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EXHIBIT 5.2
September 25, 2000
Paradigm Capital Trust II
c/o Paradigm Bancorporation, Inc.
2828 FM 1960
Houston, TX 77273
Re: Paradigm Capital Trust II
Ladies and Gentlemen:
We have acted as special Delaware counsel for Paradigm Bancorporation,
Inc., a Texas corporation ("Paradigm"), and Paradigm Capital Trust II, 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"), as
filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on July 6, 2000.
(b) The Trust Agreement of the Trust, dated as of July 6, 2000 (the
"Original Trust Agreement"), among Paradigm, First Union Trust
Company, National Association, a national banking association
with its principal place of business in the State of Delaware
("First Union"), as trustee (the "Delaware Trustee"), and Peter
E. Fisher, Jay W. Porter, Jr. and William H. Fagan, as
administrative trustees (the "Administrative Trustees");
(c) A form of Amended and Restated Trust Agreement for the Trust,
among Paradigm, the Delaware Trustee, First Union, as property
trustee (the "Property Trustee"), the Administrative Trustees,
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) (the "Amended and Restated Trust
Agreement;" and, together with the Original Trust Agreement, the
"Trust Agreement");
(d) The Registration Statement (the "Registration Statement") on Form
SB-2, including a preliminary prospectus with respect to the
Trust (the "Prospectus"), relating to the Trust Preferred
Securities of the Trust
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Paradigm Capital Trust II
September 25, 2000
Page 2
representing preferred undivided beneficial ownership interests
in the assets of the Trust (each, a "Trust Preferred Security"
and collectively, the "Trust Preferred Securities"), filed by
Paradigm and the Trust with the Securities and Exchange
Commission on September 22, 2000; and
(e) A Certificate of Good Standing for the Trust, dated September 25,
2000, 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 bears upon or 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 matter thereof, including with respect to the creation,
operation and termination of the Trust, that the Certificate of Trust is in full
force and effect and has not been amended and that the Trust Agreement will be
in full force and effect and will not be amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or 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 creation, 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,
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Paradigm Capital Trust II
September 25, 2000
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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 Preferred Security is to be issued by
the Trusts (collectively, the "Preferred Security Holders") of a Preferred
Security Certificate for such Preferred Security and the payment for the
Preferred Security acquired by it, in accordance with the Trust Agreement and
the Registration Statement, and (vii) that the Preferred Securities are issued
and sold to the Preferred Security Holders in accordance with the Trust
Agreement and the Registration Statement. We have not participated in the
preparation of the Registration Statement or 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.
(S) 3801, et seq.
2. The Preferred Securities of the Trust have been duly authorized
by the Trust Agreement and will be duly and validly issued and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
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Paradigm Capital Trust II
September 25, 2000
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3. The Preferred 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 Delaware. We note that the Preferred Security Holders may be
obligated to make payments as set forth in the Trust Agreement.
4. We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In addition,
we hereby consent to the reference to us as local counsel under the headings
"Legal Matters" 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.
Very truly yours,
DKD/DSG
