EXHIBIT 1
BANKBOSTON CAPITAL TRUST III
(a Delaware business trust)
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
PURCHASE AGREEMENT
Dated: ___________ , 1997
Draft of May 28, 1997
BANKBOSTON CAPITAL TRUST III
(a Delaware business trust)
$250,000,000
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
PURCHASE AGREEMENT
_______, 1997
MORGAN STANLEY & CO. INCORPORATED
CS FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
as Representatives of the several Underwriters
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
BANKBOSTON CAPITAL TRUST III (the "Trust"), a statutory
business trust organized under the Business Trust Act (the
"Delaware Act") of the State of Delaware (Chapter 38, Title 12,
of the Delaware Code, 12 Del. (Sections 3801 et seq.)) and
BANKBOSTON CORPORATION, a Massachusetts corporation (the
"Company" and together with the Trust, the "Offerors"), confirm
their agreement (the "Agreement") with Morgan Stanley & Co.
Incorporated ("Morgan Stanley") and each of the other
Underwriters named in Schedule A hereto (collectively, the
"Underwriters", which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for
whom Morgan Stanley, CS First Boston Corporation, Lehman Brothers
Inc. and Salomon Brothers Inc are acting as representatives (in
such capacity, the "Representatives"), with respect to the issue
and sale by the Trust and the purchase by the Underwriters,
acting severally and not jointly, of the respective number of
Floating Rate Capital Securities (liquidation amount of $1,000
per capital security) of the Trust (the "Capital Securities") set
forth in said Schedule A. The Capital Securities will be
guaranteed by the Company, to the extent described in the
Prospectus (as defined below), with respect to distributions and
payments upon liquidation, redemption and
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otherwise (the "Capital Securities Guarantee") pursuant to the Capital
Securities Guarantee Agreement, to be dated as of _______, 1997 (the
"Capital Securities Guarantee Agreement"), between the Company and The Bank
of New York, as Trustee (the "Guarantee Trustee"). The Capital Securities
issued in book-entry form will be issued to Cede & Co. as nominee of The
Depository Trust Company ("DTC") pursuant to a letter agreement, to be
dated as of the Closing Time (as defined in Section 2(b)) (the "DTC
Agreement"), among the Trust, the Guarantee Trustee and DTC.
The Offerors understand that the Underwriters propose to
make a public offering of the Capital Securities as soon as the
Representatives deem advisable after this Agreement has been
executed and delivered and the Declaration (as defined herein),
the Indenture (as defined herein) and the Capital Securities
Guarantee Agreement have been qualified under the Trust Indenture
Act of 1939, as amended (the "1939 Act").
The entire proceeds from the sale of the Capital Securities
will be combined with the entire proceeds from the sale by the
Trust to the Company of its common securities (the "Common
Securities") , as guaranteed by the Company, to the extent set
forth in the Prospectus, with respect to distributions and
payments upon liquidation, redemption and otherwise (the "Common
Securities Guarantee" and, together with the Capital Securities
Guarantee, the "Guarantees") pursuant to the Common Securities
Guarantee Agreement, to be dated as of _______, 1997 (the "Common
Securities Guarantee Agreement" and, together with the Capital
Securities Guarantee Agreement, the "Guarantee Agreements"), made
by the Company, and will be used by the Trust to purchase
$257,732,000 aggregate principal amount of Floating Rate Junior
Subordinated Deferrable Interest Debentures due _______, 2027
(the "Subordinated Debentures") to be issued by the Company. The
Capital Securities and the Common Securities will be issued
pursuant to the Amended and Restated Declaration of Trust of the
Trust, to be dated as of _______, 1997 (the "Declaration"), among
the Company, as sponsor, Robert T. Jefferson, Kathleen M.
McGillycuddy and Craig V. Starble, as administrative trustees
(the "Administrative Trustees"), The Bank of New York, as
property trustee (the "Property Trustee"), and The Bank of New
York (Delaware), as Delaware trustee (the "Delaware Trustee,"
and, together with the Property Trustee and the Administrative
Trustees, the "Trustees"). The Subordinated Debentures will be
issued pursuant to an indenture, to be dated as of _______, 1997
(the "Indenture"), between the Company and The Bank of New York,
as trustee (the "Debenture Trustee").
The Capital Securities, the Capital Securities Guarantee and
the Subordinated Debentures are hereinafter collectively referred
to as the "Securities." The Indenture, the Declaration, the DTC
Agreement and this Agreement are hereinafter referred to
collectively as the "Operative Documents."
The Offerors have filed with the Securities and Exchange
Commission (the "Commission") a registration statement on
Form S-3 (No. 333-27229) covering the registration of the
Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or
prospectuses. Promptly after execution and delivery of this
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Agreement, the Offerors will either (i) prepare and file a
prospectus in accordance with the provisions of Rule 430A ("Rule
430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule
424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the
Offerors have elected to rely upon Rule 434 ("Rule 434") of the
1933 Act Regulations, prepare and file a term sheet (a "Term
Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). The information included in such prospectus or in such
Term Sheet, as the case may be, that was omitted from such
registration statement at the time it became effective but that
is deemed to be part of such registration statement at the time
it became effective (i) pursuant to paragraph (b) of Rule 430A is
referred to as "Rule 430A Information" or (ii) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Each prospectus used before such registration
statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434
Information, that was used after such effectiveness and prior to
the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including
the exhibits thereto, the schedules thereto, if any, and the
documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, at the time it became effective
and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the
term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final prospectus, including the
documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, in the form first furnished to
the Underwriters for use in connection with the offering of the
Securities, is herein called the "Prospectus." If Rule 434 is
relied on, the term "Prospectus" shall refer to the preliminary
prospectus and the Term Sheet, and all references in this
Agreement to the date of the Prospectus shall mean the date of
the Term Sheet. For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the
Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and
schedules and other information which is "contained," "included"
or "stated" in the Registration Statement, any preliminary
prospectus or the Prospectus (or other references of like import)
shall be deemed to mean and include all such financial statements
and schedules and other information which are incorporated by
reference in the Registration Statement, any preliminary
prospectus or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the
Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to mean and include the filing of any
document under the Securities Exchange Act of 1934, as amended
(the "1934 Act"), which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the
Prospectus, as the case may be.
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SECTION 1. Representations and Warranties.
(a) The Offerors jointly and severally represent and
warrant to each Underwriter as of the date hereof and as of the
Closing Time, and agree with each Underwriter as follows:
(i) The Company meets the requirements for use of
Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement
or any Rule 462(b) Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have
been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request
on the part of the Commission for additional information has
been complied with.
At the respective times the Registration Statement, any
Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at the Closing Time,
the Registration Statement, the Rule 462(b) Registration
Statement and any amendments thereto complied and will
comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the 1939 Act and
the rules and regulations of the Commission under the 1939
Act (the "1939 Act Regulations"), and did not and will not
contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or
supplement was issued and at the Closing Time, included or
will include an untrue statement of a material fact or
omitted or will omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the
requirements of Rule 434. The representations and
warranties in this subsection shall not apply to statements
in or omissions from the Registration Statement (or any
amendments thereto) or Prospectus (or any amendments or
supplements thereto) made in reliance upon and in conformity
with information furnished to the Offerors in writing by any
Underwriter through Morgan Stanley expressly for use in the
Registration Statement (or any amendments thereto) or
Prospectus (or any amendments or supplements thereto).
Any preliminary prospectus and the prospectus filed as
part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant to Rule 424
under the 1933 Act, complied when so filed in all material
respects with the 1933 Act Regulations and any preliminary
prospectus and the Prospectus delivered to the Underwriters
for use in connection with this offering was identical to
the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted
by Regulation S-T.
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(ii) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and
the Prospectus, at the time they were or hereafter are filed
with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder (the
"1934 Act Regulations"), and, when read together with the
other information in the Prospectus, at the time the
Registration Statement became effective, at the time the
Prospectus was issued and at the Closing Time, did not and
will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(iii) The accountants who certified certain
financial statements and supporting schedules included in
the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) The consolidated financial statements,
together with the related schedules and notes, included in
the Registration Statement and the Prospectus present fairly
the consolidated financial position of the Company and its
subsidiaries at the dates indicated and the consolidated
results of operations, stockholders' equity and cash flows
of the Company and its subsidiaries for the periods
specified; said financial statements have been prepared in
conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such
financial statements. The supporting schedules, if any,
included in the Registration Statement present fairly the
information required to be stated therein. The summary
financial data included in the Prospectus present fairly the
information shown therein and have been compiled on a basis
consistent with that of the audited financial statements
included in the Registration Statement.
(v) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein or
contemplated thereby and, except for normal recurring
dividends on the capital stock of the Company, there has not
been (A) any material adverse change in the condition
(financial or otherwise), earnings, business affairs or
business prospects of the Trust, or of the Company and its
subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, (B) any
transaction entered into by the Trust, the Company or any
subsidiary, other than in the ordinary course of business,
that is material to the Trust, or to the Company and its
subsidiaries, considered as one enterprise, or (C) any
dividend or distribution of any kind declared, paid or made
by the Company on its capital stock.
(vi) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has the corporate power
and authority under such laws to own, lease and operate its
properties and to conduct its business as described in the
Prospectus; the Company is duly
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registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be
in good standing would not have a material adverse effect on the
Company and its subsidiaries, considered as one enterprise.
(vii) Each of BankBoston, N.A. ("BankBoston") and
Rhode Island Hospital Trust National Bank ("Hospital Trust")
is a duly organized and validly existing national banking
association under the laws of the United States, continues
to hold a valid certificate to do business as such and has
full power and authority to conduct its business as such;
Bank of Boston Connecticut is a duly organized and validly
existing state-chartered savings bank under the laws of the
State of Connecticut, continues to hold a valid certificate
to do business as such and has full power and authority to
conduct its business as such (BankBoston, Hospital Trust and
Bank of Boston Connecticut are referred to collectively as
the "Significant Subsidiaries"); each Significant Subsidiary
has the authority under its jurisdiction of organization to
own, lease and operate its properties and to conduct its
business and is duly authorized to transact business and is
in good standing in each jurisdiction in which it owns or
leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except
to the extent that the failure to so qualify or to be in
good standing would not have a material adverse effect on
the Company and its subsidiaries, considered as one
enterprise.
(viii) The Company does not have any
subsidiaries which are material to its business, except to
the extent that one or more of the Significant Subsidiaries
may be deemed to be so material.
(ix) (a) The Company had at the date indicated a
duly authorized and outstanding capitalization as set forth
in the Prospectus, (b) all of the outstanding shares of
capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable, and
(c) none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive rights of
any stockholder of the Company.
(x) The Trust has been duly created and is
validly existing in good standing as a business trust under
the Delaware Act with the power and authority to own
property and to conduct its business as described in the
Prospectus and to enter into and perform its obligations
under the Operative Documents, as applicable, and the
Capital 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.
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(xi) The Common Securities have been duly
authorized by the Declaration and, when issued and delivered
by the Trust to the Company against payment therefor as
described in the Prospectus, will be validly issued and will
represent undivided beneficial interests in the assets of
the Trust; 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.
(xii) As of the Closing Time, the Capital
Securities will have been duly authorized by the Trust and,
when issued and delivered against payment therefor as
provided herein, will be validly issued and 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 and the
issuance of the Capital Securities will not be subject to
preemptive or other similar rights.
(xiii) This Agreement has been duly authorized,
executed and delivered by the Offerors.
(xiv) The Declaration has been qualified under
the 1939 Act and has been 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 Declaration by
the Trustees, the Declaration will, at the Closing Time, be
a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by the
receivership, conservatorship and supervisory powers of bank
regulatory agencies generally as well as to bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity) and the
availability of equitable remedies (collectively, the
"Enforceability Exceptions").
(xv) The Capital Securities Guarantee Agreement
has been qualified under the 1939 Act; each of the Guarantee
Agreements has been duly authorized by the Company and, at
the Closing Time, will have been duly executed and delivered
by the Company and will constitute a valid and binding
obligation of the Company, enforceable against the Company
in accordance with its terms, except to the extent that
enforcement thereof may be limited by the Enforceability
Exceptions.
(xvi) The Indenture has been qualified under
the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and
delivered by the Company and will constitute a valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms except to the extent
that enforcement thereof may be limited by the
Enforceability Exceptions.
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(xvii) The Subordinated Debentures have been
duly authorized by the Company and, at the Closing Time,
will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture
and delivered against payment therefor as described in the
Prospectus, will constitute valid and binding obligations of
the Company, enforceable against the Company in accordance
with their terms except to the extent that enforcement
thereof may be limited by the Enforceability Exceptions; and
the Subordinated Debentures 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
in the Prospectus.
(xviii) Each of the Administrative Trustees of
the Trust is an officer of the Company or BankBoston and has
been duly authorized by the Company to execute and deliver
the Declaration.
(xix) The Trust is not, and following
consummation of the transactions contemplated hereby will
not be, an "investment company" or a company "controlled" by
an "investment company" which is required to be registered
under the Investment Company Act of 1940, as amended (the
"1940 Act").
(xx) The Operative Documents conform in all
material respects to the summary descriptions thereof
contained in the Prospectus.
(xxi) None of the Trust, the Company nor any
Significant Subsidiary is 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 agreement or instrument
to which it is a party or by which it may be bound or to
which any of its properties may be subject, except for such
defaults that would not have a material adverse effect on
the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise; the execution
and delivery of the Operative Documents by the Trust or the
Company, as the case may be, the issuance and delivery of
the Securities, the consummation by the Offerors of the
transactions contemplated in the Operative Documents, and
compliance by the Offerors with the terms of the Operative
Documents to which they are party have been duly authorized
by all necessary corporate action on the part of the Company
and, as at the Closing Time, will have been duly authorized
by all necessary action on the part of the Trust, and do not
and will not result in any violation of the charter or by-
laws of the Company or any Significant Subsidiary or the
Declaration or the trust certificate of the Trust filed with
the State of Delaware on May 14, 1997 (the "Trust
Certificate"), and do not and will not conflict with, or
result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property of assets of the Trust, the Company or any
Significant Subsidiary under (A) any indenture, mortgage,
loan agreement, note, lease or other agreement or instrument
to which the Trust, the Company or any Significant
Subsidiary is a party or by which it may be bound
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or to which any of its properties may be subject, except
for such conflicts, breaches or defaults or liens, charges
or encumbrances that would not have a material adverse effect
on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Trust, or the
Company and its subsidiaries considered as one enterprise or
(B) any existing applicable law, rule, regulation, judgment,
order or decree of any government, governmental
instrumentality or court, domestic or foreign, having
jurisdiction over the Trust, the Company or any Significant
Subsidiary or any of its properties.
(xxii) No filing with, or authorization,
approval, consent, license, order, registration,
qualification or decree of, any court or governmental
authority or agency, other than those that have been made or
obtained, is necessary or required for the performance by
the Company or the Trust of their obligations hereunder, in
connection with the issuance and sale of the Capital
Securities or the consummation of the transactions
contemplated by the Operative Documents, except as have been
previously made or obtained.
(xxiii) To the best knowledge of the Offerors,
no labor problem exists with employees of the Significant
Subsidiaries or is imminent that could adversely affect the
Trust, or the Company and its subsidiaries considered as one
enterprise, and the Offerors are not aware of any existing
or imminent labor disturbance by the employees of any of its
or the Significant Subsidiaries' principal suppliers,
contractors or customers that could be expected to
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Trust, or the Company and its subsidiaries considered
as one enterprise.
(xxiv) Except as disclosed in the Registration
Statement, there is no action, suit or proceeding before or
by any government, governmental instrumentality or court,
domestic or foreign, now pending or, to the knowledge of the
Company or the Trust, threatened against or affecting the
Trust, or the Company or any Significant Subsidiary that is
required to be disclosed in the Registration Statement or
that, in the final outcome, could, in the judgment of the
Company, result in any material adverse change in the
condition (financial or otherwise), earnings, business
affairs or business prospects of the Trust, or the Company
and its subsidiaries considered as one enterprise, or that
could materially and adversely affect the properties or
assets of the Trust, or the Company and its subsidiaries
considered as one enterprise, or that could adversely affect
the consummation of the transactions contemplated in the
Operative Documents; the aggregate liability or loss, if
any, resulting from the final outcome of all pending legal
or governmental proceedings to which the Trust, the Company
or any Significant Subsidiary is a party or which affect any
of its properties that are not described in the Registration
Statement, including ordinary routine litigation incidental
to its business, would not have a material adverse effect on
the condition (financial or otherwise), earnings, business
affairs or business prospects of the Trust, or the Company
and its subsidiaries considered as one enterprise.
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(xxv) There are no contracts or documents
which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by
reference therein or to be filed as exhibits thereto which
have not been so described or filed as required.
(xxvi) The Offerors and the Significant
Subsidiaries each owns or possesses, or can acquire on
reasonable terms, adequate patents, patent licenses,
trademarks, service marks and trade names necessary to carry
on their businesses as presently conducted, and neither the
Offerors nor any of the Significant Subsidiaries has
received any notice of infringement of or conflict with
asserted rights of others with respect to any patents,
patent licenses, trademarks, service marks or trade names
that, in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could materially adversely
affect the condition (financial or otherwise), earnings,
business affairs or business prospects of the Trust, or the
Company and its subsidiaries considered as one enterprise.
(xxvii) The Offerors and the Significant
Subsidiaries each owns, possesses or has obtained all
material governmental licenses, permits, certificates,
consents, orders, approvals and other authorizations
necessary to own or lease, as the case may be, and to
operate its properties and to carry on its business as
presently conducted, and neither the Offerors nor any
Significant Subsidiary has received any notice of
proceedings relating to revocation or modification of any
such licenses, permits, certificates, consents, orders,
approvals or authorizations that, in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Trust, or the Company and its subsidiaries considered
as one enterprise.
(xxviii) The Offerors and the Significant
Subsidiaries each has good and marketable title to all
properties and assets described in the Prospectus as owned
by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as (A) are described in the
Prospectus or (B) are neither material in amount nor
materially significant in relation to the business of the
Trust, or the Company and its subsidiaries considered as one
enterprise; and all of the leases and subleases material to
the business of the Trust, and the Company and its
subsidiaries considered as one enterprise, and under which
the Offerors or any Significant Subsidiary holds properties
described in the Prospectus, are in full force and effect,
and neither the Offerors nor any Significant Subsidiary has
any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Offerors or
any Significant Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the
rights of such corporation to the continued possession of
the leased or subleased premises under any such lease or
sublease.
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(xxix) The Company has not taken and will not
take, directly or indirectly, any action designed to, or
that might be reasonably expected to, cause or result in
stabilization or manipulation of the price of the
Securities.
(b) Any certificate signed by any Trustee of the Trust or
any duly authorized officer of the Company or any Significant
Subsidiary and delivered to the Representatives or to counsel for
the Underwriters shall be deemed a representation and warranty by
the Trust or the Company, as the case may be, to each Underwriter
as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein
set forth, the Trust agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and
not jointly, agrees to purchase from the Trust, at the price per
Capital Security set forth in Schedule B, the number of Capital
Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Capital Securities
which such Underwriter may become obligated to purchase pursuant
to the provisions of Section 10 hereof.
(b) Payment of the purchase price for, and delivery of
certificates for, the Capital Securities shall be made at the
offices of Skadden, Arps, Slate, Meagher & Flom LLP, 919 Third
Avenue, New York, New York 10022, or at such other place as
shall be agreed upon by the Representatives and the Offerors, at
10:00 A.M. (Eastern time) on the third (fourth, if the pricing
occurs after 4:30 P.M. (Eastern time) on any given day) business
day after the date hereof (unless postponed in accordance with
the provisions of Section 10), or such other time not later than
ten business days after such date as shall be agreed upon by the
Representatives and the Offerors (such time and date of payment
and delivery being herein called "Closing Time").
Payment shall be made to the Trust by wire transfer of
immediately available funds to a bank account designated by the
Trust against delivery to the Representatives for the respective
accounts of the Underwriters of certificates for the Capital
Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account,
to accept delivery of, receipt for, and make payment of the
purchase price for, the Capital Securities which it has agreed to
purchase. Morgan Stanley, individually and not as representative
of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Capital Securities to be
purchased by any Underwriter whose funds have not been received
by the Closing Time, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(c) Certificates for the Capital Securities shall be in
such denominations and registered in such names as the
Representatives may request in writing at least one full business
day before the Closing Time. The Securities will be made
available for examination and
11
packaging by the Representatives in The City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time.
(d) As compensation to the Underwriters for their
commitments hereunder and in view of the fact that the proceeds
of the sale of the Capital Securities will be used to purchase
Subordinated Debentures of the Company, the Company hereby agrees
to pay at the Closing Time to Morgan Stanley in immediately
available funds, for the accounts of the several Underwriters, a
commission per Capital Security to be delivered by the Trust
hereunder at the Closing Time as set forth in Schedule B.
SECTION 3. Covenants of the Offerors. The Offerors
covenant with each Underwriter as follows:
(a) The Offerors, subject to Section 3(b) hereof, will
comply with the requirements of Rule 430A or Rule 434, as
applicable, and will notify the Representatives immediately, and
confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall become effective,
or any supplement to the Prospectus or any amended Prospectus
shall have been filed, (ii) of the receipt of any comments from
the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and
(iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such
purposes. The Offerors will promptly effect the filings
necessary pursuant to Rule 424(b) and will take such steps as it
deems necessary to ascertain promptly whether the form of
prospectus transmitted for filing under Rule 424(b) was received
for filing by the Commission and, in the event that it was not,
it will promptly file such prospectus. The Offerors will make
every reasonable effort to prevent the issuance of any stop order
and, if any stop order is issued, to obtain the lifting thereof
at the earliest possible moment.
(b) The Offerors will give the Representatives notice of
its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)),
any Term Sheet or any amendment, supplement or revision to either
the prospectus included in the Registration Statement at the time
it became effective or to the Prospectus, whether pursuant to the
1933 Act, the 1934 Act or otherwise, will furnish the
Representatives with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document without the
consent of the Representatives, which consent shall not be
unreasonably withheld.
(c) The Offerors have furnished or will deliver to the
Representatives and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith
or incorporated by reference therein and documents incorporated
or deemed to be incorporated by reference therein) and
12
signed copies of all consents and certificates of experts, and will
also deliver to the Representatives, without charge, a conformed copy
of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the
Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical
to the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(d) The Offerors will furnish to each Underwriter, without
charge, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, such number of
copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters
will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to
the extent permitted by Regulation S-T.
(e) The Offerors will comply with the 1933 Act, the 1933
Act Regulations, the 1934 Act, the 1934 Act Regulations, the 1939
Act and the 1939 Act Regulations so as to permit the completion
of the distribution of the Capital Securities as contemplated in
this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in
connection with sales of the Capital Securities, any event shall
occur or condition shall exist as a result of which it is
necessary, in the reasonable opinion of counsel for the
Underwriters or for the Offerors, to amend the Registration
Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the
Offerors will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment or supplement as may be
necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such
requirements, and the Offerors will furnish to the Underwriters
such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) The Offerors will use their best efforts, in
cooperation with the Underwriters, to qualify the Capital
Securities for offering and sale under the applicable securities
laws of such states and other jurisdictions as the
Representatives may designate and to maintain such qualifications
in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the
Offerors shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Capital Securities
have been so qualified, the Offerors will file such statements
and reports as may be required by the laws of such jurisdiction
to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration
Statement and any Rule 462(b) Registration
13
Statement. The Offerors will also supply the Underwriters with
such information as is necessary for the determination of the
legality of the Capital Securities for investment under the laws
of such jurisdictions as the Underwriters may request.
(g) The Company and the Trust will make generally available
to their securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section 11(a) of the 1933
Act.
(h) The Offerors shall take all reasonable action necessary
to enable Standard & Poor's Ratings Services, a division of
McGraw Hill, Inc. ("S&P"), and Moody's Investors Service, Inc.
("Moody's") to provide their respective credit ratings of the
Capital Securities.
(i) The Offerors will cooperate with the Underwriters and
use their best efforts to permit the Capital Securities to be
eligible for clearance and settlement through the facilities of
DTC.
(j) The Trust will use the net proceeds received by it from
the sale of the Capital Securities; and the Company will use the
proceeds received by it from the sale of the Subordinated
Debentures, in the manners specified in the Prospectus under "Use
of Proceeds".
(k) Prior to the Closing Time, neither the Trust nor the
Company will, without the prior written consent of Morgan
Stanley, directly or indirectly, issue, sell, offer or agree to
sell, grant any option for the sale of, or otherwise dispose of,
Capital Securities, any security convertible into exchangeable or
exercisable for Capital Securities or the Subordinated Debentures
or any debt securities substantially similar (including
provisions with respect to the deferral of interest) to the
Subordinated Debentures or any equity security substantially
similar to the Capital Securities (except for the Securities
issued pursuant to this Agreement).
(l) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the
1934 Act and the 1934 Act Regulations.
SECTION 3A. Covenants of the Underwriters. Each of the
Underwriters represents and agrees as follows:
(a) The Underwriters will comply with the provisions of
Rule 2810 of the Conduct Rules of the National Association of
Securities Dealers, Inc. (the "NASD"), including, without
limitation, Sections (b)(2)(B) and (b)(3)(D) thereof.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident
to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the
14
Registration Statement (including financial statements and any
schedules or exhibits and any document incorporated therein by
reference) and of each amendment thereto, (ii) the preparation,
printing and delivery to the Underwriters of this Agreement, the
Operative Documents and such other documents as may be required
in connection with the offering, purchase, sale and delivery of
the Securities, (iii) the preparation, issuance and delivery of
the certificates for the Capital Securities to the Underwriters,
(iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) rating agency fees, (vi) the
fees and expenses of any trustee appointed under any of the
Operative Documents, including the fees and disbursements of
counsel for such trustees in connection with the Operative
Documents, (vii) the qualification of the Capital Securities
under securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable
fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of
the Blue Sky Survey and any supplement thereto, (viii) the
printing and delivery to the Underwriters of copies of each
preliminary prospectus, any Term Sheets and the Prospectus and
any amendments or supplements thereto, (ix) the preparation,
printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (x) the filing fees
incident to, and the reasonable fees and disbursements of counsel
to the Underwriters in connection with, the review, if any, by
the NASD of the terms of the sale of the Securities, (xi) the
fees and expenses of any transfer agent or registrar for the
Securities, and (xii) the cost of qualifying the Capital
Securities with DTC.
(b) Termination of Agreement. If this Agreement is
terminated by the Representatives in accordance with the
provisions of Section 5 or Section 9(a)(i) hereof, the Company
shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The
obligations of the several Underwriters hereunder are subject to
the accuracy of the representations and warranties of the
Offerors contained in Section 1 hereof or in certificates of any
Trustee of the Trust, officer of the Company or any of its
subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Offerors of their obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. The
Registration Statement, including any Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the
part of the Commission for additional information shall have been
complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430A Information
shall have been filed with the Commission in accordance with Rule
424(b) (or a post-effective amendment providing such information
shall have been filed and declared effective in accordance with
the requirements of Rule 430A) or, if the Offerors have elected
to rely upon
15
Rule 434, a Term Sheet shall have been filed with the Commission
in accordance with Rule 424(b).
(b) Opinion of Outside Counsel for Offerors. At the
Closing Time, the Underwriters shall have received the favorable
opinion, dated as of the Closing Time, of Brown & Wood LLP,
counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters.
(c) Opinion of General Counsel. At the Closing Time, the
Underwriters shall have received the favorable opinion, dated as
of the Closing Time, of Gary A. Spiess, General Counsel for the
Company, in form and substance reasonably satisfactory to counsel
for the Underwriters.
(d) Opinion of Special Delaware Counsel for Offerors. If
the opinion referred to in Section 5(b) does not cover applicable
matters of Delaware law, at the Closing Time, the Underwriters
shall have received the favorable opinion, dated as of the
Closing Time, of special Delaware counsel to the Offerors, in
form and substance reasonably satisfactory to counsel for the
Underwriters.
(e) Opinion of Counsel for The Bank of New York. At the
Closing Time, the Underwriters shall have received the favorable
opinion, dated as of the Closing Time, of Emmet, Marvin & Martin,
LLP, counsel to The Bank of New York, as Property Trustee under
the Declaration, and Guarantee Trustee under the Capital
Securities Guarantee Agreement, in form and substance reasonably
satisfactory to counsel for the Underwriters.
(f) Opinion of Special Tax Counsel for the Offerors. At
the Closing Time, the Underwriters shall have received an
opinion, dated as of the Closing Time, of Brown & Wood LLP,
special tax counsel to the Offerors, that (i) the Subordinated
Debentures will be classified for United States federal income
tax purposes as indebtedness of the Company, (ii) the Trust will
be classified for United States federal income tax purposes as a
grantor trust and not as an association taxable as a corporation
and (iii) although the discussion set forth in the Prospectus
under the heading "Certain Federal Income Tax Consequences" does
not purport to discuss all possible United States federal income
tax consequences of the purchase, ownership and disposition of
the Capital Securities, such discussion constitutes, in all
material respects, a fair and accurate summary of the United
States federal income tax consequences of the purchase, ownership
and disposition of the Capital Securities under current law.
Such opinion may be conditioned on, among other things, the
initial and continuing accuracy of the facts, financial and other
information, covenants and representations set forth in
certificates of officers of the Company and other documents
deemed necessary for such opinion.
(g) Opinion of Counsel for Underwriters. At the Closing
Time, the Underwriters shall have received the favorable opinion,
dated as of the Closing Time, of Skadden, Arps, Slate, Meagher &
Flom LLP, counsel for the Underwriters, with respect to the
incorporation and legal existence of the Company, the Capital
Securities, the Indenture, the Capital Securities
16
Guarantee, this Agreement, the Prospectus and other related
matters as the Underwriters may require. Such counsel may also
state that, insofar as such opinion involves factual matters, they
have relied, to the extent they deem proper, upon certificates of
Trustees of the Trust, officers of the Company and its
subsidiaries and certificates of public officials.
(h) Certificates. At the Closing Time, there shall not
have been, since the date hereof 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
Trust, or the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of
business, and the Representatives shall have received a
certificate of the Chairman, any Vice Chairman, the Chief
Executive Officer, the President or any Vice President of the
Company and of the chief financial officer, the chief accounting
officer or the Executive Director, Global Treasury of the Company
and a certificate of an Administrative Trustee of the Trust,
dated as of the Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations
and warranties in Section 1 hereof were true and correct when
made and are true and correct with the same force and effect as
though expressly made at and as of the Closing Time, (iii) the
Offerors have complied with all agreements and satisfied all
conditions on their part to be performed or satisfied at or prior
to the Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are
pending or, to each such officer's knowledge, are contemplated by
the Commission.
(i) Accountant's Comfort Letter. At the time of the
execution of this Agreement, the Representatives shall have
received from Coopers & Lybrand L.L.P. a letter dated such date,
in form and substance satisfactory to the Representatives,
together with signed or reproduced copies of such letter for each
of the other Underwriters, containing statements and information
of the type ordinarily included in accountants' "comfort letters"
to underwriters with respect to the financial statements and
certain financial information contained in the Registration
Statement and the Prospectus.
(j) Bring-down Comfort Letter. At the Closing Time, the
Representatives shall have received from Coopers & Lybrand L.L.P.
a letter, dated as of the Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to
subsection (i) of this Section, except that the specified date
referred to shall be a date not more than three business days
prior to the Closing Time.
(k) Maintenance of Rating. At the Closing Time, the
Capital Securities shall be rated at least baa1 by Moody's and
BBB by S&P, and the Trust shall have delivered to the
Representatives a letter dated the Closing Time, from each such
rating agency, or other evidence satisfactory to the
Representatives, confirming that the Capital Securities have such
ratings; and between the date of this Agreement and the Closing
Time, there shall not have occurred a downgrading in the rating
assigned to the Capital Securities or any of the Company's other
debt securities by any nationally recognized statistical rating
organization, and no such organization
17
shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of
the Capital Securities or any of the Company's other debt securities.
(l) Additional Documents. At the Closing Time, counsel for
the Underwriters shall have been furnished with such documents
and opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Capital Securities as
herein contemplated, or in order to evidence the accuracy of any
of the representations or warranties of the Offerors, or the
fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Offerors in connection with the issuance
and sale of the Capital Securities as herein contemplated shall
be satisfactory in form and substance to the Representatives and
counsel for the Underwriters.
(m) Termination of Agreement. If any condition specified
in this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement may be terminated by the
Representatives by notice to the Offerors at any time at or prior
to the Closing Time, and such termination shall be without
liability of any party to any other party except as provided in
Section 4 and except that Sections 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Offerors agree to
jointly and severally indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(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), including the Rule 430A Information and
the Rule 434 Information, if applicable, or the omission or
alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein
not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
preliminary prospectus or the Prospectus (or any amendment
or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading;
(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
any 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; provided that
(subject to
18
Section 6(d) below) any such settlement is effected with the
written consent of the Offerors; and
(iii) against any and all expense whatsoever, as
incurred (including the fees and disbursements of counsel
chosen by Morgan Stanley), reasonably incurred in
investigating, preparing or defending against any
litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission,
to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply
to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with written information furnished to the Offerors by any
Underwriter through Morgan Stanley expressly for use in the
Registration Statement (or any amendment thereto), including the
Rule 430A Information and the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto).
(b) Indemnification of Offerors, Directors and Officers.
Each Underwriter severally agrees to indemnify and hold harmless
the Offerors, their respective directors or trustees, the
Company's officers who signed the Registration Statement, and
each person, if any, who controls the Offerors within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements
or omissions, or alleged untrue statements or omissions, made in
the Registration Statement (or any amendment thereto), including
the Rule 430A Information and the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Offerors by
such Underwriter through Morgan Stanley expressly for use in
Registration Statement (or any amendment thereto) or such
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) Actions against Parties; Notification. Each
indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder,
but failure to so notify an indemnifying party shall not relieve
such indemnifying party from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in
any event shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. In
the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Morgan
Stanley, and, in the case of parties indemnified pursuant to
Section 6(b) above, counsel to the indemnified parties shall be
selected by the Offerors. An indemnifying party may participate
at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except
with the consent of
19
the indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties
in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without
the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under
this Section 6 or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii)
does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any
indemnified party.
(d) Settlement without Consent if Failure to Reimburse.
Notwithstanding the last sentence of Section 6(c), if at any time
an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable
for any settlement effected without its written consent if (i)
such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of
such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request
prior to the date of such settlement; provided that an
indemnifying party shall not be liable for any such settlement
effected without its consent if such indemnifying party (1)
reimburses such indemnified party in accordance with such request
to the extent it considers such request to be reasonable and (2)
provides written notice to the indemnified party substantiating
the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
SECTION 7. Contribution. In order to provide for just
and equitable contribution in circumstances under which the
indemnification provided for in Section 6 hereof is for any
reason held to be unenforceable by an indemnified party in
respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities,
claims, damages and expenses incurred by such indemnified party,
as incurred, 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
Capital Securities pursuant to this Agreement.
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 Capital Securities pursuant to this Agreement
shall be deemed to be in the same respective proportions as the
total net proceeds from the offering of the Capital Securities
pursuant to this Agreement (before deducting expenses) received
by the Offerors and the total commission received by the
Underwriters, bear to the aggregate initial public offering price
of the Capital Securities.
20
The Offerors and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above
in this Section 7 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon
any such untrue or alleged untrue statement or omission or
alleged omission.
Notwithstanding the provisions of this Section 7, no
Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Capital
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of
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 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act shall have the same rights
to contribution as such Underwriter, and each director of the
Company, each officer of the Company who signed the Registration
Statement, each trustee of the Trust and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several
in proportion to the number of Capital Securities set forth
opposite their respective names in Schedule A hereto and not
joint.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the
Company or trustees of the Trust submitted pursuant hereto shall
remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Trust or the
Company, and shall survive delivery of the Capital Securities to
the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may
terminate this Agreement, by notice to the Offerors, at any time
at or prior to the Closing Time (i) if there has been, since the
time of execution of this 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,
21
or in the earnings, business affairs or business prospects of the
Trust or the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, or
(ii) if there has occurred any material adverse change in the
financial markets in the United States or any outbreak of
hostilities or escalation thereof or other calamity or crisis, in
each case the effect of which is such as to make it, in the
judgment of the Representatives, impracticable to market the
Capital Securities or to enforce contracts for the sale of the
Capital Securities, or (iii) if trading in any securities of the
Company has been suspended or limited by the Commission, or if
trading generally on the American Stock Exchange or the New York
Stock Exchange or in the NASDAQ National Market System has been
suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required,
by any of said exchanges or by such system or by order of the
Commission, the NASD or any other governmental authority, or (iv)
if a banking moratorium has been declared by either Federal or
New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant
to this Section, such termination shall be without liability of
any party to any other party except as provided in Section 4
hereof, and provided further that Sections 1, 6, 7 and 8 shall
survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters.
If one or more of the Underwriters shall fail at the Closing Time
to purchase the Capital Securities which it or they are obligated
to purchase under this Agreement (the "Defaulted Securities"),
the Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities
in such amounts as may be agreed upon and upon the terms herein
set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not
exceed 10% of the total number of Capital Securities to be
purchased hereunder, each of the non-defaulting Underwriters
shall be obligated, severally and not jointly, to purchase
the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters,
or
(b) if the number of Defaulted Securities exceeds 10%
of the total number of Capital Securities to be purchased
hereunder, this Agreement shall terminate without liability
on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives or the
Company shall have the right to postpone the Closing Time for a
period not exceeding seven days in order to effect any required
changes in the Registration
22
Statement or Prospectus or in any other documents or arrangements.
As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Notices. All notices and other
communications hereunder shall be in writing and shall be deemed
to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives c/o Morgan Stanley at 1585
Broadway, New York, New York 10036, attention of
_________________________, with a copy to Skadden, Arps, Slate,
Meagher & Flom LLP, 919 Third Avenue, New York, New York 10022,
Attention of Gregory A. Fernicola, Esq.; notices to the Offerors
shall be directed to BankBoston Corporation, 100 Federal Street,
MA BOS 01-25-01, Boston, Massachusetts 02110, attention of Gary
A. Spiess, General Counsel with a copy to Brown & Wood llp, One
World Trade Center, 58th Floor, New York, New York 10048,
Attention of Edward F. Petrosky, Esq.
SECTION 12. Parties. This Agreement shall each 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 Sections 6 and 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 Capital
Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
SECTION 14. Effect of Headings. The Article and Section
headings herein and the Table of Contents are for convenience
only and shall not affect the construction hereof.
23
If the foregoing is in accordance with your 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 among the
Underwriters and the Offerors in accordance with its terms.
Very truly yours,
BANKBOSTON CORPORATION
By
--------------------------
Title:
BANKBOSTON CAPITAL TRUST III
By
--------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above
written:
MORGAN STANLEY & CO.
INCORPORATED
CS FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
By: MORGAN STANLEY & CO. INCORPORATED
By
-----------------------------------
Authorized Signatory
For themselves and as representative of the other Underwriters
named in Schedule A hereto.
24
SCHEDULE A
Number of
Name of Underwriter Capital Securities
------------------- ------------------
MORGAN STANLEY & CO. INCORPORATED . . . . . . .
CS FIRST BOSTON CORPORATION . . . . . . . . . .
LEHMAN BROTHERS INC. . . . . . . . . . . . . .
SALOMON BROTHERS INC . . . . . . . . . . . . .
--------
Total . . . . . . . . . . . . . . . . . . . . . 250,000
========
Sch A-1
SCHEDULE B
BANKBOSTON CAPITAL TRUST III
250,000
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
1. The initial public offering price for the Capital
Securities, determined as provided in said Section 2, shall be $
_________ per security.
2. The purchase price for the Capital Securities to be
paid by the several Underwriters shall be $_______ per security,
being an amount equal to the initial public offering price set
forth above.
3. The commission for the Capital Securities to be paid by
the Company to the Underwriters for their commitments hereunder
shall be $_____ per Capital Security.
Sch B-1