Exhibit 1.1
10,000,000 TRUST PREFERRED SECURITIES
W. R. BERKLEY CAPITAL TRUST II
6.750% TRUST ORIGINATED PREFERRED SECURITIES (SM) ("TOPrS (SM)"* )
(LIQUIDATION AMOUNT OF $25 PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED BY W. R. BERKLEY CORPORATION TO THE EXTENT
THE TRUST HAS FUNDS AVAILABLE FOR PAYMENT OF SUCH DISTRIBUTIONS
PURCHASE AGREEMENT
JULY 19, 2005
- ----------
* (SM) "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co.
July 19, 2005
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Citigroup Global Markets Inc.
Morgan Stanley & Co. Incorporated
UBS Securities LLC
As Representatives of the Several Underwriters
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
250 Vesey Street
North Tower
New York, New York 10281
Dear Sirs and Mesdames:
W. R. Berkley Capital Trust II, (the "TRUST"), a statutory trust
organized under the Statutory Trust Act, as amended, of the State of Delaware
(the "DELAWARE ACT"), and W. R. Berkley Corporation, a Delaware corporation (the
"COMPANY" and, together with the Trust, the "OFFERORS"), confirm their agreement
(the "AGREEMENT") with Merrill Lynch, Pierce, Fenner & Smith Incorporated
("MERRILL LYNCH"), Citigroup Global Markets Inc., Morgan Stanley & Co.
Incorporated and UBS Securities LLC, as representatives (in such capacity,
collectively, the "REPRESENTATIVES") of the several Underwriters named in
Schedule I hereto (collectively, the "UNDERWRITERS") with respect to the sale by
the Trust and the purchase by the Underwriters, acting severally and not
jointly, of an aggregate of 10,000,000 6.750% Trust Originated Preferred
Securities (liquidation amount of $25 per preferred security) of the Trust (the
"PREFERRED SECURITIES"). The Preferred Securities will be fully and
unconditionally guaranteed by the Company with respect to distributions (the
"PREFERRED SECURITIES GUARANTEE"), to the extent the Trust has available funds
for payment of such distributions, pursuant to the Preferred Securities
Guarantee Agreement, to be dated as of the Closing Date (as defined below) (the
"PREFERRED SECURITIES GUARANTEE AGREEMENT"), between the Company and The Bank of
New York (Delaware), as trustee (the "GUARANTEE TRUSTEE"), and in certain
circumstances described in the Prospectus (as defined herein) the Trust will
distribute Subordinated Debt Securities (as defined herein) to holders of
Preferred Securities. The Preferred Securities, the related Preferred Securities
Guarantee and the Subordinated Debt Securities are collectively referred to
herein as the "SECURITIES."
The Offerors have filed with the Securities and Exchange Commission
(the "COMMISSION") a registration statement on Form S-3 (No. 333-109621) and
pre-effective amendment nos. 1 and 2 thereto covering the registration of the
securities of the Company, including the Securities, under the Securities Act of
1933, as amended (the "SECURITIES ACT"),
including the related preliminary prospectus or prospectuses, and the offering
thereof from time to time in accordance with Rule 415 of the rules and
regulations of the Commission under the Securities Act (the "RULES AND
REGULATIONS") and the Offerors have filed such post-effective amendments thereto
as may be required prior to the execution of this Agreement. Promptly after
execution and delivery of this Agreement, the Offerors will prepare and file a
final prospectus and final prospectus supplement in accordance with the
provisions of paragraph (b) of Rule 424 of the Rules and Regulations. Such
registration statement, as amended, including the exhibits and schedules
thereto, if any, and the information, if any, deemed to be a part thereof
pursuant to Rule 430A(b) of the Rules and Regulations (the "RULE 430A
INFORMATION") 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 be deemed to include
all documents incorporated therein by reference pursuant to the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), prior to the execution of
this Agreement. A "PRELIMINARY PROSPECTUS" shall be deemed to refer to any
prospectus used before the applicable registration statement became effective
and any amendment or supplement thereto that omitted the Rule 430A Information
that was used after such effectiveness and prior to the execution and delivery
of the applicable purchase agreement. For purposes of this Agreement, all
references to the Registration Statement, Prospectus or any preliminary
prospectus or to any amendment or supplement to any of them shall be deemed to
include any copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval System.
The Offerors understand that the Underwriters propose to make a
public offering of the Securities as soon as the Representatives deem advisable
after this Agreement has been executed and delivered. The entire proceeds to the
Trust from the sale of the Preferred Securities will be combined with the entire
proceeds from the sale by the Trust to the Company of its common securities
pursuant to a purchase agreement (the "COMMON SECURITIES PURCHASE AGREEMENT")
(the "COMMON SECURITIES" and, together with the Preferred Securities, the "TRUST
SECURITIES"), as guaranteed by the Company, to the extent set forth in the
Prospectus, with respect to distributions and payments upon liquidation and
redemption (the "COMMON SECURITIES GUARANTEE" and together with the Preferred
Securities Guarantee, the "GUARANTEES") pursuant to the Common Securities
Guarantee Agreement, to be dated as of the Closing Date (the "COMMON SECURITIES
GUARANTEE AGREEMENT" and, together with the Preferred Securities Guarantee
Agreement, the "GUARANTEE AGREEMENTS"), between the Company and the Guarantee
Trustee, as Trustee, and will be used by the Trust to purchase the $250,000,000
aggregate principal amount of 6.750% Subordinated Debentures due 2045 (the
"SUBORDINATED DEBT SECURITIES") to be issued by the Company under the Indenture
(as defined herein). The Preferred Securities and the Common Securities will be
issued pursuant to the amended and restated trust agreement, to be dated as of
the Closing Date (the "TRUST AGREEMENT"), among the Company, as Sponsor, and The
Bank of New York, as property trustee (the "PROPERTY TRUSTEE"), The Bank of New
York (Delaware), as Delaware trustee (the "DELAWARE TRUSTEE"), Ira. S. Lederman,
as trustee (the "FIRST ADMINISTRATIVE TRUSTEE"), and Eugene G. Ballard, as
trustee (the "SECOND ADMINISTRATIVE TRUSTEE"; together with the First
Administrative Trustee, the "ADMINISTRATIVE TRUSTEES"; and together with the
First Administrative Trustee, the Property Trustee and the Delaware Trustee, the
"TRUSTEES"). The Subordinated Debt Securities will be issued pursuant to
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the Subordinated Indenture, to be dated as of the Closing Date (the "BASE
INDENTURE"), between the Company and The Bank of New York, as trustee (the "DEBT
TRUSTEE"), as supplemented by Supplemental Indenture No. 1, to be dated as of
the Closing Date (the "SUPPLEMENTAL INDENTURE" and, together with the Base
Indenture, the "INDENTURE"), between the Company and the Debt Trustee.
1. Representations and Warranties. The Offerors jointly and
severally represent and warrant to each of the Underwriters that:
(a) The Company meets, and at the respective times of the
commencement and consummation of the public offering of the Preferred
Securities will meet, the requirements for use of Form S-3 under the
Securities Act. The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to the
knowledge of the Company, threatened by the Commission.
(b) On the effective date of the Registration Statement, such
Registration Statement conformed in all material respects to the
requirements of the Securities Act and the Rules and Regulations and did
not 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 not misleading, and on the date of this Agreement and
at the Closing Time, the Registration Statement and the Prospectus will
conform in all material respects to the requirements of the Securities Act
and the Rules and Regulations; the Prospectus does not include and will
not include any untrue statement of a material fact or omit to state any
material fact required to be stated therein, in light of the circumstances
under which they were made, or necessary to make the statements therein
not misleading, except that the foregoing does not apply to (A) statements
in or omissions from any of such documents based upon written information
furnished to the Company by any Underwriter through the representatives or
representatives of the Underwriters, if any (the "REPRESENTATIVES"),
specifically for use therein or (B) that part of the Registration
Statement that constitutes the Statement of Eligibility (Form T-1) under
the Trust Indenture Act of 1939, as amended (the "TRUST INDENTURE ACT"),
of the Trustee; and the documents incorporated by reference in the
Prospectus, at the time they were, or hereafter, are filed with the
Commission, complied and, at any time when a prospectus relating to the
Securities is required to be delivered under the Securities Act in
connection with sales by any Underwriter or dealer, will comply as to form
in all material respects with the requirements of the Exchange Act and the
rules and regulations thereunder.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus; and the Company is
duly qualified to do business as a foreign corporation 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 in such
jurisdictions where the failure to be so qualified would not individually
or in the aggregate have a material adverse effect on the condition
(financial or other), business, properties or results of
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operations of the Company and its subsidiaries taken as a whole ("MATERIAL
ADVERSE EFFECT").
(d) Each Significant Subsidiary (as defined below) of the Company
has been duly incorporated and is an existing corporation in good standing
under the laws of the jurisdiction of its incorporation, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus; and each Significant Subsidiary
of the Company is, to the extent applicable, duly qualified to do business
as a foreign corporation 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 be so qualified
would not individually or in the aggregate have a Material Adverse Effect;
all of the issued and outstanding capital stock of each Significant
Subsidiary of the Company has been duly authorized and validly issued and
is fully paid and nonassessable; and the capital stock of each Significant
Subsidiary owned by the Company, directly or through subsidiaries, is
owned free from liens, encumbrances and defects. As used herein,
"SIGNIFICANT SUBSIDIARIES" means Berkley Regional Insurance Company,
Berkley Insurance Company and Admiral Insurance Company, which are
currently the only operating insurance companies that are "significant
subsidiaries" of the Company as that term is defined in Rule 1-02(w) of
Regulation S-X of the Rules and Regulations.
(e) The Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, and at the Closing Time (as defined
below) will be duly executed and delivered by the Company and a valid and
binding Agreement of the Company, enforceable in accordance with its terms
except to the extent that (i) enforcement thereof may be limited by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
affecting the rights of creditors generally or by general equitable
principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles
of general applicability.
(f) The Subordinated Debt Securities have been duly authorized by
the Company and, when validly executed by the Debt Trustee, authenticated
in the manner provided for in the Indenture and delivered against payment
therefor as described in the Prospectus, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance
with their terms except to the extent that (i) enforcement thereof may be
limited by bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting the rights of creditors generally or by general
equitable principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles
of general applicability; and will be in the form contemplated by, and
entitled to the benefits of, the Indenture and will conform in all
material respects to the description thereof contained in the Prospectus.
(g) The Trust has been duly created and is validly existing and in
good standing as a statutory trust under the Delaware Act with the power
and authority to own property and to conduct its business as described in
the Registration Statement and
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Prospectus and to enter into and perform its obligations under this
Agreement, the Trust Agreement, the Preferred Securities and the Common
Securities; the Trust is not a party to or otherwise bound by any material
agreement other than those described in the Prospectus; and the Trust is
and will (under current law) be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable
as a corporation.
(h) The Trust Agreement has been duly qualified under the Trust
Indenture Act and duly authorized by the Company and, at the Closing Time,
will have been duly executed and delivered by the Company and the
Trustees, and assuming due authorization, execution and delivery of the
Trust Agreement by the Trustees, the Trust Agreement will, at the Closing
Time, be a valid and binding obligation of the Company and the Trustees,
enforceable against the Company and the Trustees in accordance with its
terms, except to the extent that (i) enforcement thereof may be limited by
bankruptcy, reorganization, insolvency, moratorium or other similar laws
affecting the rights of creditors generally or by general equitable
principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and (ii) the availability of equitable
remedies may be limited by equitable principles of general applicability,
and will conform in all material respects to the description thereof
contained in the Prospectus; each of the Administrative Trustees is an
employee of the Company and has been authorized by the Company to execute
and deliver the Trust Agreement.
(i) The Common Securities will be at the Closing Time duly
authorized by the Trust pursuant to the Trust Agreement and, when issued
and delivered by the Trust to the Company against payment therefor, will
be validly issued and, subject to the terms of the Trust Agreement, fully
paid and non-assessable undivided beneficial interests in the assets of
the Trust and will conform in all material respects to the description
thereof contained in the Prospectus; the issuance of the Common Securities
is not subject to preemptive or other similar rights; and at the Closing
Time all of the issued and outstanding Common Securities of the Trust will
be directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right.
(j) The Preferred Securities will be at the Closing Time duly
authorized by the Trust pursuant to the Trust Agreement and, when issued
and delivered pursuant to this Agreement against payment of the
consideration therefor as provided herein, will be validly issued and
fully paid and non-assessable undivided beneficial interests in the assets
of the Trust (provided that the holders of the Preferred Securities may be
obligated to make certain payments as set forth in the Trust Agreement)
and will conform in all material respects to the description thereof
contained in the Prospectus; the issuance of the Preferred Securities is
not subject to preemptive or other similar rights; and holders of
Preferred Securities will be entitled to the same limitation of personal
liability under Delaware law as extended to stockholders of private
corporations for profit.
(k) Each of the Guarantees and the Guarantee Agreements has been
duly authorized by the Company and, at the Closing Time, will have been
validly executed and delivered by the Company, and, assuming due
authorization, execution and delivery
5
of the Guarantee Agreements by the Guarantee Trustee, will constitute
valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms, except to the extent that (i)
enforcement thereof may be limited by bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting the rights of
creditors generally or by general equitable principles (regardless of
whether enforcement is considered in a proceeding at law or in equity) and
(ii) the availability of equitable remedies may be limited by equitable
principles of general applicability; each of the Guarantees and the
Guarantee Agreements will conform in all material respects to the
description thereof contained in the Prospectus; and the Preferred
Securities Guarantee Agreement has been duly qualified under the Trust
Indenture Act.
(l) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection
with this offering.
(m) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Securities Act.
(n) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
issuance and sale of the Common Securities or the Common Securities
Guarantee or the offering, issuance or sale of the Securities or the
performance by the Company of its obligations under this Agreement, the
Indenture, the Subordinated Debt Securities, the Trust Agreement, the
Guarantee Agreements or the Trust Securities, except such as have been
obtained and made under the Securities Act, as contemplated under Section
5(a) hereof, and such as may be required under state securities laws.
(o) The Trust is not in violation of the Trust Agreement or its
certificate of trust filed with the State of Delaware on March 22, 2001
(the "CERTIFICATE OF TRUST"). None of the execution, delivery and
performance by the Offerors of this Agreement, the Trust Agreement, the
Preferred Securities, the Common Securities, the Indenture, the
Subordinated Debt Securities, the Guarantee Agreements and the Guarantees
and the consummation of the transactions contemplated hereby and thereby
and compliance by the Offerors with their respective obligations hereunder
and thereunder did or will result in a breach of any of the terms or
provisions of, or constitute a default or require the consent of any party
under, any statute, any rule, regulation or order of any governmental
agency or body or any court, domestic or foreign, having jurisdiction over
the Trust, the Company or any Significant Subsidiaries of the Company or
any of their respective material properties, or any material agreement or
instrument to which the Trust, the Company or any such subsidiary is a
party or by which the Trust, the Company or any such subsidiary is bound
or to which any of the properties of the Trust, the Company or
6
any such subsidiary is subject, or the Certificate of Trust of the Trust
or the charter or by-laws of the Company or any such subsidiary, or did or
will result in the creation or imposition of any material lien on the
property or assets of the Trust, the Company or any such subsidiary.
(p) This Agreement has been duly authorized, executed and delivered
by the Company.
(q) Except as disclosed in the Prospectus, the Company and its
Significant Subsidiaries have good and marketable title to all real
properties and all other properties and assets owned by them, in each case
free from liens, encumbrances and defects that would affect the value
thereof or interfere with the use made or to be made thereof by them,
other than liens, encumbrances and defects that would not individually or
in the aggregate have a Material Adverse Effect; and except as disclosed
in the Prospectus, the Company and its subsidiaries hold any leased real
or personal property under valid and enforceable leases with no exceptions
that would individually or in the aggregate have a Material Adverse
Effect.
(r) The Company and its Significant Subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by them
and have not received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its Significant
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(s) The Company has made all required filings under applicable
insurance holding company statutes, and has received approvals of
acquisition of control and/or affiliate transactions, in each jurisdiction
in which such filings or approvals are required, except where the failure
to have made such filings or receive such approvals in any such
jurisdiction would not have individually or in the aggregate a Material
Adverse Effect; each of the Company's Significant Subsidiaries that is
required to be organized and licensed as an insurance or reinsurance
company (the "INSURANCE SUBSIDIARIES") in its jurisdiction of
incorporation is duly organized and licensed as an insurance or
reinsurance company in its respective jurisdiction of incorporation, and
each such Significant Subsidiary is duly licensed or authorized as an
insurer or reinsurer (the "INSURANCE LICENSES") in each other jurisdiction
in which such licensing or authorization is required, except where the
failure to be so licensed or authorized in any such jurisdiction would not
have individually or in the aggregate a Material Adverse Effect; there is
no pending or, to the knowledge of the Company, threatened action, suit,
proceeding or investigation that would reasonably be expected to lead to
the revocation, termination or suspension of any such Insurance Licenses,
the revocation, termination or suspension of which would have individually
or in the aggregate a Material Adverse Effect; and except as disclosed in
the Prospectus, no insurance regulatory agency or body has issued any
order or decree impairing, restricting or prohibiting the payment of
dividends of any Company subsidiary to its respective parent which would
have individually or in the aggregate a Material Adverse Effect.
7
(t) The Company and each of its Significant Subsidiaries is in
compliance with the requirements of all laws, ordinances, governmental
rules or regulations or court decrees to which it may be subject, and has
filed all notices, reports, documents or other information required to be
filed thereunder, except where the failure to so comply or file would not
individually or in the aggregate have a Material Adverse Effect.
(u) Except as disclosed in the Prospectus, neither the Company nor
any of its Insurance Subsidiaries is in violation of, or in default in the
performance, observance or fulfillment of, any obligation, agreement,
covenant or condition contained in reinsurance treaties, contracts,
agreements and arrangements to which the Company or any of its Insurance
Subsidiaries is a party, except for such violations or defaults which
would not individually or in the aggregate have a Material Adverse Effect;
neither the Company nor any of its Insurance Subsidiaries has received any
notice from any of the other parties to such treaties, contracts,
agreements or arrangements that such other party intends not to perform
its obligations thereunder and none of them has any reason to believe that
any of the other parties to such treaties, contracts, agreements or
arrangements will be unable to perform its obligations thereunder, except
to the extent that such nonperformance would not individually or in the
aggregate have a Material Adverse Effect.
(v) To the knowledge of the Company and its Insurance Subsidiaries,
no change in any insurance law or regulation is pending that would
reasonably be expected to have individually or in the aggregate a Material
Adverse Effect, except as described in the Prospectus.
(w) No labor dispute with the employees of the Company or any
Significant Subsidiary exists or, to the knowledge of the Company, is
imminent that would reasonably be expected to have individually or in the
aggregate a Material Adverse Effect.
(x) The Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and
other intellectual property (collectively, "INTELLECTUAL PROPERTY RIGHTS")
materially necessary to conduct the business now operated by them and have
not received any notice of infringement of or conflict with asserted
rights of others with respect to any intellectual property rights that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(y) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or restoration
of the environment or human exposure to hazardous or toxic substances
(collectively, "ENVIRONMENTAL LAWS"), owns or operates any real property
contaminated with any substance that is subject to any environmental laws,
is liable for any off-site disposal or contamination pursuant to any
environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim
8
would individually or in the aggregate have a Material Adverse Effect; and
the Company is not aware of any pending investigation which would
reasonably be expected to lead to such a claim.
(z) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that would individually
or in the aggregate have a Material Adverse Effect, or would materially
and adversely affect the ability of the Company to perform its obligations
under this Agreement; and no such actions, suits or proceedings are, to
the Company's knowledge, threatened or contemplated.
(aa) KPMG LLP, who have certified the financial statements and
supporting schedules of the Company and its subsidiaries contained in the
Prospectus, are an independent registered public accounting firm within
the meaning of the Securities Act and the Rules and Regulations; except as
disclosed in the Prospectus, the financial statements included or
incorporated by reference in the Registration Statement and the Prospectus
present fairly the financial position of the Company and its consolidated
subsidiaries as of the dates shown and their results of operations and
cash flows for the periods shown; except as disclosed in the Prospectus,
such financial statements have been prepared in conformity with the
generally accepted accounting principles in the United States applied on a
consistent basis; except as disclosed in the Prospectus, the schedules
included or incorporated in the Registration Statement present fairly the
information required to be stated therein; and except as disclosed in the
Prospectus, the Company and its Insurance Subsidiaries have made no
material change in their insurance reserving practices since the most
recent audited financial statements included in the Prospectus.
(bb) The statutory annual and quarterly statements of the Insurance
Subsidiaries required to file such statutory statements and the statutory
balance sheets and income statements included in such statutory annual and
quarterly statements, most recently filed in each jurisdiction, have been
prepared in conformity with required or permitted or prescribed statutory
accounting principles or practices applied on a consistent basis, except
as may otherwise be indicated in the notes thereto, and present fairly the
financial position of the Insurance Subsidiaries (on a statutory basis)
for the period covered thereby.
(cc) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with United
States generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance
with management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(dd) Except as disclosed in the Prospectus and except for regular
dividends declared or paid consistent with past practice, since the date
of the latest audited financial
9
statements included in the Prospectus, (i) there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other), business,
properties or results of operations of the Company and its subsidiaries
taken as a whole, (ii) there have not been any transactions entered into
by the Company or any of its subsidiaries other than in the ordinary
course of business which are material to the Company and its subsidiaries
taken as a whole, and, (iii) there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock.
(ee) None of the Offerors is and, after giving effect to the
offering and sale of the Securities as herein contemplated and the
application of the proceeds thereof as described in the Prospectus, none
of the Offerors will be an "investment company" as defined in the
Investment Company Act of 1940, as amended.
(ff) The Offerors acknowledge and agree that (i) the purchase and
sale of the Preferred Securities pursuant to this Agreement is an
arm's-length commercial transaction between the Offerors, on the one hand,
and the Underwriters, on the other, (ii) in connection therewith each
Underwriter is acting as a principal and not the agent or fiduciary of the
Offerors and (iii) no Underwriter has assumed an advisory responsibility
in favor of the Offerors with respect to the offering contemplated hereby
or the process leading thereto (irrespective of whether such Underwriter
has advised or is currently advising the Offerors on other matters) or any
other obligation to the Offerors except the obligations expressly set
forth in this Agreement.
(gg) As of the Closing Time, the Preferred Securities will have been
approved for listing on the New York Stock Exchange, subject to notice of
issuance.
(hh) Each certificate signed by any officer of the Company or an
Administrative Trustee and delivered to the Representatives or to counsel
for the Underwriters shall be deemed to be a representation and warranty
by the Company or the Trust, as the case may be, to each Underwriter as to
the matters covered thereby.
2. Agreements to Sell and Purchase. The Trust hereby agrees to sell
to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Trust the respective principal amount of Preferred Securities set forth in
Schedule I hereto opposite its name at $25 per Preferred Security (the "PURCHASE
PRICE") plus accrued distributions, if any, from July 26, 2005 to the date of
payment and delivery.
3. Terms of Public Offering. The Offerors are advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Preferred Securities as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Company is
further advised by you that the Preferred Securities are to be offered to the
public initially at $25 per Preferred Security (the "PUBLIC OFFERING PRICE")
plus accrued distributions, if any, from July 26, 2005 to the date of payment
and delivery and to certain dealers selected by you at a price that represents a
concession not in excess of $0.50 per Preferred Security under the Public
Offering Price, and that any Underwriter
10
may allow, and such dealers may reallow, a concession to certain other dealers
not to exceed $0.45 per Preferred Security.
4. Payment and Delivery. Payment for the Preferred Securities shall
be made to the Trust by wire transfer in Federal or other funds immediately
available in New York City against delivery of such Preferred Securities at 9:00
a.m., New York City time, on July 26, 2005, or such other time not later than 10
business days after such date, as shall be agreed upon by the Representatives
and the Offerors. The time and date of such payment are hereinafter referred to
as the "CLOSING TIME" and the "CLOSING DATE," respectively.
At the Closing Time, the Company will pay, or cause to be paid, a
commission of $0.7875 per Preferred Security to Merrill Lynch on behalf of the
Underwriters by wire transfer of immediately available funds to a bank account
designated by Merrill Lynch.
Certificates for the Preferred Securities shall be in global form
and registered in such names and in such denominations as the Underwriters shall
request in writing not later than one full business day prior to the Closing
Date. The certificates evidencing the Preferred Securities shall be delivered to
the Representatives at the Closing Time for the respective accounts of the
several Underwriters, with any transfer taxes payable in connection with the
transfer of the Securities to the Underwriters duly paid, against payment of the
Purchase Price therefor plus accrued interest, if any, to the date of payment
and delivery.
5. Covenants of the Offerors. In further consideration of the
agreements of the Underwriters herein contained, the Offerors covenant with each
Underwriter as follows:
(a) The Offerors will file the Prospectus with the Commission
pursuant to and in accordance with Rule 424(b) not later than the second
business day following the execution and delivery of this Agreement.
(b) The Offerors will advise the Representatives promptly of any
proposal to amend or supplement the Registration Statement or the
Prospectus and will afford the Representatives a reasonable opportunity to
comment on any such proposed amendment or supplement; provided, however,
the Offerors shall not file any such proposed amendment or supplement to
which the Representatives reasonably object; and the Offerors will also
advise the Representatives promptly of the filing of any such amendment or
supplement and 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 Preferred
Securities as in the opinion of counsel for the Underwriters is required
to be delivered under the Securities Act in connection with sales by any
Underwriter or dealer, 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 for any other reason it shall
be necessary during the same period to
11
amend or supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus in order to comply
with the provisions of the Securities Act, the Exchange Act or the Trust
Indenture Act, the Offerors promptly will notify the Representatives of
such event, and if such event shall occur or if, in the opinion of counsel
for the Underwriters, it is necessary at any time to amend the Prospectus
to comply with the Securities Act, the Offerors will promptly prepare and
file with the Commission, at its own expense, an amendment or supplement
which will correct such statement or omission or an amendment which will
effect such compliance. Neither the Representatives' consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6
hereof.
(d) As soon as practicable, but not later than 16 months, after the
date of this Agreement, the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the later of (i) the effective date of the
registration statement relating to the Preferred Securities, (ii) the
effective date of the most recent post-effective amendment to the
Registration Statement to become effective prior to the date of this
Agreement and (iii) the date of the Company's most recent Annual Report on
Form 10-K filed with the Commission prior to the date of this Agreement,
which will satisfy the provisions of Section 11(a) of the Securities Act.
(e) The Offerors will furnish to the Representatives copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus
and all amendments and supplements to such documents, in each case prior
to 3:00 P.M. New York City time on the business day next succeeding the
date of this Agreement or as soon as possible, with respect to any
amendment or supplement, during the period mentioned in Section 5(c) above
and in such quantities as the Representatives reasonably request. The
Offerors will pay the expenses of printing and distributing to the
Underwriters all such documents.
(f) The Offerors will arrange for the qualification of the Preferred
Securities for sale under the laws of such jurisdictions as the
Representatives reasonably designate and will continue such qualifications
in effect so long as required for the distribution; provided, that in
connection therewith the Offerors shall not be required to qualify to do
business in any jurisdiction or to file or consent or otherwise subject
itself to service of process or taxation in any jurisdiction where it is
not already so subject.
(g) During the period of five years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a
copy of its annual report to stockholders for such year; and the Company
will furnish to the Representatives (i) as soon as available, a copy of
each report and any definitive proxy statement of the Company filed with
the Commission under the Exchange Act or mailed to stockholders, and (ii)
from time to time, such other information concerning the Company as the
Representatives may reasonably request.
12
(h) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of its obligations under
this Agreement, including: (i) the fees, disbursements and expenses of the
Company's and the Trust's counsel and the Company's accountants in
connection with the registration and delivery of the Preferred Securities
under the Securities Act and all other fees or expenses in connection with
the preparation and filing of the Indenture, the Trust Agreement, the
Guarantee Agreements, the Registration Statement, any preliminary
prospectus, the Prospectus and amendments and supplements to any of the
foregoing, including all printing costs associated therewith, and the
mailing and delivering of copies thereof to the Underwriters and dealers,
in the quantities hereinabove specified, (ii) all costs and expenses
related to the transfer and delivery of the Preferred Securities to the
Underwriters, including any transfer or other taxes payable thereon, (iii)
the cost of printing certificates representing the Preferred Securities,
(iv) any fees charged by securities rating services for rating the
Preferred Securities, (v) the fees and expenses of the Trustees, the Debt
Trustee and any agent of the Trustees or the Debt Trustee and the fees and
disbursements of counsel for the Trustees and the Debt Trustee in
connection with the Indenture and the Trust Securities, (vi) travel and
lodging expenses of officers and employees of the Company for any "road
show" undertaken in connection with the marketing of the offering of the
Preferred Securities, and one-half of the cost of any aircraft chartered
in connection with the road show, (vii) the fees and expenses incurred in
connection with the listing of the Preferred Securities and, if
applicable, the Subordinated Debt Securities on the New York Stock
Exchange, (viii) the cost of qualifying the Preferred Securities with the
Depository Trust Company and (x) all other costs and expenses incident to
the performance of the obligations of the Offerors hereunder for which
provision is not otherwise made in this Section. It is understood,
however, that except as provided in this Section, Section 7 entitled
"Indemnity and Contribution", and the last paragraph of Section 9 below,
the Underwriters will pay all of their costs and expenses, including fees
and disbursements of their counsel, transfer taxes payable on resale of
any of the Preferred Securities by them and any advertising expenses
connected with any offers they may make.
(i) The Offerors will use their best efforts to effect the listing
of the Preferred Securities on the New York Stock Exchange and to cause
the Preferred Securities to be registered under the Exchange Act. If the
Preferred Securities are exchanged for Subordinated Debt Securities, the
Company will use its best efforts to effect the listing of the
Subordinated Debt Securities on the New York Stock Exchange on which the
Preferred Securities were then listed and to cause the Subordinated Debt
Securities to be registered under the Exchange Act.
(j) During a period of 90 days from the date of this Agreement,
neither the Trust nor the Company will, without the prior written consent
of the Representatives, directly or indirectly, sell, offer to sell, grant
any option for the sale of, or otherwise dispose of, or enter into any
agreement to sell, any Preferred Securities, any security convertible into
or exchangeable into or exercisable for Preferred Securities or the
Subordinated Debt Securities or any subordinated debt securities
substantially similar to the Subordinated Debt Securities or equity
securities substantially similar to the Preferred Securities.
13
(k) The Trust will use the net proceeds received by it from the sale
of the Trust Securities, and the Company will use the net proceeds
received by it from the sale of the Subordinated Debt Securities, in the
manner specified in the Prospectus under "Use of Proceeds."
6. Conditions to the Underwriters' Obligations. The obligations of
the Trust to sell the Preferred Securities to the Underwriters and the several
obligations of the Underwriters to purchase and pay for the Preferred Securities
at the Closing Time are subject to the following conditions:
(a) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5(a) of this
Agreement. No stop order suspending the effectiveness of the Registration
Statement or of any part thereof shall have been issued and no proceedings
for that purpose shall have been instituted or, to the knowledge of the
Company or any Underwriter, shall be contemplated by the Commission.
(b) As of the Closing Time, the Preferred Securities shall have been
approved for listing on the New York Stock Exchange, subject to notice of
issuance.
(c) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Time:
(i) except as may have been announced prior to the date
hereof, there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by Moody's Investors Service, Inc. or Standard
& Poor's Ratings Group, a division of McGraw Hill, Inc.; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in the
Representatives' judgment, is material and adverse and that makes
it, in the Representatives' judgment, impracticable to market the
Securities on the terms and in the manner contemplated in the
Prospectus.
(d) The Underwriters shall have received at the Closing Time an
opinion of Willkie Farr & Gallagher LLP, outside counsel for the Company,
dated the Closing Date, to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of
Delaware;
14
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement;
(iii) The Indenture has been duly qualified under the Trust
Indenture Act, has been duly authorized, executed and delivered by
the Company and is a valid and binding agreement of the Company,
enforceable in accordance with its terms except to the extent that
(A) the enforcement thereof may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws
affecting creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and (B) rights of acceleration and
the availability of equitable remedies may be limited by equitable
principles of general applicability;
(iv) The Subordinated Debt Securities have been duly
authorized by the Company and, when validly executed by the Debt
Trustee, authenticated in the manner provided for in the Indenture
and delivered against payment therefor as described in the
Prospectus, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their
terms except to the extent that (i) enforcement thereof may be
limited by bankruptcy, reorganization, insolvency, moratorium or
other similar laws affecting creditor's rights generally or by
general equitable principles (regardless of whether enforcement is
considered in a proceeding at law or in equity) and (ii) rights of
acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability; and will
be in the form contemplated by, and entitled to the benefits of, the
Indenture and will conform in all material respects to the
description thereof contained in the Prospectus.
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for
the consummation of the transactions contemplated by this Agreement
in connection with the issuance or sale of the Preferred Securities
by the Trust, except such as have been obtained and made under the
Securities Act and such as may be required under state securities
and insurance laws, and the execution and delivery of this Agreement
and the consummation of the transactions herein contemplated will
not conflict with or constitute a breach of, or default under, the
certificate of incorporation or by-laws of the Company;
(vi) The Registration Statement has become effective under the
Securities Act, the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) specified in such
opinion on the date specified therein, and, to the best of the
knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any part thereof has
been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the Securities Act, and the
Registration Statement and the Prospectus (but not including the
Form T-1 heretofore referred to or any document incorporated by
reference in the Registration Statement or the
15
Prospectus), as of the date of this Agreement, and any amendment or
supplement thereto, and as of its date, complied as to form in all
material respects with the requirements of the Securities Act and
the Rules and Regulations; it being understood that such counsel
need express no opinion as to the financial statements or other
financial data contained in the Registration Statement or the
Prospectus;
(vii) This Agreement has been duly authorized, executed and
delivered by the Company;
(viii) The Trust Agreement has been duly authorized, executed
and delivered by the Company and the Administrative Trustees; and
the Trust is and will (under current law) be classified for United
States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation;
(ix) The information in the Prospectus under the captions
"Description of Securities," "Description of the Debt Securities,"
"Description of Preferred Securities," "Description of Preferred
Securities Guarantees," "Plan of Distribution" and "Underwriting,"
to the extent that such information is applicable to the Preferred
Securities, the Common Securities, the Indenture, the Subordinated
Debt Securities, the Guarantee Agreements and the Guarantees and
constitutes matters of law or legal conclusions or descriptions of
documents referred to therein, has been reviewed by such counsel and
is correct in all material respects;
(x) The Company is not and, after giving effect to the
offering and sale of the Subordinated Debt Securities and the
application of the proceeds thereof as described in the Prospectus,
will not be an "investment company" as defined in the Investment
Company Act of 1940;
(xi) Each of the Guarantees and the Guarantee Agreements has
been duly authorized by the Company and, when validly executed and
delivered by the Company, and, in the case of the Preferred
Securities Guarantee and the Preferred Securities Guarantee
Agreement, assuming due authorization, execution and delivery of the
Preferred Securities Guarantee Agreement by the Guarantee Trustee,
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms except to the
extent that (i) enforcement thereof may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws
affecting the rights of creditors generally or by general equitable
principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability, and each of the Guarantees and the Guarantee
Agreements conforms in all material respects to the description
thereof contained in the Prospectus; and the Preferred Securities
Guarantee Agreement has been duly qualified under the Trust
Indenture Act; and
16
(xii) The Preferred Securities conform in all material
respects to the description thereof contained in the Prospectus.
The opinion of Willkie Farr & Gallagher LLP described in this
Section 6(c) above shall be rendered to the Underwriters at the request of
the Company and shall so state therein.
In rendering such opinions, such counsel may state that (i) its
opinion is limited to matters governed by the Federal laws of the United
States of America, the laws of the State of New York and the corporate law
of the State of Delaware (excluding the trust laws of the State of
Delaware) and (ii) it has relied, as to matters of fact to the extent it
deems proper, on certificates of responsible officers of the Company or
public officials. In addition to the matters set forth above, such counsel
shall state that it has no reason to believe that the Registration
Statement, as of the date of this Agreement or as of the Closing Date, or
any amendment thereto, as of its date or as of the Closing Date, contained
any untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, as of the date of this
Agreement or as of such Closing Date, or any amendment or supplement
thereto, as of its date or as of the Closing Date, contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; it being
understood that such counsel need express no view as to (A) the financial
statements or other financial data contained in the Registration Statement
or the Prospectus and (B) that part of the Registration Statement that
constitutes the Form T-1 heretofore referred to.
(e) The Underwriters shall have received at the Closing Time an
opinion of Ira S. Lederman, Senior Vice President - General Counsel and
Secretary of the Company, dated the Closing Date, to the effect that:
(i) The Company has an authorized capitalization as set forth
in the Prospectus.
(ii) The Company is duly qualified to do business as a foreign
corporation 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 be so
qualified would not individually or in the aggregate have a Material
Adverse Effect;
(iii) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, has
the corporate power and authority to own, lease and operate its
properties and to conduct the business described in the Registration
Statement and, to the extent applicable, is duly qualified as a
foreign corporation to transact business and is in good standing as
such in each jurisdiction in which it owns or leases substantial
properties or in which the conduct of its business requires such
qualification (except in such jurisdictions
17
where the failure to be so qualified would not individually or in
the aggregate have a Material Adverse Effect) (such counsel may note
in his opinion that insurance laws of certain of such jurisdictions
where the Significant Subsidiaries hold an insurance license do not
require such due qualification as a foreign corporation); except as
set forth in the Registration Statement, all of the issued and
outstanding shares of capital stock of each Significant Subsidiary
have been duly authorized and validly issued and are owned directly
or indirectly by the Company, free and clear of any pledges, liens,
encumbrances, claims or equities; and all such shares are fully paid
and nonassessable;
(iv) There are no contracts, agreements or understandings
known to such counsel between the Company and any person granting
such person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Securities Act;
(v) To the best of such counsel's knowledge, there are no
licenses, franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to be
described in the Registration Statement or to be filed as an exhibit
thereto other than those described therein or filed or incorporated
by reference as exhibits thereto;
(vi) The execution and delivery, the performance by the
Offerors of their respective obligations under, this Agreement, the
Trust Agreement, the Preferred Securities, the Common Securities,
the Indenture, the Subordinated Debt Securities, the Guarantee
Agreements, and the Guarantees and the consummation of the
transactions contemplated hereby and thereby will not (a) conflict
with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any rule,
regulation or order of any governmental agency or body or any court
having jurisdiction over the Trust, the Company or any Significant
Subsidiary of the Company or the charter or by-laws of any such
subsidiary, or, to the best of such counsel's knowledge, any of
their material properties, or any material agreement, contract,
indenture, mortgage, loan agreement, note, lease or other instrument
to which any of the Trust, the Company or any such subsidiary is a
party or by which the Trust, the Company or any such subsidiary is
bound or to which any of their respective properties or assets is
subject;
(vii) The Company has made all required filings under
applicable insurance holding company statutes, and has received
approvals of acquisition of control and/or affiliate transactions,
in each jurisdiction in which such filings or approvals are
required, except where the failure to have made such filings or
receive such approvals in any such jurisdiction would not reasonably
be expected to have individually or in the aggregate a Material
Adverse Effect; each of the
18
Insurance Subsidiaries is duly organized and licensed as an
insurance or reinsurance company in its respective jurisdiction of
incorporation, and each such Insurance Subsidiary owns the Insurance
Licenses in each other jurisdiction in which such licensing or
authorization is required, except where the failure to be so
licensed or authorized in any such jurisdiction would not reasonably
be expected to have individually or in the aggregate a Material
Adverse Effect; there is no pending or, to the best of such
counsel's knowledge, threatened action, suit, proceeding or
investigation that would be reasonably likely to lead to the
revocation, termination or suspension of any such Insurance
Licenses, the revocation, termination or suspension of which would
reasonably be expected to have individually or in the aggregate a
Material Adverse Effect; and except as disclosed in the Prospectus,
no insurance regulatory agency or body has issued any order or
decree impairing, restricting or prohibiting the payment of
dividends of any Company subsidiary to its respective parent which
would reasonably be expected to have individually or in the
aggregate a Material Adverse Effect;
(viii) Except as would not individually or in the aggregate
have a Material Adverse Effect and except as described in the
Prospectus, (i) to the best of such counsel's knowledge, there are
no legal or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement, other than
those disclosed therein, and (ii) there are no pending legal or
governmental proceedings, to the best of such counsel's knowledge,
to which the Company any of its subsidiaries or the Trust is a party
or of which any of their property is the subject which are not
described in the Registration Statement but are required to be so
described in the Registration Statement, including ordinary routine
litigation incidental to the business;
(ix) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the Securities Act (other than
the financial statements, supporting schedules and other financial
information included or incorporated by reference therein, as to
which no opinion need to be rendered), at the time they were filed
with the Commission or delivered to the security holders, as the
case may be, complied as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations
thereunder; and
(x) The descriptions in the Registration Statement and
Prospectus of legal and governmental proceedings and contracts and
other documents are accurate in all material respects and fairly
present the information required to be shown; and, to the best of
such counsel's knowledge, no stop order suspending the effectiveness
of the Registration Statement or any part thereof has been issued
and no proceedings for that purpose have been instituted or are
pending or contemplated under the Securities Act.
In rendering such opinions, such counsel may state that (i) its
opinion is limited to matters governed by the Federal laws of the United
States of America and the corporate law of the State of Delaware and (ii)
it has relied, as to matters of fact to the extent it deems proper, on
certificates of responsible officers of the Company or public officials.
19
In addition to the matters set forth above, such counsel shall state that
it has no reason to believe that the Registration Statement, as of the
date of this Agreement or as of the Closing Time, or any amendment
thereto, as of its date or as of the Closing Time, contained any untrue
statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, as of the date of this Agreement or
as of such Closing Time, or any amendment or supplement thereto, as of its
date or as of the Closing Time, contained any untrue statement of a
material fact or omitted to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; it being understood that such counsel need
express no view as to (A) the financial statements or other financial data
contained in the Registration Statement or the Prospectus and (B) that
part of the Registration Statement that constitutes the Form T-1
heretofore referred to.
(f) The Underwriters shall have received at the Closing Time, an
opinion of Prickett, Jones & Elliott, P. A., special Delaware counsel to
the Offerors, dated the Closing Date, to the effect that:
(i) The Trust has been duly created and is validly existing
and in good standing as a statutory trust under the Delaware Act
with the statutory trust power and authority to own property and to
conduct its business as described in the Registration Statement and
Prospectus and to perform its obligations under the Trust Agreement;
(ii) Assuming that the Trust Agreement has been duly
authorized, executed and delivered by the Company and the Trustees,
the Trust Agreement constitutes a valid and binding obligation of
the Trustees and the Company and is enforceable against the Trustees
and the Company in accordance with its terms, except to the extent
that (i) enforceability thereof may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws
affecting the rights of creditors generally, by general equitable
principles (regardless of whether enforcement is considered in a
proceeding at law or in equity) and by the effect of public policy
on enforceability of provisions relating to indemnification,
contribution and exculpation and (ii) the availability of equitable
remedies may be limited by equitable principles of general
applicability;
(iii) Under the Delaware Act and the Trust Agreement, the
Trust has the power to (i) execute and deliver, and to perform its
obligations under, this Agreement and (ii) issue, and perform its
obligations under, the Trust Securities;
(iv) The execution and delivery by the Trust of this Agreement
and the performance by the Trust of its obligations hereunder, have
been duly authorized by all necessary action on the part of the
Trust;
(v) Under the Delaware Act and the Trust Agreement, the
issuance of Trust Securities is not subject to preemptive or other
similar rights;
20
(vi) The issuance and sale by the Trust of the Trust
Securities, the execution, delivery and performance by the Trust of
this Agreement, the consummation of the transactions contemplated
hereby and the compliance by the Trust with its obligations
hereunder do not violate any of the provisions of the Certificate of
Trust or Trust Agreement or any applicable Delaware law, rule or
regulation (counsel may exclude state securities or Blue Sky laws of
the State of Delaware from such opinion);
(vii) The Common Securities have been duly authorized by the
Trust Agreement and, when issued and delivered by the Trust to the
Company against payment therefor in accordance with the Trust
Agreement and the Common Securities Purchase Agreement and as
described in the Registration Statement and the Prospectus, will be
validly issued and, subject to the terms of the Trust Agreement,
fully paid and non-assessable undivided beneficial interests in the
assets of the Trust; the Common Securities will have the rights set
forth in the Trust Agreement; and
(viii) The Preferred Securities have been duly authorized by
the Trust Agreement and, when issued and delivered pursuant to the
Trust Agreement and this Agreement against payment of the
consideration therefor as provided herein, will be validly issued
and, subject to the terms of the Trust Agreement and the
qualifications hereinafter expressed in this paragraph, fully paid
and non-assessable undivided beneficial interests in the assets of
the Trust; the Preferred Securities will have the rights set forth
in the Trust Agreement and holders of Preferred Securities, as
beneficial owners of the Trust, will be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law
of the State of Delaware; counsel may note that the holders of the
Preferred Securities may be obligated to make certain payments as
set forth in the Trust Agreement.
(g) The Underwriters shall have received at the Closing Time, an
opinion of Emmet, Marvin & Martin LLP, counsel to The Bank of New York, as
Property Trustee and Guarantee Trustee under the Preferred Securities
Guarantee Agreement, and The Bank of New York (Delaware) as Delaware
Trustee under the Trust Agreement, dated the Closing Date, to the effect
that:
(i) The Bank of New York is a New York banking corporation
with trust powers, duly organized, validly existing and in good
standing under the laws of the State of New York with all necessary
power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of the Trust Agreement and
the Preferred Securities Guarantee Agreement; The Bank of New York
(Delaware) is a Delaware banking corporation with trust powers, duly
organized, validly existing and in good standing under the laws of
the State of Delaware with all necessary power and authority to
execute and deliver, and to carry out and perform its obligations
under the terms of the Trust Agreement and the Preferred Securities
Guarantee Agreement.
21
(ii) The execution, delivery and performance by the Property
Trustee and the Delaware Trustee of the Trust Agreement and the
execution, delivery and performance by the Guarantee Trustee of the
Preferred Securities Guarantee Agreement have been duly authorized
by all necessary corporate action on the part of the Property
Trustee, the Delaware Trustee and the Guarantee Trustee,
respectively. The Trust Agreement has been duly executed and
delivered by the Property Trustee and the Delaware Trustee, and the
Preferred Securities Guarantee Agreement has been duly executed and
delivered by the Guarantee Trustee.
(iii) The execution, delivery and performance of the Trust
Agreement by the Property Trustee and the Delaware Trustee and the
execution, delivery and performance of the Preferred Securities
Guarantee Agreement by the Guarantee Trustee do not conflict with or
constitute a breach of the Articles of Organization, charter or
Bylaws of Property Trustee, the Delaware Trustee and the Guarantee
Trustee, respectively.
(iv) No consent, approval or authorization of, or registration
with or notice to, any New York or Delaware (as applicable) or
federal banking authority governing the banking or trust powers of
the Property Trustee, Delaware Trustee or Guarantee Trustee is
required for the execution, delivery or performance by the Property
Trustee and the Delaware Trustee of the Trust Agreement and by the
Guarantee Trustee of the Preferred Securities Guarantee Agreement.
(h) The Underwriters shall have received at the Closing Time an
opinion of LeBoeuf, Lamb, Greene & MacRae LLP, counsel for the
Underwriters, dated the Closing Time, with respect to the incorporation
and legal existence of the Company, the Preferred Securities, the
Indenture, the Preferred Securities Guarantee Agreement, this Agreement,
the Registration Statement, the Prospectus and other related matters as
the Representatives may require. In giving their opinion, LeBoeuf, Lamb,
Greene & MacRae LLP may rely as to certain matters of Delaware law upon
the opinion of Prickett, Jones & Elliott, P. A., Delaware counsel for the
Offerors, which shall be delivered in accordance with Section 6(f) hereof.
(i) The Underwriters shall have received at the Closing Time a
certificate, dated as of the Closing Date, of the President or any Vice
President and a principal financial or accounting officer of the Company
in which such officers, to the best of their knowledge and after
reasonable investigation, shall state that the representations and
warranties of the Company in this Agreement are true and correct, that the
Company has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to the Closing
Time, that no stop order suspending the effectiveness of the Registration
Statement or of any part thereof has been issued and no proceedings for
that purpose have been instituted or are contemplated by the Commission
and that, subsequent to the date of the most recent financial statements
in the Prospectus, (A) except as may have been announced prior to the date
hereof, there has not occurred any downgrading, nor has any notice been
given of any intended or potential downgrading or any review for a
possible change that does not indicate the direction of
22
the possible change, in the rating accorded any of the Company's
securities by Moody's Investors Service, Inc. or Standard & Poor's Ratings
Group, a division of McGraw Hill, Inc., and (B) there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other), business,
properties or results of operations of the Company and its subsidiaries
taken as a whole except as set forth in or contemplated by the Prospectus
or as described in such certificate.
(j) The Underwriters shall have received on the date of this
Agreement a letter in form and substance agreed to by LeBoeuf, Lamb,
Greene & MacRae LLP, counsel for the Underwriters, from KPMG LLP, an
independent registered public accounting firm, 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, which letter shall use a "cut-off date" not earlier than
the date hereof (the "COMFORT LETTER"). The Underwriters shall also have
received at the Closing Time a letter reaffirming all statements made in
the Comfort Letter (the "BRINGDOWN COMFORT LETTER"), which letter shall
use a "cut-off date" not earlier than three business days prior to the
Closing Time.
(k) At Closing Time, the Preferred Securities shall be rated at
least "Baa3" by Moody's Investor's Service Inc. and "BBB-" by Standard &
Poor's Ratings Group, a division of McGraw-Hill, Inc., and the Trust shall
have delivered to the Representatives a letter, dated at, or shortly
prior, to the Closing Date, from such nationally recognized statistical
rating agencies, or other evidence satisfactory to the Representatives,
confirming that the Preferred Securities have such ratings; and since the
Closing Time there shall not have occurred any decrease in the ratings of
any securities of the Company or of the Preferred Securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Rule and Regulations) and such
organization shall not have publicly announced that it has under
surveillance or review its rating of any of the securities of the Company
or of the Preferred Securities.
If any condition specified in this Section 6 shall not have been
fulfilled when and as required to be fulfilled by this Agreement, the
obligations of the several Underwriters to purchase the Preferred Securities,
may be terminated by the Underwriters by notice to the Offerors, at any time at
or prior to Closing Time, and such termination shall be without liability of any
party to any other party except for the expenses to be borne by the Offerors and
the Underwriters as provided in Section 5(h) hereof, and except that Sections 1
and 7 hereof shall survive any such termination and will remain in full force
and effect.
7. Indemnity and Contribution. (a) The Offerors jointly and
severally agree to indemnify and hold harmless each Underwriter, each person, if
any, who controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act and each affiliate of any
Underwriter within the meaning of Rule 405 under the Securities Act from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue
23
statement of a material fact contained in the Registration Statement or any
amendment thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Offerors shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Underwriter
furnished to the Offerors in writing by such Underwriter through the
Representatives expressly for use therein, it being understood and agreed that
the only such information furnished by any Underwriter consists of the
information described as such in subsection (b) below; provided, however, that
the foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter from whom the person asserting
any such losses, claims, damages or liabilities purchased Preferred Securities,
or any person controlling such Underwriter, if a copy of the Prospectus (as then
amended or supplemented if the Offerors shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such Underwriter
to such person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Preferred Securities to such person, and
if the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities, unless such failure
is the result of noncompliance by the Offerors with Section 5(e) hereof.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, the Trust, the Trustees, each of the
Company's directors and officers who signed the Registration Statement and
each person, if any, who controls the Company or the Trust within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the
Offerors to such Underwriter, but only with reference to information
relating to such Underwriter furnished to the Offerors in writing by such
Underwriter through the Representatives expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 7(a) or 7(b), such
person (the "INDEMNIFIED PARTY") shall promptly notify the person against
whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii)
the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is
understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
24
expenses of more than one separate firm (in addition to any local counsel)
for all such indemnified parties and that all such fees and expenses shall
be reimbursed as they are incurred. Such firm shall be designated in
writing by the Representatives, in the case of parties indemnified
pursuant to Section 7(a), and by the Offerors, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such settlement
is entered into more than 30 days after receipt by such indemnifying party
of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to
the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of
any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement (i) includes
an unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding and (ii) does not
include a statement as to or in admission of fault, culpability or a
failure to act, by or on behalf of any indemnified party.
(d) To the extent the indemnification provided for in Section 7(a)
or 7(b) is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Offerors on the one hand and the
Underwriters on the other hand from the offering of the Preferred
Securities or (ii) if the allocation provided by clause 7(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause 7(d)(i) above
but also the relative fault of the Offerors on the one hand and of the
Underwriters on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Offerors on the one hand and the Underwriters on the other
hand in connection with the offering of the Preferred Securities shall be
deemed to be in the same respective proportions as the net proceeds from
the offering of the Preferred Securities (before deducting expenses)
received by the Company through issuance of the Subordinated Debt
Securities to the Trust and the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the
table on the cover of the Prospectus, bear to the aggregate Public
Offering Price of the Preferred Securities. The relative fault of the
Offerors on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a
25
material fact relates to information supplied by the Offerors or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Underwriters' respective obligations to contribute pursuant
to this Section 7 are several in proportion to the respective principal
amount of Preferred Securities they have purchased hereunder, and not
joint.
(e) The Offerors and the Underwriters agree that it would not be
just or equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that
does not take account of the equitable considerations referred to in
Section 7(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Preferred
Securities underwritten by it and distributed to the public were offered
to the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The remedies provided for in this
Section 7 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Offerors contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the Offerors, the
officers or directors of the Company or any person controlling the
Offerors and (iii) acceptance of and payment for any of the Preferred
Securities.
8. Termination. This Agreement shall be subject to termination by
notice given by the Representatives to the Company and the Trust, if: (a) after
the execution and delivery of this Agreement and prior to the Closing Time (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock Exchange
or the National Association of Securities Dealers, Inc., (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a material disruption in securities settlement,
payment or clearance services in the United States shall have occurred, (iv) any
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities, or (v) there shall have
occurred any outbreak or escalation of hostilities or, any change in financial
markets or any calamity or crisis that, in the Representatives' judgment, is
material and adverse; and (b) in the case of any of the events specified in
clauses 8(a)(i) through 8(a)(v), such event, singly or together with any other
such event, makes it, in the
26
Representatives' judgment, impracticable or inadvisable to proceed with the
offer, sale or delivery of the Preferred Securities on the terms and in the
manner contemplated in the Prospectus.
This Agreement may also terminate pursuant to the provisions of the
last paragraph of Section 6, with the effect stated in such Section.
9. Effectiveness; Defaulting Underwriters. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If at the Closing Time any one or more of the Underwriters shall
fail or refuse to purchase Preferred Securities that it has or they have agreed
to purchase hereunder on such date, and the aggregate principal amount of
Preferred Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the aggregate
principal amount of the Preferred Securities to be purchased on such date, the
other Underwriters shall be obligated severally in the proportions that the
principal amount of Preferred Securities set forth opposite their respective
names in Schedule I bears to the aggregate principal amount of Preferred
Securities set forth opposite the names of all such non-defaulting Underwriters,
or in such other proportions as the Representatives may specify, to purchase the
Preferred Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on such date; provided, that in no event shall
the principal amount of Preferred Securities that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 9 by
an amount in excess of one-ninth of such principal amount of Preferred
Securities without the written consent of such Underwriter. If, at the Closing
Time any Underwriter or Underwriters shall fail or refuse to purchase Preferred
Securities and the aggregate principal amount of Preferred Securities with
respect to which such default occurs is more than one-tenth of the aggregate
principal amount of Preferred Securities to be purchased, and arrangements
satisfactory to the Representatives and the Offerors for the purchase of such
Preferred Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or the Offerors. In any such case either the Representatives or the
Offerors shall have the right to postpone the Closing Time, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Offerors to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Offerors shall be unable to perform their obligations under this
Agreement, the Offerors will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives,
27
Merrill Lynch, Pierce, Fenner & Smith Incorporated, World Financial Center, 250
Vesey Street, North Tower, New York, New York 10281, Attention: Syndicate
Department; Citigroup Global Markets Inc., 388 Greenwich Street, New York, New
York 10013, Attention: Syndicate Department; Morgan Stanley & Co. Incorporated,
1585 Broadway, New York, New York, 10036, Attention: Syndicate Department; and
UBS Securities LLC, 299 Park Avenue, New York, New York 10171, Attention:
Syndicate Department; or, if sent to the Company or the Trust, will be mailed,
delivered or telegraphed and confirmed to it at address and numbers of the
Company set forth in the Registration Statement, Attention: Ira S. Lederman,
Senior Vice President - General Counsel and Secretary; provided, however, that
any notice to an Underwriter pursuant to Section 7 will be mailed, delivered or
telegraphed and confirmed to such Underwriter.
11. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
14. Parties. This Agreement shall inure to the benefit of and be
binding upon the Underwriters and the Offerors and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters
and the Offerors and their respective successors and the controlling persons and
officers, directors and trustees referred to in Section 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Offerors 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 Preferred Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
[Remainder of page intentionally left blank]
28
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Trust a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Trust and the Company in accordance with its
terms.
Very truly yours,
W. R. BERKLEY CORPORATION
By: /s/ William R. Berkley
---------------------------------------
Name: William R. Berkley
Title: Chairman and Chief Executive Officer
W. R. BERKLEY CAPITAL TRUST II
By: W. R. Berkley Corporation, as Depositor
By: /s/ Eugene G. Ballard
---------------------------------------
Name: Eugene G. Ballard
Title: Senior Vice President
29
Accepted as of the date hereof
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
CITIGROUP GLOBAL MARKETS INC.
MORGAN STANLEY & CO. INCORPORATED
UBS SECURITIES LLC
Acting severally on behalf
of themselves and the
several Underwriters named
in Schedule I hereto
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
/s/ Kerry Cannella
---------------------------------------
Name: Kerry Cannella
Authorized Signatory
30
SCHEDULE I
UNDERWRITER NUMBER OF TRUST PREFERRED SECURITIES
Merrill Lynch, Pierce, Fenner & Smith
Incorporated............................................... 2,300,000
Citigroup Global Markets Inc. ......................................... 2,220,000
Morgan Stanley & Co. Incorporated ..................................... 2,220,000
UBS Securities LLC..................................................... 2,220,000
BB&T Capital Markets, a division of Scott & Stringfellow, Inc. ........ 65,000
Credit Suisse First Boston LLC......................................... 65,000
Deutsche Bank Securities Inc. ......................................... 65,000
A.G. Edwards & Sons, Inc. ............................................. 65,000
Ferris, Baker Watts, Incorporated...................................... 65,000
Keefe, Bruyette & Woods, Inc. ......................................... 65,000
KeyBanc Capital Markets, A Division of McDonald Investments Inc. ...... 65,000
Legg Mason Wood Walker, Incorporated................................... 65,000
Morgan Keegan & Company, Inc. ......................................... 65,000
Oppenheimer & Co. Inc. ................................................ 65,000
Piper Jaffray & Co. ................................................... 65,000
RBC Dain Rauscher Inc. ................................................ 65,000
Raymond James & Associates, Inc. ...................................... 65,000
Sandler O'Neill & Partners, L.P. ...................................... 65,000
Charles Schwab & Co., Inc. ............................................ 65,000
Wells Fargo Securities, LLC............................................ 65,000
----------
Total: 10,000,000
==========
31