H. F. AHMANSON & COMPANY
("Issuer")
Subordinated Debt Securities
Terms Agreement
---------------
August 24, 1994
H. F. Ahmanson & Company
4900 Rivergrade Road
Irwindale, California 91706
Attention: Chief Financial Officer
The several Underwriters named in Schedule A hereto agree to purchase
the following principal amount of Designated Securities on and subject to the
terms and conditions of the Underwriting Agreement attached hereto
("Underwriting Agreement").
TITLE: 7.875% Subordinated Notes due September 1, 2004.
AGGREGATE PRINCIPAL AMOUNT: $125,000,000.
PRICE TO PUBLIC: 99.534% of the principal amount of the Designated
Securities, plus accrued interest, if any, from August 31, 1994.
PURCHASE PRICE BY UNDERWRITERS: 98.934% of the principal amount of the
Designated Securities.
DELIVERY OF DESIGNATED SECURITIES: The Designated Securities shall be
represented by one or more global certificates that will be deposited with
The Depository Trust Company ("DTC") at least twenty-four hours before the
closing (as specified below) and registered in the name of DTC's nominee.
Ownership interests in the Designated Securities shall be delivered by or
on behalf of the Issuer to the Underwriters in book-entry form through the
book-entry facilities of DTC for the respective accounts of the
Underwriters or their nominees that are participants in DTC, with any
transfer taxes payable in connection with the transfer of the Designated
Securities to the Underwriters duly paid, against payment by the
Underwriters of the purchase price therefor.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE: Immediately available
funds.
INDENTURE: Indenture dated as of August 24, 1994, between the Issuer and
The First National Bank of Chicago, as Trustee.
MATURITY: September 1, 2004.
INTEREST RATE: 7.875% per annum.
INTEREST PAYMENT DATES: September 1 and March 1 of each year, commencing
March 1, 1995.
REDEMPTION PROVISIONS: None.
SINKING FUND PROVISIONS: None.
DEFEASANCE PROVISIONS: All provisions described in the Prospectus are
applicable.
CLOSING: 7:00 A.M., August 31, 1994, at Sullivan & Cromwell, 444 South
Flower Street, Los Angeles, California.
NAMES AND ADDRESS OF THE UNDERWRITERS:
Lehman Brothers Inc.
CS First Boston Corporation
Smith Barney Inc.
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Lehman Brothers Inc. will act for the several Underwriters in
connection with this financing, and any action under this Agreement taken by
Lehman Brothers Inc. will be binding upon all the Underwriters.
The respective amounts of the Designated Securities to be purchased by
each of the Underwriters are set forth opposite their names in Schedule A
hereto.
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Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.
Very truly yours,
LEHMAN BROTHERS INC.
CS FIRST BOSTON CORPORATION
SMITH BARNEY INC.
By Lehman Brothers Inc.
By _____________________________
Herbert McDade III
Managing Director
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SCHEDULE A
PRINCIPAL
AMOUNT OF
DESIGNATED
SECURITIES
TO BE
UNDERWRITER PURCHASED
- - ----------------------------- ------------
Lehman Brothers Inc............... $ 43,000,000
CS First Boston Corporation....... $ 41,000,000
Smith Barney Inc.................. $ 41,000,000
------------
Total................... $125,000,000
============
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To: Lehman Brothers Inc.
CS First Boston Corporation
Smith Barney Inc.
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
We accept the offer contained in the Terms Agreement, dated August 24,
1994, relating to $125,000,000 aggregate principal amount of 7.875% Subordinated
Notes due September 1, 2004. We also confirm that, to the best of our knowledge
after reasonable investigation, the representations and warranties of the
undersigned in the Underwriting Agreement signed by the Issuer and attached
hereto ("Underwriting Agreement") are true and correct, no stop order suspending
the effectiveness of the Registration Statement (as defined in the Underwriting
Agreement) or of any part thereof has been issued and no proceedings for that
purpose have been instituted or, to the knowledge of the undersigned, are
contemplated by the Securities and Exchange Commission and, subsequent to the
respective dates of the most recent financial statements in the Prospectus (as
defined in the Underwriting Agreement), there has been no material adverse
change in the financial position or results of operations of the undersigned and
its subsidiaries except as set forth in or contemplated by the Prospectus.
Very truly yours,
H. F. AHMANSON & COMPANY
By: _____________________________
Anne-Drue Anderson
First Vice President
and Treasurer
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H. F. AHMANSON & COMPANY
Subordinated Debt Securities
Underwriting Agreement
August 24, 1994
To the Representatives of the
several Underwriters named
in the respective Terms
Agreements hereinafter described
Dear Sirs:
1. Introductory. H. F. Ahmanson & Company, a Delaware corporation
(the "Issuer"), proposes to enter into one or more Terms Agreements (each, a
"Terms Agreement") in the form of Annex I hereto with such additions and
deletions as the parties thereto may determine, and subject to the terms and
conditions stated herein and therein, to issue and sell to the Underwriters
named in the applicable Terms Agreement (such firms constituting the
"Underwriters" with respect to such Terms Agreement and the Securities specified
therein), the aggregate principal amount of Subordinated Debt Securities (the
"Securities"), of the Issuer specified in such Terms Agreement (with respect to
such Terms Agreement, the "Designated Securities").
The terms of any particular issuance of Designated Securities shall be
as specified in the Terms Agreement relating thereto and in or pursuant to the
indenture ("Indenture") specified in the Terms Agreement.
Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities for whom firms designated as
representatives of the Underwriters of such Securities in the Terms Agreement
relating thereto will act as Representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as the sole Representative
of the Underwriters and to Underwriters acting without any firm being designated
as their Representative. This Underwriting Agreement shall not be construed as
an obligation on the part of the Issuer to sell any of the Securities or as an
obligation of any of the Underwriters to purchase the Securities. The
obligation of the Issuer to issue and sell any of the Securities and the
obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced by the Terms
Agreement with respect to the Designated Securities specified therein. Each
Terms Agreement shall specify the title of such Designated Securities, the
aggregate principal amount of such Designated Securities, the price to the
public of such Designated Securities, the purchase price to the Underwriters of
such Designated Securities, the names of the Underwriters of such Designated
Securities and the Representatives of such Underwriters and the principal amount
of such Designated Securities to be purchased by each Underwriter and shall set
forth the date, time and manner of delivery of such Designated Securities and
payment therefor. The Terms Agreement shall also specify (to the extent not set
forth in the registration statement and prospectus related thereto) the terms of
such Designated Securities. A Terms Agreement shall be in the form of an
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or other rapid transmission device
designed to produce a written record of communications transmitted.
2. Representations and Warranties of the Issuer. The Issuer
represents and warrants to, and agrees with, each of the Underwriters that:
(a) The registration statement (No. 33-57218) relating to the
Securities (including a prospectus which, as supplemented, shall be used in
connection with sales of the Securities) has been filed with the Securities
and Exchange Commission ("Commission"); and such registration statement and
each post-effective amendment thereto have been declared effective by the
Commission. The registration statement relating to Securities and the
Designated Securities in any offering hereunder, as amended at the time of
any Terms Agreement referred to in Section 1 and Section 3, is hereinafter
referred to as the "Registration Statement," and the prospectus as
supplemented as contemplated by Section 1 and Section 3 to reflect the
terms of the Designated Securities and terms of offering thereof, including
all material incorporated by reference therein, is hereinafter referred to
as the "Prospectus."
(b) On the effective date of the Registration Statement, such
Registration Statement conformed in all respects to the requirements of the
Securities Act of 1933 ("Act") and the rules and regulations of the
Commission ("Rules and Regulations") and did not
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include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and on the date of each Terms Agreement referred to
in Section 1 and Section 3, the Registration Statement and the Prospectus
will conform in all respects to the requirements of the Act and the Rules
and Regulations and neither of such documents will include any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, except
that the foregoing does not apply to statements in or omissions from any
such documents based upon written information furnished to the Issuer by
any Underwriter specifically for use therein.
3. Purchase and Offering. Upon the execution of the Terms Agreement
applicable to any Designated Securities and authorization by the Representatives
of the release of such Designated Securities, the several Underwriters propose
to offer the Designated Securities for sale upon the terms and conditions set
forth in the Prospectus. The obligations of the Underwriters to purchase the
Designated Securities shall be several and not joint. Unless otherwise
specified in the Terms Agreement, certificates representing Designated
Securities to be purchased by each Underwriter pursuant to a Terms Agreement
relating thereto, in definitive form to the extent practicable, and in such
authorized denominations and registered in such names as the Underwriters
request upon at least two full business days' prior notice to the Issuer, shall
be delivered by or on behalf of the Issuer to the Representatives for the
account of such Underwriter, against payment by such Underwriter or on its
behalf of the purchase price therefor by certified or official bank check or
checks payable to the order of the Issuer in the funds specified in such Terms
Agreement, all at the place and time and date specified in such Terms Agreement
or at such other place and time and date as the Representatives and the Issuer
may agree upon in writing, such time and date being herein called a "Closing
Date" for such Designated Securities.
4. Covenants of the Issuer. The Issuer agrees with the several
Underwriters in connection with each offering of the Designated Securities:
(a) The Issuer will prepare the Prospectus and file such Prospectus
pursuant to Rule 424(b) under the
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Act not later than the Commission's close of business on the second
business day following the execution and delivery of each Terms Agreement,
or, if applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Act, and will advise the Representatives promptly of such filing;
the Issuer will file timely all reports and any definitive proxy or
information statements required to be filed by the Issuer with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 ("Exchange Act") for so long as the delivery of a
prospectus is required in connection with the offering of the Designated
Securities.
(b) The Issuer will advise the Representatives promptly of any
amendment or supplementation of the Registration Statement or the
Prospectus and will not effect such amendment or supplementation without
the consent of the Representatives (which consent shall not be unreasonably
withheld, but shall not be deemed a waiver of any condition set forth in
Section 5 below); the Issuer will also advise the Representatives of the
institution by the Commission of any stop order proceedings in respect of
the Registration Statement or of any part thereof, and will use its best
efforts to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Designated
Securities is required to be delivered under the Act, any event occurs as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact, or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend or supplement the Registration Statement or
the Prospectus to comply with the Act, the Issuer promptly will prepare and
file with the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance.
The Underwriters agree to use the Prospectus, as so amended and
supplemented, in lieu of the Prospectus theretofore in effect.
(d) Not later than 18 months after the date of each Terms Agreement,
the Issuer will make generally available to its securityholders an earnings
statement covering a period of at least 12 months beginning after
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the date of such Terms Agreement which will satisfy the provisions of
Section 11(a) of the Act.
(e) The Issuer will furnish to the Representatives copies of the
Registration Statement, including all exhibits, each preliminary prospectus
supplement, the Prospectus and all amendments and supplements to such
documents, in each case as soon as available and in such quantities as are
reasonably requested.
(f) The Issuer will arrange for the qualification of the Designated
Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions within the United States as
the Representatives designate and will continue such qualifications in
effect so long as required for the distribution of the Designated
Securities as contemplated by this Agreement; provided that the Issuer
shall not be required to qualify as a foreign corporation or to file a
general consent to service of process in any jurisdiction.
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to each Representative (i) as soon as
available, a copy of any report or definitive proxy statement of the Issuer
filed with the Commission under the Exchange Act and (ii) subject to
applicable law, from time to time, such other information concerning the
Issuer as the Representatives may reasonably request. To the extent such
information is specifically designated by the Issuer as confidential and is
not otherwise available to the public, you will not disseminate such
information unless required to do so by applicable law or legal or
administrative process.
(h) The Issuer will pay or cause to be paid the following: (i) the
fees, disbursements and expenses of the Issuer's counsel and accountants in
connection with the registration of the Securities under the Act and all
other expenses in connection with the preparation, printing and filing of
the Registration Statement and the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) all expenses in connection with the
qualification of the Designated Securities for offering and sale under
state securities laws as provided in Section 4(f) hereof, including the
fees and disbursements of counsel for the Underwriters
5
in connection with such qualification and in connection with the Blue Sky
and legal investment surveys; (iii) any fees charged by securities rating
services for rating the Designated Securities at the request of the Issuer;
(iv) the filing fees incident to any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the
Designated Securities; (v) the cost of preparing note certificates; (vi)
the cost and charges of any depositary, transfer agent or registrar; and
(vii) all other costs and expenses incident to the performance of its
obligations hereunder and under the applicable Terms Agreement which are
not otherwise specifically provided for in this Section. It is understood,
however, that, except as provided in this Section, Section 7 and Section 9
hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on resale of any
Designated Securities by them and any advertising expenses connected with
any offers they may make.
(i) Without your prior written consent, the Issuer will not, during
the period beginning on the date of the Terms Agreement and continuing to
and including the last Closing Date for such Designated Securities or, if
later, the date of expiration of any option granted to the Underwriters by
the Issuer to purchase Designated Securities, offer, sell or agree to sell
or otherwise dispose of any securities of the Issuer which are
substantially similar to the Designated Securities without the prior
written consent of the Representatives.
5. Conditions of the Obligations of the Underwriters. The
obligations of the Underwriters of any Designated Securities under the Terms
Agreement relating to such Designated Securities shall be subject, in the
discretion of the Representatives, to the condition that all representations and
warranties and other statements of the Issuer in or incorporated in the Terms
Agreement are, at and as of the relevant Closing Date, true and correct, the
condition that the Issuer shall have performed all of its obligations hereunder
and under the applicable Terms Agreement theretofore to be performed, and the
following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by
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the Rules and Regulations and in accordance with Section 4(a) hereof; no
stop order suspending the effectiveness of the Registration Statement or
any part thereof shall have been issued and remain in effect and no
proceeding for that purpose shall have been initiated or threatened by the
Commission;
(b) Sullivan & Cromwell, counsel for the Underwriters, shall have
furnished to you such opinion or opinions, dated such Closing Date, with
respect to the incorporation of the Issuer, the validity of the Designated
Securities, the Registration Statement, the Prospectus, and other related
matters as the Representatives may reasonably request, and such counsel
shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) The Representatives shall have received the written opinion or
opinions, dated such Closing Date, in form and substance satisfactory to
the Representatives of (A) Gibson, Dunn & Crutcher, counsel for the Issuer
(as to paragraphs (i), (ii), (vi), (vii) and (viii) below) and (B) Tim S.
Glassett, Assistant General Counsel of the Issuer, or other counsel
acceptable to you (as to paragraphs (iii), (iv) and (v) below) to the
effect that:
(i) The Issuer has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, and Home Savings of America, FSB ("Home Savings") has
been duly organized and is validly existing as a savings bank in good
standing under the laws of the United States of America, each with all
necessary corporate power to own its properties and conduct its
business as described in the Prospectus, and Home Savings is a member
of the Federal Home Loan Bank of San Francisco; and the savings
accounts of depositors in Home Savings are insured by the Federal
Deposit Insurance Corporation ("FDIC") in accordance with the law and
the rules and regulations of the FDIC;
(ii) The Indenture has been duly authorized, executed and
delivered by the Issuer; the Designated Securities have been duly
authorized, executed and delivered by the Issuer and conform in all
material respects to the description thereof contained in the
Prospectus; and the
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Indenture and the Designated Securities, assuming the Designated
Securities are authenticated by the Trustee as contemplated by the
Indenture, constitute valid and legally binding obligations of the
Issuer subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights, and to general equity principles,
regardless of whether such enforcement is considered in a proceeding
at law or in equity;
(iii) Each of the Issuer and Home Savings has been duly qualified
as a foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in which it
owns or leases properties, or conducts any business, so as to require
such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction;
(iv) To the best of such counsel's knowledge, (A) the Issuer and
Home Savings are conducting their respective businesses in compliance
in all material respects with all applicable material Federal and
State laws and regulations (including without limitation all
regulations and orders of the Commission and FDIC), and (B) neither
the Issuer nor Home Savings is charged with or under investigation
with respect to any material violation of any such laws or regulations
or the subject of any pending or threatened material adverse
proceedings by any such regulatory authority having jurisdiction over
its business or operations;
(v) This Agreement and the Terms Agreement with respect to the
Designated Securities have been duly authorized, executed and
delivered by the Issuer;
(vi) The execution, delivery and performance by the Issuer of the
Indenture, this Agreement and the Terms Agreement with respect to the
Designated Securities and the issuance and sale of the Designated
Securities and compliance by the Issuer with the terms and provisions
thereof will not result in a breach or violation of any of the terms
and provisions of, or constitute a default under (A) any statute,
rule, regulation or order
8
known to such counsel of any governmental agency or body or any court
having jurisdiction over the Issuer or Home Savings or any of their
properties (provided that such counsel need not express any opinion in
this clause (A) with respect to the antifraud provisions of the
Federal securities laws, rules and regulations that are expressly
considered in other sections of its opinion, or with respect to state
securities or blue sky laws), (B) any agreement or instrument listed
as material to the Issuer or Home Savings on the officer's certificate
annexed to such opinion, to which the Issuer or Home Savings is a
party or by which the Issuer or Home Savings is bound or to which any
of the properties of the Issuer or Home Savings is subject, or (C) the
Certificate of Incorporation or Bylaws of the Issuer or Charter or
Bylaws of Home Savings;
(vii) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale by the Issuer of the Designated
Securities or the consummation by the Issuer of the other transactions
contemplated by this Agreement and the Terms Agreement with respect to
the Designated Securities, except the registration of the Designated
Securities under the Act and such consents, approvals, authorizations,
registrations or qualifications as have been obtained or may be
required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Designated Securities by the
Underwriters of the Designated Securities; and
(viii) The Registration Statement and Prospectus and any further
amendments and supplements thereto made by the Issuer prior to such
Closing Date (other than the financial statements and related
schedules and other financial and statistical data therein, as to
which such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act and the Rules and
Regulations; the description in the Prospectus under the captions "H.
F. Ahmanson & Company" and "Description of Debt Securities", together
with the description in the Prospectus Supplement under the captions
"Recent Developments -- Regulatory
9
Developments" and "Description of the Notes", of statutes, rules,
regulations, legal and governmental proceedings and contracts and
other documents described therein are accurate in all material
respects and fairly present the information required to be shown.
You shall have also received from Gibson, Dunn & Crutcher a written
statement, dated the Closing Date, in the standard form of such counsel, to the
effect that, based on their participation in the preparation thereof, no facts
have come to the attention of such counsel that would lead them to believe that,
as of its effective date, the Registration Statement or any further amendment or
supplement thereto made by the Issuer prior to such Closing Date (other than the
financial statements and related schedules and other financial or statistical
data therein, as to which such counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
or that, as of its date, the Prospectus or any further amendment or supplement
thereto made by the Issuer prior to such Closing Date (other than the financial
statements and related schedules and other financial or statistical data
therein, as to which such counsel need express no opinion) contained an untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in light of the circumstances in which they were
made, not misleading or that as of such Closing Date, the Registration Statement
or the Prospectus or any further amendment or supplement thereto made by the
Issuer prior to such Closing Date (other than the financial statements and
related schedules and other financial or statistical data therein, as to which
such counsel need express no opinion) contains an untrue statement of a material
fact 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 are made, not misleading; provided that such counsel may state
that the limitations inherent in their examination and the knowledge available
to them are such that they are unable to assume, and do not assume, any
responsibility for the accuracy, completeness or fairness of such statements
except for those statements under the captions "H. F. Ahmanson & Company" and
"Description of Debt Securities" in the Prospectus and "Recent Developments --
Regulatory Developments" and "Description of the Notes" in the Prospectus
Supplement insofar as statutes, rules, regulations, contracts or other documents
are described therein; and such counsel does not
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know of any legal or governmental proceedings required to be described in the
Prospectus which are not described as required, or of any contracts or other
documents of a character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the Prospectus or
required to be described in the Registration Statement or Prospectus which are
not filed or incorporated by reference or described as required;
(d) At each Closing Date, KPMG Peat Marwick shall have furnished to
the Representatives a letter or letters, dated the respective dates of
delivery thereof, each in form and substance satisfactory to the
Representatives, to the effect set forth in Annex II hereof;
(e) Subsequent to the execution and delivery of the Terms Agreement,
there shall not have occurred (i) any change, or any development involving
a prospective change, in or affecting particularly the business or
properties of the Issuer or its subsidiaries which, in the judgment of the
Representatives, materially impairs the investment quality of the
Designated Securities; (ii) any downgrading in the rating of any debt
securities or preferred stock of the Issuer by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Act); (iii) neither Standard and Poor's Corporation nor Moody's
Investors Service, Inc. shall have publicly announced that it has under
surveillance or review, with possible negative implications, its ratings of
any of the Issuer's debt securities or preferred stock; (iv) a suspension
or material limitation in trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Issuer on
any exchange or in the over-the-counter market; (v) a general moratorium on
commercial banking activities in New York or California declared by either
Federal or applicable state authorities; or (vi) the outbreak or escalation
of major hostilities involving the United States or the declaration by the
United States of a national emergency or war, if the effect of any such
event specified in Clauses (i) or (vi) in the judgment of the
Representatives makes it impracticable to proceed with the public offering
or the delivery of the Designated Securities being delivered on such
Closing Date on the
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terms and in the manner contemplated in the Prospectus; and
(f) The Issuer shall have furnished or caused to be furnished to the
Representatives at such Closing Date certificates of the President or any
Vice President and a principal financial or accounting officer of the
Issuer which shall state that to the best of their knowledge after
reasonable investigation in their capacity as officers of the Issuer (i)
the representations and warranties of the Issuer herein and in the Terms
Agreement with respect to the Designated Securities at and as of such
Closing Date are true and correct, (ii) the Issuer has complied in all
material respects with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder and under the applicable Terms
Agreement at or prior to such Closing Date, (iii) the matters set forth in
subsection (a) (regarding a suspension of effectiveness) of this Section
are true and correct and (iv) there has been no change, or any development
involving a prospective change, in or affecting particularly the business
or properties of the Issuer or its subsidiaries which materially impairs
the investment quality of the Designated Securities.
6. Conditions to the Obligations of the Issuer. The obligation of
the Issuer to issue and sell any Designated Securities under a Terms Agreement
shall be subject to (i) the performance by the Underwriters in all material
respects of their respective obligations hereunder; and (ii) the condition
precedent that prior to the Closing Date no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge of
the Issuer or any Underwriter, contemplated by the Commission.
7. Indemnification and Contribution. (a) The Issuer will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus, or any amendment or supplement thereto
or any related preliminary prospectus supplement, or arise out of or are based
upon the omission or alleged omission to state therein a material fact
12
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, and
will reimburse each Underwriter for any legal or other expenses reasonably
incurred as such expenses are incurred by such Underwriter in connection with
investigating or defending any such action or claim, such amounts to be repaid
by such Underwriter if and to the extent it shall be determined ultimately that
such Underwriter was not entitled to such amounts under the provisions of this
Agreement; provided, however, that the Issuer shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement or the Prospectus or any
such amendment or supplement or any related preliminary prospectus supplement in
reliance upon and in conformity with written information furnished to the Issuer
by any Underwriter through the Representatives expressly for use therein; and
provided, further, that the Issuer shall not be liable to any Underwriter under
the indemnity agreement in this subsection (a) with respect to any untrue
statement or omission in any preliminary prospectus supplement to the extent
that any such loss, claim, damage or liability of such Underwriter results from
the fact such Underwriter sold Designated Securities to a person to whom there
was not sent or given, at or prior to the written confirmation of such sale, a
copy of the Prospectus (excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding documents incorporated by
reference) in any case where such delivery is required if the Issuer has
previously furnished copies thereof to such Underwriter and the loss, claim,
damage or liability of such Underwriter results from an untrue statement or
omission of a material fact contained in the preliminary prospectus supplement
or the Prospectus, as the case may be, which was corrected in the Prospectus (or
the Prospectus as amended or supplemented).
(b) Each Underwriter will severally and not jointly indemnify and
hold harmless the Issuer against any losses, claims, damages or liabilities to
which the Issuer may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, or any
amendment or supplement thereto or any preliminary prospectus supplement, or
arise out of or are based upon the omission or alleged omission to state therein
a material
13
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, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
preliminary prospectus supplement or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information furnished
to the Issuer by such Underwriter expressly for use therein, and will reimburse
the Issuer for any legal or other expenses reasonably incurred as such expenses
are incurred by the Issuer in connection with investigating or defending any
such action or claim, such amounts to be repaid by the Issuer if and to the
extent it shall be determined ultimately that the Issuer was not entitled to
such amounts under the provisions of this Agreement.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection, except to the extent
that the indemnifying party is prejudiced as a result of such failure. In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
14
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Issuer on the one hand and the Underwriters on
the other from the offering of the Designated Securities. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Issuer on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Issuer on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Issuer as set forth in the table on the
cover page of the Prospectus bear to the total underwriting discounts and
commissions received by the Underwriters as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Issuer on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Issuer and
the Underwriters agree that it would not be just and equitable if contribution
pursuant to this subsection (d) 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 subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Designated Securities
15
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(e) The obligations of the Issuer under this Section 7 shall be in
addition to any liability which the Issuer may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 7 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Issuer and to each
person, if any, who controls the Issuer within the meaning of the Act.
8. Default of Underwriters. (a) If any Underwriter shall default in
its obligation to purchase the Designated Securities which it has agreed to
purchase under a Terms Agreement at a Closing Date, the Representatives shall
use reasonable efforts to arrange for another party or other parties to purchase
such Designated Securities, or the Representatives may in their discretion
purchase such Designated Securities, on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Issuer
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Designated Securities on such terms. In the event that, within
the respective prescribed periods, the Representatives notify the Issuer that
the Representatives have so arranged for the purchase of such Designated
Securities, or the Issuer notifies the Representatives that it has so arranged
for the purchase of such Designated Securities, the Representatives or the
Issuer shall have the right to postpone such Closing Date for a period of not
more than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Issuer agrees to file promptly any amendments
to the
16
Registration Statement or the Prospectus which in the Representatives'
reasonable opinion may thereby be made necessary. The term "Underwriter" as
used in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been made a party to this
Agreement or a Terms Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Issuer as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remain unpurchased
does not exceed one-eleventh of the aggregate principal amount of all the
Designated Securities to be purchased at such Closing Date, then the Issuer
shall have the right to require each non-defaulting Underwriter to purchase the
principal amount of Designated Securities which such Underwriter agreed to
purchase hereunder on such Closing Date and, in addition, to require each non-
defaulting Underwriter to purchase its pro rata share (based on the principal
amount of Designated Securities which such Underwriter agreed to purchase
hereunder) of the Designated Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Issuer as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remain unpurchased
exceeds one-eleventh of the aggregate principal amount of Designated Securities
to be purchased on such Closing Date, or if the Issuer shall not exercise the
right described in subsection (b) above to require non-defaulting Underwriters
to purchase Designated Securities of a defaulting Underwriter or Underwriters,
then this Agreement and the Terms Agreement with respect to the Designated
Securities and any obligation of the Underwriters to purchase and of the Issuer
to sell the Designated Securities shall thereupon terminate, without liability
on the part of any non-defaulting Underwriter or the Issuer, except for the
expenses to be borne by the Issuer and the Underwriters as provided in the first
sentence of Section 4(h) hereof and the indemnity and contribution agreements in
Section 7 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
17
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Issuer and the several Underwriters, as set forth in this
Agreement and the Terms Agreement with respect to the Designated Securities or
made by or on behalf of them, respectively, pursuant to this Agreement and the
Terms Agreement with respect to the Designated Securities, shall remain in full
force and effect, regardless of any investigation (or any statement as to the
results thereof) made by or on behalf of any Underwriter or any controlling
person of any Underwriter, or the Issuer, or any officer or director or
controlling person of the Issuer, and shall survive delivery of and payment for
the Designated Securities.
If this Agreement shall be terminated pursuant to Section 6(i),
Section 5(e)(iii), (iv) (only with regards to a suspension or material
limitation in trading in securities generally on the New York Stock Exchange,
or the setting of minimum prices for trading on such exchange), (v) or (vi) or
Section 8 hereof, the Issuer shall not then be under any liability to any
Underwriter except as provided in the first sentence of Section 4(h) and Section
7 hereof; but, if for any other reason the Designated Securities are not
delivered by or on behalf of the Issuer as provided in the applicable Terms
Agreement, the Issuer will reimburse the Underwriters for all out-of-pocket
expenses approved in writing by the Representatives, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Designated Securities,
but the Issuer shall then be under no further liability to any Underwriter
except as provided in Section 4(h) and Section 7 hereof.
10. Notices. In all dealings under a Terms Agreement, the
Representatives shall act on behalf of each of the Underwriters of such
Designated Securities, and the parties to any Terms Agreement shall be entitled
to act and rely upon any statement, request, notice or agreement on behalf of
any Underwriter made or given by the Representatives on behalf of the
Underwriters.
All statements, requests, notices, and agreements hereunder and under
any Terms Agreement shall be in writing or by telegram if promptly confirmed in
writing, and if to the Underwriters shall be sufficient in all respects if
delivered or sent by registered mail to the Representatives at their address set
forth in the applicable Terms Agreement; and if to the Issuer shall be
sufficient in all
18
respects if delivered or sent by registered mail to 4900 Rivergrade Road,
Irwindale, California 91706, Attention: General Counsel; provided, however,
that the Representatives agree to use reasonable efforts to advise orally
Charles R. Rinehart, Kevin M. Twomey or George G. Gregory of the mailing or
transmission of any such notice concurrently with such mailing or transmission,
but the failure to advise any of the foregoing individuals of any such notice
shall not invalidate such notice; and provided, further, that any notice to an
Underwriter pursuant to Section 7(c) hereof shall be delivered or sent by
registered mail to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Issuer by the Representatives upon request. Any
such statements, requests, notices or agreements shall take effect upon receipt
thereof.
11. Successors. This Agreement shall be binding upon and inure
solely to the benefit of, the Underwriters of Designated Securities, the Issuer
and, to the extent provided in Section 7 and Section 9 hereof, the officers and
directors of the Issuer and each person who controls the Issuer or any such
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the Designated Securities from
any Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
12. Time. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
13. Applicable Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
19
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
Very truly yours,
H. F. AHMANSON & COMPANY
By: _______________________________
Name:
Title:
20
ANNEX II
Pursuant to Section 5(d) of the Underwriting Agreement, the accountants
shall furnish a letter or letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Issuer and its subsidiaries within the meaning of the Act and the Rules
and Regulations;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable,
prospective financial statements and/or pro forma financial information
examined) by them and included or incorporated by reference in the
Registration Statement or the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Act or the
Exchange Act, as applicable, and the Rules and Regulations; and they have
made a review in accordance with standards established by the American
Institute of Certified Public Accountants of the consolidated interim
financial statements, selected financial data, pro forma financial
information, prospective financial statements and/or condensed financial
statements derived from audited financial statements of the Issuer for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the representatives of the
Underwriters (the "Representatives");
(iii) On the basis of limited procedures, not constituting an audit in
accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of the Issuer and its subsidiaries, inspection of the minute
books of the Issuer and its subsidiaries since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Issuer and its subsidiaries
responsible for financial and accounting matters and such other inquiries
and procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included
or incorporated by reference in the Issuer's Quarterly Reports on Form
10-Q incorporated by reference in the Prospectus do not comply as to
form in all material respects with the applicable accounting
requirements of the Exchange Act as it applies to Form 10-Q and the
Rules and Regulations or are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
the basis for the audited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included or incorporated by reference in the Issuer's Annual Report on
Form 10-K for the most recent fiscal year;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Issuer's Annual Report on Form 10-K for the most recent fiscal year;
(C) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the Rules and Regulations or
the pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(D) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Issuer and its
subsidiaries, or any decreases in consolidated
2
stockholders' equity, total deposits or total assets, or changes in
allowance for possible loan losses or other items specified by the
Representatives, or any increases in Federal Home Loan Bank advances
or any other items specified by the Representatives, in each case as
compared with amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(E) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (D) there were any decreases
in consolidated net interest income, consolidated noninterest income
or total or per share amounts of consolidated net income or other
items specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with the
comparable period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in each
case for increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iv) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraph (iii) above, they have carried out certain specified procedures,
not constituting an audit in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives which are derived from the
general accounting records of the Issuer and its subsidiaries, which appear
in the Prospectus (excluding documents incorporated by reference), or in
Part II of, or in exhibits and schedules to, the Registration Statement
specified by the Representatives or in documents incorporated by reference
in the Prospectus specified by the Representatives, and have compared
certain of such amounts, percentages and financial information with the
accounting records of the Issuer
3
and its subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to
refer to the Prospectus (including the documents incorporated by reference
therein) as amended or supplemented in relation to the applicable Designated
Securities at the Closing Date for such Designated Securities.
4
ANNEX I
H. F. AHMANSON & COMPANY
Subordinated Debt Securities
Terms Agreement
August __, 1994
H. F. Ahmanson & Company
4900 Rivergrade Road
Irwindale, California 91706
Attention: Chief Financial Officer
The undersigned agrees to purchase the following principal amount of
Designated Securities on and subject to the terms and conditions of the
Underwriting Agreement attached hereto ("Underwriting Agreement").
TITLE:
AGGREGATE PRINCIPAL AMOUNT:
PRICE TO PUBLIC:
PURCHASE PRICE BY UNDERWRITERS:
DELIVERY OF DESIGNATED SECURITIES:
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
INDENTURE:
MATURITY:
INTEREST RATE:
INTEREST PAYMENT DATES:
REDEMPTION PROVISIONS:
SINKING FUND PROVISIONS:
DEFEASANCE PROVISIONS:
CLOSING:
NAMES AND ADDRESS OF THE UNDERWRITERS:
Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and returning it to us.
Very truly yours,
By _________________________
Name:
Title:
2
To:
We accept the offer contained in the Terms Agreement, dated August __,
1994, relating to $__________ aggregate principal amount of ___% Subordinated
Notes due __________. We also confirm that, to the best of our knowledge after
reasonable investigation, the representations and warranties of the undersigned
in the Underwriting Agreement signed by the Issuer and attached hereto
("Underwriting Agreement") are true and correct, no stop order suspending the
effectiveness of the Registration Statement (as defined in the Underwriting
Agreement) or of any part thereof has been issued and no proceedings for that
purpose have been instituted or, to the knowledge of the undersigned, are
contemplated by the Securities and Exchange Commission and, subsequent to the
respective dates of the most recent financial statements in the Prospectus (as
defined in the Underwriting Agreement), there has been no material adverse
change in the financial position or results of operations of the undersigned and
its subsidiaries except as set forth in or contemplated by the Prospectus.
Very truly yours,
H. F. AHMANSON & COMPANY
By: _______________________
Name:
Title: