EXHIBIT 1.1
DRAFT
5/3/99
1,200,000 CAPITAL SECURITIES
QUAD CITY HOLDINGS CAPITAL TRUST I
_____% CUMULATIVE CAPITAL SECURITIES
(LIQUIDATION PREFERENCE OF $10 PER CAPITAL SECURITY)
UNDERWRITING AGREEMENT
__________, 1999
Dain Rauscher Wessels, a division of
Dain Rauscher Incorporated
Howe Barnes Investments, Inc.
c/o Dain Rauscher Incorporated
Dain Rauscher Plaza
60 South Sixth Street
Minneapolis, Minnesota 55402
Ladies and Gentlemen:
Quad City Holdings, Inc., a Delaware corporation (the "Company"), and its
subsidiary, Quad City Holdings Capital Trust I, a statutory business trust
organized under the Delaware Business Trust Act (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 you (the
"Underwriters"), an aggregate of 1,200,000 of the Trust's _____% Cumulative
Capital Securities, with a liquidation preference of $10.00 per capital security
(the "Capital Securities"). The Offerors propose that the Trust issue the
Capital Securities pursuant to an amended and restated declaration of trust, by
First Union Trust Company, National Association, a national banking association
("First Union"), as Property Trustee and Delaware Trustee, the regular trustees
named therein (the "Regular Trustees") and the Company and by the holders from
time to time of undivided beneficial interests in the Trust (the "Declaration").
The Capital Securities will be guaranteed by the Company (the "Guarantee") as
set forth in a Guarantee Agreement (the "Guarantee Agreement"), to be dated
___________, 1999, between the Company and First Union, as trustee (the
"Guarantee Trustee").
The proceeds of the sale of the Capital Securities will be used to purchase
junior subordinated deferrable interest debentures (the "Junior Subordinated
Debentures") issued by the Company pursuant to that certain Indenture, to be
dated ____________, 1999, between the Company and First Union, as trustee, (the
"Indenture").
The Offerors have filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-2 (File No. _________) for the
registration of the Capital Securities, the Guarantee and the Junior
Subordinated Debentures under the Securities Act of 1933, as amended (the "Act")
and the rules and regulations thereunder and the
qualification of the Indenture, the Declaration and the Guarantee under the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the
rules and regulations thereunder. If the Offerors have elected not to rely upon
Rule 430A under the Act, the Offerors have prepared and will promptly file an
amendment to the registration statement and an amended prospectus (including a
term sheet meeting the requirements of Rule 434 under the Act) if necessary to
complete the Prospectus. If the Offerors have elected to rely upon Rule 430A
under the Act, they will prepare and file a prospectus (or a term sheet meeting
the requirements of Rule 434) pursuant to Rule 424(b) that discloses the
information previously omitted from the prospectus in reliance upon Rule 430A.
Such registration statement, as amended at the time it is or was declared
effective by the Commission, and, in the event of any amendment thereto after
the effective date and prior to the Closing Date (as hereinafter defined), such
registration statement as so amended (but only from and after the effectiveness
of such amendment), including a registration statement (if any) filed pursuant
to Rule 462(b) under the Act increasing the size of the offering registered
under the Act and information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rules 430A(b) and 434(d)
under the Act, is hereinafter called the "Registration Statement". The
prospectus included in the Registration Statement at the time it is or was
declared effective by the Commission is hereinafter called the "Prospectus",
except that if any prospectus (including any term sheet meeting the requirements
of Rule 434 under the Act provided by the Offerors for use with a prospectus
subject to completion within the meaning of Rule 434 under the Act in order to
meet the requirements of Section 10(a)) filed by the Offerors with the
Commission pursuant to Rule 424(b) under the Act (and Rule 434 under the Act, if
applicable) or any other such prospectus provided to you by the Offeror for use
in connection with the offering of the Capital Securities (whether or not
required to be filed by the Offeror with the Commission pursuant to Rule 424(b)
under the Act) differs from the prospectus on file at the time the Registration
Statement is or was declared effective by the Commission, the term "Prospectus"
shall refer to such differing prospectus (including any term sheet within the
meaning of Rule 434 under the Act) from and after the time such prospectus is
filed with the Commission or transmitted to the Commission for filing pursuant
to such Rule 424(b) (and Rule 434, if applicable) or from and after the time it
is first provided to you by the Offeror for such use. The term "Preliminary
Prospectus" as used herein means the preliminary prospectus included in any
Registration Statement prior to the time it becomes or became effective under
the Act and any prospectus subject to completion as described in Rule 430A or
434 under the Act.
Copies of the Registration Statement, including all exhibits and schedules
thereto, any amendments thereto and all Preliminary Prospectuses have been
delivered to the Underwriters.
The Offerors hereby confirm their agreement with respect to the purchase of
the Capital Securities by the Underwriters as follows:
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
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Registration Statement has been issued and no proceeding for that purpose has
been instituted or, to the Company's knowledge, threatened by the Commission.
(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 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 and the Prospectus
conform in all material respects to the requirements of the Act and the rules
and regulations thereunder and the Trust Indenture Act and the rules and
regulations thereunder. Neither the Registration Statement, as of its effective
date and the date of any amendment thereto, nor the Prospectus contains 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
(i) 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
(ii) information in those parts of the Registration Statement which constitute
Statements of Eligibility and Qualification ("Form T-1") under the Trust
Indenture Act. Each Preliminary Prospectus and the Prospectus will be identical
to the electronically transmitted copies thereof filed with the Commission
pursuant to its Electronic Date Gathering, Analysis and Retrieval system
("EDGAR"), except to the extent permitted by Regulation S-T.
(iv) The documents of the Company incorporated by
reference in the Registration Statement and the Prospectus, when they were filed
with the Commission, conformed in all material respects to the requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and the
rules and regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading; and any further documents so filed and incorporated by reference
in the Registration Statement and the Prospectus or any further amendment or
supplement thereto, when such documents are filed with the Commission will
conform in all material respects to the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder, and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
(v) 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
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and to enter into and perform its obligations under this Agreement, the Capital
Securities, the Common Securities and the Declaration 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), earnings, business, prospects,
assets, results of operations or properties taken as a whole; the Trust has
conducted and will conduct no business other than the transactions contemplated
by the Declaration and described in the Prospectus; the Trust is not a party to
or otherwise bound by any agreement other than this Agreement and those
described in the Prospectus; 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 the Trust is and will be treated as a consolidated
subsidiary of the Company pursuant to generally accepted accounting principles.
(vi) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended (the "BHC Act"), supervised by the Board of
Governors of the Federal Reserve System (the "FRB"). The subsidiaries of the
Company are Quad City Bank and Trust Company (the "Bank") and Quad City Bancard,
Inc. (each a subsidiary and collectively the "Subsidiaries"). The Bank is a
commercial bank having a valid charter from the State of Iowa. Each Subsidiary
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation. Each of the
Company and the Subsidiaries has the corporate power and authority to own or
lease its properties and conduct its business as described in the Registration
Statement and the Prospectus; is, to the Company's knowledge, in compliance with
all federal and state regulatory rules and guidelines; and is duly qualified to
transact business in all jurisdictions in which the conduct of its business or
its ownership or leasing of property requires such qualification and the failure
so to qualify would have a material adverse effect on the business or condition,
financial or otherwise, of the Company and the Subsidiaries, taken as a whole.
The accounts of each of the Company's Subsidiaries which are banks are insured
by the Bank Insurance Fund of the Federal Deposit Insurance Corporation (the
"FDIC") up to the maximum applicable amount in accordance with the rules and
regulations of the FDIC, and no proceedings for the termination or revocation of
such membership or insurance are pending, or, to the knowledge of the Company,
threatened.
(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 Capital Securities. Neither the filing of the Registration Statement nor
the registration of the Capital 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. All outstanding shares
of capital stock of each of the Subsidiaries have been duly authorized and
validly issued, are fully paid and non-assessable, and are owned, directly or
indirectly, by the Company free and
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clear of all liens, encumbrances and security interests, except as disclosed in
the Registration Statement and Prospectus and the information incorporated
therein by reference. No options, warrants or other rights to purchase,
agreements or other obligations to issue, or other rights to convert any
obligations into, shares of capital stock or ownership interests in any of the
Subsidiaries are outstanding. Other than the foregoing Subsidiaries and the
Trust, the Company does not own directly any capital stock or other equity,
ownership or proprietary interest in any company, partnership, association,
trust or other entity, other than securities for investment purposes.
(viii) Each of this Agreement, the Indenture, the
Declaration and the Guarantee 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
underlying the federal or state securities laws. The execution, delivery and
performance of this Agreement, the Indenture, the Declaration and the Guarantee
Agreement and the consummation of the transactions herein or therein
contemplated will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, (x) 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
Subsidiaries is a party or by which the Trust, the Company or any of the
Subsidiaries is bound or to which any property or assets of the Trust, the
Company or any of the Subsidiaries is subject or any order, rule, regulation,
order, agreement or decree of any court or governmental agency or body having
jurisdiction over the Company, any Subsidiary or the Trust or any of the
properties of the Company, any Subsidiary or the Trust or (y) the Company's or
any Subsidiary's charter or bylaws or the Declaration or the Trust's certificate
of trust filed with the State of Delaware on April 27, 1999 (the "Certificate of
Trust"). 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 Declaration and the Guarantee
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 Capital 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. Each of the Company and the
Trust has full power and authority to enter into this Agreement, the Indenture,
the Declaration and the Guarantee Agreement, as the case may be, and to
authorize, issue and sell the Junior Subordinated Debentures or the Common
Securities and the Capital Securities, as the case may be, as contemplated by
this Agreement and each of the Indenture, the Declaration 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 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,
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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, 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 Declaration and, when issued and delivered by the Trust to the Company
against payment therefor as described in the Registration Statement and
Prospectus, will be validly issued and (subject to the terms of the Declaration)
fully paid and nonassessable undivided beneficial interests in the assets of the
Trust and will conform in all material respects to all statements relating
thereto contained in the Prospectus; and at the Closing Date 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 Capital Securities have been duly authorized by
the Declaration 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 Declaration and will conform in all
material respects to the statements relating thereto contained in the
Prospectus; and holders of Capital Securities will be entitled to the same
limitation of personal liability under Delaware law as extended to stockholders
of private corporations for profit.
(xii) The Indenture, the Declaration and the Guarantee
Agreement are in substantially the respective forms filed as exhibits to the
Registration Statement.
(xiii) The Company's obligations under the Guarantee are
subordinated and junior in right of payment to all Senior and Subordinated Debt
(as defined in the Indenture) of the Company.
(xiv) The Junior Subordinated Debentures are subordinate
and junior in right of payment to all Senior and Subordinated Debt of the
Company.
(xv) Each of the Regular Trustees of the Trust is an
officer of the Company and has been duly authorized by the Company to execute
and deliver the Declaration.
(xvi) The financial statements, together with the related
notes and schedules, contained or incorporated by reference in the Registration
Statement and Prospectus present fairly the consolidated financial position,
results of operations, shareholders' equity and cash flows of the Company and
its consolidated Subsidiaries on the basis stated therein at the indicated dates
and for the indicated periods. Such financial statements have been prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, except as expressly stated therein, and all
adjustments necessary for a fair presentation of results for such periods have
been made, except as otherwise stated therein. The selected financial and
statistical data included in the Registration Statement present fairly the
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information shown therein on the basis stated in the Registration Statement and
have been compiled on a basis consistent with the financial statements presented
therein.
(xvii) There is no action or proceeding pending or, to the
knowledge of the Trust or the Company, threatened or contemplated against any of
the Trust, the Company or any Subsidiary before any court or administrative or
regulatory agency which, if determined adversely to the Trust, the Company or
such Subsidiary would, individually or in the aggregate, result in a material
adverse change in the business or condition (financial or otherwise), results of
operations, shareholders' equity or prospects of the Trust, or of the Company
and it Subsidiaries taken as a whole, except as set forth in the Registration
Statement or the Prospectus.
(xviii) There are no contracts or documents of the Trust or
the Company or any Subsidiary that are required by the Act or by the rules and
regulations thereunder to be filed as exhibits to the Registration Statement or
any document incorporated by reference therein which contracts or documents have
not been so filed.
(xix) The Company and the Subsidiaries have good and
marketable title to all properties and assets reflected as owned in the
financial statements hereinabove described (or as described as owned in the
Prospectus), in each case free and clear of all liens, encumbrances and defects,
except such as are described in the Registration Statement and the Prospectus or
do not substantially affect the value of such properties and assets and do not
materially interfere with the use made and proposed to be made of such
properties and assets by the Company and the Subsidiaries; and any real property
and buildings held under lease by the Company and the Subsidiaries are held by
them under valid, subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the use made and proposed to be made of
such property and buildings by the Company and the Subsidiaries.
(xx) 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 Trust, or 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, or of the Company and the
Subsidiaries taken as a whole, whether or not occurring in the ordinary course
of business, including, without limitation, any material increase in
delinquencies or the amount or number of classified assets of the Bank, any
material decrease in net interest margin for any month, 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 Subsidiaries which
is material to the Trust, or the Company and the Subsidiaries taken as a whole,
other than transactions described or contemplated in the Registration Statement,
(C) the Trust, the Company and the 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,
or the Company and the Subsidiaries taken as a whole, (D) the Trust, the Company
and the 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) there has not been
any change in the capital stock of the Company or the Subsidiaries (other than
upon
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the exercise of options and warrants described in the Registration Statement),
or any material increase in the short-term or long-term debt (including
capitalized lease obligations) of the Company and the Subsidiaries taken as a
whole, and (F) 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
or the Subsidiaries other than any dividends or distributions described or
contemplated in the Registration Statement and the Company's regular quarterly
common stock dividend.
(xxi) Neither the Company nor any of the Subsidiaries is
in violation of its respective charter or bylaws; the Trust is not in violation
of the Declaration or its Certificate of Trust; and none of the Trust, the
Company, or the Subsidiaries is in violation of or otherwise in default under
any statute, or any rule, regulation, order, supervisory agreement, judgment,
decree or authorization of any court or governmental or administrative agency or
body having jurisdiction over the Trust, the Company or any of the Subsidiaries
or any of their properties, or 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 Subsidiaries is a party or by which any of
them are bound or to which any property or assets of the Trust, the Company or
any of the Subsidiaries is subject, which violation or default would have a
material adverse effect on the business, condition (financial or otherwise),
results of operations, shareholders' equity or prospects of the Trust, or of the
Company and the Subsidiaries taken as a whole.
(xxii) The Trust, the Company and each of the Subsidiaries
holds and is operating in compliance in all material respects with all licenses,
approvals, certificates and permits from governmental and regulatory authorities
which are necessary to the conduct of its business as described in the
Prospectus. Without limiting the generality of the foregoing, the Company has
all necessary federal or state approvals to own the stock of the Subsidiaries.
None of the Trust, the Company or any Subsidiary has received notice of or has
knowledge of any basis for any proceeding or action relating specifically to the
Trust, the Company or the Subsidiaries for the revocation or suspension of 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 the Subsidiaries that would have a
material adverse effect on the Trust, the Company or any Subsidiary.
(xxiii) McGladrey and Pullen L.L.P., which have certified
the financial statements filed with the Commission as part of the Registration
Statement, are independent public accountants with respect to the Company as
required by the Act and the rules and regulations thereunder.
(xxiv) 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 in, stabilization or
manipulation of the price of the Capital Securities.
(xxv) The Offerors' registration statement pursuant to
Section 12(b) of the Exchange Act with respect to the Capital Securities, has
been declared effective by the Commission; and the Capital Securities have been
approved for designation upon notice of issuance on the American Stock Exchange,
under the symbol "______________."
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(xxvi) The Offerors have not distributed and will not
distribute any prospectus or other offering material in connection with the
offering and sale of the Capital Securities other than any Preliminary
Prospectus or the Prospectus or other materials permitted by the Act to be
distributed by the Company.
(xxvii) Neither the Company nor any Subsidiary has received
or is subject to any directive, order or supervisory agreement or arrangement
from the FRB, the FDIC, 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.
(xxviii) The Offerors are in material compliance with all
provisions of Florida Statutes Section 517.075 (Chapter 92-198, laws of
Florida). Neither of 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.
(xxix) The Trust, the Company and the Subsidiaries have
filed all federal, state, local and foreign tax returns or reports required to
be filed (including extensions), and have paid in full all taxes indicated by
said returns or reports and all assessments received by it or any of them to the
extent that such taxes have become due and payable (including extensions),
except where the Trust, the Company and the Subsidiaries are contesting in good
faith such taxes and assessments. The Company and the Subsidiaries have also
filed all required applications, reports, returns and other documents and
information with all state and federal savings bank authorities and agencies.
(xxx) The Trust, the Company and each of the Subsidiaries
owns or licenses all patents, patent applications, trademarks, service marks,
tradenames, trademark registrations, service mark registrations, copyrights,
licenses, inventions, trade secrets and other similar rights necessary for the
conduct of their businesses as described in the Prospectus, except where the
failure to so own would not have a material adverse effect on the Trust, the
Company or any Subsidiary. Neither the Trust nor the Company has any knowledge
of any infringement by them or the Subsidiaries of any patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service mark registrations, copyrights, licenses, inventions, trade secrets or
other similar rights of others, and none of the Trust, the Company or any of the
Subsidiaries has received any notice or claim of conflict with the asserted
rights of others with respect to any of the foregoing.
(xxxi) None of the Trust, the Company or any of the
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.
(xxxii) The Company and its Subsidiaries maintain, and the
Trust will 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
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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.
(xxxiii) 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.
(xxxiv) No report or application filed by the Company or any
of its Subsidiaries with the FRB, the FDIC, the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"), the Office of the
Comptroller of the Currency (the "OCC") or any other regulatory authority, as of
the date it was filed or amended, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading when made or failed to
comply in all material respects with the applicable requirements of the FRB, the
FDIC, the Federal Reserve Board, the OCC or any other regulatory authority, as
the case may be.
(xxxv) Based upon current guidelines of the Federal Reserve
Board, the Junior Subordinated Debentures will constitute "tier 1" capital (as
defined in 12 C.F.R. Part 225), subject to applicable regulatory restrictions on
the amount thereof that can be included in tier 1 capital.
(xxxvi) The Offerors meet all of the requirements for the
use of Form S-2 to register the Capital Securities, the Guarantee and the Junior
Subordinated Debentures under the Act.
(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.
2. PURCHASE, SALE AND DELIVERY OF CAPITAL 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 per Capital Security of
$10.00, the number of Capital Securities set forth opposite the name of such
Underwriter in Schedule A hereto.
As compensation to the Underwriters for their commitments hereunder and in
view of the fact that the proceeds of the sale of the Capital Securities
(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 to the
Underwriters a commission of $_______ per Capital Security sold by the Trust
hereunder.
The Capital Securities will be delivered by the Company to the Underwriters
against payment of the purchase price therefor at the offices of ___________, or
such other location as may be mutually acceptable, at 9:00 a.m. Central time on
___________, 1999, or such other time
10
and date as the Underwriters and the Company may agree upon in writing, such
time and date of delivery being herein referred to as the "Closing Date." The
purchase price shall be payable by wire transfer of immediately available funds
to an account designated by the Trust at least two business days preceding the
Closing Date. The Underwriters' commission shall be payable by wire transfer of
immediately available funds to an account designated by the Underwriters at
least two business days preceding the Closing Date. Delivery of the Capital
Securities may be made by credit through full fast transfer to the accounts at
The Depository Trust Company ("DTC") designated by the Underwriters.
Certificates representing the Capital Securities, in definitive form and in such
denominations and registered in such names as the Underwriters 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 at the offices
of Dain Rauscher Incorporated, Dain Rauscher Plaza, 60 South Sixth Street,
Minneapolis, Minnesota, 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 Underwriter for the
Securities to be purchased by such Underwriter. Any such payment shall not
relieve such other Underwriter of any of its obligations hereunder. Nothing
herein contained shall constitute the Underwriters as an unincorporated
association or partner with either or both Offerors.
3. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to make a public offering of the Capital Securities as soon
as the Underwriters deem it advisable to do so. The Capital Securities are to
be initially offered to the public at the initial public offering price set
forth in the Prospectus. The Underwriters may from time to time thereafter
change the public offering price and other selling terms.
4. COVENANTS OF THE OFFERORS. The Offerors jointly and severally
covenant and agree with the several Underwriters that:
(a) If the Registration Statement has not already been
declared effective by the Commission, the Company will use its best efforts
to cause the Registration Statement and any post-effective amendments thereto
to become effective as promptly as possible; the Company will notify you
promptly of the time when the Registration Statement or any post-effective
amendment to the Registration Statement has become effective or any
supplement to the Prospectus (including any term sheet within the meaning of
Rule 434 under the Act) has been filed and of any request by the Commission
for any amendment or supplement to the Registration Statement or Prospectus
or additional information; if the Company has elected to rely on Rule 430A
under the Act, the Company will prepare and file a Prospectus (or term sheet
within the meaning of Rule 434 under the Act) containing the information
omitted therefrom pursuant to Rule 430A under the Act with the Commission
within the time period required by, and otherwise in accordance with the
provisions of, Rules 424(b), 430A and 434, if applicable; the Offerors will
prepare and file with the Commission, promptly upon your request, any
amendments or supplements to the Registration Statement or Prospectus
(including any term sheet within the meaning of Rule 434 under the Act) that,
in your opinion, may be necessary or advisable in connection with your
distribution of the Capital Securities; and the Offerors will not file any
amendment or supplement to the Registration Statement or Prospectus
(including any
11
term sheet within the meaning of Rule 434 under the Act) to which you shall
reasonably object by notice to the Company after having been furnished a copy
a reasonable time prior to the filing.
(b) 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 Capital 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.
(c) The Offerors will cooperate with the Underwriters and the
Underwriters' counsel in order to qualify the Capital Securities and the Junior
Subordinated Debentures for sale under the securities laws of such jurisdictions
as the Underwriters may reasonably have designated in writing and to continue
such qualifications in effect for so long as the Underwriters may reasonably
request for distribution of the Capital Securities (or obtain exemptions from
the application of such laws), provided that neither Offeror shall be required
to qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not now so qualified or required to file
such a consent. 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.
(d) 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, two conformed copies of the
Registration Statement and all amendments thereto including all exhibits filed
therewith, and will deliver to the Underwriters such number of conformed copies
of the Registration Statement, without exhibits, and of all amendments thereto,
as the Underwriters may reasonably request.
(e) If, during the period in which a prospectus is required by
law to be delivered by an Underwriter or dealer, any event shall occur as a
result of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in light of the circumstances existing
at the time the Prospectus is delivered to a purchaser, not misleading, or if
for any other reason it shall be necessary at any time to amend or supplement
the Prospectus to comply with any law, the Offerors promptly will prepare and
file with the Commission an appropriate amendment to the Registration Statement
or supplement to the Prospectus so that the Prospectus as so amended or
supplemented will not include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein in
light of the circumstances when it is so delivered, not misleading, or so that
the Prospectus will comply with law.
12
(f) The Offerors will make generally available to their security
holders, as soon as it is practicable to do so, but in any event not later than
18 months after the effective date of the Registration Statement, an earnings
statement (which need not be audited) in reasonable detail, covering a period of
at least 12 consecutive months beginning after the effective date of the
Registration Statement, which earnings statement shall satisfy the requirements
of Section 11(a) of the Act and Rule 158 thereunder and will advise the
Underwriters in writing when such statement has been so made available.
(g) The Company will, for five years from the Closing Date,
deliver to each Underwriter, as soon as they are available, copies of its annual
report and copies of all other documents, reports and information furnished by
the Company to its security holders or filed with any securities exchange
pursuant to the requirements of such exchange or with the Commission pursuant to
the Act or the Exchange Act. The Company will deliver to each Underwriter
similar reports with respect to significant subsidiaries, as that term is
defined in the rules and regulations under the Act, which are not consolidated
in the Company's financial statements.
(h) The Offerors will apply the net proceeds from the sale of the
Junior Subordinated Debentures and the Capital Securities substantially in
accordance with the purposes set forth under "Use of Proceeds" in the
Prospectus.
(i) The Offerors will use their best efforts to maintain the
designation of the Capital Securities on the American Stock Exchange.
(j) The Offerors have not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in, or which has constituted, the stabilization or manipulation
of the price of any security of either Offeror to facilitate the sale or resale
of the Capital Securities, and has not effected any sales of Common Stock which
are required to be disclosed in response to Item 701 of Regulation S-K under the
Act which have not been so disclosed in the Registration Statement.
(k) Neither Offeror will incur 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.
(l) The Offerors will inform the Florida Department of Banking
and Finance at any time prior to the consummation of the distribution of the
Capital Securities by you if it commences engaging in business with the
government of Cuba or with any person or affiliate located in Cuba. Such
information will be provided within 90 days after the commencement thereof or
after a change occurs with respect to previously reported information.
5. COSTS AND EXPENSES.
(a) 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, the Preliminary Prospectus(es) and the
Prospectus and
13
any amendments and supplements thereto and the printing, mailing and delivery to
the Underwriters and dealers of copies thereof and of this Agreement, any
selected dealers agreement, any blue sky memorandum 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
and expenses (including legal fees and disbursements of counsel for the
Underwriters) incident to securing any required review by the NASD of the terms
of the sale of the Capital 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 Declaration 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 Capital Securities under state
securities or Blue Sky laws; the fees and expenses incurred in connection with
the designation of the Capital Securities on the American Stock Exchange; the
costs of preparing certificates representing Junior Subordinated Debentures or
Capital 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.
Notwithstanding anything to the contrary in the foregoing sentence, the Offerors
shall not be required to pay more than an aggregate of (i) $_________ of fees
and expenses (x) related to qualification of the Capital Securities under state
securities or Blue Sky laws or (y) incident to securing any required review by
the NASD of the terms of the sale of the Capital Securities and (ii) $_________
of 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. The Offerors shall not be required to pay
for any of the Underwriters' expenses (other than those related to qualification
of the Capital Securities under state securities or Blue Sky laws and those
incident to securing any required review by the NASD of the terms of the sale of
the Capital Securities 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(b) 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 several 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 Capital Securities or in contemplation of performing their
obligations hereunder; but the Offerors shall not in any event be liable to any
of the several Underwriters for damages on account of loss of anticipated
profits from the sale by them of the Capital Securities.
(b) Upon successful completion of the offering contemplated by
this Agreement, the Offerors will pay all reasonable and customary costs,
expenses and fees incident to tombstone advertisements of the offering and
incurred with the approval of the Company.
14
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS.
The several obligations of the Underwriters to purchase the Capital
Securities on the 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, 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 (or any required post-effective amendment to the
Registration Statement shall have been filed and declared effective in
accordance with the requirements of Rule 430A); 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 the
opinions of Barack Ferrazzano Kirschbaum Perlman & Nagelberg, counsel for the
Offerors, dated the Closing Date addressed to the Underwriters, in the form
attached hereto as EXHIBIT 1.
Such counsel shall also state that on the basis of such counsel's review
and participation in conferences in connection with the preparation of the
Registration Statement and the Prospectus, such counsel has no reason to believe
that, as of its effective date, the Registration Statement or any further
amendment thereto made by the Offerors prior to the Closing Date, including any
document incorporated by reference in the Registration Statement, as the case
may be (other than the financial statements, other financial and statistical
data and related schedules therein, as to which such counsel need express no
statement) contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that, as of its date, the Prospectus or any
further amendment or supplement thereto made by the Offerors prior to the
Closing Date, including any document incorporated by reference in the Prospectus
(other than the financial statements, other financial and statistical data and
related schedules therein, as to which such counsel need express no statement)
contained an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading or that, as of the Closing Date, either the
Registration Statement or the Prospectus or any further amendment or supplement
thereto made by the Offerors prior to the Closing Date (other than the financial
statements, other financial and statistical data and related schedules therein,
as to which such counsel need express no statement) contains an untrue statement
of a material fact or omits to state a material fact necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading; and they do not know of any amendment to the Registration Statement
(or any document incorporated therein by reference) required to be filed.
In rendering the above opinions, counsel may rely (i) as to matters of law
other than federal law, upon the opinion or opinions of local counsel provided
that the extent of such
15
reliance is specified in such opinion and that such counsel shall state that
such opinion or opinions of local counsel are satisfactory to them and they
believe they and the Underwriters are justified in relying thereon and (ii) as
to matters of fact, upon the representations of the Trust and the Company
contained in this Agreement and upon certificates of trustees or officers of the
Trust, the Company and of public officials.
(c) The Underwriters shall have received on the Closing Date the
opinions of Barack Ferrazzano Kirschbaum Perlman & Nagelberg, special counsel
for the Offerors, dated the Closing Date addressed to the Underwriters, to the
effect that:
(i) The statements set forth in the Prospectus under the
caption "Federal Income Tax Consequences" constitute a fair and accurate summary
of the matters addressed therein, based upon current law and the assumptions
stated or referred to therein.
(ii) 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 Capital 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.
(iii) 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 the
opinion of Richards, Layton & Finger, counsel to First Union, as Property
Trustee under the Declaration, Indenture Trustee under the Indenture, and
Guarantee Trustee under the Guarantee Agreement, dated the Closing Date
addressed to the Underwriters, to the effect that:
(i) First Union is a national banking association duly
organized and validly existing in good standing under the laws of the United
States.
(ii) First Union has the power and authority to execute,
deliver and perform its obligations under the Declaration, the Indenture and the
Guarantee Agreement.
(iii) Each of the Declaration, the Indenture and the
Guarantee Agreement has been duly authorized, executed and delivered by First
Union and constitutes a legal, valid and binding obligation of First Union,
enforceable against First Union, in accordance with its terms.
(iv) The execution, delivery and performance by First
Union of the Declaration, the Indenture and the Guarantee Agreement do not
conflict with or constitute a breach of the charter or by-laws of First Union.
16
(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 First Union is required for the execution, delivery or performance by
First Union of the Declaration, the Indenture and the Guarantee Agreement.
(e) The Underwriters shall have received on the Closing Date the
opinion of Richards, Layton & Finger, as special Delaware counsel for the
Offerors, dated the Closing Date or the Additional Closing Date, addressed to
the Underwriters, to the effect 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 Declaration 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 Declaration constitutes a valid and binding
obligation of the Company, the Property Trustee and each of the Regular
Trustees, and is enforceable against the Company, the Property Trustee and each
of the Regular Trustees in accordance with its terms.
(iv) Under the Declaration and the Delaware Act, the
Trust has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, this Agreement, (ii) to issue, and to perform its
obligations under, the Capital Securities and the Common Securities and (iii) to
purchase and hold the Debentures.
(v) Under the Declaration 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 Declaration as Exhibit E is an appropriate form of certificate to evidence
ownership of the Capital Securities. The Capital Securities have been duly
authorized by the Declaration 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 and are
entitled to the benefits of the Declaration. The Common Securities have been
duly authorized by the Declaration and are duly and validly issued undivided
beneficial interests in the assets of the Trust and are entitled to the benefits
of the Declaration. The holders of the Capital 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 Capital Securities may be obligated, pursuant to
the Declaration, to make certain payments under the Declaration.
17
(vii) Under the Declaration and the Delaware Act, the
issuance of the Capital Securities and the Common Securities is not subject to
preemptive or similar rights.
(viii) The issuance and sale by the Trust of the Capital
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 Declaration, or (b) any applicable Delaware law or
Delaware administrative regulation.
(ix) No authorization, approval, consent or order of any
Delaware court or any Delaware governmental authority or Delaware agency is
required to be obtained by the Trust solely in connection with the issuance and
sale by the Trust of the Common Securities or the Capital Securities or the
performance by the Trust of its obligations under the Declaration or this
Agreement.
(x) The Capital Security holders (other than those
Capital Security holders who reside or are domiciled in the State of Delaware)
will have no liability for income taxes imposed by the state of Delaware solely
as a result of their participation in the Trust, and the Trust will not be
liable for any income tax imposed by the State of Delaware or any political
subdivisions or taxing authority thereof.
(f) The Underwriters shall have received from Faegre & Benson
LLP, counsel for the Underwriters, an opinion dated the Closing Date with
respect to the formation of the Trust, the validity of the Capital Securities,
the Indenture, the Declaration, the Guarantee 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. In rendering the above opinions, counsel may rely (i) as to
matters of law other than federal law, upon the opinion or opinions of local
counsel provided that the extent of such reliance is specified in such opinion
and (ii) as to matters of fact, upon the representations of the Trust and the
Company contained in this Agreement and upon certificates of trustees or
officers of the Trust, the Company and of public officials.
(g) The Underwriters shall have received on each of the date
hereof and the Closing Date, a signed letter, dated as of the date hereof and
the Closing Date in form and substance reasonably satisfactory to the
Underwriters, from McGladrey & Pullen, L.L.P. (i) to the effect that they are
independent public accountants with respect to the Trust, the Company and the
Subsidiaries within the meaning of the Act and the related rules and
regulations; (ii) 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 (iii) confirming that the Trust
is and will be treated as a consolidated subsidiary of the Company pursuant to
generally accepted accounting principles.
18
(h) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date 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 the Underwriters' 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 Capital Securities
being delivered at the Closing Date on the terms and in the manner contemplated
in the Prospectus.
(i) The Underwriters shall have received on the Closing Date a
certificate or certificates of the chief executive officer and the chief
financial officer of the Company, to the effect that, as of the Closing Date
each of them severally represents as follows:
(i) No stop order suspending the effectiveness of the
Registration Statement or the qualification of the Capital Securities for
offering or sale has been issued, and no proceedings for such purpose have been
initiated or are, to such officer's 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 and the Company has performed all of its obligations under this
Agreement to be performed at or prior to the Closing Date.
(iii) The signers of said certificate have carefully
examined the Registration Statement and the Prospectus, and any amendments
thereof or supplements thereto (including any term sheet within the meaning of
Rule 434 under the Act), and (a) such documents contain all statements and
information required to be included therein, the Registration Statement, or any
amendment thereof, does not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading and the Prospectus, as amended or
supplemented, does not include any untrue statement of material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has not
been so set forth, (C) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, the Trust
has not incurred any material liabilities or obligations, direct or contingent,
or entered into any material transactions, not in the ordinary course of
business, or declared or paid any dividends or made any distribution of any kind
with respect to its capital securities, and except as disclosed in the
Prospectus, there has not been any change in the capital securities, or any
material change in the short-term or long-term debt, or any issuance of options,
warrants, convertible securities or other rights to purchase the capital
securities, of the Trust or any material adverse change or any development
involving a prospective material adverse change (whether or not arising in the
ordinary course of business), in the general affairs, condition (financial or
otherwise), business, key personnel, property, prospects, net worth or results
of operations of the Trust, and (D) except as stated in the Registration
Sttement and the Prospectus, there is not pending, or, to the knowledge of the
Trust, threatened or contemplated, any action, suit or proceeding to which the
Trust is a party before or by any court or governmental agency, authority or
body, or any arbitrator, which might
19
result in any material adverse change in the condition (financial or otherwise),
business, prospects or results of operations of the Trust.
(j) The Underwriters shall have received on the Closing Date a
certificate or certificates of the Regular Trustees, to the effect that, as of
the Closing Date each of them severally represents as follows:
(i) No stop order suspending the effectiveness of the
Registration Statement or the qualification of the Capital Securities for
offering or sale has been issued, and no proceedings for such purpose have been
initiated or are, to such officer's 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 and the Trust has performed all of its obligations under this
Agreement to be performed at or prior to the Closing Date.
(iii) The signers of said certificate have carefully
examined the Registration Statement and the Prospectus, and any amendments
thereof or supplements thereto (including any term sheet within the meaning of
Rule 434 under the Act), and (a) such documents contain all statements and
information required to be included therein, the Registration Statement, or any
amendment thereof, does not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and the Prospectus, as amended or
supplemented, does not include any untrue statement of material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has not
been so set forth, (C) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, the Trust
has not incurred any material liabilities or obligations, direct or contingent,
or entered into any material transactions, not in the ordinary course of
business, or declared or paid any dividends or made any distribution of any kind
with respect to its capital securities, and except as disclosed in the
Prospectus, there has not been any change in the capital securities, or any
material change in the short-term or long-term debt, or any issuance of options,
warrants, convertible securities or other rights to purchase the capital
securities, of the Trust or any material adverse change or any development
involving a prospective material adverse change (whether or not arising in the
ordinary course of business), in the general affairs, condition (financial or
otherwise), business, key personnel, property, prospects, net worth or results
of operations of the Trust, and (D) except as stated in the Registration
Satement and the Prospectus, there is not pending, or, to the knowledge of the
Trust, threatened or contemplated, any action, suit or proceeding to which the
Trust is a party before or by any court or governmental agency, authority or
body, or any arbitrator, which might result in any material adverse change in
the condition (financial or otherwise), business, prospects or results of
operations of the Trust.
(k) The Offerors shall have furnished to the Underwriters such
further certificates and documents as the Underwriters may reasonably have
requested.
20
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 Faegre & Benson LLP,
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 Trust of such termination in writing or by
telegram at or prior to the Closing Date. In such event, the Trust and the
Underwriters shall not be under any obligation to each other (except to the
extent provided in Sections 5 and 7 hereof).
7. INDEMNIFICATION.
(a) The Offerors jointly and severally agree to indemnify and
hold harmless each Underwriter, each officer and director thereof, and each
person, if any, who controls any Underwriter within the meaning of the Act,
against any losses, claims, damages or liabilities to which such Underwriter or
such persons may become subject under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
any Preliminary Prospectus or the Prospectus, including any amendments or
supplements thereto (including any term sheet within the meaning of Rule 434
under the Act), (ii) 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 light of the circumstances under which they were made,
or (iii) any act or failure to act or any alleged act or failure to act by any
Underwriter in connection with, or relating in any manner to, the Capital
Securities or the offering contemplated hereby, and which is included as part of
or referred to in any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arising out of or based upon matters covered by
clause (i) or (ii) above, 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 action or claim as such expenses are incurred; provided,
however, that the Offerors shall not be liable (1) in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement, or omission or alleged
omission, made in the Registration Statement, any Preliminary Prospectus or the
Prospectus, including any amendments or supplements thereto, in reliance upon
and in conformity with written information furnished to the Offerors by any
Underwriter specifically for use therein or (2) in the case of any matter
covered by clause (iii) above to the extent that it is determined in a final
judgment by a court of competent jurisdiction that such losses, claims, damages
or liabilities resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Underwriter through its gross
negligence or willful misconduct.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Offerors and the trustees and directors and officers who have
signed the Registration Statement, and each person, if any, who controls the
Offerors within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Offerors or any such person may become
21
subject under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or are
based upon any untrue statement 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 the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made, and
will reimburse any legal or other expenses reasonably incurred by the Offerors
or any such person in connection with investigating or defending any such action
or claim as such expenses are incurred; provided, however, that each Underwriter
will be liable in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission has
been made in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Trust or the Company by or
through the Underwriters specifically for use therein. The obligations of the
Underwriters under this Section 7(b) are several in proportion to their
respective underwriting obligations and not joint.
(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 subsection (a).
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity or contribution may be sought pursuant to this Section 7, such person
(the "indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing. No
indemnification provided for in Section 7(a) or (b) or contribution provided for
in Section 7(e) shall be available with respect to a proceeding to any party who
shall fail to give notice of such proceeding as provided in this Section 7(d) if
the party to whom notice was not given was unaware of the proceeding to which
such notice would have related and was prejudiced by the failure to give such
notice, but the failure to give such notice shall not relieve the indemnifying
party or parties from any liability which it or they may have to the indemnified
party otherwise than on account of the provisions of Section 7(a) or (b). In
case any such proceeding shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party and shall pay as incurred the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel at its own
expense. Notwithstanding the foregoing, the indemnifying party shall pay
promptly as incurred the reasonable fees and expenses of the counsel retained by
the indemnified party in the event (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and the
indemnified party shall have reasonably concluded that there may be a conflict
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it or other indemnified parties which are different from or
additional to those available to the indemnifying party. It is understood that
the
22
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm at any time for all such indemnified parties. Such
firm shall be designated in writing by the Underwriters and shall be reasonably
satisfactory to the Offerors in the case of parties indemnified pursuant to
Section 7(a) and shall be designated in writing by the Offerors and shall be
reasonably satisfactory to the Underwriters in the case of parties indemnified
pursuant to Section 7(b). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent but if settled
with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under Section
7(a) or (b) above in respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) 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 Capital Securities. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the 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 (or actions or proceedings in respect thereof),
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 on the cover page of the Prospectus. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Offerors on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Offerors and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section 7(e) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7(e). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions or proceedings in respect thereto) referred
to above in this Section 7(e) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7(e), no Underwriter shall be required to contribute
any amount in excess of the underwriting discounts and commissions applicable to
the Capital Securities purchased by such Underwriter; and 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
23
Underwriters' obligations in this Section 7(e) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(f) The obligations of the Offerors under this Section 7 shall be
in addition to any liability which the Offerors may otherwise have, and the
obligations of the Underwriters under this Section 7 shall be in addition to any
liability which the Underwriters may otherwise have.
8. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided herein, will be mailed, delivered, telegraphed or
sent via facsimile transmission and confirmed as follows: if to the
Underwriters, to them c/o Dain Rauscher Incorporated, 60 South Sixth Street,
Minneapolis, Minnesota 55402, Attention: J. David Welch, Managing Director, with
a copy to David B. Miller, Esq., Faegre & Benson LLP, 2200 Norwest Center,
90 South Seventh Street, Minneapolis, Minnesota 55402-3901; if to the Company,
to Quad City Holdings, Inc., 3551 7th Street, Suite 100, Moline, Illinois 61265,
Attention: Douglas M. Hultquist, CPA, with a copy to John Freechack, Barack
Ferrazzano Kirschbaum Perlman & Nagelberg, 333 West Wacker Drive, Suite 2700,
Chicago, Illinois 60606, and if to the Trust, to it c/o Quad City Holdings,
Inc., Attention: Douglas M. Hultquist, CPA, with a copy to First Union, One
Rodney Square, 920 King Street, First Floor, Wilmington, Delaware 19801
Corporate Trust Administration. All notices given by facsimile transmission or
facsimile transmission shall be electronically confirmed and a copy of such
notice shall be sent promptly via U.S. mail. Any notice to the Trust shall also
be copied to the Company at the address previously stated, Attention: Douglas M.
Hultquist, CPA. Any party may change its address for notice purposes by written
notice to the other parties.
9. TERMINATION. This Agreement may be terminated by the Underwriters
by notice to the Offerors as follows:
(a) at any time prior to the earlier of (i) the time the Capital
Securities are released by the Underwriters for sale or (ii) 10:00 A.M., Central
time, on the first business day following the date of this Agreement; for the
purpose of this Section, the Capital Securities shall be deemed to have been
released for sale to the public upon release by you of the publication of a
newspaper advertisement relating thereto or upon release by the Underwriters of
telexes offering the Capital Securities for sale to securities dealers,
whichever shall first occur. By giving notice as hereinafter specified before
the time this Agreement becomes effective, the Underwriters, the Trust or the
Company may prevent this Agreement from becoming effective without liability of
any party to any other party, except that the provisions of Section 4(a)(viii)
and Section 6 hereof shall at all times be effective.
(b) at any time prior to the Closing Date if any of the following
has occurred: (i) since the respective dates as of which information is given in
the Registration Statement and the Prospectus, any material adverse change in or
affecting the condition, financial or otherwise, of the Trust, or 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,
or of the Company and the Subsidiaries taken as a whole, whether or not arising
in the ordinary course of business, (ii) any outbreak or escalation of
hostilities or declaration of war or national emergency after the date hereof or
other national or international calamity or crisis or change in
24
economic or political conditions if the effect of such outbreak, escalation,
declaration, emergency, calamity, crisis or change on the financial markets of
the United States would, in the Underwriters' judgment, make the offering or
delivery of the Capital Securities impracticable or inadvisable,
(iii) suspension of trading in securities on the New York Stock Exchange or the
American Stock Exchange or limitation on prices (other than limitations on hours
or numbers of days of trading) for securities on either such Exchange, or a halt
or suspension of trading in securities generally which are quoted on Nasdaq
(iv) declaration of a banking moratorium by either federal or state authorities
or New York, Illinois or Iowa authorities; (v) either Offeror shall have failed,
refused or been unable, at or prior to the Closing Date, to perform any
agreement on its part to be performed hereunder, or (vi) any other condition of
the Underwriters' obligations hereunder is not fulfilled.
(c) as provided in Section 6 of this Agreement.
10. WRITTEN INFORMATION. For all purposes under this Agreement
(including, without limitation, Section 1, Section 3 and Section 7 hereof), the
Offerors understand and agree with each of the Underwriters that the following
constitutes the only written information furnished to the Offerors by the
Underwriters specifically for use in preparation of the Registration Statement,
any Preliminary Prospectus, the Prospectus, or any amendment or supplement
thereto: (i) the per share "Public Offering Price" and per share "Underwriting
Fees to be Paid by the Company" set forth on the cover page of the Prospectus,
and (ii) the information set forth under the caption "Underwriting" in the
Preliminary Prospectus and the Prospectus.
11. SUCCESSORS. This Agreement has been and is made solely for the
benefit of and shall be binding upon the Underwriters, the Trust and the Company
and their respective successors, executors, administrators, heirs and assigns,
and the trustees and controlling persons and the officers and directors of any
such controlling person referred to herein, and no other person will have any
right or obligation hereunder. The term "successors" shall not include any
purchaser of the Capital Securities merely because of such purchase.
12. MISCELLANEOUS. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Offerors or controlling persons thereof and (c) delivery of and payment for
the Capital Securities under this Agreement.
Each provision of this Agreement shall be interpreted in such a manner as
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.
25
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Minnesota.
If the foregoing letter is in accordance with the Underwriters'
understanding of our agreement, please sign and return to us the enclosed
duplicates hereof, whereupon it will become a binding agreement among the
Offerors and the Underwriters in accordance with its terms.
[The remainder of this page intentionally left blank.]
26
Very truly yours,
QUAD CITY HOLDINGS CAPITAL TRUST I, a
Delaware business trust
By:
---------------------------------
Douglas M. Hultquist, Regular Trustee
QUAD CITY HOLDINGS, INC.
By:
---------------------------------
Douglas M. Hultquist, President
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
DAIN RAUSCHER WESSELS, A DIVISION OF
DAIN RAUSCHER INCORPORATED
HOWE BARNES INVESTMENTS, INC.
By:
------------------------------------
Dain Rauscher Incorporated
By:
--------------------------------
______________, Vice President
27
SCHEDULE A
SCHEDULE OF UNDERWRITERS
Capital Number of
Securities Capital Securities
Underwriter to be purchased
- ----------- ------------------
Dain Rauscher Wessels, a division of
Dain Rauscher Incorporated......................
Howe Barnes Investments, Inc....................
----------
Total 1,200,000
----------
----------
A-1
EXHIBIT I
(FORM OF OPINION OF COMPANY COUNSEL)
() The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware
and is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended. Each subsidiary of the Company has been
duly incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its formation. Each of the Company
and its subsidiaries has the corporate power and authority to own or lease
its properties and conduct its business as described in the Registration
Statement and the Prospectus; is, to such counsel's knowledge, in
compliance with all federal and state regulatory rules and guidelines; and
is duly qualified to transact business in all jurisdictions in which the
conduct of its business or its ownership or leasing of property requires
such qualification and the failure so to qualify would have a material
adverse effect on the business or condition, financial or otherwise, of the
Company and its subsidiaries, taken as a whole. The accounts of each of
the Company's subsidiaries which are banks are insured by the Bank
Insurance Fund of the Federal Deposit Insurance Corporation (the "FDIC") up
to the maximum applicable amount in accordance with the rules and
regulations of the FDIC, and, to the knowledge of such counsel, no
proceedings for the termination or revocation of such membership or
insurance are pending, or threatened.
() The statements in the Prospectus under the caption
"Description of the Capital Securities", "Description of the Debentures",
"Description of the Guarantee", and "Relationship among the Capital
Securities, the Debentures and the Guarantee" insofar as such statements
constitute matters of law applicable to the Offerors or summaries of
documents, fairly present the information required to be included therein
in all material respects. All of the issued and outstanding shares of the
capital stock of the Company have been duly authorized and validly issued
and are fully paid and nonassessable, and the holders thereof are not
subject to personal liability by reason of being such holders. Except as
otherwise stated in the Registration Statement and Prospectus, there are no
preemptive rights or options, warrants, agreements, contracts or other
rights in existence to purchase or acquire from the Company any shares of
the capital stock of the Company pursuant to the Company's certificate of
incorporation, bylaws or any agreement or other instrument known to such
counsel to which the Company is a party or by which the Company is bound.
To such counsel's knowledge, neither the filing of the Registration
Statement nor the offering or sale of the Junior Subordinated Debentures or
Capital Securities as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any shares of Common Stock or
other securities of the Company.
() All of the issued and outstanding shares of capital stock of
each of the Company's Subsidiaries have been duly and validly authorized
and issued and are fully paid and nonassessable, and, to such counsel's
knowledge, except as otherwise described in the Registration Statement and
Prospectus and except for directors' qualifying shares, the Company owns of
record and beneficially, free and clear of any security interests, claims,
liens, proxies, equities or other encumbrances, all of the issued and
outstanding shares of the stock of the Subsidiaries. To such counsel's
knowledge, except as described in the Registration Statement and
Prospectus, there are no options, warrants, agreements, contracts or other
rights in existence to purchase or acquire from the Company or any of its
Subsidiaries any shares of the capital stock of any Subsidiary of the
Company.
2
() All of the issued and outstanding Common Securities of the
Trust are owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right.
() The Declaration has been duly qualified under the Trust
Indenture Act.
() 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.
() The Junior Subordinated Debentures are subordinate and
junior in right of payment to all "Senior and Subordinated Debt" (as
defined in the Indenture) of the Company.
() Neither the Company nor the Trust is an "investment company"
or a company "controlled" by an "investment company" within the meaning of
the 1940 Act.
() To such counsel's knowledge and information after due
inquiry, the Trust is not required to be authorized to do business in any
other jurisdiction and the Trust is not a party to or otherwise bound by
any agreement other than those described in the Prospectus.
() The Declaration has been duly authorized, executed and
delivered by the Company and the Regular Trustees.
() To such counsel's knowledge and information after due
inquiry, the Trust is not in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or any other
instrument of which the Trust is a party or by which it may be bound, or to
which any of the property or assets of the Trust is subject.
() The Registration Statement has become effective under the
Act and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
such counsel, threatened by the Commission.
() The descriptions in the Registration Statement and
Prospectus of statutes, and to counsel's knowledge, legal and governmental
proceedings or rulings, contracts and other documents are accurate in all
material respects and fairly present the information required to be shown;
and such counsel does not know of any statutes or legal or governmental
proceedings required to be described in the Prospectuses that are not
described as required, or of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus or
included as exhibits to the Registration Statement that are not described
or included as required.
3
() The reports of the Company incorporated by reference in the
Registration Statement and the Prospectus or any further amendment or
supplement thereto made by the Company (other than the financial
statements, other financial data and related schedules therein, as to which
such counsel need express no opinion), when they were filed with the
Commission, complied as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder.
() 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 Declaration and the Guarantee Agreement to which it is a
party and to issue the Junior Subordinated Debentures and Capital
Securities, as the case may be, and to effect the transactions contemplated
by this Agreement, the Indenture, the Declaration and the Guarantee
Agreement to which it is a party, and each of this Agreement, the
Indenture, the Declaration and the Guarantee Agreement is duly authorized,
executed and delivered by the Company and the Trust, as applicable, and
constitutes a valid, legal and binding obligation of the Company
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 Declaration, the
Guarantee Agreement, the Capital Securities, the Common Securities, the
Junior Subordinated Debentures and the Guarantee and the consummation of
the transactions herein or therein contemplated will not result in a breach
or violation of any of the terms and provisions of, or constitute a default
under, any statute, rule or regulation, any agreement or instrument known
to such counsel to which the Company or the Trust is a party or by which
either is bound or to which any of their property is subject, the Company's
charter or bylaws, or the Trust's Certificate or any order or decree known
to such counsel of any court or governmental agency or body having
jurisdiction over the Company or the Trust or any of its respective
properties, except for any breach, violation or default which would not
have a material adverse effect on the Company; and 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 Declaration, the Guarantee Agreement, the
Capital Securities, the Junior Subordinated Debentures, or the Guarantee 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 Capital Securities by the Trust,
except (a) such as may be required under the Act, which has been obtained,
or under state securities or blue sky laws, and (b) the qualification of
the Declaration, the Guarantee Agreement and the Indenture under the Trust
Indenture Act and the regulations thereunder.
() To such counsel's knowledge, neither the Company nor any of
its Subsidiaries is in violation of its respective charter or bylaws.
() The Registration Statement and the Prospectus, and any
amendment thereof or supplement thereto (including any term sheet within
the meaning of Rule 434 under the Act), comply as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; and on the basis of conferences with officers of the Company,
examination of documents referred to in the Registration Statement and
Prospectus and such other procedures as such counsel deemed appropriate,
nothing has come to the attention of such counsel that causes such counsel
to believe that the Registration Statement or any amendment thereof, at the
time such Registration Statement became effective and as of the Closing
Date (including any Registration Statement filed under Rule 462(b) under
the Act),
4
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus (as of their
respective dates and as of the Closing Date), as amended or supplemented,
includes any untrue statement of material fact or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; it being
understood that such counsel need express no opinion as to the financial
statements or other financial data included in any of the documents
mentioned in this clause.
5