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EXHIBIT 1.1
$25,000,000 PREFERRED SECURITIES*
OLD SECOND CAPITAL TRUST I
____% CUMULATIVE PREFERRED SECURITIES
(LIQUIDATION AMOUNT OF $10 PER PREFERRED SECURITY)
UNDERWRITING AGREEMENT
June __, 2003
Howe Barnes Investments, Inc.
As Representative of the Several
Underwriters Named in Schedule A
135 South LaSalle Street
Chicago, Illinois 60603
Ladies and Gentlemen:
Old Second Bancorp, Inc., a Delaware corporation (the "COMPANY"), and its
subsidiary, Old Second Capital Trust I, a statutory business trust organized
under the Delaware Business Trust Act, as amended (the "DELAWARE ACT") (the
"TRUST" and, together with the Company, the "OFFERORS"), propose, subject to the
terms and conditions stated herein, to issue and sell to the several
underwriters named on Schedule A (individually, an "UNDERWRITER," and
collectively, the "UNDERWRITERS"), an aggregate of $25,000,000, representing
2,500,000 securities (the "FIRM SECURITIES") of the Trust's ____% Cumulative
Preferred Securities, with a liquidation preference of $10.00 per preferred
security, and, at the election of the Underwriters, up to 375,000 additional
securities (the "OPTION SECURITIES"). The Firm Securities and the Option
Securities are herein collectively called the "PREFERRED SECURITIES." The
Offerors propose that the Trust issue the Preferred Securities pursuant to a
Trust Agreement, as amended and restated, among Wilmington Trust Company, as
Property Trustee and Delaware Trustee, the administrative trustees named therein
(the "ADMINISTRATIVE TRUSTEES") and the Company (the "TRUST AGREEMENT"). The
Preferred Securities will be guaranteed by the Company with respect to
distributions and payments upon liquidation, redemption and otherwise (the
"GUARANTEE") pursuant to a Guarantee Agreement (the "GUARANTEE AGREEMENT"), to
be dated June __, 2003, between the Company and Wilmington Trust Company, as
trustee (the "GUARANTEE TRUSTEE"), and entitled to the benefits of certain
backup undertakings described in the Prospectus (as defined herein) with respect
to the Company's agreement pursuant to the Expense Agreement (as defined herein)
to pay all expenses relating to administration of the Trust.
The proceeds of the sale of the Preferred Securities will be used to
purchase junior subordinated deferrable interest debentures (the "JUNIOR
SUBORDINATED DEBENTURES") issued by
* The Underwriters have been granted an over-allotment option, exercisable at
their election in accordance with Section 2 herein, to purchase up to an
additional $3,750,000 of Preferred Securities.
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the Company pursuant to an Indenture, to be dated June __, 2003, between the
Company and Wilmington Trust Company, as trustee (the "INDENTURE").
The Offerors have filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement on Form S-3 (File Nos. 333-_____ and
333-_____-01) and a related preliminary prospectus for the registration of the
Preferred Securities, the Guarantee and the Junior Subordinated Debentures,
under the Securities Act of 1933, as amended (the "ACT"), and the Trust
Indenture Act of 1939, as amended (the "TRUST INDENTURE ACT"), and the rules and
regulations thereunder. The registration statement, as amended, at the time it
was declared effective, including the information (if any) deemed to be part
thereof pursuant to Rule 430A under the Act, is herein referred to as the
"REGISTRATION STATEMENT." The form of prospectus first filed by the Offerors
with the Commission pursuant to Rules 424(b) and 430A under the Act is referred
to herein as the "PROSPECTUS." Each preliminary prospectus included in the
Registration Statement prior to the time it becomes effective or filed with the
Commission pursuant to Rule 424(a) under the Act is referred to herein as a
"PRELIMINARY PROSPECTUS." If the Company elects to rely on Rule 434 of the Act,
all references to "Prospectus" shall be deemed to include, without limitation,
the form of prospectus and the term sheet, taken together, provided to the
Underwriters by the Company in accordance with Rule 434 of the Act ("RULE 434
PROSPECTUS"). Any registration statement (including any amendment or supplement
thereto or information which is deemed part thereof) filed by the Offerors under
Rule 462(b) ("RULE 462(b) REGISTRATION STATEMENT") shall be deemed to be part of
the "Registration Statement" as defined herein, and any prospectus (including
any amendment or supplement thereto or information which is deemed part thereof)
included in such registration statement shall be deemed to be part of the
"Prospectus," as defined herein, as appropriate. The Securities Exchange Act of
1934, as amended, is referred to herein as the "EXCHANGE ACT." Any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Form
S-3 under the Act (the "INCORPORATED DOCUMENTS"), as of the date of such
Preliminary Prospectus or Prospectus, as the case may be. Any document filed by
either the Company or the Trust under the Exchange Act after the effective date
of the Registration Statement or the date of the Prospectus and incorporated by
reference in the Prospectus shall be deemed to be included in the Registration
Statement and the Prospectus as of the date of such filing. Copies of the
Registration Statement, including all exhibits thereto, together with copies of
all documents incorporated by reference therein, any amendments thereto and all
Preliminary Prospectuses have been delivered to you.
The Offerors hereby confirm their agreement with respect to the purchase of
the Preferred Securities by the Underwriters as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE OFFERORS. (a) The
Offerors jointly and severally represent and warrant to, and agree with, each of
the Underwriters that:
(i) The Registration Statement has been declared effective under
the Act, and no post-effective amendment to the Registration Statement has
been filed with the Commission as of the date of this Agreement. No stop
order suspending the effectiveness of the Registration Statement has been
issued and no proceeding for that purpose has been instituted or threatened
by the Commission.
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(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the Trust Indenture Act and the
rules and regulations of the Commission promulgated thereunder, and did 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; PROVIDED, HOWEVER, that the Offerors make no representation or
warranty as to information contained in or omitted in reliance upon, and in
conformity with, written information furnished to the Offerors by or on
behalf of any Underwriter, expressly for use in the preparation thereof.
(iii) The Registration Statement conforms, and the Prospectus and
any amendments or supplements thereto will conform, in all material
respects to the requirements of the Act, including for use of Form S-3, and
the Trust Indenture Act and the rules and regulations thereunder. Neither
the Registration Statement nor any amendment thereto, and neither the
Prospectus nor any supplement thereto, contains or will contain, as the
case may be, any untrue statement of a material fact or omits or will omit
to state any 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; PROVIDED, HOWEVER, that the Offerors make no
representation or warranty as to (A) information contained in or omitted
from the Registration Statement or the Prospectus, or any such amendment or
supplement, in reliance upon, and in conformity with, written information
furnished to the Offerors by or on behalf of any Underwriter, expressly for
use in the preparation thereof or (B) information in those parts of the
Registration Statement which constitute the Statement of Eligibility and
Qualification ("FORM T-1") under the Trust Indenture Act.
The Incorporated Documents, when they were or will be filed with the
Commission, conformed or will conform in all material respects to the
requirements of the Exchange Act and none of such documents contained or
will contain an untrue statement of a material fact or omitted or will omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading.
(iv) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations or banking
associations in good standing under the laws of their respective places of
incorporation, with corporate power and authority to own their respective
properties and conduct their respective businesses as described in the
Prospectus; the Company and each of its non-bank subsidiaries are duly
qualified to do business as foreign corporations under the corporation law
of, and are in good standing as such in, each jurisdiction in which such
qualification is required except in any such case where the failure to so
qualify or be in good standing would not have a material adverse effect
upon the condition (financial or otherwise) or results of operations of the
Company and its subsidiaries taken as a whole; and no proceeding of which
the Company has knowledge has been instituted in any such jurisdiction,
revoking, limiting or curtailing, or seeking to revoke, limit or curtail,
such power and authority or qualification.
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(v) (a) The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Act with full trust
power and authority to own property and to conduct its business as
described in the Registration Statement and Prospectus and is authorized to
do business in each jurisdiction in which such qualification is required,
except where the failure to so qualify would not have a material adverse
effect on the Trust's condition (financial or otherwise) or results of
operations taken as a whole; (b) the Trust has conducted and will conduct
no business other than the transactions contemplated by the Trust Agreement
and described in the Prospectus; (c) the Trust is not a party to or
otherwise bound by any agreement other than those described in the
Prospectus; (d) the Trust is and will be classified for United States
federal income tax purposes as a grantor trust and not as an association
taxable as a corporation; and (e) the Trust is and will be treated as a
consolidated subsidiary of the Company pursuant to generally accepted
accounting principles.
(vi) The Company owns directly or indirectly 100 percent of the
issued and outstanding capital stock of each of its subsidiaries, in each
case free and clear of any claims, liens, encumbrances or security
interests, except for any such stock or interests pledged against
borrowings of the Company or any of its subsidiaries, and all of such
capital stock has been duly authorized and validly issued and is fully paid
and nonassessable. The Company's bank subsidiaries consist exclusively of
the following: The Old Second National Bank of Aurora, The Yorkville
National Bank and Kane County Bank and Trust Co., which are collectively
hereinafter referred to as the "BANKS."
(vii) All of the issued and outstanding shares of capital stock of
the Company are duly authorized, validly issued, fully paid and
nonassessable, were offered and sold in compliance with all federal and
state securities laws, and were not issued in violation of or subject to
any preemptive rights or other rights to subscribe for or purchase
securities. Except as otherwise stated in the Registration Statement and
Prospectus, there are no preemptive rights or other rights to subscribe for
or to purchase, or any restriction upon the voting or transfer of, the
Junior Subordinated Debentures, the common securities of the Trust held by
the Company (the "COMMON SECURITIES") or the Preferred Securities. Neither
the filing of the Registration Statement nor the registration of the
Preferred Securities, the Guarantee or the Junior Subordinated Debentures
gives rise to any rights for or relating to the registration of any capital
stock or other securities of the Company or the Trust. The Company has an
authorized and outstanding capitalization as set forth in the Registration
Statement and the Prospectus.
(viii) Each of this Agreement, the Indenture, the Trust Agreement,
the Guarantee Agreement and the Agreement as to Expenses and Liabilities
(the "EXPENSE AGREEMENT") has been duly authorized, executed and delivered
by the Company and/or the Trust, as the case may be, and constitutes a
valid, legal and binding obligation of the Company and/or the Trust, as the
case may be, enforceable in accordance with its terms, except as rights to
indemnity hereunder may be limited by federal or state securities laws and
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally
and subject to general principles of equity and, with respect to Section 7
hereof, by the public policy
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underlying the federal or state securities laws. The execution, delivery
and performance of this Agreement, the Indenture, the Trust Agreement, the
Guarantee Agreement and the Expense Agreement and the consummation of the
transactions herein or therein contemplated will not result in a breach of
the Company's or any of its subsidiaries' charters or bylaws, the Trust
Agreement or the Trust's certificate of trust filed with the State of
Delaware on May 12, 2003 (the "CERTIFICATE OF TRUST") or breach or
violation of any of the terms and provisions of, or constitute a default
under, any statute, any indenture, mortgage, deed of trust, loan agreement,
lease, franchise, license or other agreement or instrument to which the
Trust, the Company or any of the Company's subsidiaries is a party or by
which the Trust, the Company or any of the Company's subsidiaries is bound
or to which any property or assets of the Trust, the Company or any of the
Company's subsidiaries is subject, or any order, rule, regulation or decree
of any court or governmental agency or body having jurisdiction over the
Company, any of its subsidiaries or the Trust or having jurisdiction over
any of the properties of the Company, any of its subsidiaries or the Trust
which breach, violation or default would have a material adverse effect
upon the condition (financial or otherwise) or results of operations of the
Company and its subsidiaries taken as a whole. No consent, approval,
authorization or order of, or filing with, any court or governmental agency
or body is required for the execution, delivery and performance of this
Agreement, the Indenture, the Trust Agreement, the Guarantee Agreement and
the Expense Agreement or for the consummation of the transactions
contemplated hereby or thereby, including the issuance or sale of the
Junior Subordinated Debentures by the Company and the Common Securities and
the Preferred Securities by the Trust, except such as may be required under
the Act, all of which have been obtained or made, and under state
securities or blue sky laws and clearance of such offering of the Preferred
Securities by the Underwriters with the National Association of Securities
Dealers, Inc. ("NASD") and except where any failure to obtain such
consents, approvals, authorizations or orders or to make such filings will
not have a material adverse effect upon the condition (financial or
otherwise) or results of operations of the Company and its subsidiaries
taken as a whole. Each of the Company and the Trust, as the case may be,
has full power and authority to enter into this Agreement, the Indenture,
the Trust Agreement, the Guarantee Agreement and the Expense Agreement, as
the case may be, and to authorize, issue and sell the Junior Subordinated
Debentures or the Common Securities and the Preferred Securities, as the
case may be, as contemplated by this Agreement; and each of the Indenture,
the Trust Agreement and the Guarantee Agreement has been duly qualified
under the Trust Indenture Act and will conform in all material respects to
the statements relating thereto in the Registration Statement and the
Prospectus.
(ix) The Junior Subordinated Debentures have been duly authorized
by the Company and at the Closing Date or the Option Closing Date (each as
defined below), as the case may be, 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 bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally
and subject to general principles of equity,
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will be in the form contemplated by, and entitled to the benefits of, the
Indenture, will conform to the statements relating thereto in the
Prospectus, and will be owned by the Trust free and clear of any security
interest, pledge, lien, encumbrance, claim or equity.
(x) The Common Securities have been duly authorized by the Trust
Agreement and, when issued and delivered by the Trust to the Company
against payment therefor as described in the Prospectus, will be validly
issued and (subject to the terms of the Trust Agreement) fully paid and
nonassessable undivided beneficial interests in the assets of the Trust and
will conform to all statements relating thereto contained in the
Prospectus; and at the Closing Date or the Option Closing Date, as the case
may be, 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, pledge, lien, encumbrance, claim or equity.
(xi) The Preferred Securities have been duly authorized by the
Trust Agreement and, when issued and delivered pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued and fully paid and non-assessable undivided beneficial interests in
the Trust, will be entitled to the benefits of the Trust Agreement and will
conform to the statements relating thereto contained in the Prospectus.
(xii) The Indenture, the Trust Agreement, the Guarantee Agreement
and the Expense Agreement are in substantially the respective forms filed
as exhibits to the Registration Statement.
(xiii) The Company's obligations under the Guarantee Agreement are
subordinated and junior in right of payment to all Senior Indebtedness (as
defined in the Indenture) of the Company.
(xiv) The Junior Subordinated Debentures are subordinate and
junior in right of payment to all Senior Indebtedness of the Company.
(xv) Each of the Administrative Trustees of the Trust is an
officer or director of the Company and has been duly authorized by the
Company to execute and deliver the Trust Agreement.
(xvi) The consolidated financial statements of the Company
included or incorporated by reference in the Registration Statement present
fairly the consolidated financial position of the Company as of the
respective dates of such financial statements, and the consolidated results
of operations and cash flows of the Company for the respective periods
covered thereby, are in conformity with generally accepted accounting
principles consistently applied throughout the periods involved, except as
disclosed in the Prospectus. The financial information included and
incorporated by reference in the Prospectus under "Selected Consolidated
Financial and Other Data" presents fairly, on the basis stated in the
Prospectus, the information set forth therein.
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(xvii) The accountants who have expressed their opinions with
respect to certain of the financial statements included or incorporated by
reference in the Registration Statement are independent accountants as
required by the Act.
(xviii) Neither the Company nor any subsidiary is in violation of
its respective charter; the Trust is not in violation of the Trust
Agreement or its Certificate of Trust; and none of the Trust, the Company
or its subsidiaries is in violation or otherwise in default under any
consent decree, or in default with respect to any provision of any material
lease, loan agreement, franchise, license, permit or other contract
obligation to which it is a party which would have a material adverse
effect upon the condition (financial or otherwise) or results of operations
of the Trust, the Company and the Company's subsidiaries, taken as a whole
("MATERIAL ADVERSE EFFECT"); and there does not exist any state of facts
which constitutes an Event of Default as defined in such documents or
which, with notice or lapse of time or both, would constitute such an Event
of Default, in each case, except for defaults which neither singly nor in
the aggregate would have a Material Adverse Effect.
(xix) There are no legal or governmental proceedings pending, or
to the Trust's or Company's knowledge, threatened to which the Trust, the
Company or any of the Company's subsidiaries is or may reasonably be
expected to be a party or of which property owned or leased by the Trust,
the Company or any of the Company's subsidiaries is or may reasonably be
expected to be the subject, or related to environmental or discrimination
matters which if adversely determined would have a Material Adverse Effect
that are not disclosed in the Prospectus.
(xx) The Company is a financial holding company duly registered
with the Board of Governors of the Federal Reserve System ("FEDERAL
RESERVE") under the Bank Holding Company Act of 1956, as amended. The
conduct of the business of the Company and each of its subsidiaries is in
compliance in all respects with applicable federal, state, local and
foreign laws and regulations, except where the failure to be in compliance
would not have a material adverse effect upon the condition (financial or
otherwise) or results of operation of the Company and its subsidiaries
taken as a whole. The Company and its subsidiaries own or possess or have
obtained all governmental licenses, permits, consents, orders, approvals
and other authorizations necessary to lease or own, as the case may be, and
to operate their properties and to carry on their businesses as presently
conducted except where the failure to have obtained such licenses, permits,
consents, orders, approvals and other authorization would not have a
material adverse effect upon the condition (financial or otherwise) or
results of operation of the Company and its subsidiaries taken as a whole,
and neither the Company nor its subsidiaries have received any notice of
proceedings related to revocation or modification of any such licenses,
permits, consents, orders, approvals or authorizations which singly or in
the aggregate, if the subject of an unfavorable ruling or finding, would
result in a material adverse effect upon the condition (financial or
otherwise) or results of operation of the Company and its subsidiaries
taken as a whole. Neither the Company nor any Bank is a party or subject to
any agreement or memorandum with, or directive or order issued by, the
Federal Reserve, the Office of the Controller of the Currency (the "OCC"),
the
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Federal Deposit Insurance Corporation (the "FDIC"), the Illinois Office of
Banks and Real Estate or any other bank regulatory authority, which imposes
any restrictions or requirements not generally applicable to bank holding
companies or commercial banks, except as described or contemplated in the
Prospectus.
(xxi) The Company and each of its subsidiaries have good and
marketable title to all the properties and assets reflected as owned in the
financial statements hereinabove described (or elsewhere in the
Prospectus), subject to no lien, mortgage, pledge, charge or encumbrance of
any kind except for such properties as are pledged against the borrowings
of the Company or any of its subsidiaries and except those, if any,
reflected in such financial statements (or elsewhere in the Prospectus) or
which are not material to the Company and its subsidiaries taken as a
whole. The Company and each of its subsidiaries hold their respective
leased properties which are material to the Company and its subsidiaries
taken as a whole under valid and binding leases.
(xxii) The Offerors have not taken and will not take, directly or
indirectly, any action designed to or which has constituted or which might
reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of the Preferred
Securities.
(xxiii) There is no material contract or other document of a
character required to be described in the Registration Statement or the
Prospectus (or the Incorporated Documents) or to be filed as an exhibit to
the Registration Statement (or the Incorporated Documents) which is not
described or filed as required.
(xxiv) The Trust and the Company have filed all necessary federal
and state income and franchise tax returns and have paid all taxes shown as
due thereon, and there is no tax deficiency that has been or to the
knowledge of the Trust or the Company, threatened to be asserted against
the Trust or the Company or any of their properties or assets that would or
could be expected to have a Material Adverse Effect.
(xxv) The Trust and the Company, together with the Company's
subsidiaries, own and possess all right, title and interest in and to, or
have duly licensed from third parties, all patents, patent rights, trade
secrets, inventions, know-how, trademarks, trade names, copyrights, service
marks and other proprietary rights ("TRADE RIGHTS") material to the
business of the Trust and the Company and each of the Company's
subsidiaries taken as a whole. Neither the Trust, the Company nor any of
its subsidiaries has received any notice of infringement, misappropriation
or conflict from any third party as to such material Trade Rights which has
not been resolved or disposed of and to the Trust's and the Company's
knowledge neither the Trust, the Company nor any of the Company's
subsidiaries has infringed, misappropriated or otherwise conflicted with
material Trade Rights of any third parties, which infringement,
misappropriation or conflict would have a Material Adverse Effect.
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(xxvi) No statement, representation, warranty or covenant made by
the Company in this Agreement or made in any certificate or document
required by this Agreement to be delivered to will be, when made,
inaccurate, untrue or incorrect.
(xxvii) Neither the Company nor its subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or its
subsidiaries has made any payment of funds of the Company or its
subsidiaries or received or retained any funds in violation of any law,
rule or regulation.
(xxviii) Since the respective dates as of which information is given
in the Registration Statement, as it may be amended or supplemented, (A)
there has not been any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
condition, financial or otherwise, of the Company and the subsidiaries
taken as a whole, or the business affairs, management, financial position,
shareholders' equity or results of operations of the Trust, the Company and
the Company's subsidiaries, taken as a whole, whether or not occurring in
the ordinary course of business, including, without limitation, any
material increase in the amount or number of classified assets of the
Banks, any decrease in net interest margin for any month to a level below
[3.75]%, or any material decrease in the volume of loan originations, the
amount of deposits or the amount of loans, (B) there has not been any
transaction not in the ordinary course of business entered into by the
Trust, the Company or any of the Company's subsidiaries which is material
to the Trust, the Company and the Company's subsidiaries, taken as a whole,
other than transactions described or contemplated in the Registration
Statement, (C) the Trust, the Company and the Company's subsidiaries have
not incurred any material liabilities or obligations, which are not in the
ordinary course of business or which could result in a material reduction
in the future earnings of the Trust, the Company and the Company's
subsidiaries, taken as a whole, (D) the Company and the Company's
subsidiaries have not sustained any material loss or interference with
their respective businesses or properties from fire, flood, windstorm,
accident or other calamity, whether or not covered by insurance, (E) except
as described or contemplated in the Prospectus, since December 31, 2002,
there has not been any material change in the capital stock of the Company
or the Company's subsidiaries, or any material increase in the short-term
or long-term debt (including capitalized lease obligations) of the Company
and the Company's subsidiaries, taken as a whole, and (F) except as
described or contemplated in the Prospectus, since December 31, 2002, there
has not been any declaration or payment of any dividends or any
distributions of any kind with respect to the capital stock of the Company.
(xxix) Other than a Certificate of Trust filed with the Secretary
of State of Delaware on May 12, 2003, there are no required licenses,
approvals, certificates and permits from governmental and regulatory
authorities, foreign and domestic, which are necessary to the conduct of
its business as described in the Prospectus. The Company has all necessary
approvals of the Federal Reserve to own the stock of its subsidiaries. None
of the Trust, the Company or any of the Company's subsidiaries has received
notice of or has knowledge of any basis for any proceeding or action
relating specifically to the Trust, the Company or any of the Company's
subsidiaries for the revocation or suspension of
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any such consent, authorization, approval, order, license, certificate or
permit or any other action or proposed action by any regulatory authority
having jurisdiction over the Trust, the Company or any of the Company's
subsidiaries that would have a material adverse effect on the Trust, the
Company or any of the Company's subsidiaries.
(xxx) The Offerors' registration statement pursuant to Section
12(b) of the Exchange Act with respect to the Preferred Securities, has
been declared effective by the Commission and the Preferred Securities have
been approved for inclusion on The Nasdaq National Market under the symbol
"_____".
(xxxi) The Offerors have not distributed and will not distribute
any prospectus or other offering material in connection with the offering
and sale of the Preferred Securities other than any Preliminary Prospectus
or the Prospectus or other materials permitted by the Act to be distributed
by the Company.
(xxxii) The deposit accounts of the Banks are insured by the FDIC to
the fullest extent provided by law. No proceeding for the termination of
such insurance is pending or is threatened. Except as described in the
Prospectus, neither the Company nor any of its subsidiaries has received or
is subject to any directive or order from the Federal Reserve, the FDIC,
the OCC or the Illinois Office of Banks and Real Estate, or any other
regulatory authority to make any material change in the method of
conducting their respective businesses that has not been complied with in
all material respects.
(xxxiii) Neither the Offerors nor any of their affiliates does any
business, directly or indirectly, with the government of Cuba or with any
person or entity located in Cuba.
(xxxiv) None of the Trust, the Company or any of the Company's
subsidiaries is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of
1940, as amended, or an "investment adviser" within the meaning of the
Investment Advisers Act of 1940, as amended.
(xxxv) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurances
that (A) transactions are executed in accordance with management's general
or specific authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(C) access to records is permitted only in accordance with management's
general or specific authorization; and (D) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxxvi) Other than as contemplated by this Agreement and as
disclosed in the Registration Statement, the Company has not incurred any
liability for any finder's or broker's fee or agent's commission in
connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
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(xxxvii) No report or application filed by the Company or any of its
subsidiaries with the Federal Reserve, the FDIC, the OCC or the Illinois
Office of Banks and Real Estate, as of the date it was filed, failed to
comply with the applicable requirements of the Federal Reserve, the FDIC,
the OCC or the Illinois Office of Banks and Real Estate, as the case may
be, in any material respect.
(xxxviii) The proceeds from the sale of the Preferred Securities will
constitute "Tier 1" capital (as defined in 12 C.F.R. Part 325), subject to
applicable regulatory restrictions on the amount thereof that can be
included in Tier 1 capital.
(b) Any certificate signed by or on behalf of the Trust or the Company and
delivered to the Underwriters or counsel to the Underwriters shall be deemed to
be a representation and warranty of the Trust or the Company to each Underwriter
as to the matters covered thereby.
SECTION 2. PURCHASE, SALE AND DELIVERY OF PREFERRED SECURITIES. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Trust agrees to issue
and sell to each Underwriter, and each of the Underwriters agrees, severally and
not jointly, to purchase from the Trust, at a purchase price of $10.00 per
security, the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule A hereto.
In addition, on the basis of the representations, warranties and covenants
herein contained and subject to the terms and conditions herein set forth, the
Trust hereby grants to the several Underwriters an option to purchase, at their
election, up to 375,000 Option Securities at a price of $10.00 per security, for
the sole purpose of covering overallotments in the sale of the Firm Securities.
The option granted hereby may be exercised in whole or in part, but only once,
and at any time upon written notice given within 30 days after the date of this
Agreement, by you, as Representative of the several Underwriters, to the Trust
setting forth the number of Option Securities as to which the several
Underwriters are exercising the option and the time and date at which
certificates are to be delivered. If any Option Securities are purchased, each
Underwriter agrees, severally and not jointly, to purchase that portion of the
number of Option Securities as to which such election shall have been exercised
(subject to adjustment to eliminate fractional shares) determined by multiplying
such number of Option Securities by a fraction the numerator of which is the
maximum number of Option Securities which such Underwriter is entitled to
purchase as set forth opposite the name of such Underwriter in Schedule A hereto
and the denominator of which is the maximum number of Option Securities which
all of the Underwriters are entitled to purchase hereunder. If the date of
exercise of the option is three or more full days before the Closing Date, the
notice of exercise shall set the Closing Date as the Option Closing Date.
As compensation to the Underwriters for their commitments hereunder and in
view of the fact that the proceeds of the sale of the Preferred Securities
(together with the entire proceeds from the sale by the Trust to the Company of
the Common Securities) will be used to purchase the Junior Subordinated
Debentures, the Company hereby agrees to pay at the Closing Date, or the Option
Closing Date, as the case may be (each as defined below) to the Representative a
commission of $0.35 per Preferred Security (except with respect to sales of up
to 20% of the
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Preferred Securities if such sales are directed by the Company, in which case
the commission shall be $0.15 per Preferred Security) sold by the Trust
hereunder on each respective date.
The Firm Securities will be delivered by the Company to the Representatives
against payment of the purchase price therefor at the offices of Chapman and
Cutler, Chicago, Illinois, or such other location as may be mutually acceptable,
at 9:00 a.m., central time on June __, 2003, or such other time and date as the
Representative and the Company may agree upon in writing, such time and date of
delivery being herein referred to as the "Closing Date," and, with respect to
the Option Securities, at the time and on the date specified by you in the
written notice given by you of the Underwriters' election to purchase the Option
Securities, or such other time and date as you and the Company may agree upon in
writing, such time and date being referred to herein as the "Option Closing
Date." The purchase price shall be payable by wire transfer of immediately
available funds to an account, such account to be designated by the Trust at
least two business days preceding the Closing Date or the Option Closing Date,
as the case may be. The Underwriters' commission shall be payable by wire
transfer of immediately available funds to an account, such account to be
designated by the Underwriters at least two business days preceding the Closing
Date or the Option Closing Date, as the case may be. Delivery of the Preferred
Securities may be made by credit through full fast transfer to the accounts at
The Depository Trust Company designated by you. Certificates representing the
Preferred Securities, in definitive form and in such denominations and
registered in such names as you may request upon at least two business days'
prior notice to the Company shall be prepared and will be made available for
checking and packaging, not later than 10:30 a.m., central time, on the business
day next preceding the Closing Date or the Option Closing Date, as the case may
be, at the offices of Howe Barnes Investments, Inc., 135 South LaSalle Street,
Chicago, Illinois 60603, or such other location as may be mutually acceptable.
It is understood that any Underwriter may (but shall not be obligated to)
make payment to the Company on behalf of the other Underwriters for the
Preferred Securities to be purchased by such Underwriters. Any such payment
shall not relieve such other Underwriters of any of their obligations hereunder.
Nothing herein contained shall cause the Underwriters to be construed as an
unincorporated association or partner with either or both Offerors.
SECTION 3. OFFERING BY UNDERWRITERS. (a) It is understood that the
Underwriters propose to make a public offering of the Firm Securities as soon as
the Underwriters deem it advisable to do so. The Firm Securities are to be
initially offered to the public at the initial public offering price set forth
in the Prospectus. (b) The Representative, on behalf of the Underwriters,
represent and warrant to the Company that the information set forth (i) on the
cover page of the Prospectus with respect to price, underwriting compensation
and terms of the offering and (ii) under "Underwriting" in the Prospectus was
furnished to the Offerors by and on behalf of the Underwriters for use in
connection with the preparation of the Registration Statement and is correct and
complete in all material respects.
SECTION 4. COVENANTS OF THE OFFERORS. The Offerors jointly and severally
covenant and agree with the Underwriters that:
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(a) The Company and the Administrative Trustees on behalf of the Trust
will prepare and timely file with the Commission under Rule 424(b) under the Act
a Prospectus containing information previously omitted at the time of
effectiveness of the Registration Statement in reliance on Rule 430A under the
Act, and will not file any amendment to the Registration Statement or supplement
to the Prospectus of which the Underwriters shall not previously have been
advised and furnished with a copy and as to which the Underwriters shall have
reasonably objected in writing promptly after reasonable notice thereof or which
is not in compliance with the Act or the rules and regulations thereunder.
(b) If the Offerors elect to rely on Rule 434 of the Act, the Offerors
will prepare a term sheet that complies with the requirements of Rule 434. If
the Offerors elect not to rely on Rule 434, the Offerors will provide the
Underwriters with copies of the form of prospectus, in such numbers as the
Underwriters may reasonably request, and file with the Commission such
prospectus in accordance with Rule 424(b) of the Act by the close of business in
New York City on the second business day immediately succeeding the date of
pricing of the offering of the Preferred Securities (the "PRICING DATE"). If the
Offerors elect to rely on Rule 434, the Offerors will provide the Underwriters
with copies of the form of Rule 434 Prospectus, in such numbers as the
Underwriters may reasonably request, by the close of business in New York on the
business day immediately succeeding the Pricing Date.
(c) The Offerors will advise the Underwriters promptly of any request of
the Commission for amendment of the Registration Statement or for supplement to
the Prospectus or for any additional information, or of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the use of the Prospectus, of the suspension of the qualification
of the Preferred Securities for offering or sale in any jurisdiction, or of the
institution or threatening of any proceedings for that purpose, and the Offerors
will use their best efforts to prevent the issuance of any such stop order
preventing or suspending the use of the Prospectus or suspending such
qualification and to obtain as soon as possible the lifting thereof, if issued.
(d) The Offerors will cooperate with you and your counsel in order to
qualify the Preferred Securities for sale under the securities laws of such
jurisdictions as the Underwriters may reasonably have designated and to continue
such qualifications in effect for so long as the Underwriters may reasonably
request for distribution of the Preferred Securities (or obtain exemptions from
the application of such laws). The Offerors will, from time to time, prepare and
file such statements, reports and other documents as may be requested by the
Underwriters for that purpose.
(e) The Offerors will furnish the Underwriters with as many copies of any
Preliminary Prospectus as the Underwriters may reasonably request and, during
the period when delivery of a prospectus is required under the Act, the Offerors
will furnish the Underwriters with as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Underwriters may, from
time to time, reasonably request. The Offerors will deliver to the Underwriters,
at or before the Closing Date or the Option Closing Date, as the case may be,
two signed copies of the Registration Statement and all amendments thereto
including all exhibits filed therewith, together with the Incorporated
Documents, and will deliver to the Underwriters
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such number of conformed copies of the Registration Statement, without exhibits,
and of all amendments thereto, together with the Incorporated Documents, as the
Underwriters may reasonably request.
(f) If at any time when a prospectus relating to the Preferred Securities
is required to be delivered under the Act any event occurs as a result of which
the Prospectus, including any amendments or supplements, would include an untrue
statement of a material fact, or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
at any time to amend the Prospectus, including any amendments or supplements
thereto and including any revised prospectus which the Offerors propose for use
by the Underwriters in connection with the offering of the Preferred Securities
which differs from the prospectus on file with the Commission at the time of
effectiveness of the Registration Statement, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) to comply with the
Act, the Offerors promptly will advise you thereof and will promptly prepare and
file with the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance; and, in
case any Underwriter is required to deliver a prospectus nine months or more
after the effective date of the Registration Statement, the Offerors upon
request, but at the expense of such Underwriter, will prepare promptly such
prospectus or prospectuses as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Act.
(g) Not later than September 30, 2004, the Company will make generally
available to its security holders an earnings statement (which need not be
audited) covering a period of at least 12 months beginning after the effective
date of the Registration Statement, which will satisfy the provisions of the
last paragraph of Section 11(a) of the Act.
(h) During the period of five years hereafter, the Company will furnish
you with a copy (i) as soon as practicable after the filing thereof, of each
report filed by the Company with the Commission, any securities exchange or the
NASD; (ii) as soon as practicable after the release thereof, of each material
press release in respect of the Company; and (iii) as soon as available, of each
report of the Company mailed to stockholders.
(i) The Offerors will use the net proceeds received by it from the sale of
the Preferred Securities in the manner specified in the Prospectus.
(j) If, at the time of effectiveness of the Registration Statement, any
information shall have been omitted therefrom in reliance upon Rule 430A and/or
Rule 434, then on the Pricing Date, the Offerors will prepare, and file or
transmit for filing with the Commission in accordance with such Rule 430A, Rule
424(b) and/or Rule 434, copies of an amended Prospectus, or, if required by such
Rule 430A and/or Rule 434, a post-effective amendment to the Registration
Statement (including an amended Prospectus), containing all information so
omitted. If required, the Offerors will prepare and file, or transmit for
filing, a Rule 462(b) Registration Statement not later than the date of the
execution of the Pricing Agreement. If a Rule 462(b) Registration Statement is
filed, the Offerors shall make payment of, or arrange for payment of, the
additional registration fee owing to the Commission required by Rule 111.
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(k) The Offerors will comply with all registration, filing and reporting
requirements of the Exchange Act and The Nasdaq National Market.
SECTION 5. COSTS AND EXPENSES. The Offerors will pay (directly or by
reimbursement) all costs, expenses and fees incident to the performance of the
obligations of the Offerors under this Agreement, including, without limiting
the generality of the foregoing, the following: accounting fees of the Offerors;
the fees and disbursements of counsel for the Offerors; the cost of preparing,
printing and filing of the Registration Statement, Preliminary Prospectuses and
the Prospectus and any amendments and supplements thereto and the printing,
mailing and delivery to the Underwriters and dealers of copies thereof and of
this Agreement, the Selected Dealers Agreement, any blue sky memorandum, if
deemed necessary by the Underwriters, after consultation with the Offerors, and
any supplements or amendments thereto (excluding, except as provided below, fees
and expenses of counsel to the Underwriters); the filing fees of the Commission;
the filing fees incident to securing any required review by NASD of the terms of
the sale of the Preferred Securities; the fees and expenses of the Indenture
Trustee, including the fees and disbursements of counsel for the Indenture
Trustee in connection with the Indenture and Junior Subordinated Debentures; the
fees and expenses of the Property Trustee and the Delaware Trustee, including
the fees and disbursements of counsel for the Property Trustee and the Delaware
Trustee in connection with the Trust Agreement and the Certificate of Trust; the
fees and expenses of the Guarantee Trustee, including the fees and disbursements
of counsel for the Guarantee Trustee in connection with the Guarantee and
Guarantee Agreement; listing fees, if any, transfer taxes and the expenses,
including the fees and disbursements of counsel for the Underwriters, incurred
in connection with the qualification of the Preferred Securities under state
securities or blue sky laws (which shall not exceed $2,000); the fees and
expenses incurred in connection with the listing of the Preferred Securities on
The Nasdaq National Market; the costs of preparing certificates representing
Junior Subordinated Debentures or Preferred Securities; the costs and fees of
any registrar or transfer agent and all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section 5. The Offerors shall not be required to pay for
any of the Underwriters' expenses (other than those related to qualification of
the Preferred Securities under state securities or blue sky laws which shall be
paid by the Offerors as provided above) except that, if this Agreement shall not
be consummated because the conditions in Section 6 hereof are not satisfied, or
because this Agreement is terminated by the Underwriters pursuant to Section 9
hereof, or by reason of any failure, refusal or inability on the part of the
Offerors to perform any undertaking or satisfy any condition of this Agreement
or to comply with any of the terms hereof on either of their parts to be
performed, unless such failure to satisfy said condition or to comply with said
terms shall be due to the default or omission of any Underwriter, then the
Offerors promptly upon request by the Underwriters shall reimburse the
Underwriters for all actual, accountable out-of-pocket expenses, including fees
and disbursements of counsel reasonably incurred in connection with
investigating, marketing and proposing to market the Preferred Securities or in
contemplation of performing their obligations hereunder, up to $20,000 but the
Offerors shall not in any event be liable to any of the Underwriters for damages
on account of loss of anticipated profits from the sale by them of the Preferred
Securities.
SECTION 6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Securities on the Closing
Date and the Option Securities,
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if any, on the Option Closing Date are subject to the condition that all
representations and warranties of the Offerors contained herein are true and
correct, at and as of the Closing Date or the Option Closing Date, as the case
may be, and the condition that each Offeror shall have performed all of its
covenants and obligations hereunder and to the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 4(a) hereof;
no stop order suspending the effectiveness of the Registration Statement, as
amended from time to time, or any part thereof shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the reasonable satisfaction of the
Underwriters.
(b) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, the opinion of Barack Ferrazzano Kirschbaum
Perlman & Nagelberg, counsel for the Offerors, dated the Closing Date or the
Option Closing Date, as the case may be, addressed to the Underwriters, to the
effect that:
(i) (a) the Company is validly existing as a corporation in good
standing under the laws of the State of Delaware with corporate power and
authority to own its properties and conduct its business as described in
the Prospectus; and, to the best of such counsel's knowledge the Company is
duly qualified to do business as a foreign corporation under the
corporation laws of, and is in good standing as such in, every jurisdiction
where such qualification is required except where the failure so to qualify
would not have a material adverse effect upon the condition (financial or
otherwise) or results of operations of the Company and its subsidiaries
taken as a whole; (b) an opinion to the same general effect as clause (a)
of this subparagraph (i) in respect of each non-bank subsidiary of the
Company;
(ii) the Company owns directly or indirectly 100 percent of the
outstanding capital stock of each subsidiary;
(iii) since December 31, 2000, the issued and outstanding capital
stock of the Company has been duly authorized and validly issued and is
fully paid and nonassessable;
(iv) the Registration Statement has become effective under the
Act, and, to the best knowledge of such counsel, 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
contemplated under the Act, and the Registration Statement (including the
information deemed to be part of the Registration Statement at the time of
effectiveness pursuant to Rule 430A(b) and/or Rule 434, if applicable), the
Prospectus and each amendment or supplement thereto (except for the
financial statements and other statistical or financial data included
therein as to which such counsel need express no opinion and except for the
parts of the registration statement which constitute the Form
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T-1 under the Trust Indenture Act as to which such counsel need express no
opinion) comply as to form in all material respects with the requirements
of the Act; all documents incorporated by reference in the Prospectus, when
they were filed with the Commission, complied as to form in all material
respects with the requirements of the Exchange Act; and such counsel have
no reason to believe that any of such documents, when they were so filed,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which such statements were made when such
documents were so filed, not misleading (such counsel need express no
opinion as to the financial statements or other financial or statistical
data contained in any such document); such counsel have no reason to
believe that either the Registration Statement (including the information
deemed to be part of the Registration Statement at the time of
effectiveness pursuant to Rule 430A(b) and/or Rule 434, if applicable), or
the Registration Statement as amended (except as aforesaid), as of their
respective effective dates, contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus as amended or supplemented, if applicable, as of the issue date
and as of the Closing Date or the Option Closing Date, as the case may be,
contained any untrue statement of a material fact or omitted to state any
material fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made (except for the
financial statements and other statistical or financial data included
therein as to which such counsel need express no opinion); and such counsel
does not know of any legal or governmental proceedings pending or
threatened required to be described in the Prospectus which are not
described as required, nor of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus or to
be filed as exhibits to the Registration Statement which are not described
or filed, as required;
(v) the statements under the captions "Description of the
Preferred Securities," "Description of the Debentures," "Book-Entry
Issuance," "Description of the Guarantee," "Relationship Among the
Preferred Securities, the Debentures and the Guarantee," "Material Federal
Income Tax Consequences" and "ERISA Considerations" in the Prospectus,
insofar as such statements constitute a summary of documents referred to
therein or matters of law, are accurate summaries and fairly present, in
all material respects, the information called for with respect to such
documents and matters;
(vi) the holders of the Company's outstanding securities are not
entitled to any preemptive or other rights to subscribe for the Junior
Subordinated Debentures or the Preferred Securities under the Company's
bylaws and, to the knowledge of such counsel, no such rights exist under
any other agreement or arrangement;
(vii) all of the issued and outstanding Common Securities of the
Trust are owned by the Company and, to the best of such counsel's
knowledge, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equitable right;
(viii) the Trust Agreement, the Indenture and the Guarantee have
been duly qualified under the Trust Indenture Act;
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(ix) the Junior Subordinated Debentures are in the form
contemplated by the Indenture, have been duly authorized, executed and
delivered by the Company and, when authenticated by the Indenture Trustee
in the manner provided for in the Indenture and delivered against payment
therefor, 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 bankruptcy,
insolvency, reorganization or similar laws affecting the rights of
creditors generally and subject to general principles of equity;
(x) the Junior Subordinated Debentures are subordinate and
junior in right of payment to all Senior Indebtedness (as defined in the
Indenture) of the Company;
(xi) to the best of such counsel's knowledge and information
after due inquiry, (A) the Trust is not required to be authorized to do
business in any jurisdiction other than Delaware, except where the failure
to be so authorized would not have a material adverse effect on the Trust's
condition (financial or otherwise) or results of operations taken as a
whole; and (B) the Trust is not a party to or otherwise bound by any
material agreement other than those described in the Prospectus;
(xii) the Trust Agreement has been duly executed and delivered by
the Administrative Trustees;
(xiii) the Company has full corporate power and authority and the
Trust has full trust power and authority to enter into this Agreement, the
Indenture, the Trust Agreement, the Guarantee Agreement and the Expense
Agreement, as applicable, and to issue the Junior Subordinated Debentures
and to effect the transactions contemplated by this Agreement, the
Indenture, the Trust Agreement, the Guarantee Agreement and the Expense
Agreement, as applicable, and each of this Agreement, the Indenture, the
Trust Agreement, the Guarantee Agreement and the Expense Agreement have
been duly authorized, executed and delivered by the Company and the Trust,
as applicable, and constitutes a valid, legal and binding obligation of the
Company and the Trust, as applicable, enforceable in accordance with its
terms (except as rights to indemnity hereunder may be limited by federal or
state securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting the rights
of creditors generally and subject to general principles of equity). The
execution, delivery and performance of this Agreement, the Indenture, the
Trust Agreement, the Guarantee Agreement, the Preferred Securities, the
Common Securities, the Junior Subordinated Debentures and the Expense
Agreement and the consummation of the transactions herein or therein
contemplated will not, to the best of such counsel's knowledge, result in a
breach or violation of any of the terms and provisions of, or constitute a
default under, any statute, rule or regulation (except that such counsel
need express no opinion regarding any blue sky or state securities laws),
any lease, contract, indenture, mortgage, loan agreement or other agreement
or instrument known to such counsel to which the Company, the Trust or any
of the Company's subsidiaries is a party or by which it is bound or to
which any of its property is subject, the Company's or any of its
subsidiaries' charter or bylaws, or the Certificate of Trust or any permit,
judgment,
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order or decree known to such counsel of any court or governmental agency
or body having jurisdiction over the Company, the Trust or any of the
Company's subsidiaries or any of their respective properties, except for
any breach, violation or default which would not have a material adverse
effect on the Company or the Trust; and no consent, approval,
authorization, order of, designation, declaration or filing by or with, any
court or any regulatory, administrative or governmental agency or body is
required for the execution, delivery and performance of this Agreement, the
Indenture, the Trust Agreement, the Guarantee Agreement, the Expense
Agreement, the Common Securities, the Preferred Securities, or the Junior
Subordinated Debentures, or for the consummation of the transactions
contemplated hereby or thereby (other than as may be required by federal or
state laws governing banks or bank holding companies, the NASD, or by state
securities and blue sky laws, as to which such counsel need express no
opinion), including the issuance or sale of the Junior Subordinated
Debentures by the Company and the Common Securities and Preferred
Securities by the Trust, except (a) such as may be required under the Act,
which have been obtained or made, and (b) the qualification of the Trust
Agreement, the Guarantee Agreement and the Indenture under the Trust
Indenture Act and the regulations thereunder, all of which have been
effected. The filing of the Registration Statement and the registration of
the Junior Subordinated Debentures, the Guarantee and the Preferred
Securities under the Act does not give rise to any rights for or relating
to the registration of any shares of capital stock or other securities of
the Company;
(xiv) neither the Company nor the Trust is, and immediately upon
completion of the sale of Preferred Securities contemplated hereby, neither
the Company nor the Trust will be, an "investment company" or a company
"controlled" by an investment company under the Investment Company Act of
1940, as amended;
(xv) Kane County Bank and Trust Co. is validly existing as an
Illinois banking corporation in good standing under the laws of the State
of Illinois and The Old Second National Bank of Aurora and The Yorkville
National Bank are federally chartered banks in good standing under the laws
of the United States, all with power and authority to own its respective
properties and conduct its respective business as described in the
Prospectus;
(xvi) no Capital Treatment Event (as defined in the Indenture) has
occurred; and
(xvii) the Offerors satisfy all of the requirements of the Act for
use of Form S-3 for the offering of Preferred Securities contemplated by
this Agreement.
In rendering such opinion, such counsel may state that insofar as
their opinion under clause (iv) above relates to the accuracy and
completeness of the Prospectus and Registration Statement, including the
Incorporated Documents, it is based upon a general review with the
Offerors' representatives and independent accountants of the information
contained therein, without independent verification by such counsel of the
accuracy or completeness of such information. Such counsel may also rely
upon the opinions of other competent counsel and, as to factual matters, on
certificates of officers of the Offerors
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and of federal or state agencies or officials, in which case their opinion
is to state that they are so doing and copies of said opinions or
certificates are to be attached to the opinion unless said opinions or
certificates (or, in the case of certificates, the information therein)
have been furnished to the Representatives in other form.
(c) The Underwriters shall have received on the Closing Date and the
Option Closing Date, as the case may be, the opinion of Barack Ferrazzano
Kirschbaum Perlman & Nagelberg, dated the Closing Date or the Option Closing
Date, addressed to the Underwriters, to the effect that:
(i) under current law, 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; accordingly, for United States
federal income tax purposes each beneficial owner of Preferred Securities
will be treated as owning an undivided beneficial interest in the Junior
Subordinated Debentures, and stated interest on the Junior Subordinated
Debentures generally will be included in income by a holder of Capital
Securities at the time such interest income is paid or accrued in
accordance with such holder's regular method of tax accounting; and
(ii) for federal income tax purposes, (a) the Junior Subordinated
Debentures will constitute indebtedness of the Company and (b) the interest
on the Junior Subordinated Debentures will be deductible by the Company on
an economic accrual basis in accordance with Section 163(e) of the Internal
Revenue Code of 1986, as amended, and Treasury Regulation Section 1.163-7.
(d) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, the opinion of Richards, Layton & Finger,
P.A., counsel to Wilmington Trust Company, as Property Trustee under the Trust
Agreement, Indenture Trustee under the Indenture, and Guarantee Trustee under
the Guarantee Agreement, dated the Closing Date or the Option Closing Date, as
the case may be, addressed to the Underwriters, to the effect that:
(i) Wilmington Trust Company is duly incorporated and is validly
existing in good standing as a banking corporation under the laws of the
State of Delaware;
(ii) Wilmington Trust Company has the power and authority to
execute, deliver and perform its obligations under the Trust Agreement, the
Indenture and the Guarantee Agreement;
(iii) each of the Trust Agreement, the Indenture and the Guarantee
Agreement has been duly authorized, executed and delivered by Wilmington
Trust Company and constitutes a legal, valid and binding obligation of
Wilmington Trust Company, enforceable against Wilmington Trust Company, in
accordance with its terms;
(iv) the execution, delivery and performance by Wilmington Trust
Company of the Trust Agreement, the Indenture and the Guarantee Agreement
do not conflict with or constitute a breach of the charter or bylaws of
Wilmington Trust Company; and
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(v) no consent, approval or authorization of, or registration
with or notice to, any governmental authority or agency of the State of
Delaware or the United States of America governing the banking or trust
powers of Wilmington Trust Company is required for the execution, delivery
or performance by Wilmington Trust Company of the Trust Agreement, the
Indenture and the Guarantee Agreement.
(e) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, the opinion of Richards, Layton & Finger,
P.A., as special Delaware counsel for the Offerors that:
(i) the Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, and all filings
required as of the date hereof under the Delaware Act with respect to the
creation and valid existence of the Trust as a business trust have been
made;
(ii) under the Trust Agreement and the Delaware Act, the Trust
has the trust power and authority to own property and to conduct its
business, all as described in the Prospectus;
(iii) the Trust Agreement constitutes a valid and binding
obligation of the Company, the Property Trustee and each of the
Administrative Trustees, and is enforceable against the Company, the
Property Trustee and each of the Administrative Trustees in accordance with
its terms;
(iv) under the Trust Agreement and the Delaware Act, the Trust
has the trust power and authority (a) to execute and deliver, and to
perform its obligations under, this Agreement, and (b) to issue, and to
perform its obligations under, the Preferred Securities and the Common
Securities;
(v) under the Trust Agreement and the Delaware Act, the
execution and delivery by the Trust of this Agreement, and the performance
by the Trust of its obligations under this Agreement, have been duly
authorized by all necessary trust action on the part of the Trust;
(vi) under the Delaware Act, the certificate attached to the
Trust Agreement as Exhibit D is an appropriate form of certificate to
evidence ownership of the Preferred Securities. The Preferred Securities
and the Common Securities have been duly authorized by the Trust Agreement
and are duly and validly issued and, subject to the qualifications
hereinafter expressed in this paragraph (vi), fully paid and non-assessable
undivided beneficial interests in the assets of the Trust. The respective
holders of the Preferred Securities and the Common Securities, as
beneficial owners of the Trust, will be entitled to the same limitation of
personal liability extended to stockholders of private corporations for
profit organized under the General Corporation Law of the State of
Delaware. Such counsel may note that the respective holders of the
Preferred Securities and the Common Securities may be obligated, pursuant
to the Trust Agreement, to make certain payments under the Trust Agreement;
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(vii) under the Trust Agreement and the Delaware Act, the issuance
of the Preferred Securities and the Common Securities is not subject to
preemptive or similar rights; and
(viii) the issuance and sale by the Trust of the Preferred
Securities and the Common Securities, the purchase by the Trust of the
Junior Subordinated Debentures, the execution, delivery and performance by
the Trust of this Agreement and the Guarantee Agreement, the consummation
by the Trust of the transactions contemplated by this Agreement and
compliance by the Trust with its obligations under this Agreement do not
violate (A) any of the provisions of the Certificate of Trust or the Trust
Agreement or (B) any applicable Delaware law or Delaware administrative
regulations.
(f) The Underwriters shall have received from Chapman and Cutler, Chicago,
Illinois, counsel for the Underwriters, an opinion dated the Closing Date or the
Option Closing Date, as the case may be, with respect to the formation of the
Trust, the validity of the Preferred Securities, the Indenture, the Trust
Agreement, the Guarantee Agreement, the Expense Agreement, this Agreement, the
Registration Statement, the Prospectus, and other related matters as the
Underwriters may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them to pass
upon such matters.
(g) The Underwriters shall have received on the date hereof, the Closing
Date and, if applicable, the Option Closing Date, a signed letter, dated as of
the date hereof, the Closing Date or the Option Closing Date, as the case may
be, respectively, in form and substance satisfactory to the Underwriters, from
Ernst & Young, LLP to the effect that they are independent public accountants
with respect to the Trust, the Company and the Company's subsidiaries within the
meaning of the Act and the related rules and regulations and 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 (and the Incorporated Documents).
(h) Subsequent to the execution and delivery of this Agreement and prior
to the Closing Date or the Option Closing Date, as the case may be, there shall
not have been any change or any development involving a reasonably foreseeable
change, in or affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Offerors otherwise than as
set forth or contemplated in the Prospectus, the effect of which, in your
reasonable judgment, is material and adverse to the Offerors and makes it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Preferred Securities being delivered at the Closing Date, or the Option
Closing Date, as the case may be, on the terms and in the manner contemplated in
the Prospectus.
(i) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, a certificate or certificates of the chief
executive officer and the principal financial officer of the Company, to the
effect that, as of the Closing Date or the Option Closing Date, as the case may
be, each of them severally represents as follows:
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(i) The Prospectus was filed with the Commission pursuant to
Rule 424(b) within the applicable period prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 4 of
this Agreement; no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings for such purpose
have been initiated or are, to his knowledge, threatened by the Commission.
(ii) The representations and warranties of the Company set forth
in Section 1 of this Agreement are true and correct at and as of the
Closing Date or the Option Closing Date, as the case may be, and the
Company has performed all of its obligations under this Agreement to be
performed at or prior to the Closing Date or the Option Closing Date, as
the case may be.
(j) The Underwriters shall have received on the Closing Date or the Option
Closing Date, as the case may be, a certificate or certificates of the
Administrative Trustees, to the effect that, as of the Closing Date or the
Option Closing Date, as the case may be, each of them severally represents as
follows:
(i) The Prospectus was filed with the Commission pursuant to
Rule 424(b) within the applicable period prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 4 of
this Agreement; no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings for such purpose
have been initiated or are, to his knowledge, threatened by the Commission.
(ii) The representations and warranties of the Trust set forth in
Section 1 of this Agreement are true and correct at and as of the Closing
Date or the Option Closing Date, as the case may be, and the Trust has
performed all of its obligations under this Agreement to be performed at or
prior to the Closing Date or the Option Closing Date, as the case may be.
(k) The Offerors shall have furnished to the Underwriters such further
certificates and documents as the Underwriters may reasonably have requested,
including with respect to (i) the treatment of the Junior Subordinated
Debentures as indebtedness of the Company and (ii) the deductibility of the
interest on the Junior Subordinated Debenture.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects reasonably satisfactory to the Underwriters and to Chapman and Cutler,
counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Underwriters by notifying the Company and the Trust of such termination in
writing or by telegram at or prior to the Closing Date or the Option Closing
Date, as the case may be. In such event, the Offerors and the Underwriters shall
not be under any obligation to each other (except to the extent provided in
Sections 5 and 7 hereof).
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SECTION 7. INDEMNIFICATION. (a) The Offerors jointly and severally agree
to indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of the Act or the Exchange Act
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter or such controlling person may become subject under the Act,
the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise (including in settlement of any litigation if such
settlement is effected with the written consent of the Offerors), insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are (i) based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement,
including the information deemed to be part of the Registration Statement at the
time of effectiveness pursuant to Rule 430A and/or Rule 434, if applicable, any
Preliminary Prospectus, the Prospectus, the Incorporated Documents or any
amendment or supplement thereto, or (ii) arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading; and
will reimburse each Underwriter and each such controlling person for any legal
or other expenses reasonably incurred by such Underwriter or such controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Offerors will not be
liable in any such case to the extent that (A) any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement,
any Preliminary Prospectus, the Prospectus, the Incorporated Documents or any
amendment or supplement thereto in reliance upon and in conformity with written
information furnished to the Offerors by or on behalf of any Underwriter,
specifically for use therein; or (B) if such statement or omission was contained
or made in any Preliminary Prospectus and corrected in the Prospectus and (1)
any such loss, claim, damage or liability suffered or incurred by any
Underwriter (or any person who controls any Underwriter) resulted from an
action, claim or suit by any person who purchased Preferred Securities which are
the subject thereof from such Underwriter in the offering and (2) such
Underwriter failed to deliver or provide a copy of the Prospectus to such person
at or prior to the confirmation of the sale of such Preferred Securities in any
case where such delivery is required by the Act. In addition to its other
obligations under this Section 7(a), the Offerors agree that, as an interim
measure during the pendency of any claim, action, investigation, inquiry or
other proceeding arising out of or based upon any statement or omission, or any
alleged statement or omission, described in this Section 7(a), it will reimburse
the Underwriters on a quarterly basis for all reasonable legal and other
expenses incurred in connection with investigating or defending any such claim,
action, investigation, inquiry or other proceeding, notwithstanding the absence
of a judicial determination as to the propriety and enforceability of the
Offerors' obligation to reimburse the Underwriters for such expenses and the
possibility that such payments might later be held to have been improper by a
court of competent jurisdiction. To the extent that any such interim
reimbursement payment is held by a court of competent jurisdiction to have been
improper, each recipient thereof will promptly return it to the Offerors. This
indemnity agreement will be in addition to any liability which the Offerors may
otherwise have.
(b) Each Underwriter will severally indemnify and hold harmless the
Offerors, the trustees, and the Company's directors, each of the Company's
officers who signed the Registration Statement and each person, if any, who
controls either Offeror within the meaning
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of the Act or the Exchange Act, against any losses, claims, damages or
liabilities to which the Offerors, or any such director, officer or controlling
person may become subject under the Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Underwriter), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto in reliance upon any written information furnished to the
Offerors by such Underwriter specifically for use in the preparation thereof;
and will reimburse any legal or other expenses reasonably incurred by the
Offerors, or any such director, officer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action. In
addition to their other obligations under this Section 7(b), each Underwriter
agrees that, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or based upon any
statement or omission, or any alleged statement or omission, described in this
Section 7(b), the Underwriters will reimburse the Offerors on a quarterly basis
for all reasonable legal and other expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry or
other proceeding, notwithstanding the absence of a judicial determination as to
the propriety and enforceability of the Underwriters' obligation to reimburse
the Offerors for such expenses and the possibility that such payments might
later be held to have been improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement payment is held by a court of
competent jurisdiction to have been improper, each recipient thereof will
promptly return it to the Underwriters. This indemnity agreement will be in
addition to any liability which the Underwriters may otherwise have.
(c) The Company agrees to indemnify the Trust against all loss, liability,
claim damage and expense whatsoever, which may become due from the Trust under
paragraph (a).
(d) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party under this
Section, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party except to the extent that
the indemnifying party was prejudiced by such failure to notify. In case any
such action is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate in, and, to the extent that it may wish, jointly with
all other indemnifying parties similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; PROVIDED, HOWEVER,
if the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
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indemnifying party, or the indemnified and indemnifying parties may have
conflicting interests which would make it inappropriate for the same counsel to
represent both of them, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defense and otherwise to
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed such counsel in
connection with the assumption of legal defense in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representative in the case of paragraph (a)
representing all indemnified parties not having different or additional defenses
or potential conflicting interests among themselves who are parties to such
action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability arising out
of such proceeding.
(e) If the indemnification provided for in this Section is unavailable to
an indemnified party under paragraphs (a) or (b) hereof in respect of any
losses, claims, damages or liabilities referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors on the one
hand and the Underwriters on the other from the offering of the Preferred
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Offerors on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Offerors on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Offerors bears to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the Prospectus. The
relative fault of the Offerors and the Underwriters shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Offerors or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages and liabilities referred to
above
26
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shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any action
or claim.
The Offerors and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section, no Underwriter shall be required
to contribute any amount in excess of the amount by which the total price at
which the Preferred Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section are several in proportion to their respective
underwriting commitments and not joint.
(f) The provisions of this Section shall survive any termination of the
Agreement.
SECTION 8. DEFAULT OF UNDERWRITERS. It shall be a condition to the
agreement and obligation of the Offerors to sell and deliver the Preferred
Securities hereunder, and of each Underwriter to purchase the Preferred
Securities hereunder, that, except as hereinafter in this paragraph provided,
each of the Underwriters shall purchase and pay for all Preferred Securities
agreed to be purchased by such Underwriter hereunder upon tender to the
Representative of all such Preferred Securities in accordance with the terms
hereof. If an Underwriter defaults in its obligation to purchase Preferred
Securities hereunder on the Closing Date or the Option Closing Date, as the case
may be, and the aggregate number of Preferred Securities which such defaulting
Underwriter agreed but failed to purchase does not exceed 10 percent of the
total number of Firm Securities or Option Securities, as the case may be, which
the Underwriters are obligated to purchase on the Closing Date or the Option
Closing Date, as the case may be, the Representative may make arrangements
satisfactory to the Offerors for the purchase of such Preferred Securities by
other persons, including the Representative, but if no such arrangements are
made by such date the nondefaulting Underwriter shall be obligated to purchase
the Preferred Securities which such defaulting Underwriter agreed but failed to
purchase on such date. If any Underwriter so defaults and the aggregate number
of Preferred Securities with respect to which such default occurs is more than
the above percentage and arrangements satisfactory to the Representative and the
Offerors for the purchase of such Preferred Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of the nondefaulting Underwriter or the Offerors, except
for the expenses to be paid by the Offerors pursuant to Section 5 hereof and
except to the extent provided in Section 7 hereof.
In the event that Preferred Securities to which a default relates are to be
purchased by the nondefaulting Underwriter or by another party or parties, the
Representative or the Offerors shall have the right to postpone the Closing Date
or the Option Closing Date, as the case may be, for not more than seven business
days in order that the necessary changes in the Registration Statement,
Prospectus and any other documents, as well as any other arrangements, may be
effected. As used in this Agreement, the term "Underwriter" includes any person
substituted for
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an Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
SECTION 9. TERMINATION. Without limiting the right to terminate this
Agreement pursuant to any other provision hereof, this Agreement may be
terminated by you prior to the Closing Date or the Option Closing Date, as the
case may be, if (i) trading in securities on The Nasdaq National Market shall
have been suspended or minimum prices shall have been established on such
exchange, or (ii) a banking moratorium shall have been declared by Illinois, New
York, or United States authorities, or (iii) there shall have been any material
adverse change in financial markets or in political, economic or financial
conditions from the date hereof which, in the reasonable opinion of the
Representative, either renders it impracticable or inadvisable to proceed with
the offering and sale of the Preferred Securities on the terms set forth in the
Prospectus or materially and adversely affects the market for the Preferred
Securities, or (iv) there shall have been an outbreak of major armed hostilities
between the United States and any foreign power which in the reasonable opinion
of the Representative makes it impractical or inadvisable to offer or sell the
Preferred Securities. Any termination pursuant to this paragraph shall be
without liability on the part of any Underwriter to the Offerors or on the part
of the Offerors to any Underwriter (except for expenses to be paid or reimbursed
pursuant to Section 7 hereof and except to the extent provided in Section 5
hereof).
SECTION 10. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of the Offerors, the Trustees, any of the Company's officers and of
the Underwriters set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of
any Underwriter or the Offerors or any of its or their partners, officers or
directors or any controlling person, as the case may be, and will survive
delivery of and payment for the Preferred Securities sold hereunder.
SECTION 11. NOTICES. All communications hereunder will be in writing and,
if sent to the Underwriters will be mailed, delivered or sent by facsimile
transmission and confirmed to you c/o Howe Barnes Investments, Inc., 135 South
LaSalle Street, Chicago, Illinois 60603, Attention: Daniel E. Coughlin with a
copy to Matthew C. Boba, Esq., Chapman and Cutler, 111 West Monroe, Chicago,
Illinois 60603; and if sent to the Company will be mailed, delivered or
telegraphed and confirmed to the Company, Attention: William B. Skoglund, at its
corporate headquarters with a copy to John E. Freechack, Esq., Barack Ferrazzano
Kirschbaum Perlman & Nagelberg, 333 West Wacker Drive, Suite 2700, Chicago,
Illinois 60606.
SECTION 12. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors, personal
representatives and assigns, and to the benefit of the officers and directors
and controlling persons referred to in Section 7, and no other person will have
any right or obligation hereunder. The term "successors" shall not include any
purchaser of the Preferred Securities as such from any of the Underwriters
merely by reason of such purchase.
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SECTION 13. REPRESENTATION OF UNDERWRITERS. You will act as Representative
for the Underwriters in connection with this financing, and any action under or
in respect of this Agreement taken by either of you will be binding upon all the
Underwriters.
SECTION 14. PARTIAL UNENFORCEABILITY. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
SECTION 15. MISCELLANEOUS. Each provision of this Agreement shall be
interpreted in such a manner to be effective and valid under applicable law, but
if any provision of this Agreement is held to be invalid, illegal or
unenforceable under any applicable law or rule in any jurisdiction, such
provision will be ineffective only to the extent of such invalidity, illegality
or unenforceability in such jurisdiction or any provision hereof in any other
jurisdiction.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Illinois.
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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement among the Offerors and the Underwriters including
you, all in accordance with its terms.
Very truly yours,
OLD SECOND BANCORP, INC.
By
---------------------------------------------
William B. Skoglund
Its President and Chief Executive Officer
OLD SECOND CAPITAL TRUST I
By
---------------------------------------------
J. Douglas Cheatham
Its Administrative Trustee
The foregoing Agreement is hereby confirmed and accepted as of the date
first above written.
HOWE BARNES INVESTMENTS, INC.
Acting as Representative of the Underwriters
named in Schedule A
By
---------------------------------------------
Daniel E. Coughlin
President and Chief Executive Officer
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SCHEDULE A
SCHEDULE OF UNDERWRITERS
<Table>
<Caption>
NUMBER OF
PREFERRED SECURITIES
UNDERWRITER TO BE PURCHASED
- ----------- --------------------
Howe Barnes Investments, Inc.
Total 2,500,000
=========
</Table>