examination and packaging by the Underwriters in The City of
New York not later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time or the relevant Date of Delivery, as the case may be.
Section 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will notify the Underwriters immediately,
and confirm the notice in writing, of (i) the effectiveness of any
post-effective amendment to the Registration Statement or the filing of any
supplement or amendment to the Prospectus, (ii) the receipt of any comments
from the Commission, (iii) any request by the Commission for any amendment
to the Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of
any preliminary prospectus, or of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424 and
will take such steps as they deem necessary to ascertain promptly whether
the Prospectus transmitted for filing under Rule 424 was received for
filing by the Commission and, in the event that it was not, they will
promptly file the Prospectus. The Company 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.
10
(b) Filing of Amendments. The Company will give the Underwriters notice
of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b) of the 1933 Act
Regulations) or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectus, whether pursuant to the 1933 Act, the 1934
Act or otherwise, will furnish the Underwriters with copies of any such
documents a reasonable amount of time prior to such proposed filing or use,
as the case may be, and will give the Underwriters a reasonable opportunity
to comment on any such document prior to such proposed filing or use, as
the case may be.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Underwriters and counsel for the Underwriters, without
charge, 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) and signed copies of all consents and
certificates of experts, and will also deliver to the Underwriters, without
charge, a conformed copy of the Registration Statement as originally filed
and of each amendment thereto (without exhibits) for each of the
Underwriters. The Registration Statement and each amendment thereto
furnished to the Underwriters will be identical to any electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company will deliver to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter may reasonably request, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectus as such Underwriter may reasonably
request. The Prospectus and any amendments or supplements thereto furnished
to the Underwriters will be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the
Securities as contemplated in this Underwriting Agreement and in the
Registration Statement and the Prospectus. If at any time when the
Prospectus is required by the 1933 Act or the 1934 Act to be delivered in
connection with sales of the Securities, any event shall occur or condition
shall exist as a result of which it is necessary, in the opinion of counsel
for the Underwriters or for the Company, to amend the Registration
Statement in order that the Registration Statement will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or to amend or supplement the Prospectus in order that the
Prospectus 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 the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of
such counsel, at any such time to amend the Registration Statement or amend
or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare
and file with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or to
make the Registration Statement or the Prospectus comply with such
requirements, and the Company will furnish to the Underwriters, without
charge, such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
11
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Underwriters may designate and
to maintain such qualifications in effect for a period of not less than one
year from the date of this Underwriting Agreement; provided, however, that
the Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which they are not so qualified or to
subject themselves to taxation in respect of doing business in any
jurisdiction in which they are not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company
will file such statements and reports as may be required by the laws of
such jurisdiction to continue such qualification in effect for a period of
not less than one year from the date of this Underwriting Agreement.
(g) Earnings Statement. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the Prospectus
under "Use of Proceeds".
(i) Restriction on Sale of Securities. During a period of 90 days from
the date of the Prospectus, the Company will not, without the prior written
consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (A) directly or indirectly, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option for the sale of, or otherwise
transfer or dispose of any Securities, Purchase Contracts, preferred
shares, ordinary shares or any security of the Company similar to the
Securities, Preferred Shares, Purchase Contracts or Ordinary Shares or any
security convertible into or exercisable or exchangeable for or repayable
with Securities, Purchase Contracts, Preferred Shares or Ordinary Shares or
any equity securities substantially similar to the Securities, Purchase
Contracts, Preferred Shares or Ordinary Shares; or (B) directly or
indirectly, enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, the economic equivalent of ownership
of the Securities, Purchase Contracts, Preferred Shares or Ordinary Shares,
any security convertible into or exercisable or exchangeable for or
repayable with the Securities, Purchase Contracts, Preferred Shares or
Ordinary Shares or equity securities substantially similar to the
Securities, Purchase Contracts, Preferred Shares or Ordinary Shares whether
any such swap or transaction is to be settled by delivery of Securities,
Purchase Contracts, Preferred Shares or Ordinary Shares or other
securities, in cash or otherwise. The foregoing sentence shall not affect
the ability of the Company to take any such action (i) in connection with
any employee benefit, dividend reinvestment and stock option or stock
purchase plans of the Company or its subsidiaries; (ii) in connection with
the offering of the Securities issued pursuant to this Agreement; (iii) in
connection with any securities issued pursuant to or sold in connection
with any securities of the Company or its subsidiaries, outstanding as of
the date hereof, that are convertible into or exercisable or exchangeable
for or repayable with any securities of the Company and its subsidiaries;
(iv) in connection with Growth PRIDES or Income PRIDES to be created or
recreated upon substitution of Pledged Securities, or Ordinary Shares
issuable upon early settlement of the Income PRIDES or Growth PRIDES; (v)
in connection with any merger, acquisition or acquisition of assets by the
Company, the consideration for which are securities of the Company; or (vi)
upon exercise of stock options.
12
(j) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods required by the 1934 Act and the
1934 Act Regulations.
(k) Documentary, Stamp or Similar Issue Taxes. The Company will jointly
and severally indemnify and hold harmless the Underwriters against any
documentary, stamp or similar issue tax, including any interest and
penalties, on the creation, issue and sale of the Securities and on the
execution and delivery of this Underwriting Agreement. All payments to be
made by the Company hereunder shall be made without withholding or
deduction for or on account of any present or future taxes, duties or
governmental charges whatsoever unless the Company is compelled by law to
deduct or withhold such taxes, duties or charges. In that event, the
Company shall pay such additional amounts as may be necessary in order that
the net amounts received after such withholding or deduction shall equal
the amounts that would have been received if no withholding or deduction
had been made.
(l) Reserve of Ordinary Shares. The Company will reserve and keep
available at all times, free of preemptive or other similar rights and liens
and adverse claims, sufficient Ordinary Shares to satisfy any obligations to
issue Ordinary Shares upon settlement of the Purchase Contracts and shall
take all actions necessary to keep effective the Registration Statement
with respect to the Ordinary Shares.
Section 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Underwriting Agreement, the Purchase
contracts, the Purchase Contract Agreement and the Pledge Agreement
including (i) the preparation, printing and filing of the Registration
Statement (including financial statements and exhibits) as originally filed
and of each amendment thereto, (ii) the preparation, printing and delivery
to the Underwriters of this Underwriting Agreement, any Agreement among
Underwriters, the other Operative Agreements, and such other documents as
may be required in connection with the offering, purchase, sale, issuance
or delivery of the Securities, (iii) the preparation, issuance and delivery
of the Securities and any certificates for the Securities, to the
Underwriters, including any transfer taxes and any stamp or other duties
payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors or agents (including transfer agents and
registrars), as well as the fees and disbursements of the Purchase Contract
Agent, the Collateral Agent, any depositary and their respective counsel,
(v) the qualification of the Securities under state securities laws in
accordance with the provisions of Section 3(f) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection therewith and in connection with the
preparation, printing and delivery of the Blue Sky Survey, and any
amendment thereto, (vi) the printing and delivery to the Underwriters of
copies of each preliminary prospectus and the Prospectus and any amendments
or supplements thereto, (vii) the fees charged by nationally recognized
statistical rating organizations for the rating of the Securities, if
applicable, and (viii) the filing fees incident to, and the reasonable fees
and disbursements of counsel to the Underwriters in connection with, the
review, if any, by the National Association of Securities Dealers, Inc.
(the "NASD") of the terms of the sale of the Securities.
(b) Termination of Agreement. If this Underwriting Agreement is
terminated by the Underwriters in accordance with the provisions of Section 5
or Section 9(a)(i) or 9(a)(ii) hereof, the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
13
Section 5. Conditions of Underwriters' Obligations. The obligations of
the Underwriters to purchase and pay for the Securities pursuant to this
Underwriting Agreement are subject to the accuracy of the representations
and warranties of the Company contained in Section 1 hereof or in
certificates of any officer of the Company or any of its respective
subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations
hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective
under the 1933 Act and no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act and no
proceedings for that purpose shall have been instituted or be pending or
threatened by the Commission, and any request on the part of the Commission
for additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. A prospectus containing
information relating to the description of the Securities, the specific
method of distribution of the Securities and similar matters shall have
been filed with the Commission in accordance with Rule 424(b)(1), (2), (3),
(4) or (5), as applicable.
(b) Opinions of Counsel for the Company. At Closing Time, the
Underwriters shall have received the favorable opinions, each dated as of
Closing Time, of ▇▇▇▇▇▇ and ▇▇▇▇▇▇, Cayman Islands counsel for the Company,
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇, Bermuda counsel for the Company, ▇▇▇▇▇ ▇. ▇▇▇▇,
Esq., General Counsel of the Company, and ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, United States
counsel for the Company, each in form and substance satisfactory to counsel for
the Underwriters, together with signed or reproduced copies of such letters for
each of the other Underwriters, to the effect set forth in: Exhibit A
hereto with respect to the opinion of ▇▇▇▇▇▇ and Calder; Exhibit B hereto
with respect to the opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇; Exhibit C hereto
with respect to the opinion of ▇▇▇▇▇ ▇. ▇▇▇▇, Esq., and Exhibit D hereto
with respect to the opinion of ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, and, as to each
opinion, to such further effect as counsel to the Underwriters may
reasonably request.
(c) Opinion of Counsel for Purchase Contract Agent. At Closing Time, the
Underwriters shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, counsel to the Purchase Contract
Agent, in form and substance satisfactory to counsel for the Underwriters,
to the effect that:
(i) The Bank of New York is duly incorporated and is validly
existing as a national banking association with trust powers under
the laws of the United States with all necessary power and authority to
execute, deliver and perform its obligations under the Purchase
Contract Agreement, the Pledge Agreement and the Remarketing
Agreement;
(ii) The execution, delivery and performance by the Purchase
Contract Agent of the Purchase Contract Agreement, the Pledge Agreement
and the Remarketing Agreement, and the authentication and delivery of the
Securities have been duly authorized by all necessary action on the part
of the Purchase Contract Agent. The Purchase Contract Agreement, the
Pledge Agreement and the Remarketing Agreement have been duly executed
and delivered by the Purchase Contract Agent, and constitute the legal,
valid and binding obligations of the Purchase Contract Agent, enforceable
against the Purchase Contract Agent in accordance with their respective
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by general
equitable principles (regardless of whether enforcement is considered in
a proceeding at law or in equity);
(iii) The execution, delivery and performance of the Purchase
Contract Agreement, the Pledge Agreement and the Remarketing Agreement by
the Purchase Contract Agent does not conflict with or constitute a
breach of the charter or by-laws of the Purchase Contract Agent;
and
14
(iv) No consent, approval or authorization of, or registration
with or notice to, any Illinois or federal governmental authority or
agency is required for the execution, delivery or performance by
the Purchase Contract Agent of the Purchase Contract Agreement,
the Pledge Agreement and the Remarketing Agreement.
(d) Opinion of Counsel for Underwriters. At Closing Time, the
Underwriters shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Underwriters, in form and substance
reasonably satisfactory to the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters. In
giving such opinion, such counsel may rely, as to all matters governed by
the laws of jurisdictions other than the law of the State of New York, the
federal law of the United States and the General Corporation Law of the
State of Delaware, upon the opinions of counsel satisfactory to the
Underwriters. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper,
upon certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(e) Officers' Certificate. At Closing Time, the Underwriters shall have
received a certificate of the Chairman, President and Chief Executive
Officer or the General Counsel and Secretary of the Company and of the
chief financial officer, chief accounting officer or chief investment
officer of the Company, dated as of Closing Time, to the effect that (i)
there has not been, since the date of this Underwriting Agreement or since
the respective dates as of which information is given in the Prospectus,
any material adverse change, or any development or event involving a
prospective material adverse change, in the financial condition, business
or results of operations of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business,
(ii) the representations and warranties of the Company in Section 1(a) are
true and correct with the same force and effect as though expressly made at
and as of the Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the 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 instituted, are pending or,
to the best of such officers' knowledge, are threatened by the Commission.
(f) Accountant's Comfort Letters. At the time of the execution of this
Underwriting Agreement, the Underwriters shall have received from
PricewaterhouseCoopers LLP a letter, dated such date, in form and substance
satisfactory to the Underwriters, together with signed or reproduced copies
of such letters for each of the other Underwriters, 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 contained in the Registration Statement and
the Prospectus.
(g) Bring-down Comfort Letters. At Closing Time, the Underwriters shall
have received from PricewaterhouseCoopers LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (j) of this Section 5, except that the
specified date referred to shall be a date not more than three business
days prior to the Closing Time.
(h) Ratings. At Closing Time and at any relevant Date of Delivery, the
Securities shall be rated no lower than "BBB" by Standard & Poor's Rating
Service and "a2" by ▇▇▇▇▇'▇ Investors Service, Inc., and the Company shall
have delivered to the Underwriters a letter, dated as of such date, from
each such rating organization, or other evidence satisfactory to the
Underwriters, confirming that the Securities have such ratings. Since the
time of execution of this Underwriting Agreement, there shall not have
occurred a downgrading in, or withdrawal of, the rating assigned to the
Securities or any of the Company's securities or the Company's financial
strength or claims paying ability by any such rating organization or any
other "nationally recognized statistical rating organization," as defined
for purposes of Rule 436(g)(2) under the 1933 Act Regulations, and no such
rating organization shall have publicly announced that it has under
surveillance or review with negative implications its rating of the
Securities or any of the Company's securities or the Company's financial
strength or claims paying ability.
15
(i) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option to purchase all or any portion of the
Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by the
Company or any of its subsidiaries hereunder shall be true and correct as
of each Date of Delivery, and, at the relevant Date of Delivery the
Underwriters shall have received:
(1) The favorable opinions of (i) ▇▇▇▇▇▇ and Calder, Cayman Islands
counsel for the Company, (ii) ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇, Bermuda
counsel for the Company, (iii) ▇▇▇▇▇ ▇. ▇▇▇▇, Esq., General
Counsel of the Company, and (iv) ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, United
States counsel for the Company, each in form and substance
satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities and otherwise to the
same effect as the opinions required by Section 5(b) hereof.
(2) The favorable opinion of ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, counsel to
the Purchase Contract Agent, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities and otherwise to the same effect
as the opinion required by Section 5(c) hereof.
(3) The favorable opinion of ▇▇▇▇▇ & Wood LLP, counsel for the
Underwriters, in form and substance reasonably satisfactory to the
Underwriters, dated such Date of Delivery, relating to the Option
Securities and otherwise to the same effect as the opinion
required by Section 5(d) hereof.
(4) A certificate, dated such Date of Delivery, of the Chairman,
President and Chief Executive Officer or the General Counsel and
Secretary of the Company and of the chief financial officer, chief
accounting officer or chief investment officer of the Company,
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(e) hereof remains true and correct as of
such Date of Delivery.
(5) A letter from PricewaterhouseCoopers LLP, in form and
substance satisfactory to the Underwriters and dated such Date of
Delivery, substantially the same in form and substance as the letter
furnished to the Underwriters pursuant to Section 5(f) hereof,
except that the "specified date" on the letter furnished pursuant
to this paragraph shall be a date not more than three business
days prior to such Date of Delivery.
(j) Additional Documents. At Closing Time and at each Date of Delivery,
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 Securities as herein contemplated, 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 Company in connection with the issuance and sale of
the Securities as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
(k) Termination of Agreement. If any condition specified in this
Section 5 shall not have been fulfilled when and as required to be fulfilled,
this Underwriting Agreement (or, with respect to the Underwriters' exercise of
the over-allotment option for the purchase of Option Securities on a Date
of Delivery after the Closing Time, the obligations of the Underwriters to
purchase the Option Securities on such Date of Delivery) may be terminated
by the Underwriters by notice to the Company at any time at or prior to the
Closing Time (or such Date of Delivery, as applicable), and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
16
Section 6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act as follows:
(1) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein
not misleading or arising out of any untrue statement or alleged
untrue statement of a material fact included in any preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading;
(2) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 6(d)
below) any such settlement is effected with the written consent of
the Company; and
(3) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under
(1) or (2) above;
provided, however, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Underwriters expressly for use
in the Registration Statement (or any amendment thereto), or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) Indemnification of the Company, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Company,
its directors, each of its officers who signed the Registration Statement
and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and
all loss, liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto),
or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Underwriters expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
17
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may
be sought hereunder, but failure to so notify an indemnifying party shall
not relieve such indemnifying party from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by the Underwriters, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel
to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event
shall the indemnifying parties be liable for fees and expenses of more than
one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances. No indemnifying party
shall, without the prior written consent of the indemnified parties, settle
or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever in respect of
which indemnification or contribution could be sought under this Section 6
or Section 7 hereof (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent
(i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or
claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel, such indemnifying
party agrees that it shall be liable for any settlement of the nature
contemplated by Section 6(a)(2) effected without its written consent if (i)
such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party
shall have received notice of the terms of such settlement at least 30 days
prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with
such request prior to the date of such settlement.
Section 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute
to the aggregate amount of such losses, liabilities, claims, damages and
expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by
the Company, on the one hand, and the Underwriters, on the other hand, from
the offering of the Securities pursuant to this Underwriting Agreement or
(ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative
fault of the Company, on the one hand, and the Underwriters, on the other
hand, in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
18
The relative benefits received by the Company, on the one hand,
and the Underwriters, on the other hand, in connection with the offering of
the Securities pursuant to this Underwriting Agreement shall be deemed to
be in the same respective proportions as the total net proceeds from the
offering of such Securities (before deducting expenses) received by the
Company and the total underwriting commission received by the Underwriters,
in each case as set forth on the cover of the Prospectus, bear to the
aggregate initial public offering price of such Securities as set forth on
such cover.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such 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 or by the Underwriters and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this
Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of any
such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls
an Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company
who signed the Registration Statement and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as the Company.
The Underwriters' respective obligations to contribute pursuant to this
Section 7 are several in proportion to the principal amount of Initial
Securities set forth opposite their respective names in Schedule A hereto,
and not joint.
Section 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this
Underwriting Agreement or in certificates of officers of the Company or any
of its subsidiaries 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
Company, and shall survive delivery of and payment for the Securities.
19
Section 9. Termination.
(a) Underwriting Agreement. The Underwriters may terminate this
Underwriting Agreement by notice to the Company, at any time at or prior to
the Closing Time, if (i) there has been, since the time of execution of
this Underwriting Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change, or any
development or event involving a prospective material adverse change, in
the financial condition, business or results of operations of the Company
and its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, or (ii) there has occurred any material
adverse change in the financial markets in the United States 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
referred to in this clause (ii), the effect of which is such as to make it,
in the judgment of the Underwriters, impracticable to market the Securities
or to enforce contracts for the sale of the Securities, or (iii) trading in
any securities of the Company has been suspended or materially limited by
the Commission or the New York Stock Exchange, or if trading generally on
the New York Stock Exchange or the American Stock Exchange or in the Nasdaq
National Market has been suspended or materially limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices
have been required, by either of said exchanges or by such system or by
order of the Commission, the NASD or any other governmental authority, or
(iv) a banking moratorium has been declared by either U.S. Federal, New
York or Bermuda authorities.
(b) Liabilities. If this Underwriting Agreement is terminated pursuant to
this Section 9, such termination shall be without liability of any party to
any other party except as provided in Section 4 hereof, and provided
further that Sections 1, 6, 7 and 8 shall survive such termination and
remain in full force and effect.
Section 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at the Closing Time or the relevant Date of
Delivery, as the case may be, to purchase the Securities which it or they
are obligated to purchase under this Underwriting Agreement (the "Defaulted
Securities"), then the Underwriters 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 Underwriters 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 number of Securities to be purchased on such date
pursuant to this Underwriting Agreement, 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 under this Underwriting
Agreement bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of
the number of Securities to be purchased on such date pursuant to
this Underwriting Agreement, this Underwriting Agreement (or, with
respect to the Underwriters' exercise of the over-allotment option
for the purchase of Option Securities on a Date of Delivery after
the Closing Time, the obligations of the Underwriters to purchase
such Option Securities on such Date of Delivery) shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
20
In the event of any such default which does not result in (i) a
termination of this Underwriting Agreement or (ii) in the case of a Date of
Delivery after the Closing Time, a termination of the obligations of the
Underwriters and the Company with respect to the related Option Securities,
as the case may be, either the Underwriters or the Company shall have the
right to postpone the Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or the Prospectus or in any
other documents or arrangements.
Section 11. 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 the Underwriters c/o Merrill Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, World Financial Center, ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Director,
Financial Institutions Group; and notices to the Company shall be directed
to it at The ACE Building, 30 Woodbourne Avenue, ▇▇▇▇▇▇▇▇ ▇▇ 08 Bermuda,
attention of the General Counsel and Secretary.
Section 12. Parties. This Underwriting Agreement shall inure to the
benefit of and be binding upon the Underwriters, the Company, and their
respective successors. Nothing expressed or mentioned in this Underwriting
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters, the Company, and their respective
successors and the controlling persons and officers, directors and trustees
referred to in Sections 6 and 7 and their heirs and legal representatives,
any legal or equitable right, remedy or claim under or in respect of this
Underwriting Agreement or any provision herein contained. This Underwriting
Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the parties hereto 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 Securities from any
Underwriter shall be deemed to be a successor by reason merely of such
purchase.
Section 13. Consent to Jurisdiction; Miscellaneous. Each of the parties
hereto hereby expressly and irrevocably submits to the non-exclusive
jurisdiction of any competent court in the place of its domicile and any
United States Federal or New York State court sitting in the Borough of
Manhattan in The City of New York in any action, suit or proceeding arising
out of or relating to this Underwriting Agreement or the transactions
contemplated hereby to the extent that such court has subject matter
jurisdiction over the controversy, and expressly and irrevocably waives, to
the extent permitted under applicable law, any immunity from the
jurisdiction thereof and any claim or defense in such action, suit or
proceeding based on a claim of improper venue, forum non conveniens or any
similar basis to which it might otherwise be entitled in any such action,
suit or proceeding. The Company irrevocably appoints ACE USA, Inc., 1133
Avenue of the Americas, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as its
authorized agent in the Borough of Manhattan in The City of New York upon
which process may be served in any such action, suit or proceeding, and
agrees that service of process upon such agent, and written notice of said
service to the Company by the person serving the same to the address
provided in Section 11, shall be deemed in every respect effective service
of process upon the the Company, in any such action, suit or proceeding.
The Company further agrees to take any and all action as may be necessary
to maintain such designation and appointment of such agent in full force
and effect for a period of seven years from the date of this Underwriting
Agreement.
21
Section 14. Waiver of Immunities. To the extent that the Company or any
of its properties, assets or revenues may have or may hereafter become
entitled to, or have attributed to them, any right of immunity, on the
grounds of sovereignty, from any legal action, suit or proceeding, from
set-off or counterclaim, from the jurisdiction of any court, from service
of process, from attachment upon or prior to judgment, or from attachment
in aid of execution of judgment, or from execution of judgment, other legal
process or proceeding for the giving of any relief or for the enforcement
of any judgment, in any jurisdiction in which proceedings may at any time
be commenced, with respect to their obligations, liabilities or any other
matter under or arising out of or in connection with this Underwriting
Agreement or any additional agreement, the Company hereby irrevocably and
unconditionally, to the extent permitted by applicable law, waives and
agrees not to plead or claim any such immunity and consents to such relief
and enforcement.
Section 15. Judgement Currency. The Company agrees to indemnify each
Underwriter against any loss incurred by such Underwriter as a result of
any judgment or order being given or made for any amount due hereunder and
such judgment or order being expressed and paid in a currency (the
"Judgment Currency") other than United States dollars and as a result of
any variation as between (i) the rate of exchange at which the United
States dollar amount is converted into the Judgment Currency for the
purpose of such judgment or order, and (ii) the rate of exchange at which
such Underwriter is able to purchase United States dollars with the amount
of the Judgment Currency actually received by such Underwriter. The
foregoing indemnity shall constitute a separate and independent obligation
of the Company and shall continue in full force and effect notwithstanding
any such judgment or order as aforesaid. The term "rate of exchange" shall
include any premiums and costs of exchange payable in connection with the
purchase of, or conversion into, the relevant currency.
Section 16. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
Section 17. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this Underwriting Agreement, along with all counterparts, will
become a binding agreement between the Underwriters and the Company in
accordance with its terms.
Very truly yours,
ACE LIMITED
By: -------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: -----------------------------------------
Authorized Signatory
22
Sch-A-1
Schedule A
Number of
Initial
Underwriter Securities
---------- ----------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated..............................
Banc of America Securities LLC.........................
▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation....
Total.......................................... ==========
Sch-A-1
Schedule B
ACE LIMITED
(a Cayman Islands company)
6,000,000 FELINE PRIDES (Stated Amount of $50 per FELINE PRIDES),
consisting of
6,000,000 Income PRIDES
each consisting of
a Purchase Contract of ACE Limited requiring the purchase on
May 16, 2003 (or earlier)
of Ordinary Shares of
ACE Limited
and
an 8.25% Cumulative Redeemable Preferred Share, Series A
of ACE Limited ($50 Liquidation Preference per Share)
1. The initial public offering price per Security, determined as
provided in said Section 2, shall be $50 per Security.
2. The price per Security to be paid by the several Underwriters
shall be equal to the initial public offering price set forth in
paragraph 1 above. The Company shall pay a commission to the
Underwriters equal to nine million dollars ($9,000,000) and, with
respect to the Option Securities, $1.50 per Option Security.
Sch-B-1
Exhibit A
FORM OF OPINION OF ▇▇▇▇▇▇ AND CALDER, THE COMPANY'S
CAYMAN ISLANDS COUNSEL, TO BE DELIVERED
PURSUANT TO SECTION 5(b)
(1) The Company has been duly incorporated and is validly existing
and in good standing as an exempted company, under the laws of the Cayman
Islands, and has the corporate power and corporate authority to own, lease
and operate its property, and to conduct its business, as described in the
Registration Statement and the Prospectus, and to enter into and perform
its obligations under, or as contemplated under, the Operative Agreements.
(2) The authorized share capital of the Company, as set out in its
Memorandum and Articles of Association, conforms as to legal
matters to the description thereof contained in the Registration
Statement and the Prospectus.
(3) The Operative Agreements have been duly authorized, executed and
delivered by the Company.
(4) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, the Operative Agreements
do not and will not (A) violate any provision of the Memorandum
and Articles of Association of the Company; (B) contravene any
provision of any law, public rule or regulation of the Cayman
Islands applicable to the Company; (C) to the best of such
counsel's knowledge, contravene any existing published order or
decree of the courts of the Cayman Islands by which the Company is
bound or by which its properties or assets may be affected; or (D)
require any consent, approval or authorization or order of, or
qualification with, any Cayman Islands governmental agency in
connection with the offer and sale of the Securities.
(5) To the best of such counsel's knowledge, but based only upon a
search of the cause list at the offices of the Grand Courts of the
Cayman Islands, there was no action, suit or proceeding to which
the Company is a party or to which the assets, properties or
operations of the Company is subject, before the courts of the
Cayman Islands at the close of business on [specify a recent
date].
(6) All statements made in the Prospectus with regard to statutes,
regulations, rules, treaties and other laws of the Cayman Islands
(including, but not limited to, insurance, regulatory and tax
matters and the Companies Law (1998 Revision) of the Cayman
Islands) and enforcement of judgments in the Cayman Islands are
accurate.
(7) Pursuant to the Underwriting Agreement, and to the extent that
the laws of the Cayman Islands are relevant, the Company has legally,
validly, effectively and irrevocably submitted to the jurisdiction
of the United States Federal and New York State courts sitting in
the Borough of Manhattan in The City of New York, State of New
York, and has legally, validly and effectively appointed ACE USA,
Inc. as the authorized agent of the Company for the purposes
described in Section 13 of the Underwriting Agreement assuming
this to be the case as a matter of the applicable United States
Federal and New York State laws.
A-1
(8) The choice of the laws of the State of New York, United States
of America as the governing law of the Underwriting Agreement is a
valid and effective choice of law and in an action brought before
a court of competent jurisdiction in the Cayman Islands, the laws
of the State of New York would, to the extent specifically pleaded
and proved as a fact by expert evidence, be recognized and applied
by such court to all issues concerning the formal and essential
validity of the Underwriting Agreement and the interpretation
thereof, except that in any such action such court will apply
those laws of the Cayman Islands as such court characterizes as
procedural, and will not apply those laws of the State of New York
as such court characterizes as procedural.
(9) Although there is no statutory enforcement in the Cayman Islands
of a judgment obtained in New York, the courts of the Cayman
Islands will recognize and enforce a foreign judgment of a court
of competent jurisdiction, based on the principle that a judgment
of a competent foreign court imposes upon the judgment debtor an
obligation to pay the sum for which judgment has been given
provided such judgment is final, for a liquidated sum, not in
respect of taxes or a fine or penalty, and was not obtained in a
manner and is not of a kind the enforcement of which is contrary
to the public policy of the Cayman Islands. A Cayman Islands court
may stay proceedings if concurrent proceedings are being brought
elsewhere. For the purposes of enforcement of a judgment granted
against the Company in respect of the Underwriting Agreement, a
court in the Cayman Islands would recognize the jurisdiction of
the applicable federal or state court to the jurisdiction of which
the Company has submitted rendering such judgment if service of
process on the Company is effected pursuant to and in accordance
with the provisions of the Underwriting Agreement.
(10) On the basis that the Company carries on its business as set
forth in the Prospectus, there is no requirement that it be licensed
under the Insurance Law, 1979, as amended of the Cayman Islands.
(11) The Securities to be purchased by the Underwriters from the
Company have been authorized for issuance and sale to the
Underwriters and, when issued and delivered by the Company
pursuant to the Underwriting Agreement against payment of the
consideration set forth therein, will be validly issued and fully
paid and non-assessable; the issuance of such Securities will not
be subject the preemptive or other similar rights arising by law
or otherwise.
(12) The Ordinary Shares subject to the Purchase Contract Agreement
have been validly authorized and reserved for issuance and, when
issued and delivered by the Company in accordance with the
provisions of the Purchase Contract Agreement, the Purchase
Contracts and the Pledge Agreement, will be fully paid and
non-assessable; the issuance of such Ordinary Shares will not be
subject to preemptive or other similar rights arising by law or
otherwise.
A-2
(13) The Preferred Shares have been duly authorized for issuance by
the company and, when issued and delivered against payment therefor as
provided in the Prospectus, will be validly issued and fully paid
and non-assessable. The issuance of the Preferred Shares will not
be subject to preemptive or other similar rights. All corporate
action required to be taken for the authorization, issuance and
delivery of the Preferred Shares has been validly taken.
[In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the Cayman
Islands, to the extent such counsel deems proper and specified in such
opinion, upon the opinion of other counsel whom such counsel believes to be
reliable (which opinion shall be dated and furnished to the Underwriters at
the Closing Time, shall be satisfactory in form and substance to counsel
for the Underwriters and shall expressly state that the Underwriters may
rely on such opinion as if it were addressed to them), provided that such
counsel shall state in their opinion that they believe that they and the
Underwriters are justified in relying upon such opinion, and (B) as to
matters of fact (but not as to legal conclusions), to the extent such
counsel deems proper, on certificates of responsible officers of the
Company, its subsidiaries and public officials.]
A-3
Exhibit B
FORM OF OPINION OF ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇, THE COMPANY'S
BERMUDA COUNSEL, TO BE DELIVERED
PURSUANT TO SECTION 5(b)
(1) Each of ACE Bermuda Insurance Ltd. and Tempest Reinsurance
Company Limited (collectively, the "Bermuda Insurance Subsidiaries") (A)
is validly existing under the laws of Bermuda as a company with
limited liability and is in good standing under the laws of
Bermuda (meaning that such company has not failed to make any
filing with any Bermuda government authority or to pay any Bermuda
government fee or tax, the failure of which would make such
company immediately liable to be struck off the Register of
Companies and thereby cease to exist under the laws of Bermuda)
and (B) the corporate objects and powers contained in the
Memorandum of Association of each of the Bermuda Insurance
Subsidiaries are sufficient to allow them to carry on their
business and to own, lease and operate its properties as both are
described in the Prospectus.
(2) The Company is validly registered under the Companies ▇▇▇ ▇▇▇▇
as a Permit Company and is in good standing under the laws of Bermuda
(meaning that such company has not failed to make any filing with
any Bermuda government authority or to pay any Bermuda government
fee or tax which is required to be paid in respect of Permit
Companies in Bermuda).
(3) Based solely upon a certified copy of the Register of Members
for each of the Bermuda Insurance Subsidiaries, and without further
inquiry, (A) all of the issued shares in the share capital of each
of the Bermuda Insurance Subsidiaries have been duly and validly
authorized and issued and are fully paid and nonassessable
(meaning that no further sums are required to be paid by the
holders thereof in connection with the issue of such shares); and
(B) the Company is the registered holder of all the issued shares
of each of the Bermuda Insurance Subsidiaries.
(4) Each of the Bermuda Insurance Subsidiaries is duly registered
as an insurer under the Insurance Act of 1978 (Bermuda) and the
regulations promulgated thereunder (together, the "Insurance Act")
and as so registered, each Bermuda Insurance Subsidiary may
conduct the insurance business as described in the Prospectus; and
based solely on the Certificates of Compliance and without
independent inquiry, each of the Bermuda Insurance Subsidiaries
has filed with the appropriate Bermuda governmental authority all
reports, documents or other information required to be filed under
the Insurance Act.
(5) The Company is not registered as an insurer under the Insurance
Act and is therefore not required to comply with the requirements
of the Insurance Act applicable to registered insurers.
(6) The execution and delivery by the Company of, and the
performance by the Company of its obligations under the Operative
Agreements do not and will not (A) violate any provision of the Memorandum
of Association or By-laws of either of the Bermuda Insurance
Subsidiaries or any applicable law, regulation, order or decree in
Bermuda; (B) based solely upon the Cause Book, contravene any
judgment, order or decree by the Bermuda Supreme Court against the
Company or the Bermuda Insurance Subsidiaries; or (C) require any
consent, approval or authorization or order of, or qualification
with, any Bermuda governmental agency.
(7) Based solely upon the Cause Book and without further inquiry,
there is no action, suit or proceeding now pending before the
Bermuda Supreme Court against the Company or the Bermuda Insurance
Subsidiaries or any of their respective properties.
B-1
(8) All statements made in the Registration Statement and Prospectus
with respect to statutes, regulations, rules, treaties and other
laws of Bermuda (including, but not limited to, statements made
with respect to the Insurance Act and Bermuda tax matters) fairly
and accurately present the information set forth therein and such
counsel's opinion as to such matters.
[In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws other than the laws of Bermuda,
to the extent such counsel deems proper and specified in such opinion, upon
the opinion of other counsel whom such counsel believes to be reliable
(which opinion shall be dated and furnished to the Underwriters at the
Closing Time, shall be satisfactory in form and substance to counsel for
the Underwriters and shall expressly state that the Underwriters may rely
on such opinion as if it were addressed to them), provided that such
counsel shall state in their opinion that they believe that they and the
Underwriters are justified in relying upon such opinion, and (B) as to
matters of fact (but not as to legal conclusions), to the extent such
counsel deems proper, on certificates of responsible officers of the
Company, its subsidiaries and public officials.]
B-2
Exhibit C
FORM OF OPINION OF ▇▇▇▇▇ ▇. ▇▇▇▇, ESQ.,
GENERAL COUNSEL OF THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(1) The Company is qualified to do business, and is in good
standing, as a foreign corporation, under the laws of each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that
the failure to be so qualified or to be in good standing would not
singly or in the aggregate result in a Material Adverse Change;
(2) Each of ACE Bermuda Insurance Ltd., Tempest Reinsurance
Company Limited, ACE USA, Inc. and ACE INA Holdings Inc. is qualified to
transact business and is in good standing (with respect to jurisdictions
which recognize such concept) in each jurisdiction in which it owns or
leases real property or in which the conduct of its business requires
such qualification, except where the failure to be so qualified or to be
in good standing (with respect to jurisdictions which recognize such
concept) would not singly or in the aggregate result in a Material Adverse
Change;
(3) Except as set forth in the Registration Statement and the
Prospectus, such counsel does not know of any outstanding (A)
securities or obligations of the Company convertible into or
exchangeable for any shares of capital stock of the Company or any
of its subsidiaries; (B) rights, warrants or options to acquire or
purchase from the Company any shares of capital stock of the
Company or any such convertible or exchangeable securities or
obligations; or (C) obligations or understandings of the Company
to issue or sell any shares of capital stock of the Company or any
of its subsidiaries, any such convertible or exchangeable
securities or obligations, or any such warrants, rights or
obligations; and
(4) To the best of such counsel's knowledge, and other than as
disclosed in the Prospectus, there are no threatened legal
proceedings against the Company or any of its subsidiaries which,
if determined adversely to the Company or such subsidiary, would
result in a Material Adverse Change.
[In rendering such opinion, such counsel may rely as to matters of
fact (but not as to legal conclusions), to the extent such counsel deems
proper, on certificates of responsible officers of the Company, its
subsidiaries and public officials.]
C-1
Exhibit D
FORM OF OPINION OF ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇,
UNITED STATES COUNSEL FOR THE COMPANY,
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(1) Each of ACE INA Holdings Inc. and ACE USA, Inc. is duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware.
(2) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, each of the Operative
Agreements to which it is a party and any other agreement or
instrument entered into or issued or to be entered into or issued
by the Company in connection with the transactions contemplated by
the Registration Statement and the Prospectus and the consummation
by the Company of the transactions contemplated by the Operative
Agreements do not and will not (A) contravene any provision of any
United States federal or New York State law, rule or regulation,
in each case which, in such counsel's opinion, based on such
counsel's experience, are normally applicable to transactions of
the type contemplated by the Operative Agreements ("United States
Applicable Laws"), except that such counsel need not express any
opinion in this paragraph with respect to state securities laws;
(B) contravene any judgment, order or decree known to such counsel
without independent inquiry of any United States federal or New
York State court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or by
which the Company or any of its subsidiaries is bound or by which
their properties or assets may be affected; (C) conflict with,
result in any breach of or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a
default) under, or give rise to any right to accelerate the
maturity or require the prepayment of any indebtedness or the
purchase of any capital stock under, or result in the creation or
imposition of any lien, charge or encumbrance upon any properties
or assets of ACE INA Holdings Inc. or any of its subsidiaries,
pursuant to the terms of, any agreement or instrument filed as an
exhibit to the Company's Annual Report on Form 10-K for the fiscal
year ended December 30, 1999 or any agreement or instrument
otherwise known to such counsel to which the Company or any of its
subsidiaries is a party or by which it or any of them may be
bound, or to which any of the assets, properties or operations of
the Company or any of its subsidiaries is subject, or the
certificate of incorporation or bylaws of ACE INA Holdings Inc. or
ACE USA, except for such conflicts, breaches, violations,
defaults, accelerations, repayments, repurchases, liens, charges
or encumbrances that would not singly or in the aggregate result
in a Material Adverse Change; or (D) based upon such counsel's
review of the United States Applicable Laws, require any consent,
approval or authorization or order of, or qualification with, any
United States federal or state governmental agency or authority or
court, except such as have been obtained under the 1933 Act, the
1933 Act Regulations and such as may be required under state
securities or blue sky laws or state insurance laws in connection
with the offer and sale of the Securities.
(3) The Operative Agreements have been duly authorized, executed
and delivered by the Company.
(4) Assuming due authorization, execution and delivery of the
Purchase Contract Agreement by the Purchase Contract Agent, the Purchase
Contract Agreement constitutes a valid and binding agreement of
the Company, enforceable against the Company in accordance with
its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights
generally or by general equitable principles (regardless of
whether enforcement is considered in a proceeding at law or in
equity).
D-1
(5) Assuming due authorization, execution and delivery of the Pledge
Agreement by the Collateral Agent and the Purchase Contract Agent,
the Pledge Agreement constitutes a valid and binding agreement of
the Company, enforceable against the Company in accordance with
its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights
generally or by general equitable principles (regardless of
whether enforcement is considered in a proceeding at law or in
equity).
(6) The Securities and the Operative Agreements conform in all
material respects to the statements relating thereto contained in
the Prospectus and are in substantially the form filed or
incorporated by reference, as the case may be, as an exhibit to
the Registration Statement.
(7) Such counsel does not know, after inquiry of officers of the
Company and based solely on such inquiry, of any action, suit or
proceeding before or by any United States federal or state
government, governmental instrumentality or court now pending or
threatened against or affecting the Company or any of its
subsidiaries or any of their respective assets or properties that
is required to be described in the Registration Statement or the
Prospectus and is not so described or of any contract or other
document that is required to be described in the Registration
Statement or the Prospectus, or to be filed as an exhibit to the
Registration Statement, that is not described or filed, as
required.
(8) The statements in the Registration Statement and the Prospectus
insofar as they are descriptions of contracts, agreements,
instruments or proceedings, or constitute statements or summaries
of United States federal or New York State laws or legal
conclusions with respect thereto, are accurate and present fairly
the information required to be shown.
(9) The Registration Statement (including any Rule 462(b)
Registration Statement) and the Prospectus, excluding the documents
incorporated by reference therein, and each amendment or
supplement to the Registration Statement (including any Rule
462(b) Registration Statement) and Prospectus, excluding the
documents incorporated by reference therein, as of their
respective effective or issue dates (other than the financial
statements and supporting schedules and other financial data
included therein or omitted therefrom, as to which such counsel
need express no opinion) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(10) The documents incorporated by reference in the Prospectus
(other than the financial statements and supporting schedules and other
financial data included therein or omitted therefrom, as to which
such counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be, complied as
to form in all material respects with the requirements of the 1933
Act or the 1934 Act, as applicable, and the rules and regulations
of the Commission thereunder.
(11) The Securities, upon issuance, will be excluded or exempted
under, or beyond the purview of, the Commodity Exchange Act, as amended
(the "Commodity Exchange Act"), and the rules and regulations of
the Commodity Futures Trading Commission under the Commodity
Exchange Act (the "Commodity Exchange Act Regulations").
(12) The Company is not, and upon the issuance and sale of the
Securities as contemplated in the Underwriting Agreement and the
application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "1940
Act").
D-2
(13) When issued in accordance with the terms of the Purchase
Contract Agreement and delivered against payment therefor as provided in
the Underwriting Agreement, the holders of the Securities will be
entitled to the right and subject to the obligations specified in
the Purchase Contract Agreement.
(14) The provisions of the Pledge Agreement are effective to create
in favor of the Collateral Agent for the benefit of the Company a
valid security interest under the UCC in all "securities
entitlements" (as defined in Section 8-102(a)(17) of the UCC and
the Federal Book-Entry Regulations) now or hereafter credited to
the Collateral Account and relating to the Preferred Shares or the
Treasury Securities (the "Pledged Securities Entitlements"); and
the provisions of the Pledge Agreement are effective under the UCC
and the Federal Book-Entry Regulations to perfect the security
interest of the Collateral Agent for the benefit of the Company in
the Pledged Securities Entitlements.
(15) The Security Certificates are in the form contemplated by the
Purchase Contract Agreement.
Such counsel shall also state that it has been advised by the
Commission that the Registration Statement (including any Rule 462(b)
Registration Statement) became effective under the 1933 Act; that any
required filings of the Prospectus pursuant to Rule 424(b) have been made
in the manner and within the time period required by Rule 424(b); and that,
based solely on conversations with the Commission, no stop order suspending
the effectiveness of the Registration Statement (or such Rule 462(b)
Registration Statement) has been issued and no proceedings for the purpose
have been instituted, are pending or, to such counsel's knowledge, are
contemplated under the 1933 Act.
Such counsel shall also state that they have examined various
documents and participated in conferences with representatives of the
Company and their accountants and with representatives of the Underwriters
and their counsel at which times the contents of the Registration Statement
and the Prospectus and related matters were discussed, and that, although
they are not passing upon and assume no responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus or making any representation that they have
independently verified or checked the accuracy, completeness or fairness of
such statements, except as set forth above, no facts have come to such
counsel's attention that cause such counsel to believe that the
Registration Statement (including any Rule 462(b) Registration Statement)
or any post-effective amendment thereto, at the time the Registration
Statement (including any Rule 462(b) Registration Statement) or any
post-effective amendment thereto (including the filing of the Company's
Annual Report on Form 10-K with the Commission) became effective or as of
the date of the Underwriting Agreement, contained any 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 or any amendment or supplement thereto, at the date of the
Prospectus, at the date of any such amendment or supplement or at the
Closing Time, included or includes any untrue statement of a material fact
or omitted or omits to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (such counsel need
not express a belief with respect to the financial statements and
supporting schedules and other financial data included in or omitted from
the Registration Statement (including any Rule 462(b) Registration
Statement) or any post-effective amendment thereto or the Prospectus or any
amendment or supplement thereto).
[In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the State
of New York, the corporate laws of the State of Delaware or the federal
laws of the United States of America, to the extent such counsel deems
proper and specified in such opinion, upon the opinion of other counsel
whom such counsel believes to be reliable (which opinion shall be dated and
furnished to the Underwriters at the Closing Time, shall be satisfactory in
form and substance to counsel for the Underwriters and shall expressly
state that the Underwriters may rely on such opinion as if it were
addressed to them), provided that such counsel shall state in their opinion
that they believe that they and the Underwriters are justified in relying
upon such opinion, and (B) as to matters of fact (but not as to legal
conclusions), to the extent such counsel deems proper, on certificates of
responsible officers of the Company, its subsidiaries and public
officials.]
D-3