May 3, 1999
Quad City Holdings, Inc.
Quad City Holdings Capital Trust I
c/o Quad City Holdings, Inc.
3551 7th Street
Suite 100
Moline, Illinois 61265
Re: QUAD CITY HOLDINGS CAPITAL TRUST I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Quad City
Holdings, Inc., a Delaware corporation (the "Company") and Quad City Holdings
Capital Trust I, a Delaware business trust (the "Trust"), in connection with
the matters set forth herein. At your request, this opinion is being
furnished to you.
For purposes of giving the opinions hereinafter set forth,
our examination of documents has been limited to the examination of originals
or copies of the following:
(a) The Certificate of Trust of the Trust (the "Certificate
of Trust"), as filed with the office of the Secretary of State of the State
of Delaware (the "Secretary of State") on April 27, 1999;
(b) The Trust Agreement of the Trust, dated as of April 27,
1999, among the Company, First Union Trust Company, National Association, a
national banking association with its principal place of business in the
State of Delaware ("First
Quad City Holdings, Inc.
Quad City Holdings Capital Trust I
May 3, 1999
Page 2
Union"), as trustee (the "Delaware Trustee"), and Douglas M. Hultquist,
Michael A. Bauer and Shellee Showalter, as administrative trustees (the
"Administrative Trustees");
(c) The Registration Statement (the "Registration
Statement") on Form S-2, including a preliminary prospectus with respect to
the Trust (the "Prospectus"), relating to the Capital Securities of the Trust
representing preferred undivided beneficial ownership interests in the assets
of the Trust (each, a "Capital Security" and collectively, the "Capital
Securities"), to be filed by the Company and the Trust with the Securities
and Exchange Commission;
(d) A form of Amended and Restated Trust Agreement for the
Trust, to be entered into between the Company, the Trustees of the Trust
named therein, and the holders, from time to time, of the undivided
beneficial ownership interests in the assets of such Trust (including
Exhibits B and D thereto), attached as an exhibit to the Registration
Statement (the "Trust Agreement"; and
(e) A Certificate of Good Standing for the Trust, dated May
3, 1999, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise
defined are used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a) through (e)
above. In particular, we have not reviewed any document (other than the
documents listed in paragraphs (a) through (e) above) that is referred to in
or incorporated by reference into the documents reviewed by us. We have
assumed that there exists no provision in any document that we have not
reviewed that is inconsistent with the opinions stated herein. We have
conducted no independent factual investigation of our own but rather have
relied solely upon the foregoing documents, the statements and information
set forth therein and the additional matters recited or assumed herein, all
of which we have assumed to be true, complete and accurate in all material
respects.
With respect to all documents examined by us, we have
assumed (i) the authenticity of all documents submitted to us as authentic
originals, (ii) the conformity with the originals of all documents submitted
to us as copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Trust Agreement will constitute the entire agreement among the parties
thereto with respect to the subject
Quad City Holdings, Inc.
Quad City Holdings Capital Trust I
May 3, 1999
Page 3
matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Trust Agreement and the Certificate of
Trust will be in full force and effect and will not be amended, (ii) except
to the extent provided in paragraph 1 below, the due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its organization or formation, (iii) the legal capacity of natural
persons who are parties to the documents examined by us, (iv) that each of
the parties to the documents examined by us has the power and authority to
execute and deliver, and to perform its obligations under, such documents,
(v) the due authorization, execution and delivery by all parties thereto of
all documents examined by us, (vi) the receipt by each Person to whom a
Capital Security is to be issued by the Trusts (collectively, the "Capital
Security Holders") of a Capital Security Certificate for such Capital
Security and the payment for such Capital Security, in accordance with the
Trust Agreement and the Registration Statement, and (vii) that the Capital
Securities are authenticated, issued and sold to the Capital Security Holders
in accordance with the Trust Agreement and the Registration Statement. We
have not participated in the preparation of the Registration Statement or the
Prospectus and assume no responsibility for their contents.
This opinion is limited to the laws of the State of
Delaware (excluding the securities laws of the State of Delaware), and we
have not considered and express no opinion on the laws of any other
jurisdiction, including federal laws and rules and regulations relating
thereto. Our opinions are rendered only with respect to Delaware laws and
rules, regulations and orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Business Trust Act,
12 Del. C. Section 3801 ET SEQ.
2. The Capital Securities of the Trust will represent valid
and, subject to the qualifications set forth in paragraph 3 below, fully paid
and nonassessable undivided beneficial interests in the assets of the Trust.
3. The Capital Security Holders, 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
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May 3, 1999
Page 4
Delaware. We note that the Capital Security Holders may be obligated to make
payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the
Securities and Exchange Commission as an exhibit to the Registration
Statement. We hereby consent to the use of our name under the heading "Legal
Opinions" in the Prospectus. In giving the foregoing consents, we do not
thereby admit that we come within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the
rules and regulations of the Securities and Exchange Commission thereunder.
Except as stated above, without our prior written consent, this opinion may
not be furnished or quoted to, or relied upon by, any other person for any
purpose.
Very truly yours,
/s/ Richards, Layton & Finger
EAM/DKD