<PAGE>
Exhibit 1.7
BANK ONE CAPITAL IV
(a Delaware business trust)
160,000 Preferred Securities
Floating Rate Preferred Securities
(Liquidation Amount of $1,000 Per Preferred Security)
UNDERWRITING AGREEMENT
August 23, 2000
Salomon Smith Barney Inc.
Banc One Capital Markets, Inc.
Lehman Brothers, Inc.
Morgan Stanley & Co. Incorporated
As representatives of the several Underwriters
c/o Salomon Smith Barney Inc.
388 Greenwich Street
New York, NY 10013
Ladies and Gentlemen:
BANK ONE CAPITAL IV (the "Trust"), a statutory business trust organized
under the Business Trust Act of the State of Delaware (Chapter 38, Title 12, of
the Delaware Code, 12 Del. C. (S)(S) 3801 et seq.) (the "Delaware Act") and BANK
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ONE CORPORATION, a Delaware corporation (the "Company" and, together with the
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Trust, the "Offerors") confirm their agreement (the "Agreement") with Salomon
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Smith Barney Inc. ("Salomon Smith Barney") and each of the other Underwriters
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named in
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Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Salomon Smith Barney, Banc One Capital Markets Inc., Lehman
Brothers, Inc.and Morgan Stanley & Co. Incorporated are acting as
representatives (in such capacity, the "Representatives"), with respect to the
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issue and sale by the Trust and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of Floating Rate Preferred
Securities (liquidation amount of $1,000 per preferred security) of the Trust
(the "Preferred Securities") set forth in said Schedule A.
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The Preferred Securities will be guaranteed by the Company with
respect to distributions and payments upon liquidation, redemption and otherwise
(the "Preferred Securities Guarantee") pursuant to the Preferred Securities
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Guarantee Agreement (the "Preferred Securities Guarantee Agreement"), dated as
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of August 30, 2000, between the Company and The Chase Manhattan Bank, as Trustee
(the "Guarantee Trustee"). The Preferred Securities and the related Preferred
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Securities Guarantees are referred to herein as the "Securities".
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The Offerors understand that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered. The entire proceeds from the
sale of the Securities will be combined with the entire proceeds from the sale
by the Trust to the Company of its common securities (the "Common Securities")
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guaranteed by the Company, to the extent set forth in the Prospectus (as defined
herein), with respect to distributions and payments upon liquidation, and
redemption (the "Common Securities Guarantee" and together with the Preferred
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Securities Guarantee, the "Guarantees") pursuant to the Common Securities
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Guarantee Agreement (the "Common Securities Guarantee Agreement" and, together
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with the Preferred Securities Guarantee Agreement, the "Guarantee Agreements"),
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dated as of August 30, 2000, executed and delivered by the Company for the
benefit of the holders of the Common Securities, and will be used by the Trust
to purchase $164,949,000 aggregate principal amount of Junior Subordinated
Deferrable Interest Debentures due September 1, 2030 (the "Subordinated Debt
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Securities") to be issued by the Company. The Preferred Securities and the
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Common Securities will be issued pursuant to the amended and restated
declaration of trust of the Trust, dated as of August 30, 2000 (the
"Declaration"), among the Company, as Sponsor, the trustees named therein (the
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"Trustees") and the holders from time to time of undivided beneficial interests
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in the assets of the Trust. The Subordinated Debt Securities will be issued
pursuant to an indenture, dated as of January 1, 1997, between the Company and
The Chase Manhattan Bank, as trustee (the "Debt Trustee") (the "Base
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Indenture"), and a supplement thereto, dated as of August [ ], 2000 (the
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"Supplemental Indenture," and together with the Base Indenture and any other
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amendments or supplements thereto, the "Indenture"), among the Company and the
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Debt Trustee.
The Offerors have filed with the Securities and Exchange Commission
(the "Commission") a shelf registration statement on Form S-3 (File No. 333-
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80903) covering the registration of, among other securities, (i) the Preferred
Securities, (ii) the Preferred Securities Guarantee and (iii) the Subordinated
Debt Securities under the Securities Act of 1933 (the "1933 Act"), which permits
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the delayed or
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continuous offering of securities pursuant to Rule 415 of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations").
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Promptly after execution and delivery of this Agreement, the Offerors will
either (i) prepare and file a prospectus in accordance with the provisions of
Rule 424(b) ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Offerors
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have elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations,
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prepare and file a term sheet (a "Term Sheet") in accordance with the provisions
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of Rule 434 and Rule 424(b). The information included in such Term Sheet that
was omitted from such registration statement at the time it became effective but
that is deemed to be part of such registration statement at the time it became
effective is referred to as "Rule 434 Information." Each prospectus used before
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such Rule 424(b) prospectus has been filed and any prospectus that omitted the
Rule 434 Information, in each case that was used after such effectiveness and
prior to the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including the exhibits
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thereto, schedules thereto, if any, and the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it
became effective and including the Rule 434 Information is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
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462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement" and after such filing the term "Registration Statement"
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shall include the Rule 462 (b) Registration Statement. The final prospectus,
including the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the 1933 Act, in the form first furnished to the Underwriters for
use in connection with the offering of the Securities is herein called the
"Prospectus." If Rule 434 is relied on, the term "Prospectus" shall refer to the
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preliminary prospectus together with the Term Sheet and all references in this
Agreement to the date of the Prospectus shall mean the date of the Term Sheet.
For purposes of this Agreement, all references to the Registration Statement,
any preliminary prospectus, the Prospectus or any Term Sheet or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("EDGAR").
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All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
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Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
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incorporated by reference in the Registration Statement, such preliminary
prospectus
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4
or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties. The Offerors jointly
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and severally represent and warrant to each Underwriter as of the date hereof
and as of the applicable delivery date, if any (each such date being hereinafter
referred to as a "Delivery Date"), as follows:
(1) Compliance with Registration Requirements. The Company meets
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the requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with.
At the respective times the Registration Statement became effective
and at the Delivery Date, the Registration Statement and any post-effective
amendments and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations, the 1934 Act, the regulations of the Commission under the 1934
Act (the "1934 Act Regulations"), and the Trust Indenture Act of 1939 (the
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"1939 Act") and the rules and regulations of the Commission under the 1939
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Act (the "1939 Act Regulations"), and did not and will not contain an
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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. The Prospectus as amended or supplemented, if applicable,
at the Delivery Date and at the Closing Time referred to in Section 2
hereof, will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, the representations and warranties in this subsection
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shall not apply to statements in or omissions from the Registration
Statement or Prospectus made in reliance upon and in conformity with
information furnished to the Offerors in writing by any Underwriter through
Salomon Smith Barney expressly for use in the Registration Statement or
Prospectus.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with the offering of the Securities was, at the time of
such delivery, identical to any electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent
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5
permitted by Regulation S-T.
(2) Incorporated Documents. The documents incorporated or deemed to
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be incorporated by reference in the Registration Statement and the
Prospectus, when they became effective or at the time when they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1933 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations, as applicable, and,
when read together with the other information in the Prospectus, at the
time the Registration Statement became effective, at the time the
Prospectus was issued and at each Delivery Date, did not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(3) No Material Adverse Change in Business. Since the respective
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dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise (a "Material Adverse Effect"),
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whether or not arising in the ordinary course of business, (B) there have
been no transactions entered into by the Company or any of its
subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiaries considered as
one enterprise, and (C) except for regular quarterly dividends on the
common stock, par value $0.01 per share, of the Company (the "Common
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Stock") and the regular quarterly dividends on the Company's Preferred
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Stock with Cumulative and Adjustable Dividends, Series B ($100 stated
value), $0.01 par value; and Preferred Stock with Cumulative and Adjustable
Dividends, Series C ($100 stated value), $0.01 par value, in amounts per
share that are consistent with or a decrease from past practice or publicly
announced increases prior to the date of the Registration Statement, there
has been no dividend or distribution of any kind declared, paid or made on
any class of its Capital Stock.
(4) Good Standing of the Company and its Subsidiaries. The Company
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has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the state of Delaware, with power and authority
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6
(corporate and other) to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, or is subject
to no material liability or disability by reason of the failure to be so
qualified in any such jurisdiction; and each Significant Subsidiary (as
defined in Regulation S-X promulgated by the Commission) of the Company has
been duly incorporated chartered or organized and is validly existing as a
corporation or national banking association, as the case may be, in good
standing under the laws of its jurisdiction of incorporation or
organization.
(5) Capitalization. The authorized, issued and outstanding capital
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stock of the Company is as set forth in the Prospectus Supplement in the
column entitled "Actual" under the caption "Capitalization" (except for
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common stock repurchases pursuant to the Company's publicly announced stock
repurchase program and subsequent issuances, if any, pursuant to this
Agreement, pursuant to reservations, agreements or employee benefit plans
referred to in the Prospectus or pursuant to the exercise of convertible
securities or options referred to in the Prospectus or as otherwise
described in the Prospectus).
(6) Authorization and Description of Designated Securities. The
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Preferred Securities have been duly authorized for issuance and sale to the
Underwriters pursuant to this Agreement and, when issued and delivered by
the Company pursuant to this Agreement against payment of the consideration
set forth herein, will be validly issued and fully paid and non-assessable;
the Preferred Securities conform to the statements relating thereto
contained in the Prospectus and such description conforms to the rights set
forth in the instruments defining the same; the holders of the Preferred
Securities (the "Security holders") will be entitled to the same limitation
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of personal liability extended to stockholders of private corporations for
profit organized under the General Corporation Law of the State of
Delaware; and the issuance of the Preferred Securities is not subject to
the preemptive or other similar rights of any security holder of the
Company.
(7) Authorization and Description of Common Securities. The
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Common Securities have been duly and validly authorized by the Trust and
upon delivery by the Trust to the Company against payment therefor as
described in the Prospectus, will be duly and validly issued and fully paid
and non-assessable undivided beneficial interests in the assets of the
Trust and will conform to the description thereof contained in the
Prospectus; the issuance of the Common Securities is not subject to
preemptive or other similar rights; and at each Delivery 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, mortgage,
pledge, lien, encumbrance, claim or equity.
(8) Good Standing of the Trust. The Trust has been duly created and
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is validly existing as a statutory business trust in good standing under
the Delaware Act with the power and authority to own, lease and operate its
properties and conduct its business as described in the Prospectus, and the
Trust has conducted no business to date, and it will conduct no business in
the future that would be inconsistent with the description of the Trust set
forth in the Prospectus; the Trust is not a party to or bound by any
agreement or instrument other than this Agreement, the Declaration and the
agreements and instruments contemplated by the Declaration; the Trust has
no liabilities or obligations other than those arising out of the
transactions contemplated by this Agreement and the Declaration and
described in the Prospectus; and the Trust is not a party to or subject to
any action, suit or proceeding of any nature.
(9) Absence of Defaults and Conflicts. The issue and sale of the
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Preferred Securities and the Common Securities by the Trust, the compliance
by the Trust with all of the provisions of this Agreement, the purchase of
the Subordinated Debt Securities by the Trust and the consummation of the
transactions herein contemplated will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default under,
any indenture, loan agreement, mortgage, deed of trust or other agreement
or instrument to which the Trust is a party or by which the Trust is bound
or to which any of the property or assets of the Trust is subject, nor will
such action result in any violation of the provisions of the Declaration or
any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Trust or any of its properties;
and no consent, approval, authorization, order, license, certificate,
permit, registration or qualification of or with any such court or other
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8
governmental agency or body is required to be obtained by the Trust for the
issue and sale of the Preferred Securities and the Common Securities by the
Trust, the purchase of the Subordinated Debt Securities by the Trust or the
consummation by the Trust of the transactions contemplated by this
Agreement and the Declaration, except for such consents, approvals,
authorizations, licenses, certificates, permits, registrations or
qualifications as have already been obtained, or as may be required under
the 1933 Act or the 1933 Act Regulations or state securities laws or under
1939 Act.
The issuance by the Company of the Guarantees and the Subordinated
Debt Securities, the compliance by the Company with all of the provisions
of this Agreement, the execution, delivery and performance by the Company
of the Declaration, the Subordinated Debt Securities, the Guarantee
Agreements and the Indenture, and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any material indenture, loan agreement, mortgage, deed of
trust, or other material agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the property or
assets of the Company is subject, nor will such action result in any
violation of the provisions of the Restated Certificate of Incorporation or
by-laws of the Company or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Company or any of its properties; and no consent, approval, authorization,
order, license, certificate, permit, registration or qualification of or
with any such court or other governmental agency or body is required for
the issue of the Guarantees and the Subordinated Debt Securities or the
consummation by the Company of the other transactions contemplated by this
Agreement, except for such consents, approvals, authorizations, licenses,
certificates, permits, registrations or qualifications as have already been
obtained, or as may be required under the 1933 Act or the 1933 Act
Regulations or state securities laws or under the 1939 Act.
(10) Authorization of Agreements. This Agreement, the Guarantee
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Agreements, the Subordinated Debt Securities, the Declaration and the
Indenture have each been duly authorized and when validly executed and
delivered by the Company and, in the case of the Guarantee, by the
Guarantee Trustee, in the case of the Declaration, by the Trustees and, in
the case of the Indenture, by the Debt Trustee, will constitute valid and
legally binding obligations of the Company, enforceable in accordance with
their respective terms, subject, as to enforcement, to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles (regardless of whether enforcement is
sought in a proceeding at law or in equity); the Subordinated Debt
Securities are entitled to
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9
the benefits of the Indenture; and the Guarantee Agreements, the
Subordinated Debt Securities, the Declaration and the Indenture conform to
the descriptions thereof in the Prospectus.
(11) Accuracy of Exhibits. There are no contracts or documents
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which are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(12) Investment Company Act. The Trust is not, and after giving
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effect to the offering and sale of the Preferred Securities will not be, an
"investment company," or an entity "controlled" by an "investment company,"
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as such terms are defined in the Investment Company Act of 1940, as amended
(the "Investment Company Act").
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(13) Legal or Governmental Proceedings. There are no legal or
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governmental proceedings pending or threatened to which the Trust or the
Company or any of its subsidiaries is a party or to which any of the
properties of the Trust or the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or
the Prospectus and are not so described.
(14) Qualification of Agreements. Each of the Declaration, the
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Indenture and the Preferred Securities Guarantee has been qualified under
the 1939 Act and has been duly authorized by the Company and the Trust, as
applicable.
SECTION 2. Sale and Delivery to Underwriters; Closing. (a) Preferred
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Securities. On the basis of the representations and warranties herein contained
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and subject to the terms and conditions herein set forth, the Trust agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Trust, at the price per
security set forth in Schedule B, the number of Preferred Securities set forth
in Schedule A opposite the name of such Underwriter, plus any additional number
of Preferred Securities which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof.
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(1) Commission. As compensation to the Underwriters for their
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commitments hereunder and in view of the fact that the proceeds of the sale of
the Securities will be used to purchase the Subordinated Debt Securities of the
Company, the Company hereby agrees to pay to the Representatives, for the
accounts of the several Underwriters, a commission per security set forth in
Schedule B as compensation to the Underwriters for their commitments under this
Agreement.
(2) Payment. Payment of the purchase price for, and delivery of
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certificates for, the Preferred Securities shall be made at the offices of
Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth Avenue, New York, New York
10019, or at such other place as shall be agreed upon by the Representatives and
the Offerors, at 10:00 A.M. (Eastern time) on the fifth business day after the
date hereof (unless postponed in accordance with the provisions of Section 10),
or such other time not later than ten business days after such date as shall be
agreed upon by the Representatives and the Offerors (such time and date of
payment and delivery being herein called "Closing Time").
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Payment shall be made to the Trust by wire transfer of immediately
available funds to a bank account designated by the Trust, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Preferred Securities to be purchased by them. It is
understood that each Underwriter has authorized the Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the Preferred Securities which it has agreed to purchase. Salomon
Smith Barney, individually and not as representative of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the
Preferred Securities, to be purchased by any Underwriter whose funds have not
been received by the Closing Time, but such payment shall not relieve such
Underwriter from its obligations hereunder.
At the Closing Time, the Company will pay, or cause to be paid, the
commission payable at such time to the Underwriters under Section 2(b) hereof by
wire transfer of immediately available funds to a bank account designated by
Salomon Smith Barney.
(3) Denominations; Registration. Certificates for the Preferred
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Securities, shall be in such denominations and registered in such names as the
Representatives may request in writing at least one full business day before the
Closing Time. The certificates for the Securities will be made available for
examination and packaging by the Representatives in the City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior to the Closing
Time.
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11
SECTION 3. Covenants of the Offerors. Each of the Offerors jointly
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and severally covenants with each Underwriter as follows:
(1) Compliance with Securities Regulations and Commission Requests.
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The Offerors, subject to Section 3(b), will comply with the requirements of
Rule 434 and will notify the Representatives immediately, and confirm the
notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information, and (iv) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of
the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for
any of such purposes. The Offerors will promptly effect the filings
necessary pursuant to Rule 424(b) and will take such steps as they deem
necessary to ascertain promptly whether the form of prospectus transmitted
for filing under Rule 424(b) was received for filing by the Commission and,
in the event that it was not, it will promptly file such prospectus. The
Offerors will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof
at the earliest possible moment.
(2) Filing of Amendments. The Offerors will give the Representatives
---------------------------
notice of their intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term
Sheet or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or
to the Prospectus, whether pursuant to the 1933 Act, the 1934 Act or
otherwise, will furnish the Representatives with copies of any such
documents a reasonable amount of time prior to such proposed filing or use,
as the case may be, and will not file or use any such document to which the
Representatives or counsel for the Underwriters shall object.
(3) Delivery of Registration Statements. The Offerors have furnished
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12
or will deliver to the Representatives and counsel for the Underwriters,
without charge, signed copies of the Registration Statement as originally
filed and of each amendment thereto (including exhibits filed therewith or
incorporated by reference therein and documents incorporated or deemed to
be incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the Representatives,
without charge, a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) for each
of the Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(4) Continued Compliance with Securities Laws. The Offerors will
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comply with the 1933 Act and the 1933 Act Regulations and the 1934 Act and
the 1934 Act Regulations and the 1939 Act and the 1939 Act Regulations so
as to permit the completion of the distribution of the Securities as
contemplated in this Agreement and in the Prospectus. If at any time when
a prospectus is required by the 1933 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as
a result of which it is necessary, in the opinion of counsel for the
Underwriters or the Offerors, to amend the Registration Statement or amend
or supplement the Prospectus in order that the Prospectus will not include
any untrue statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel, at
any such time to amend the Registration Statement or amend or supplement
the Prospectus in order to comply with the requirements of the 1933 Act or
the 1933 Act Regulations, the Offerors will promptly prepare and file with
the Commission, subject to Section 3(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and
the Offerors will furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(5) Blue Sky Qualifications. The Offerors will use their best
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efforts, in cooperation with the Underwriters, to qualify the Preferred
Securities and the
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13
Subordinated Debt Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions as the
Representatives may designate and to maintain such qualifications in effect
for a period of not less than one year from the later of the effective date
of the Registration Statement and any Rule 462(b) Registration Statement;
provided, however, that each of the Offerors shall not be obligated to file
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any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is
not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Securities have been so qualified, the
Offerors will file such statements and reports as may be required by the
laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
(6) Rule 158. The Trust and the Company will make generally
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available to their Security holders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated by,
the last paragraph of Section 11(a) of the 1933 Act.
(7) Restriction on Sale of Securities. During a period from the
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date hereof, to the Closing Time, neither the Trust nor the Company will,
without the prior written consent of Salomon Smith Barney, directly or
indirectly, offer, sell, offer to sell or otherwise dispose of any
Preferred Securities, any other beneficial interests in the assets of the
Trust, or any preferred securities or other securities of the Trust or the
Company which are substantially similar to the Preferred Securities,
including any guarantee of such securities. The foregoing sentence shall
not apply to any of the Securities to be sold hereunder.
(8) Reporting Requirements. The Company, during the period when the
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Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods required by the 1934 Act and the
1934 Act Regulations.
SECTION 3A. Covenants of the Underwriters. Each of the Underwriters
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represents and agrees as follows:
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14
(9) Compliance with NASD Conduct Rules. The Underwriters will
-----------------------------------------
comply with the provisions of Rule 2810 of the Conduct Rules of the
National Association of Securities Dealers, Inc. (the "NASD"), including,
----
without limitation, sections (b)(2)(B) and (b)(3)(D) thereof.
(10) Sales in United Kingdom. Each Underwriter (a) has not offered
------------------------------
or sold and prior to the date six months after the date of issue of the
Preferred Securities will not offer or sell any Preferred Securities to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments
(as principal or agent) for the purposes of their businesses or otherwise
in circumstances which do not constitute an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities
Regulations 1995, (b) has complied, and will comply with, all applicable
provisions of the Financial Services Act of 1986 of Great Britain with
respect to anything done by it in relation to the Preferred Securities in,
from or otherwise involving the United Kingdom, and (c) has only issued or
passed on and will only issue or pass on in the United Kingdom any document
received by it in connection with the issuance of the Preferred Securities
to a person who is of a kind described in Article 11(3) of the Financial
Services Act of 1986 (Investment Advertisements) (Exemptions) Order 1996 of
Great Britain (as amended) or is a person to whom the document may
otherwise lawfully be issued or passed on.
SECTION 4. Payment of Expenses. (a) Expenses. The Company will pay
-------------------------------- --------
all expenses incident to the performance of each Offeror's obligations under
this Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Preferred
Securities to the Underwriters, (iv) the fees and disbursements of the Company's
and the Trust's counsel, accountants and other advisors, (v) the qualification
of the Securities under securities laws in accordance with the provisions of
Section 3(e) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to the Underwriters of copies of each
<PAGE>
15
preliminary prospectus, any Term Sheets and of the Prospectus and any amendments
or supplements thereto, (vii) the preparation, printing and delivery to the
Underwriters of copies of the Blue Sky Survey and any supplement thereto, (viii)
the filing fees incident to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review, if any, by the NASD
of the terms of the sale of the Securities, (ix) the fees and expenses of the
Debt Trustee, including the fees and disbursements of counsel for the Debt
Trustee, in connection with the Indenture and the Subordinated Debt Securities,
(x) the fees and expenses of the Institutional Trustee and the Delaware Trustee
(each as defined in the Declaration), including the fees and disbursements of
counsel for the Institutional Trustee and the Delaware Trustee, in connection
with the Declaration and the Certificate of Trust, (xi) any fees charged by
securities rating services for rating the Preferred Securities and the
Subordinated Debt Securities, (xii) the fees and expenses of any transfer agent
or registrar for the Securities, (xiii) the cost of qualifying the Preferred
Securities with The Depository Trust Company, (xiv) the fees and expenses of the
Preferred Guarantee Trustee, including the fees and disbursements of counsel for
the Preferred Guarantee Trustee, and (xv) the fees and expenses incurred in
connection with the listing of the Preferred Securities and, if applicable, the
Subordinated Debt Securities on the New York Stock Exchange.
(1) Termination of Agreement. If this Agreement is terminated by
------------------------------
the Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations
---------------------------------------------------
of the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Offerors contained in Section 1 hereof or
in certificates of any officer of the Offerors or any subsidiary of the Company
delivered pursuant to the provisions hereof, to the performance by the Offerors
of their covenants and other obligations hereunder, and to the following further
conditions:
(1) Effectiveness of Registration Statement. The Registration
---------------------------------------------
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any
request on the part of
<PAGE>
16
the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. The Prospectus
shall have been filed with the Commission in accordance with Rule 424(b)
or, if the Offerors have elected to rely upon Rule 434, a Term Sheet shall
have been filed with the Commission in accordance with Rule 424(b).
(2) Opinion of Counsel. At the Closing Time the Representatives
------------------------
shall have received:
(1) The favorable opinion, dated as of the Closing Time of
Christine A. Edwards, Esq., Chief Legal Officer or on the relevant
Delivery Date, of a deputy general counsel, for the Company, in form
and substance reasonably satisfactory to counsel for the Underwriters,
substantially in the form set forth in Exhibit A.
(2) The favorable opinion, dated as of the Closing Time of
Richards, Layton and Finger LLP, special Delaware counsel for the
Offerors, in form and substance satisfactory to counsel for the
Underwriters, substantially in the form set forth in Exhibit B.
(3) The favorable opinion, dated as of the Closing Time of
Cravath, Swaine & Moore, counsel for the Institutional Trustee, in
form and substance satisfactory to counsel for the Underwriters,
substantially in the form set forth in Exhibit C.
(4) The favorable opinion, dated as of the Closing Time of
Cravath, Swaine & Moore, counsel for the Underwriters, in form and
substance satisfactory to the Underwriters.
(5) The favorable opinion, dated as of the Closing Time of
Cravath, Swaine & Moore, special tax counsel for the Offerors, in form
and substance satisfactory to the Underwriters.
(3) Officers' Certificate. At the Closing Time, since the date
---------------------------
hereof or since the respective dates as of which information is given in
the Prospectus, there shall not have been any material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of either the
<PAGE>
17
Company and its subsidiaries considered as one enterprise, or the Trust, as
the case may be, whether or not arising in the ordinary course of business
and the Representatives shall have received a certificate, dated as of the
Closing Time, from each of (a) the President, Vice Chairman, Treasurer or a
Vice President of the Company and of the chief financial officer or chief
accounting officer of the Company and (b) a Regular Trustee (as defined in
the Declaration) of the Trust, to the effect that (i) there has been no
such material adverse change in the conditions of the Company or the Trust,
as the case may be, (ii) the representations and warranties in Section 1
hereof are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) the Company or the Trust,
as the case may be, has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or are pending or are contemplated by the Commission.
(4) Accountant's Comfort Letter. At the time of the execution of
---------------------------------
this Agreement, the Representatives shall have received from Arthur
Andersen LLP a letter dated such date, in form and substance satisfactory
to the Representatives, together with signed or reproduced copies of such
letter for each of the other Underwriters containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and
the Prospectus.
(5) Bring-down Comfort Letter. At the Closing Time the
-------------------------------
Representatives shall have received from Arthur Andersen LLP a letter,
dated as of Closing Time, to the effect that they reaffirm the statements
made in their letter furnished pursuant to subsection (d) of this Section,
except that the specified date referred to shall be a date not more than
three business days prior to Closing Time.
(6) Maintenance of Rating. At the Closing Time, the Preferred
---------------------------
Securities and the Subordinated Debt Securities shall be rated in one of
the four highest rating categories for long term debt ("Investment Grade")
----------------
by Moody's Investor's Service and by Standard & Poor's Ratings Group, a
division of
<PAGE>
18
McGraw-Hill, Inc., and the Company shall have delivered to the
Representatives a letter dated the Closing Time, from each such rating
agency, or other evidence satisfactory to the Representatives, confirming
that the Preferred Securities and the Subordinated Debt Securities have
such ratings; and since the date of this Agreement, there shall not have
occurred a downgrading in the rating assigned to the Preferred Securities
or the Subordinated Debt Securities or any of the Company's other
securities by any "nationally recognized statistical rating agency," as
that term is defined by the Commission for purposes of Rule 436(g)(2) under
the 1933 Act, and no such organization shall have publicly announced that
it has under surveillance or review its rating with a negative implication
of the Preferred Securities and the Subordinated Debt Securities or any of
the Company's other securities.
(7) Additional Documents. At the Closing Time, counsel for the
--------------------------
Underwriters shall have been furnished with such documents and opinions as
they may require for the purpose of enabling them to pass upon the issuance
and sale of the Preferred Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Offerors in connection with the issuance and sale of the
Preferred Securities as herein contemplated shall be satisfactory in form
and substance to the Representatives and counsel for the Underwriters.
(8) Termination of Agreement. If any condition specified in this
------------------------------
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Representatives by notice to the
Offerors at any time at or prior to Closing Time, and such termination
shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive
any such termination and remain in full force and effect.
<PAGE>
19
SECTION 6. Indemnification. (a) Indemnification of Underwriters.
------------------------------
The Company agrees to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act as follows:
(1) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue state statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
434 Information, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out
of any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
there in, in the light of the circumstances under which they were
made, not misleading;
(2) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
(3) against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and disbursements
of counsel chosen by Salomon Smith Barney), reasonably incurred in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, to the extent that any such expense is
not paid under (i) or (ii) above; provided, however, that this
indemnity agreement shall not apply to any loss, liability, claim,
damage or expense to the extent arising out of any untrue statement or
omission or alleged
<PAGE>
20
untrue statement or omission made in reliance upon and in conformity
with written information furnished to the Company by any Underwriter
through Salomon Smith Barney expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 434
Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto); and provided,
further, that this indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any underwriter from whom
the person asserting any such losses, liabilities, claims, damages or
expenses purchased Securities, or any person controlling such
Underwriter, if the Offerors sustain the burden that a copy of the
Prospectus (as then amended or supplemented if the Offerors shall have
furnished any such amendments or supplements thereto), but excluding
documents incorporated or deemed to be incorporated by reference, was
not sent or given by or on behalf of such Underwriter to such person,
if such is required by law, at or prior to the written confirmation of
the sale of such Securities to such person and if the Prospectus (as
so amended or supplemented, but excluding documents incorporated or
deemed to be incorporated by reference therein) would have corrected
the defect giving rise to such loss, liability, claim, damage or
expense, it being understood that this proviso shall have no
application if such defect shall have been corrected in a document
which is incorporated or deemed to be incorporated by reference in the
Prospectus.
(2) Indemnification of Offerors, Directors and Officers. Each
---------------------------------------------------------
Underwriter severally agrees to indemnify and hold harmless the Offerors, their
directors, trustees, each of its officers who signed the Registration Statement,
and each person, if any, who controls the Offerors within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Offerors by such Underwriter through
Salomon Smith Barney expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
<PAGE>
21
(3) Actions against Parties; Notification. Each indemnified party
-------------------------------------------
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
6(a) above, counsel to the indemnified parties shall be selected by Salomon
Smith Barney, and, in the case of parties indemnified pursuant to Section 6(b)
above, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
-------- -------
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
SECTION 7. Contribution. If the indemnification provided for in
-------------------------
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Securities pursuant to this Agreement or (ii) if the allocation provided
<PAGE>
22
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Preferred
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting commissions received by the Underwriters,
in each case as set forth on the cover of the Prospectus, or, if Rule 434 is
used, the corresponding location on the Term Sheet, bear to the aggregate
initial public offering price of the Securities as set forth on such cover.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within
<PAGE>
23
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as such Underwriter, and each director of
the Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the number of
Initial Securities set forth opposite their respective names in Schedule A
hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
------------------------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
---------
Agreement or in certificates of officers or Trustees of the Offerors submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Offerors, and shall survive delivery of the
Preferred Securities to the Underwriters.
SECTION 9. Termination of Agreement. (a) Termination; General.
------------------------------------- ---------------------
The Representatives may terminate this Agreement, by notice to the Offerors, at
any time at or prior to Closing Time (i) if there has been, since the date of
this Agreement or since the respective dates as of which information is given in
the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representatives,
impracticable to market the Preferred Securities or to enforce contracts for the
sale of the Preferred Securities, or (iii) if trading in any securities of the
Company has been suspended by the Commission or the New York Stock Exchange, or
if trading generally on the American Stock Exchange or the New York Stock
Exchange or in the Nasdaq National Market System has been suspended or limited,
or minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the NASD or any other governmental authority, or (iv)
if a banking moratorium has been declared by either Federal or New York or
Illinois State authorities.
(1) Liabilities. If this Agreement is terminated pursuant to this
-----------------
<PAGE>
24
Section, such termination shall be without liability of any party to any other
party except as provided in section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Underwriters. If one or
-------------------------------------------------------
more of the Underwriters shall fail at Closing Time to purchase the Preferred
Securities which it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representatives shall have the right, within 24
--------------------
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(1) if the number of Defaulted Securities does not exceed 10% of the
number of Designated Securities, each of the non-defaulting Underwriters
shall be obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(2) if the number of Defaulted Securities exceeds 10% of the number
of Preferred Securities, this Agreement shall terminate without liability
on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives or the Offerors shall
have the right to postpone Closing Time, for a period not exceeding seven days
in order to effect any required changes in the Registration Statement or
Prospectus or in any other documents or arrangements. As used herein, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section 10.
SECTION 11. Notices. All notices and other communications hereunder
---------------------
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at c/o Salomon Smith
Barney Inc., 388 Greenwich
<PAGE>
25
Street, New York, NY 10013, Attention: [ ]; notices to the Trust and the
Company shall be directed to them at 1 Bank One Plaza, Chicago, Illinois 60670,
Attention: Treasurer.
SECTION 12. Parties. This Agreement shall each inure to the benefit
--------------------
of and be binding upon the Underwriters and the Trust and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters and the Trust and the Company and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the Underwriters
and the Trust and the Company and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
-----------------------------------
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS
OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
<PAGE>
26
SECTION 14. Effect of Headings. The Article and Section headings
-------------------------------
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Trust a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Trust and the Company in accordance with its
terms.
Very truly yours,
BANK ONE CAPITAL IV,
by____________________________
Name:
Title:
<PAGE>
27
BANK ONE CORPORATION,
by__________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
SALOMON SMITH BARNEY INC.
BANC ONE CAPITAL MARKETS, INC.
LEHMAN BROTHERS INC.
MORGAN STANLEY & CO. INCORPORATED
By: SALOMON SMITH BARNEY INC.
By _____________________________
Name:
Title:
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
<PAGE>
SCHEDULE A
Number of
Name of Underwriters Preferred Securities
-------------------- --------------------
Salomon Smith Barney Inc.............. 70,400
Banc One Capital Markets, Inc......... 70,400
Lehman Brothers Inc................... 9,600
Morgan Stanley & Co. Incorporated..... 9,600
-------
Total............................ 160,000
=======
<PAGE>
SCHEDULE B
BANK ONE CAPITAL IV
160,000 Preferred Securities
Floating Rate Preferred Securities
(Liquidation Amount of $1,000 Per Preferred Security)
1. The initial public offering price per security for the Preferred
Securities, determined as provided in Section 2, shall be $9,739.00.
2. The purchase price per security for the Preferred Securities to
be paid by the several Underwriters shall be $9,739.00, being an amount equal to
the initial public offering price set forth above.
3. The Underwriters propose to offer the Preferred Securities, in
part, to certain securities dealers at the initial public offering price per
security less a concession of $0.60 per Preferred Security. The Underwriters
may allow, and such dealers may reallow, a concession not in excess of $0.25 per
Preferred Security to certain brokers and dealers.
4. The commission per Preferred Security to be paid by the Company
to the Underwriters for their commitments hereunder shall be $1.00% or
$1,600,000 in the aggregate.
<PAGE>
Exhibit A
FORM OF OPINION OF CHRISTINE A. EDWARDS, ESQ.
TO BE DELIVERED PURSUANT TO
SECTION 5(b)(i)
<PAGE>
Exhibit B
FORM OF OPINION OF RICHARDS, LAYTON & FINGER, P.A.
TO BE DELIVERED PURSUANT TO
SECTION 5(b)(ii)
<PAGE>
Exhibit C
FORM OF OPINION OF CRAVATH, SWAINE & MOORE
TO BE DELIVERED PURSUANT TO
SECTION 5(b)(iii)
