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EXHIBIT 1
STANDARD FEDERAL BANCORPORATION, INC.
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
June __, 1996
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
[OTHER AGENT(S)]
[Address]
Dear Sirs:
Standard Federal Bancorporation, Inc., a Michigan corporation (the
"Company"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and [OTHER AGENTS] (each, an "Agent", and
collectively, the "Agents") with respect to the issue and sale by the Company
of its Senior Medium-Term Notes (the "Senior Notes") and Subordinated
Medium-Term Notes (the "Subordinated Notes") Due Nine Months or More From Date
of Issue (collectively, the "Notes"). The Senior Notes are to be issued
pursuant to an Indenture, dated as of June __, 1996, as amended, supplemented
or modified from time to time (the "Senior Indenture"), and the Subordinated
Notes are to be issued pursuant to an Indenture dated as of June __, 1996, as
amended, supplemented or modified from time to time (the "Subordinated
Indenture" and collectively with the Senior Indenture, the "Indenture") between
the Company and The Chase Manhattan Bank, N.A., as trustee (the "Trustee"). As
of the date hereof, the Company has authorized the issuance and sale of up to
U.S. $___00,000,000 aggregate initial offering price (or its equivalent, based
upon the applicable exchange rate at the time of issuance, in such foreign or
composite currencies as the Company shall designate at the time of issuance) of
Notes to or through the Agents pursuant to the terms of this Agreement. It is
understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may be sold to or
through the Agents pursuant to the terms of this Agreement, all as though the
issuance of such Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company to
one or more Agents as principal for resale to investors and other purchasers
and for the sale of Notes by the
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Company directly to investors (as may from time to time be agreed to by the
Company and the applicable Agent), in which case such Agent will act as an
agent of the Company in soliciting purchases of the Notes.
The Company has filed with the Securities and Exchange Commission (the
"SEC") a registration statement on Form S-3 (No. 333-________) for the
registration of debt securities, including the Notes, under the Securities Act
of 1933, as amended (the "1933 Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the SEC under
the 1933 Act (the "1933 Act Regulations"). Such registration statement has
been declared effective by the SEC and the Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement (and any further registration statements which may be
filed by the Company for the purpose of registering additional Notes and in
connection with which this Agreement is included or incorporated by reference
as an exhibit) and the prospectus constituting a part thereof, and any
prospectus supplement and pricing supplement relating to the Notes, including
all documents incorporated therein by reference, as from time to time amended
or supplemented by the filing of documents pursuant to the Securities Exchange
Act of 1934, as amended (the "1934 Act") or the 1933 Act or otherwise, are
referred to herein as the "Registration Statement" and the "Prospectus,"
respectively, except that if any revised prospectus shall be provided to the
Agents by the Company for use in connection with the offering of the Notes,
whether or not such revised prospectus is required to be filed by the Company
pursuant to Rule 424(b) of the 1933 Act Regulations, the term "Prospectus"
shall refer to such revised prospectus from and after the time it is first
provided to the Agents for such use.
SECTION 1. Appointment as Agent.
(a) Appointment. Subject to the terms and conditions stated
herein and subject to the reservation by the Company of the right to sell Notes
directly on its own behalf, the Company hereby agrees that Notes will be sold
exclusively to or through the Agents. The Company agrees that it will not
appoint any other agents to act on its behalf, or to assist it, in the
placement of the Notes.
(b) Sale of Notes. The Company shall not sell or approve the
solicitation of purchases of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the aggregate
initial offering price of Notes registered pursuant to the Registration
Statement. The Agents shall have no responsibility for maintaining records
with respect to the aggregate initial offering price of Notes sold, or of
otherwise monitoring the availability of Notes for sale, under the Registration
Statement.
(c) Purchases as Principal. The Agents shall not have any
obligation to purchase Notes from the Company as principal, but one or more
Agents may agree from time to time to purchase Notes as principal for resale to
investors and other purchasers determined by such Agent or Agents. Any such
purchase of Notes by an Agent as principal shall be made in accordance with
Section 3(a) hereof.
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(d) Solicitations as Agent. If agreed upon by an Agent and the
Company, such Agent, acting solely as agent for the Company and not as
principal, will solicit purchases of the Notes. Such Agent will communicate to
the Company, orally, each offer to purchase Notes solicited by it on an agency
basis, other than those offers rejected by such Agent. Such Agent shall have
the right, in its discretion reasonably exercised, to reject any proposed
purchase of Notes, as a whole or in part, and any such rejection shall not be
deemed a breach of its agreement contained herein. The Company may accept or
reject any proposed purchase of Notes, in whole or in part. Such Agent shall
make reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes has been solicited by it and accepted
by the Company. Such Agent shall not have any liability to the Company in the
event that any such purchase is not consummated for any reason. If the Company
shall default on its obligation to deliver Notes to a purchaser whose offer it
has accepted, the Company shall (i) hold such Agent harmless against any loss,
claim or damage arising from or as a result of such default by the Company and
(ii) pay to such Agent any commission to which it would otherwise be entitled
absent such default.
(e) Reliance. The Company and the Agents agree that any Notes
purchased by one or more Agents as principal shall be purchased, and any Notes
the placement of which an Agent arranges as agent shall be placed by such
Agent, in reliance on the representations, warranties, covenants and agreements
of the Company contained herein and on the terms and conditions and in the
manner provided herein.
SECTION 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the
date hereof, as of the date of each acceptance by the Company of an offer for
the purchase of Notes (whether to such Agent as principal or through such Agent
as agent), as of the date of each delivery of Notes (whether to such Agent as
principal or through such Agent as agent) (the date of each such delivery to
the Agent as principal being hereafter referred to as a "Settlement Date"), and
as of any time that the Registration Statement or the Prospectus shall be
amended or supplemented or there is filed with the SEC any document
incorporated by reference into the Prospectus (each of the times referenced
above being referred to herein as a "Representation Date"), as follows:
(i) Due Incorporation and Qualification. The
Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the state of its
incorporation with corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus; the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify and be in good standing would not have a material
adverse effect on the financial condition, results of operations or
earnings of the Company and its subsidiaries considered as one
enterprise; and the Company is duly registered as a savings and loan
holding company under the Home Owners' Loan Act of 1933, as amended
("HOLA").
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(ii) Subsidiaries. Each subsidiary of the Company
which is a significant subsidiary (each, a "Significant Subsidiary"),
as defined in Rule 405 of Regulation C of the 1933 Act Regulations, has
been duly incorporated and is validly existing either as a
federally-chartered savings bank or as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and
conduct its business as described in the Prospectus and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify and be in
good standing would not have a material adverse effect on the financial
condition, results of operations or earnings of the Company and its
subsidiaries considered as one enterprise; and all of the issued and
outstanding capital stock of each Significant Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and,
except for directors' qualifying shares (if applicable), is owned by
the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equity.
(iii) Registration Statement and Prospectus. At
the time the Registration Statement became effective, the Registration
Statement complied, and as of each Representation Date will comply, in
all material respects with the requirements of the 1933 Act and the
1933 Act Regulations and the 1939 Act and the rules and regulations of
the SEC promulgated thereunder; the Registration Statement, at the
time it became effective, did not, and at each time thereafter at which
any amendment to the Registration Statement becomes effective or any
Annual Report on Form 10-K is filed by the Company with the SEC and as
of each Representation Date, will not, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and
the Prospectus, as of the date hereof does not, and as of each
Representation Date will not, include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the representations
and warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by the Agents expressly for use in the Registration
Statement or Prospectus.
(iv) Incorporated Documents. The documents
incorporated by reference in the Prospectus, at the time they were or
hereafter are filed with the SEC, complied or when so filed will
comply, as the case may be, in all material respects with the
requirements of the 1934 Act and the rules and regulations promulgated
thereunder (the "1934 Act Regulations"), and, when read together and
with the other information in the Prospectus, did not and will not
include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were or are made, not misleading.
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(v) Accountants. The accountants who certified
the financial statements included or incorporated by reference in the
Prospectus are independent public accountants as to the Company within
the meaning of the 1933 Act and the 1933 Act Regulations.
(vi) Financial Statements. The financial
statements and any supporting schedules of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the consolidated financial
position of the Company and its subsidiaries as of the dates indicated
and the consolidated results of their operations for the periods
specified; except as stated therein, said financial statements have
been prepared in conformity with U.S. generally accepted accounting
principles applied on a consistent basis; and the supporting schedules
included or incorporated by reference in the Registration Statement and
the Prospectus present fairly, in all material respects, the
information required to be stated therein. In addition, any pro forma
financial statements of the Company and its subsidiaries and the
related notes thereto included in the Registration Statement and the
Prospectus present fairly, in all material respects, the information
shown therein, have been prepared in accordance with the SEC's rules
and guidelines with respect to pro forma financial statements and have
been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(vii) Authorization and Validity of this Agreement,
the Indenture and the Notes. This Agreement has been duly authorized,
executed and delivered by the Company and, upon execution and delivery
by the Agents, will be a valid and legally binding agreement of the
Company; the Indenture has been duly authorized, executed and delivered
by the Company and, upon execution and delivery by the Trustee, will be
a valid and legally binding agreement of the Company enforceable in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting enforcement of creditors' rights generally or
by general equity principles; the Notes have been duly and validly
authorized for issuance, offer and sale pursuant to this Agreement and,
when issued, authenticated and delivered pursuant to the provisions of
this Agreement and the Indenture against payment of the consideration
therefor, the Notes will constitute valid and legally binding
obligations of the Company enforceable in accordance with their terms,
except as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
enforcement of creditors' rights generally or by general equity
principles; the Notes and the Indenture will be substantially in the
form heretofore delivered to the Agents and conform in all material
respects to all statements relating thereto contained in the
Prospectus; and each holder of Notes will be entitled to the benefits
of the Indenture.
(viii) Material Changes or Material Transactions.
Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as may otherwise be
stated therein or contemplated thereby, (1) there has been no
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material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business and (2) there have been no material
transactions entered into by the Company or any of its subsidiaries
other than those in the ordinary course of business.
(ix) No Defaults. Neither the Company nor any of
its Significant Subsidiaries is in violation of its charter or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which it is a party
or by which it or any of them or their properties may be bound which
default would have a material adverse effect on the Company and its
subsidiaries considered as one enterprise; and the execution and
delivery of this Agreement and the Indenture and the consummation of
the transactions contemplated herein and therein will not conflict with
or constitute a breach of, or default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any such subsidiary pursuant to, any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to
which the Company or any such subsidiary is a party or by which it or
any of them may be bound or to which any of the property or assets of
the Company or any such subsidiary is subject which conflict, breach or
default would have a material adverse effect on the Company and its
subsidiaries considered as one enterprise, nor will such action result
in any violation of the provisions of the charter or by-laws of the
Company or any law, administrative regulation or administrative or
court order or decree.
(x) Regulatory Approvals. No consent, approval,
authorization, order or decree of any court or governmental agency or
body is required for the consummation by the Company of the
transactions contemplated by this Agreement or in connection with the
sale of Notes hereunder, except such as have been obtained or rendered,
as the case may be, or as may be required under state securities laws
("Blue Sky").
(xi) Legal Proceedings. Except as may be included
or incorporated by reference in the Registration Statement and the
Prospectus, there is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened against or affecting,
the Company or any of its subsidiaries, which might, in the opinion of
the Company, result in any material adverse change in the financial
condition, results of operations or earnings of the Company and its
subsidiaries considered as one enterprise, or might materially and
adversely affect the properties or assets thereof or might materially
and adversely affect the consummation of this Agreement or the
Indenture or any transaction contemplated hereby or thereby.
(xii) Contracts. There are no contracts or
documents of the Company or any of its subsidiaries which are required
to be filed as exhibits to the Registration Statement by the 1933 Act
or by the 1933 Act Regulations which have not been so filed.
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(xiii) Licenses. Neither the Company nor any of its
Significant Subsidiaries is, in any material respect, in violation of
any law, ordinance, governmental rule or regulation or court decree to
which it may be subject or has failed to obtain any license, permit,
franchise or other governmental authorization necessary to the
ownership of its property or to the conduct of its business, which
violation or failure would materially adversely affect the financial
condition, results of operations or earnings of the Company and its
subsidiaries considered as one enterprise; and the Company and its
Significant Subsidiaries own or possess or have obtained all material
governmental licenses, permits, consents, orders, approvals and other
authorizations necessary to lease or own their respective properties
and to carry on their respective businesses as presently conducted.
(xiv) Trademarks; Service Marks. The Company and
its Significant Subsidiaries own or possess, or can acquire on
reasonable terms, adequate trademarks, service marks and trade names
necessary to conduct the business now operated by them, except as set
forth or incorporated by reference in the Registration Statement, and
neither the Company nor any of its Significant Subsidiaries has
received any actual notice of infringement of or conflict with asserted
rights of others with respect to any trademarks, service marks or trade
names which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially adversely
affect the financial condition, results of operations or earnings of
the Company and its subsidiaries considered as one enterprise.
(xv) Investment Company Act. Neither the Company
nor any of its subsidiaries is required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xvi) Commodity Exchange Act. The Notes, when
issued, authenticated and delivered pursuant to the provisions of this
Agreement and the Indenture, will be excluded or exempted under the
provisions of the Commodity Exchange Act.
(xvii) Doing Business with Cuba. The Company has
complied and will comply with the provisions of Florida H.B. 1771,
codified as Section 517.075 of the Florida Statutes, 1987, as amended,
and all regulations promulgated thereunder relating to issuers doing
business in Cuba.
(xviii) Ratings. The Notes are rated [ ] by
Moody's Investors Service, Inc. and [ ] by Standard & Poor's
Ratings Group.
(b) Additional Certifications. Any certificate signed by any
director or officer of the Company and delivered to one or more Agents or to
counsel for the Agents in connection with an offering of Notes to one or more
Agents as principal or through an Agent as agent shall be deemed a
representation and warranty by the Company to such Agent or Agents as to the
matters covered thereby on the date of such certificate and at each
Representation Date subsequent thereto.
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SECTION 3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Unless otherwise agreed by an Agent
and the Company, Notes shall be purchased by one or more Agents as principal in
accordance with terms agreed upon by such Agent or Agents and the Company
(which terms, unless otherwise agreed, shall, to the extent applicable, include
those terms specified in Exhibit A hereto and be agreed upon orally, with
written confirmation prepared by such Agent or Agents and mailed to the
Company). An Agent's commitment to purchase Notes as principal shall be deemed
to have been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and conditions
herein set forth. Unless the context otherwise requires, references herein to
"this Agreement" shall include the applicable agreement of one or more Agents
to purchase Notes from the Company as principal. Each purchase of Notes,
unless otherwise agreed, shall be at a discount from the principal amount of
each such Note equivalent to the applicable commission set forth in Schedule A
hereto. The Agents may engage the services of any other broker or dealer in
connection with the resale of the Notes purchased by them as principal and may
allow all or any portion of the discount received in connection with such
purchases from the Company to such brokers and dealers. At the time of each
purchase of Notes by one or more Agents as principal, such Agent or Agents
shall specify the requirements for the stand-off agreement, officers'
certificate, opinions of counsel and comfort letter pursuant to Sections 4(k),
7(b), 7(c) and 7(d) hereof.
(b) Solicitations as Agent. On the basis of the representations
and warranties herein contained, but subject to the terms and conditions herein
set forth, when agreed by the Company and an Agent, such Agent, as an agent of
the Company, will use its reasonable efforts to solicit offers to purchase the
Notes upon the terms and conditions set forth in the Prospectus. The Agents
are not authorized to appoint sub-agents with respect to Notes sold through
them as agent. All Notes sold through an Agent as agent will be sold at 100%
of their principal amount unless otherwise agreed to by the Company and such
Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through an Agent, as agent, commencing
at any time for any period of time or permanently. As soon as practicable
after receipt of instructions from the Company, such Agent will suspend
solicitation of purchases from the Company until such time as the Company has
advised such Agent that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Note sold by the Company as a result of a solicitation made by such Agent as
set forth in Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest rate
or formula, maturity date and other terms of the Notes (as applicable)
specified in Exhibit A hereto shall be agreed upon by the Company and the
applicable Agent or Agents and specified in a pricing supplement to the
Prospectus (each, a "Pricing Supplement") to be prepared in connection with
each sale of Notes. Except as may be otherwise specified in the applicable
Pricing Supplement, the Notes will be issued in denominations of U.S. $1,000 or
any larger amount that is an integral multiple
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of U.S. $1,000. Administrative procedures with respect to the sale of Notes
shall be agreed upon from time to time by the Company, the Agents and the
Trustee (the "Procedures"). The Agents and the Company agree to perform, and
the Company agrees to cause the Trustee to agree to perform, their respective
duties and obligations specifically provided to be performed by them in the
Procedures.
SECTION 4. Covenants of the Company.
The Company covenants with the Agents as follows:
(a) Notice of Certain Events. The Company will notify the Agents
promptly, and confirm such notice in writing, of (i) the effectiveness of any
amendment to the Registration Statement, (ii) the transmittal to the SEC for
filing of any amendment or supplement to the Prospectus or any document to be
filed pursuant to the 1934 Act (other than any amendment, supplement or
document relating solely to securities other than the Notes), (iii) the receipt
of any comments from the SEC with respect to the Registration Statement or the
Prospectus, (iv) any request by the SEC for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for additional
information, (v) the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose and (vi) any change in the rating assigned by any
nationally recognized statistical rating organization to any debt securities of
the Company or the public announcement by any nationally recognized statistical
rating organization that it has under surveillance or review, with possible
negative implications, its rating of any debt securities of the Company. The
Company will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) Notice of Certain Proposed Filings. The Company will give the
Agents advance notice of its intention to file or prepare any additional
registration statement with respect to the registration of additional Notes,
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus (other than an amendment or supplement providing solely for a
change in the interest rate or formula applicable to the Notes or relating
solely to the issuance and/or offering of securities other than the Notes),
whether by the filing of documents pursuant to the 1934 Act or the 1933 Act or
otherwise, and will furnish to the Agents copies of any such amendment or
supplement or other documents proposed to be filed or used a reasonable time in
advance of such proposed filing or use, as the case may be, and will not file
any such amendment or supplement or other documents in a form to which the
Agents or counsel for the Agents shall reasonably object.
(c) Copies of the Registration Statement and the Prospectus. The
Company will deliver to the Agents as many signed and conformed copies of the
Registration Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated by reference in the Prospectus) as the Agents reasonably
request. The Company will furnish to the Agents as many copies of the
Prospectus (as amended or supplemented) as the Agents reasonably request so
long as the Agents
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are required to deliver a Prospectus in connection with sales or solicitations
of offers to purchase the Notes.
(d) Preparation of Pricing Supplements. The Company will prepare,
with respect to any Notes to be sold to or through one or more Agents pursuant
to this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by the Agents and will file such Pricing Supplement
pursuant to Rule 424(b)(3) under the 1933 Act not later than the close of
business of the SEC on the fifth business day after the date on which such
Pricing Supplement is first used.
(e) Revisions of Prospectus -- Material Changes. Except as
otherwise provided in subsection (l) of this Section, if at any time during the
term of this Agreement any event shall occur or condition exist as a result of
which it is necessary, in the opinion of counsel for the Agents or counsel for
the Company, to amend or supplement the Prospectus in order that the Prospectus
will not include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, or if it shall be necessary, in the opinion of either
such counsel, to amend or supplement the Registration Statement or the
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company shall give immediate notice, confirmed in writing,
to the Agents to cease the solicitation of offers to purchase the Notes in
their capacity as agents and to cease sales of any Notes they may then own as
principal, and the Company will promptly amend the Registration Statement and
the Prospectus, whether by filing documents pursuant to the 1934 Act or the
1933 Act or otherwise, as may be necessary to correct such untrue statement or
omission or to make the Registration Statement and Prospectus comply with such
requirements.
(f) Prospectus Revisions -- Periodic Financial Information.
Except as otherwise provided in subsection (l) of this Section, on or prior to
the date on which there shall be released to the general public interim
financial statement information related to the Company with respect to each of
the first three quarters of any fiscal year or preliminary financial statement
information with respect to any fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall cause the Prospectus
to be amended or supplemented to include or incorporate by reference financial
information with respect thereto and corresponding information for the
comparable period of the preceding fiscal year, as well as such other
information and explanations as shall be necessary for an understanding thereof
or as shall be required by the 1933 Act or the 1933 Act Regulations.
(g) Prospectus Revisions -- Audited Financial Information. Except
as otherwise provided in subsection (l) of this Section, on or prior to the
date on which there shall be released to the general public financial
information included in or derived from the audited financial statements of the
Company for the preceding fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall cause the
Registration Statement and the Prospectus to be amended, whether by the filing
of documents pursuant to the 1934 Act or the 1933 Act or otherwise, to include
or incorporate by reference such audited financial state-
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ments and the report or reports, and consent or consents to such inclusion or
incorporation by reference, of the independent accountants with respect there
to, as well as such other information and explanations as shall be necessary
for an understanding of such financial statements or as shall be required by
the 1933 Act or the 1933 Act Regulations.
(h) Earnings Statements. The Company will make generally
available to its security holders as soon as practicable, but not later than 90
days after the close of the period covered thereby, an earnings statement (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering each twelve month period beginning, in each case, not later than the
first day of the Company's fiscal quarter next following the "effective date"
(as defined in such Rule 158) of the Registration Statement with respect to
each sale of Notes.
(i) Blue Sky Qualifications. The Company will endeavor, in
cooperation with the Agents, to qualify the Notes for offering and sale under
the applicable securities laws of such states and other jurisdictions of the
United States as the Agents may designate, and will maintain such
qualifications in effect for as long as may be required for the distribution of
the Notes; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified. The Company
will file such statements and reports as may be required by the laws of each
jurisdiction in which the Notes have been qualified as above provided. The
Company will promptly advise the Agents of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Notes
for sale in any such state or jurisdiction or the initiating or threatening of
any proceeding for such purpose.
(j) 1934 Act Filings. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act in
connection with sales of the Notes, will file all documents required to be
filed with the SEC pursuant to Sections 13, 14 or 15(d) of the 1934 Act within
the time periods prescribed by the 1934 Act and the 1934 Act Regulations.
(k) Stand-Off Agreement. If specified by the applicable Agent or
Agents in connection with a purchase of Notes from the Company as principal,
between the date of the agreement to purchase such Notes and the Settlement
Date with respect to such purchase, the Company will not, without the prior
written consent of such Agent or Agents, offer or sell, grant any option for
the sale of, or enter into any agreement to sell, any debt securities of the
Company (other than the Notes that are to be sold pursuant to such agreement or
commercial paper in the ordinary course of business).
(l) Suspension of Certain Obligations. The Company shall not be
required to comply with the provisions of subsections (e), (f) or (g) of this
Section or subsections (b), (c) or (d) of Section 7 during any period from the
time (i) the Agents shall have suspended solicitation of purchases of the Notes
in their capacity as agents pursuant to a request from the Company and (ii) no
Agent shall then hold any Notes purchased as principal pursuant hereto, until
the time the Company shall determine that solicitation of purchases of the
Notes should be resumed or an Agent shall subsequently purchase Notes from the
Company as principal.
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SECTION 5. Conditions of Obligations.
The obligations of the Agents to purchase Notes from the Company as
principal and to solicit offers to purchase Notes as agent of the Company, and
the obligations of any purchasers of Notes sold through an Agent as agent, will
be subject to the accuracy, in all material respects, of the representations
and warranties on the part of the Company herein and to the accuracy of the
statements of the Company's directors or officers made in any certificate
furnished pursuant to the provisions hereof, to the performance and observance
by the Company of all its covenants and agreements herein contained and to the
following additional conditions precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have
received the following legal opinions, dated as of the date hereof and in form
and substance satisfactory to the Agents:
(1) Opinion of Company Counsel. The favorable opinion of
Dykema Gossett P.L.L.C., counsel to the Company, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Michigan.
(ii) The Company has corporate power and authority to
own, lease and operate its properties and to conduct its
business as described in the Prospectus.
(iii) The Company is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so
qualify and be in good standing would not have a material
adverse effect on the financial condition, results of
operations or earnings of the Company and its subsidiaries
considered as one enterprise.
(iv) Each Significant Subsidiary has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease
and operate its properties and conduct its business as
described in the Prospectus, and, to the best of such
counsel's knowledge, is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so
qualify and be in good standing would not have a material
adverse effect on the financial condition, results of
operations or earnings of the Company and its subsidiaries
considered as one enterprise; and all of the issued and
outstanding capital stock of each Significant Subsidiary has
been duly authorized and validly issued, is fully paid and
non-assessable, and, except for directors' qualifying shares
(if applicable), is owned by the Company, free and clear of
any mortgage, pledge, lien, encumbrance, claim or equity.
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(v) The Company is duly registered as a savings and
loan holding company under the HOLA.
(vi) This Agreement has been duly authorized, executed
and delivered by the Company.
(vii) The Indenture has been duly authorized, executed
and delivered by the Company and (assuming the Indenture has
been duly authorized, executed and delivered by the Trustee)
constitutes a legal, valid and binding agreement of the
Company, enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or
affecting enforcement of creditors' rights generally or by
general equity principles.
(viii) The Notes, in the form(s) certified by the Company
as of the date hereof, have been duly authorized for issuance,
offer and sale pursuant to this Agreement and, when issued,
authenticated and delivered pursuant to the provisions of this
Agreement and the Indenture against payment of the
consideration therefor, will constitute valid and legally
binding obligations of the Company, enforceable in accordance
with their terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting enforcement of creditors' rights
generally or by general equity principles; and each holder of
Notes will be entitled to the benefits of the Indenture.
(ix) The Notes and the Indenture conform in all
material respects to the statements relating thereto in the
Prospectus; and the statements in the Prospectus under the
captions "Description of Notes" and "Description of Debt
Securities", insofar as they purport to summarize certain
provisions of documents specifically referred to therein, are
accurate summaries of such provisions.
(x) The Indenture has been duly qualified under the
1939 Act.
(xi) The Registration Statement has been declared
effective by the SEC under the 1933 Act and, to the best of
such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
under the 1933 Act or proceedings therefor initiated or
threatened by the SEC.
(xii) The Registration Statement and the Prospectus,
excluding the documents incorporated by reference therein, as
of their respective effective or issue dates, comply as to
form in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations.
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(xiii) Each document filed pursuant to the 1934 Act and
incorporated by reference in the Prospectus complied when so
filed as to form in all material respects with the 1934 Act
and the 1934 Act Regulations.
(xiv) The Notes, in the form(s) certified by the Company
as of the date hereof, when issued, authenticated and
delivered pursuant to the provisions of this Agreement and the
Indenture, will be excluded or exempted from the provisions of
the Commodity Exchange Act.
(xv) Neither the Company nor any of its subsidiaries is
required to be registered under the 1940 Act.
(xvi) No consent, approval, authorization, order or
decree of any court or governmental authority or agency is
required that has not been obtained in connection with the
consummation by the Company of the transactions contemplated
by this Agreement or the Indenture, except such as have been
obtained or rendered, as the case may be, or as may be
required under the state securities laws.
(xvii) The information contained in the Prospectus under
the caption "Certain United States Federal Income Tax
Considerations", to the extent that such information
constitutes matters of law, summaries of legal matters or
legal conclusions, has been reviewed by such counsel and is
correct.
(2) Opinion of Counsel to the Agents. The favorable
opinion of Brown & Wood, counsel to the Agents, covering the matters
referred to in subsection (a)(1) under the subheadings (vi) to (xii),
inclusive, above.
(3) Disclosure Documents. In giving their opinions
required by subsection (a)(1) and (a)(2), respectively, of this
Section 5, Dykema Gossett P.L.L.C. and Brown & Wood shall each
additionally state that nothing has come to their attention that would
lead them to believe that the Registration Statement, at the time it
became effective (or, if an amendment to the Registration Statement or
an Annual Report on Form 10-K has been filed by the Company with the
SEC subsequent to the effectiveness of the Registration Statement,
then at the time such amendment became effective or at the time of the
most recent such filing, as the case may be) or at the date hereof,
contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein not
misleading or that the Prospectus, at the date hereof (or, if such
opinion is being delivered in connection with the purchase of Notes
from the Company by one or more Agents as principal pursuant to
Section 7(c) hereof, at the date of any agreement by such Agent or
Agents to purchase Notes as principal and at the Settlement Date with
respect thereto, as the case may be) (included or) includes an untrue
statement of a material fact or (omitted or) omits to state a material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
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(b) Officer's Certificate. At the date hereof, the Agents shall
have received a certificate of the Chief Executive Officer, President or Vice
President and the principal financial officer or principal accounting officer
of the Company, dated as of the date hereof, to the effect that (i) since the
respective dates as of which information is given in the Prospectus or since
the date of any agreement by one or more Agents to purchase Notes from the
Company as principal, there has not been any material adverse change in the
financial condition, results of operations or earnings of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, (ii) the representations and warranties of the
Company contained in Section 2 hereof are true and correct in all material
respects with the same force and effect as though expressly made at and as of
the date of such certificate and (iii) the Company has performed or complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the date of such certificate. As used in this Section
5(b), the term "Prospectus" means the Prospectus in the form first provided to
the applicable Agent or Agents for use in confirming sales of the Notes.
(c) Comfort Letter of Deloitte & Touche LLP. On the date hereof,
the Agents shall have received a letter from Deloitte & Touche LLP, dated as of
the date hereof and in form and substance satisfactory to the Agents, to the
effect that:
(i) They are independent accountants with respect to the
Company within the meaning of the 1933 Act, the 1933 Act Regulations,
the 1934 Act and the 1934 Act Regulations.
(ii) It is their opinion that the consolidated financial
statements and supporting schedule(s) of the Company and its
subsidiaries and included or incorporated by reference in the
Registration Statement and the Prospectus and audited by them and
covered by their opinions therein comply in form in all material
respects with the applicable accounting requirements of the 1933 Act,
the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations.
(iii) They have performed specified procedures, not constituting
an audit, including a reading of the latest available interim
financial statements of the Company and its indicated subsidiaries, a
reading of the minute books of the Company and such subsidiaries since
the end of the most recent fiscal year with respect to which an audit
report has been issued, inquiries of and discussions with certain
officials of the Company and such subsidiaries responsible for
financial and accounting matters with respect to the unaudited
consolidated financial statements included or incorporated by
reference in the Registration Statement and Prospectus and the latest
available interim unaudited financial statements of the Company and
its subsidiaries, and such other inquiries and procedures as may be
specified in such letter, and on the basis of such inquiries and
procedures, nothing came to their attention that caused them to
believe that: (A) any material modifications should be made to the
unaudited consolidated financial statements of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement and Prospectus for them to be in conformity with generally
accepted accounting principles in the United States, (B) the unaudited
consolidated financial
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statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement and Prospectus
do not comply as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the 1934 Act Regulations
or (C) at a specified date not more than three days prior to the date
of such letter, there was any change in the consolidated capital
stock, any increase in consolidated long-term debt or any decrease in
the consolidated net current assets or consolidated net assets of the
Company and its subsidiaries, in each case as compared with the
amounts shown on the most recent consolidated balance sheet of the
Company and its subsidiaries included or incorporated by reference in
the Registration Statement and Prospectus or, during the period from
the date of such balance sheet to a specified date not more than three
days prior to the date of such letter, there were any decreases, as
compared with the corresponding period in the preceding year, in
consolidated revenues or in the total or per-share amounts of income
before extraordinary items or of net income of the Company and its
subsidiaries, except in all instances for changes, increases or
decreases that the Registration Statement and Prospectus disclose have
occurred or may occur or except for such exceptions enumerated in such
letter as shall have been agreed to by the Agents and the Company.
(iv) They are unable to and do not express any opinion on the
Pro Forma Combining Statement of Operations (the "Pro Forma
Statement") included in the Registration Statement and the Prospectus
or on the pro forma adjustments applied to the historical amounts
included in the Pro Forma Statement; however, for purposes of such
letter they have (A) read the Pro Forma Statement; (B) performed [an
audit] [a review in accordance with SAS 71] of the financial
statements which the pro forma adjustments were applied; (C) made
inquiries of certain officials of the Company who have responsibility
for financial and accounting matters about the basis for their
determination of the pro forma adjustments and whether the Pro Forma
Statement complies as to form in all material respects with the
applicable accounting requirements of Rule 11-02 of Regulation S-X;
and (D) proved the arithmetic accuracy of the application of the pro
forma adjustments to the historical amounts in the Pro Forma
Statement. On the basis of such procedures and such other inquiries
and procedures as specified therein, nothing came to their attention
that caused them to believe that the Pro Forma Statement included or
incorporated by reference in the Registration Statement does not
comply as to form in all material respects with the applicable
requirements of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical amounts
in the compilation of those statements.
(v) In addition to the audit referred to in their opinions and
the limited procedures referred to in clause (iii) above, they have
carried out certain specified procedures, not constituting an audit,
with respect to certain amounts, percentages and financial information
which are included or incorporated by reference in the Registration
Statement and the Prospectus and which are specified by the Agents,
and have found such amounts, percentages and financial information to
be in agreement with the relevant accounting, financial and other
records of the Company and its subsidiaries identified in such letter.
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(d) Other Documents. On the date hereof and on each Settlement
Date, counsel to the Agents shall have been furnished with such documents and
opinions as such counsel may reasonably require for the purpose of enabling
such counsel to pass upon the issuance and sale of Notes as herein contemplated
and related proceedings, or in order to evidence the accuracy and completeness
of any of the representations and warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of Notes as herein contemplated shall be
reasonably satisfactory in form and substance to the Agents and to counsel to
the Agents.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the applicable Agent or Agents by notice to the Company at any
time and any such termination shall be without liability of any party to any
other party, except that the covenant regarding provision of an earnings
statement set forth in Section 4(h) hereof, the provisions concerning payment
of expenses under Section 10 hereof, the indemnity and contribution agreement
set forth in Sections 8 and 9 hereof, the provisions concerning the
representations, warranties and agreements to survive delivery of Section 11
hereof, the provisions relating to governing law and forum set forth in Section
14 and the provisions relating to parties set forth in Section 15 hereof shall
remain in effect.
SECTION 6. Delivery of and Payment for Notes Sold through an Agent.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, such Agent shall promptly notify the Company and deliver
such Note to the Company and, if such Agent has theretofore paid the Company
for such Note, the Company will promptly return such funds to such Agent. If
such failure occurred for any reason other than default by such Agent in the
performance of its obligations hereunder, the Company will reimburse such Agent
on an equitable basis for its loss of the use of the funds for the period such
funds were credited to the Company's account.
SECTION 7. Additional Covenants of the Company.
The Company covenants and agrees with the Agents that:
(a) Reaffirmation of Representations and Warranties. Each
acceptance by the Company of an offer for the purchase of Notes (whether to one
or more Agents as principal or through an Agent as agent), and each delivery of
Notes (whether to one or more Agents as principal or through an Agent as
agent), shall be deemed to be an affirmation that the representations and
warranties of the Company contained in this Agreement and in any certificate
theretofore delivered to the Agents pursuant hereto are true and correct at the
time of such acceptance or sale, as the case may be, and an undertaking that
such representations and warranties will be true and correct at the time of
delivery to such Agent or Agents or to the purchaser or its agent, as the case
may be, of the Note or Notes relating to such acceptance or sale, as the case
may be, as though made at and as of each such time (and it is understood that
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such representations and warranties shall relate to the Registration Statement
and Prospectus as amended and supplemented to each such time).
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for a change in the
interest rate or formula applicable to the Notes or relating solely to the
issuance and/or offering of securities other than the Notes), (ii) there is
filed with the SEC any document incorporated by reference into the Prospectus
(other than any Current Report on Form 8-K relating solely to the issuance
and/or offering of securities other than the Notes, unless the Agents shall
otherwise specify), (iii) (if required in connection with the purchase of Notes
from the Company by one or more Agents as principal) the Company sells Notes to
such Agent or Agents as principal or (iv) the Company sells Notes in a form not
previously certified to the Agents by the Company, the Company shall furnish or
cause to be furnished to the Agent(s), forthwith a certificate dated the date
of filing with the SEC of such supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may be,
in form satisfactory to the Agent(s) to the effect that the statements
contained in the certificate referred to in Section 5(b) hereof which were last
furnished to the Agents are true and correct at the time of such amendment,
supplement, filing or sale, as the case may be, as though made at and as of
such time (except that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same tenor as the
certificate referred to in Section 5(b) hereof, modified as necessary to relate
to the Registration Statement and the Prospectus as amended and supplemented to
the time of delivery of such certificate.
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for a change in the
interest rate or formula applicable to the Notes, providing solely for the
inclusion of additional financial information, or, unless the Agents shall
otherwise specify, relating solely to the issuance and/or offering of
securities other than the Notes), (ii) there is filed with the SEC any document
incorporated by reference into the Prospectus (other than any Current Report on
Form 8-K relating solely to the issuance and/or offering of securities other
than the Notes, unless the Agents shall otherwise specify), (iii) (if required
in connection with the purchase of Notes from the Company by one or more Agents
as principal) the Company sells Notes to such Agent or Agents as principal or
(iv) the Company sells Notes in a form not previously certified to the Agents
by the Company, the Company shall furnish or cause to be furnished forthwith to
the Agent(s) and to counsel to the Agents the written opinion of Dykema Gossett
P.L.L.C., counsel to the Company, or other counsel satisfactory to the
Agent(s), dated the date of filing with the SEC of such supplement or document,
the date of effectiveness of such amendment, or the date of such sale, as the
case may be, in form and substance satisfactory to the Agent(s), of the same
tenor as the opinion referred to in Section 5(a)(1) hereof, but modified, as
necessary, to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such opinion or, in lieu of
such opinion, counsel last furnishing such opinion to the Agents shall furnish
the Agent(s) with a letter substantially to the effect that the Agent(s) may
rely on such last opinion to the same extent as though it was dated the date of
such letter authorizing reliance (except that
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statements in such last opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such letter authorizing reliance).
(d) Subsequent Delivery of Comfort Letters. Each time that (i)
the Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information (other than by an amendment or
supplement relating solely to the issuance and/or offering of securities other
than the Notes), (ii) there is filed with the SEC any document incorporated by
reference into the Prospectus which contains additional financial information,
or (iii) (if required in connection with the purchase of Notes from the Company
by one or more Agents as principal) the Company sells Notes to such Agent or
Agents as principal, the Company shall cause Deloitte & Touche LLP forthwith to
furnish to the Agent(s) a letter, dated the date of effectiveness of such
amendment, supplement or document with the SEC, or the date of such sale, as
the case may be, in form satisfactory to the Agent(s), of the same tenor as the
portions of the letter referred to in clauses (i) and (ii) of Section 5(c)
hereof but modified to relate to the Registration Statement and Prospectus as
amended and supplemented to the date of such letter, and of the same general
tenor as the portions of the letter referred to in clauses (iii) and (iv) of
said Section 5(c) with such changes as may be necessary to reflect changes in
the financial statements and other information derived from the accounting
records of the Company.
SECTION 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls
such Agent within the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in
the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, unless such untrue statement or
omission or such alleged untrue statement or omission was made in
reliance upon and in conformity with written information furnished to
the Company by the Agents expressly for use in the Registration
Statement or the Prospectus;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
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(iii) against any and all expense whatsoever (including
the reasonable fees and disbursements of counsel chosen by such
Agent), as incurred, reasonably incurred in investigating, preparing
or defending against any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above, unless such untrue
statement or omission or such alleged untrue statement or omission was
made in reliance upon and in conformity with written information
furnished to the Company by such Agent expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto).
(b) Indemnification of the Company. Each Agent agrees to
indemnify and hold harmless the Company, its directors, each of its officers
who signed the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act against any and
all loss, liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section, as incurred, but only with respect
to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity
with written information furnished to the Company by such Agent expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto).
(c) General. Each indemnified party shall give prompt notice to
each indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it may
have otherwise than on account of this indemnity agreement. An indemnifying
party may participate at its own expense in the defense of such action with
counsel chosen by it (who shall not, except with the consent of the indemnified
party, be counsel to such indemnified party). In no event shall the
indemnifying parties be liable for the fees and expenses of more than one
counsel (in addition to any local counsel) for all indemnified parties in
connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances.
SECTION 9. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 8 hereof
is for any reason held to be unavailable to or insufficient to hold harmless
the indemnified parties although applicable in accordance with its terms, the
Company and the Agents shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by said indemnity
agreement incurred by the Company and the Agents, as incurred, in such
proportions that each Agent is responsible for that portion represented by the
percentage that the commission or underwriting discount received by such Agent
bears to the total sales price from the sale of the Notes sold to or through
such Agent that were the subject of the claim for indemnification, and the
Company is
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responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section, each person,
if any, who controls an Agent within the meaning of Section 15 of the 1933 Act
shall have the same rights to contribution as such Agent, and each director of
the Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act shall have the same rights to contribution as the
Company.
SECTION 10. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation and filing of the Registration Statement and
all amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) The preparation, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the eligibility and issuance of
Notes in book-entry form;
(d) The fees and disbursements of the Company's accountants and
counsel, of the Trustee and its counsel, and of any calculation agent or
exchange rate agent;
(e) The reasonable fees and disbursements of counsel to the Agents
incurred in connection with the establishment of the program relating to the
Notes and incurred from time to time in connection with the transactions
contemplated hereby;
(f) The qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(i) hereof, including filing fees
and the reasonable fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky or
Legal Investment Survey;
(g) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any amendments
thereto, and of the Prospectus and any amendments or supplements thereto;
(h) The preparation, reproducing and delivery to the Agents of
copies of the Indenture and all amendments, supplements and modifications
thereto;
(i) Any fees charged by nationally recognized statistical rating
organizations for the rating of the Notes;
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(j) The fees and expenses incurred in connection with any listing
of Notes on a securities exchange;
(k) The fees and expenses incurred with respect to any filing with
the National Association of Securities Dealers, Inc.;
(l) Any advertising and other out-of-pocket expenses of the Agents
incurred with the approval of the Company; and
(m) The cost of providing any CUSIP or other identification
numbers for the Notes.
SECTION 11. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto or thereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Agents or any
controlling person of an Agent, or by or on behalf of the Company, and shall
survive each delivery of and payment for any of the Notes.
SECTION 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
agreement by one or more Agents to purchase Notes from the Company as
principal) may be terminated for any reason, at any time by either the Company
or an Agent, as to itself, upon the giving of 10 days' written notice of such
termination to the other party hereto.
(b) Termination of Agreement to Purchase Notes as Principal. The
applicable Agent or Agents may terminate any agreement by such Agent or Agents
to purchase Notes from the Company as principal, immediately upon notice to the
Company, at any time prior to the Settlement Date relating thereto, if (i)
there has been, since the date of such agreement or since the respective dates
as of which information is given in the Prospectus, any material adverse change
in the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there shall have occurred any material adverse change in the financial markets
in the United States or any outbreak or escalation of hostilities or other
national or international calamity or crisis the effect of which is such as to
make it, in the judgment of such Agent or Agents, impracticable to market the
Notes or enforce contracts for the sale of the Notes, or (iii) trading in any
securities of the Company has been suspended by the SEC or a national
securities exchange, or if trading generally on either the American Stock
Exchange or the New York Stock Exchange shall have been suspended, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices for
securities have been required, by either of said exchanges or by order of the
SEC or any other governmental authority, or if a banking moratorium shall have
been declared by either Federal, New York or Michigan authorities or if a
banking moratorium shall have been declared by the relevant authorities in the
country or countries of origin of any foreign currency or currencies in which
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the Notes are denominated or payable, or (iv) the rating assigned by any
nationally recognized statistical rating organization to any debt securities of
the Company as of the date of such agreement shall have been lowered since that
date or if any such rating organization shall have publicly announced that it
has under surveillance or review, with possible negative implications, its
rating of any debt securities of the Company, or (v) there shall have come to
the attention of such Agent or Agents any facts that would cause them to
believe that the Prospectus, at the time it was required to be delivered to a
purchaser of Notes, included an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements therein, in
light of the circumstances existing at the time of such delivery, not
misleading. As used in this Section 12(b), the term "Prospectus" means the
Prospectus in the form first provided to the applicable Agent or Agents for use
in confirming sales of the related Notes.
(c) General. In the event of any such termination, neither party
will have any liability to the other party hereto, except that (i) the Agents
shall be entitled to any commission earned in accordance with the third
paragraph of Section 3(b) hereof, (ii) if at the time of termination (a) any
Agent shall own any Notes purchased by it as principal with the intention of
reselling them or (b) an offer to purchase any of the Notes has been accepted
by the Company but the time of delivery to the purchaser or his agent of the
Note or Notes relating thereto has not occurred, the covenants set forth in
Sections 4 and 7 hereof shall remain in effect until such Notes are so resold
or delivered, as the case may be, and (iii) the covenant set forth in Section
4(h) hereof, the provisions of Section 10 hereof, the indemnity and
contribution agreements set forth in Sections 8 and 9 hereof, and the
provisions of Sections 11, 14 and 15 hereof shall remain in effect.
SECTION 13. Notices.
Unless otherwise provided herein, all notices required under the terms
and provisions hereof shall be in writing, either delivered by hand, by mail or
by telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
If to the Company:
Standard Federal Bancorporation, Inc.
2600 West Big Beaver Road
Troy, Michigan 48084
Attention: Joseph Krul
Telecopy No.: (810) 643-0329
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If to the Agents:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower - 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
Telecopy No.: (212) 449-2234
[OTHER AGENTS]
[ADDRESS]
Attention: ________________
Telecopy No.: (___) ________
or at such other address as such party may designate from time to time by
notice duly given in accordance with the terms of this Section 13.
SECTION 14. Governing Law; Forum.
This Agreement and all the rights and obligations of the parties shall
be governed by and construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in such State. Any
suit, action or proceeding brought by the Company against any Agent in
connection with or arising under this Agreement shall be brought solely in the
state or federal court of appropriate jurisdiction located in the Borough of
Manhattan, The City of New York.
SECTION 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to
in Sections 8 and 9 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 parties
hereto and respective successors and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Notes shall be deemed to be
a successor by reason merely of such purchase.
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SECTION 16. Counterparts.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
If the foregoing is in accordance with the Agents' understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement between the Agents and the Company in accordance with its terms.
Very truly yours,
STANDARD FEDERAL BANCORPORATION, INC.
By:__________________________________
Name:
Title:
Confirmed and Accepted, as of the date
first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:_____________________
[OTHER AGENTS]
By:_____________________
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EXHIBIT A
The following terms, if applicable, shall be agreed to by one or more
Agents and the Company in connection with each sale of Notes:
Principal Amount: $_______
(or principal amount of foreign currency or composite
currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Default Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
[ ] LIBOR Reuters
[ ] LIBOR Telerate
Index Currency:
If CMT Rate,
Designated CMT Telerate Page:
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Default Rate:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
If Repayable:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
Purchase Price: ___%, plus accrued interest, if any, from ___________
Settlement Date and Time:
Additional/Other Terms:
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Also, in connection with the purchase of Notes from the Company by one or more
Agents as principal, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 7(b) of the Distribution
Agreement.
Legal Opinions pursuant to Section 7(c) of the Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(k) of the Distribution
Agreement.
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SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the sale
of each Note equal to the principal amount of such Note multiplied by the
appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
- --------------- ----------------
From 9 months to less than 1 year . . . . . . . . . . . . . . . . . . . .125%
From 1 year to less than 18 months . . . . . . . . . . . . . . . . . . .150
From 18 months to less than 2 years . . . . . . . . . . . . . . . . . . .200
From 2 years to less than 3 years . . . . . . . . . . . . . . . . . . . .250
From 3 years to less than 4 years . . . . . . . . . . . . . . . . . . . .350
From 4 years to less than 5 years . . . . . . . . . . . . . . . . . . . .450
From 5 years to less than 6 years . . . . . . . . . . . . . . . . . . . .500
From 6 years to less than 7 years . . . . . . . . . . . . . . . . . . . .550
From 7 years to less than 10 years . . . . . . . . . . . . . . . . . . .600
From 10 years to less than 15 years . . . . . . . . . . . . . . . . . . .625
From 15 years to less than 20 years . . . . . . . . . . . . . . . . . . .700
From 20 years to 30 years . . . . . . . . . . . . . . . . . . . . . . . .750
Greater than 30 years. . . . . . . . . . . . . . . . . . . . . . . . . *
- ---------------
* As agreed to by the Company and the applicable Agent at the time of
sale.