AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 6, 1998
REGISTRATION NO. 333-43695
============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
AMBAC FINANCIAL GROUP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
------------------------
13-3621676
(I.R.S. EMPLOYER IDENTIFICATION NO.)
------------------------
ONE STATE STREET PLAZA
NEW YORK, NEW YORK 10004
(212) 668-0340
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
RICHARD B. GROSS, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
AMBAC FINANCIAL GROUP, INC.
ONE STATE STREET PLAZA
NEW YORK, NEW YORK 10004
(212) 668-0340
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENTS FOR SERVICE)
------------------------
COPIES TO:
MATTHEW J. MALLOW, ESQ. NORMAN D. SLONAKER, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP BROWN & WOOD LLP
919 THIRD AVENUE ONE WORLD TRADE CENTER, 57TH FLOOR
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10048
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration
Statement.
If the only securities being registered on this Form are to be
offered pursuant to dividend or interest reinvestment plans, please check
the following box.|_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection
with dividend or interest reinvestment plans, please check the following
box.|X|
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check
the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering.|_|
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.|_|
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box.|X|
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH
DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE
REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT
THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN
ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the issuance and
distribution of the securities being registered, other than underwriting
compensation, are:
Filing Fee for Registration Statement (actual)..$73,750
Legal Fees and Expenses......................... 75,000
Accounting Fees and Expenses.................... 20,000
Printing and Engraving Fees..................... 50,000
Trustee's Fees and Expenses..................... 10,000
Miscellaneous................................... 5,000
Total..........................................$233,750
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As authorized by Section 145 of the General Corporation Law of the
State of Delaware, each director and officer of Ambac may be indemnified
by Ambac against expenses (including attorney's fees, judgments, fines
and amounts paid in settlement) actually and reasonably incurred in
connection with the defense or settlement of any threatened, pending or
completed legal proceedings in which he is involved by reason of the fact
that he is or was a director or officer of Ambac if he acted in good
faith and in manner that he reasonably believed to be in or not opposed
to the best interests of Ambac and, with respect to any criminal action
or proceeding, if he had no reasonable cause to believe that his conduct
was unlawful. In addition, Article VII of the Amended and Restated
Certificate of Incorporation of Ambac and Article IX of its By-laws
authorize Ambac to indemnify any person entitled to be indemnified under
law. If the legal proceeding, however, is by or in the right of Ambac,
the director or officer may not be indemnified in respect of any claim,
issue or matter as to which he shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to Ambac unless a
court determines otherwise.
In addition, Ambac maintains a Directors' and Officers' liability
insurance policy.
Article VI of the Amended and Restated Certificate of Incorporation
of Ambac provides that, to the fullest extent permitted by law, no
director of Ambac will be personally liable for monetary damages to Ambac
or its stockholders for any breach of fiduciary duty as a director.
ITEM 16. EXHIBITS.
Exhibit
No. Description
------- -----------
1.01 Form of Underwriting Agreement.
4.01 Indenture dated as of August 1, 1991, between the Company
and The Chase Manhattan Bank, N.A., as Trustee
(incorporated herein by reference to the Registration
Statement of the Registrant on Form S-3 (File No.
33-59290) filed with the Commission on March 9, 1993).
5.01 Opinion of Richard B. Gross, Esq. regarding the legality of
the securities being registered.*
12.01 Statement regarding computation of ratios of earning to fixed
charges.*
23.01 Consent of KPMG Peat Marwick LLP.*
23.02 Consent of Richard B. Gross, Esq. (included in opinion filed
as Exhibit 5.01).*
24 Powers of Attorney of certain officers and directors of
Ambac Financial Group, Inc.*
25.01 Statement of Eligibility on Form T-1 of The Chase
Manhattan Bank, Trustee under the Indenture (incorporated
herein by reference to the Registration Statement of the
Registrant on Form S-3 (File No. 33-59290) filed with the
Commission on March 9, 1993).
- --------
* Previously filed.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement: (i) to
include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933, as amended (the "Securities Act"); (ii) to reflect in the
prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement
(notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement); and (iii) to include any material information with respect to
the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement.
Provided, however, that (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those items is contained in periodic reports filed with or furnished to
the Securities and Exchange Commission (the "Commission") by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that are
incorporated by reference to this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned Registrant hereby further undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Commission such indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter has
been settled by the controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it
is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Ambac
Financial Group, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this Registration Statement to be signed below on its behalf by
the undersigned, thereunto duly authorized, in The City of New York and
State of New York, on the 6th day of February 1998.
Ambac Financial Group, Inc.
By: /s/ RICHARD B. GROSS
--------------------------------
Richard B. Gross, Senior Vice
President, General Counsel and
Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities indicated on the 6th day of February 1998.
Signature Title
--------- -----
* Chairman, President, Chief Executive
------------------------------- Officer and Director
Phillip B. Lassiter (Principal Executive Officer)
/s/ FRANK J. BIVONA Executive Vice President, Chief
------------------------------- Financial Officer and Treasurer
Frank J. Bivona (Principal Financial and Accounting
Officer)
*
- ------------------------------- Director
Michael A. Callen
*
- ------------------------------- Director
Renso L. Caporali
*
- ------------------------------- Director
Richard Dulude
*
- ------------------------------- Director
W. Grant Gregory
*
- ------------------------------- Director
C. Roderick O'Neil
By: /s/ RICHARD B. GROSS
----------------------------
Attorney in Fact
EXHIBIT INDEX
ITEM 16. EXHIBITS.
Exhibit
No. Description
------- -----------
1.01 Form of Underwriting Agreement.
4.01 Indenture dated as of August 1, 1991, between the Company
and The Chase Manhattan Bank, N.A., as Trustee
(incorporated herein by reference to the Registration
Statement of the Registrant on Form S-3 (File No.
33-59290) filed with the Commission on March 9, 1993).
5.01 Opinion of Richard B. Gross, Esq. regarding the legality of
the securities being registered.*
12.01 Statement regarding computation of ratios of earning to fixed
charges.*
23.01 Consent of KPMG Peat Marwick LLP.*
23.02 Consent of Richard B. Gross, Esq. (included in opinion filed
as Exhibit 5.01).*
24 Powers of Attorney of certain officers and directors of
Ambac Financial Group, Inc.*
25.01 Statement of Eligibility on Form T-1 of The Chase
Manhattan Bank, Trustee under the Indenture (incorporated
herein by reference to the Registration Statement of the
Registrant on Form S-3 (File No. 33-59290) filed with the
Commission on March 9, 1993).
- --------
* Previously filed.
Exhibit 1.01
AMBAC FINANCIAL GROUP, INC.
(a Delaware corporation)
UNDERWRITING AGREEMENT
Dated: ____________, 1998
TABLE OF CONTENTS
PAGE
SECTION 1. Representations and Warranties........................ 3
(a) Representations and Warranties by the Company......... 3
(i) Compliance with Registration Requirements....... 3
(ii) Incorporated Documents.......................... 4
(iii) Independent Accountants......................... 4
(iv) Financial Statements............................ 4
(v) No Material Adverse Change in Business.......... 5
(vi) Good Standing of the Company.................... 5
(vii) Good Standing of Subsidiaries................... 5
(viii)Capitalization.................................. 6
(ix) Authorization of this Underwriting Agreement
and Terms Agreement............................. 6
(x) Authorization of Debt Securities................ 6
(xi) Authorization of the Indenture.................. 6
(xii) Descriptions of the Underwritten Securities and
the Indenture................................... 7
(xiii)Absence of Defaults and Conflicts............... 7
(xiv) Absence of Proceedings.......................... 7
(xv) Exhibits........................................ 8
(xvi) Absence of Further Requirements................. 8
(xvii)Possession of Licenses and Permits.............. 8
(xviiiCompliance with Cuba Act........................ 9
(xix) Investment Company Act.......................... 9
(xx) Reinsurance Treaties and Arrangements........... 9
(xxi) Absence of Dividend Restrictions................ 9
(b) Officers' Certificates................................ 9
SECTION 2. Sale and Delivery to Underwriters; Closing............ 10
(a) Underwritten Securities............................... 10
(b) Payment............................................... 10
(c) Denominations; Registration........................... 10
SECTION 3. Covenants of the Company.............................. 10
(a) Compliance with Securities Regulations and Commission
Requests.............................................. 10
(b) Filing of Amendments.................................. 11
(c) Delivery of Registration Statements................... 11
(d) Delivery of Prospectuses.............................. 11
(e) Continued Compliance with Securities Laws............. 11
(f) Blue Sky Qualifications............................... 12
(g) Rule 158.............................................. 12
(h) Use of Proceeds....................................... 12
(i) Listing............................................... 12
(j) Restriction on Sale of Securities..................... 12
(k) Reporting Requirements................................ 13
SECTION 4. Payment of Expenses................................... 13
(a) Expenses.............................................. 13
(b) Termination of Agreement.............................. 13
SECTION 5. Conditions of Underwriters' Obligations............... 13
(a) Effectiveness of Registration Statement............... 14
(b) Opinion of Counsel for Company........................ 14
(c) Opinion of Counsel for Underwriters................... 14
(d) Officers' Certificate................................. 15
(e) Accountant's Comfort Letter........................... 15
(f) Bring-down Comfort Letter............................. 15
(g) Maintenance of Ratings................................ 15
(h) Approval of Listing................................... 16
(i) Lock-up Agreements.................................... 16
(j) Additional Documents.................................. 16
(k) Termination of Terms Agreement........................ 16
SECTION 6. Indemnification....................................... 16
(a) Indemnification of Underwriters....................... 16
(b) Indemnification of Company, Directors and Officers.... 17
(c) Actions against Parties; Notification................. 18
(d) Settlement without Consent if Failure to Reimburse.... 18
SECTION 7. Contribution.......................................... 19
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.............................................. 20
SECTION 9. Termination........................................... 20
(a) Terms Agreement....................................... 20
(b) Liabilities........................................... 21
SECTION 10. Default by One or More of the Underwriters............ 21
SECTION 11. Notices............................................... 22
SECTION 12. Parties............................................... 22
SECTION 13. GOVERNING LAW AND TIME................................ 22
SECTION 14. Effect of Headings.................................... 22
AMBAC FINANCIAL GROUP, INC.
(a Delaware corporation)
Senior and Subordinated Debt Securities
UNDERWRITING AGREEMENT
________ __, 1998
Ladies and Gentlemen:
Ambac Financial Group, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell up to $250,000,000 aggregate
initial public offering price, or its equivalent based on the applicable
exchange rate at the time of offering, in such foreign or composite
currencies as the Company shall designate at the time of offering, of its
senior debt securities ("Senior Debt Securities") or subordinated debt
securities ("Subordinated Debt Securities" and, together with the Senior
Debt Securities, the "Debt Securities"), or any combination thereof, from
time to time, in or pursuant to one or more offerings on terms to be
determined at the time of sale.
Unless otherwise specified in the applicable Terms Agreement (as
defined below), the Debt Securities will be issued in one or more series
under an indenture, dated as of August 1, 1991 (the "Indenture"), between
the Company and The Chase Manhattan Bank, formerly known as Chemical Bank
(successor by merger to The Chase Manhattan Bank (National Association)),
as trustee (the "Trustee"). Each series of Debt Securities may vary, as
applicable, as to title, aggregate principal amount, rank, interest rate
or formula and timing of payments thereof, stated maturity date,
redemption and/or repayment provisions, sinking fund requirements and any
other variable terms established by or pursuant to the Indenture.
Whenever the Company determines to make an offering of Debt
Securities, the Company will enter into an agreement (each, a "Terms
Agreement") providing for the sale of such Debt Securities to, and the
purchase and offering thereof by the underwriters specified in the Terms
Agreement (the "Underwriters", which term shall include any Underwriter
substituted pursuant to Section 10 hereof). The Terms Agreement relating
to the offering of Debt Securities shall specify the aggregate principal
amount of Debt Securities to be issued (the "Underwritten Securities"),
the name of each Underwriter participating in such offering (subject to
substitution as provided in Section 10 hereof) and the name of any
Underwriter acting as manager or co-manager in connection with such
offering, the aggregate principal amount of Underwritten Securities which
each such Underwriter severally agrees to purchase, whether such offering
is on a fixed or variable price basis and, if on a fixed price basis, the
initial offering price, the price at which the Underwritten Securities
are to be purchased by the Underwriters, the form, time, date and place
of delivery and payment of the Underwritten Securities and any other
material variable terms of the Underwritten Securities. The Terms
Agreement, which shall be substantially in the form of Exhibit A hereto,
may take the form of an exchange of any standard form of written
telecommunication between the Company and one or more of the
Underwriters, acting for themselves and, if applicable, as
representative(s) of any other Underwriters. Each offering of
Underwritten Securities will be governed by this Underwriting Agreement,
as supplemented by the applicable Terms Agreement. As used herein, the
term "Representative(s)" means, with respect to any offering of Debt
Securities, any Underwriter specified as the representative of the
Underwriters of such offering in the applicable Terms Agreement and if
none is so designated, it means the Underwriters.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-43695)
for the registration of the Debt Securities under the Securities Act of
1933, as amended (the "1933 Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations"). Such
registration statement has been declared effective by the Commission and
the Indenture has been duly qualified under the Trust Indenture Act of
1939, as amended (the "1939 Act"). Such registration statement, including
the information, if any, deemed to be a part thereof pursuant to Rule
430A(b) of the 1933 Act Regulations (the "Rule 430A Information") or Rule
434(d) of the 1933 Act Regulations (the "Rule 434 Information"), is
referred to herein as the "Registration Statement"; and the final
prospectus and the final prospectus supplement relating to the offering
of the Underwritten Securities, in the form first furnished to the
Underwriters by the Company for use in connection with the offering of
the Underwritten Securities, are collectively referred to herein as the
"Prospectus"; provided, however, that all references to the "Registration
Statement" and the "Prospectus" shall also be deemed to include all
documents incorporated therein by reference pursuant to Item 12 of Form
S-3 under the 1933 Act, prior to the execution of the applicable Terms
Agreement; provided, further, that if the Company files a registration
statement with the Commission pursuant to Rule 462(b) of the 1933 Act
Regulations (the "Rule 462(b) Registration Statement"), then, after such
filing, all references to "Registration Statement" shall also be deemed
to include the Rule 462 Registration Statement; and provided, further,
that if the Company elects to rely upon Rule 434 of the 1933 Act
Regulations, then all references to "Prospectus" shall also be deemed to
include the final or preliminary prospectus and the applicable term sheet
or abbreviated term sheet (the "Term Sheet"), as the case may be, in the
form first furnished to the Underwriters by the Company in reliance upon
Rule 434 of the 1933 Act Regulations, and all references in this
Underwriting Agreement to the date of the Prospectus shall mean the date
of the Term Sheet. A "preliminary prospectus" shall be deemed to refer to
any prospectus used before the Registration Statement became effective
and any prospectus that omitted, as applicable, the Rule 430A
Information, the Rule 434 Information or other information to be included
upon pricing in a form of prospectus filed with the Commission pursuant
to Rule 424(b) of the 1933 Act Regulations and was used after such
effectiveness and prior to the execution and delivery of the applicable
Terms Agreement.
All references in this Underwriting Agreement to financial
statements and schedules and other information which is "contained,"
"included" or "stated" (or other references of like import) in the
Registration Statement, the Prospectus or any preliminary prospectus
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, the Prospectus or any preliminary prospectus, as
the case may be, prior to the execution of the applicable Terms
Agreement; and all references in this Underwriting Agreement to
amendments or supplements to the Registration Statement, the Prospectus
or any preliminary prospectus shall be deemed to mean and include the
filing of any document under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), which is incorporated by reference in the
Registration Statement, the Prospectus or any preliminary prospectus, as
the case may be, after the execution of the applicable Terms Agreement.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each Underwriter named in the applicable Terms
Agreement, as of the date thereof and as of the Closing Time (as defined
below) (in each case, a "Representation Date"), as follows:
(i) Compliance with Registration Requirements. The Company
meets the requirements for use of Form S-3 under the 1933 Act. The
Registration Statement (including any Rule 462(b) Registration
Statement) has become effective under the 1933 Act and no stop
order suspending the effectiveness of the Registration Statement
(or such 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 (including
any Rule 462(b) Registration Statement) and any post-effective
amendments thereto (including the filing of the Company's most
recent Annual Report on Form 10-K with the Commission (the "Annual
Report on Form 10-K")) became effective and at each Representation
Date, the Registration Statement (including any Rule 462(b)
Registration Statement) and any amendments thereto complied and
will comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the 1939 Act and the
rules and regulations of the Commission under the 1939 Act (the
"1939 Act Regulations") and 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. At the date of the Prospectus and at the
Closing Time, neither the Prospectus nor any amendments and
supplements thereto included or will include an untrue statement of
a material fact or omitted or will 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. If
Rule 434 is used, the Company will comply with the prospectus
delivery requirements of Rule 434. The representations and
warranties in this subsection shall not apply to (A) statements in
or omissions from the Registration Statement or the Prospectus made
in reliance upon and in conformity with information furnished to
the Company in writing by any Underwriter through the
Representative(s) expressly for use in the Registration Statement
or the Prospectus or (B) that part of the Registration Statement
that constitutes the Statement of Eligibility on Form T-1 (the
"Form T-1") under the 1939 Act of the Trustee.
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.
(ii) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Registration
Statement and the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the
rules and regulations of the Commission thereunder (the "1934 Act
Regulations") and, when read together with the other information in
the Prospectus, at the date of the Prospectus and at the Closing
Time, 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, in the
light of the circumstances under which they were made, not
misleading.
(iii) Independent Accountants. The accountants who certified
the financial statements and supporting schedules included in the
Registration Statement and the Prospectus are independent public
accountants as required by the 1933
Act and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements of the
Company and its consolidated subsidiaries included in the
Registration Statement and the Prospectus, together with the
related schedules and notes, present fairly the financial position
of the Company and its consolidated subsidiaries at the dates
indicated and the statement of operations, stockholders' equity and
cash flows of the Company and its consolidated subsidiaries for the
periods specified; except as otherwise stated in the Registration
Statement, said financial statements have been prepared in
conformity with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Registration
Statement present fairly in accordance with GAAP the information
required to be stated therein. The selected consolidated financial
data of the Company and its consolidated subsidiaries and the
summary financial information of the Company and its consolidated
subsidiaries included in the Prospectus present fairly the
information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included
in the Registration Statement and the Prospectus. In addition, any
pro forma financial statements of the Company and its subsidiaries
and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's
rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the bases described therein, and
the assumptions used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(v) No Material Adverse Change in Business. Since the
respective 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"), (B)
there have been no transactions entered into by the Company or any
of its subsidiaries, other than those arising 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 $.01
per share, of the Company in amounts per share that are consistent
with past practice, there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its
capital stock.
(vi) Good Standing of the Company. 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 has corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into and
perform its obligations under this Underwriting Agreement and the
applicable Terms Agreement. The Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be
in good standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each subsidiary of the
Company that is a "significant subsidiary" as defined in Rule 1-02
of Regulation S-X (each, a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as
a corporation in good standing under the laws of the jurisdiction
of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify or to be in good
standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement and the
Prospectus, all of the issued and outstanding capital stock of each
such Subsidiary has been duly authorized and validly issued and is
fully paid and non-assessable; each such Subsidiary is wholly owned
by the Company, directly or through subsidiaries; all of the
outstanding capital stock of such Subsidiaries which is owned by
the Company, directly or through subsidiaries, is owned free and
clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity, and none of the outstanding shares of
capital stock of any Subsidiary was issued in violation of the
preemptive or similar rights of any securityholder of such
Subsidiary.
(viii) Capitalization. If the Prospectus contains a
"Capitalization" section, the authorized and issued capital stock
of the Company is as set forth in the Prospectus in the column
entitled "Actual" under such section (except for subsequent
issuances thereof, if any, contemplated under this Underwriting
Agreement, pursuant to reservations, agreements or employee benefit
plans referred to in the Prospectus or otherwise as contemplated by
the Prospectus.
(ix) Authorization of this Underwriting Agreement and Terms
Agreement. This Underwriting Agreement has been, and the applicable
Terms Agreement as of the date thereof will have been, duly
authorized, executed and delivered by the Company.
(x) Authorization of Debt Securities. The Underwritten
Securities have been, or as of the date of the applicable Terms
Agreement will have been, duly authorized by the Company for
issuance and sale pursuant to this Underwriting Agreement and such
Terms Agreement. At the Closing Time, the Underwritten Securities
will have been duly executed by the Company and, when authenticated
by the Trustee in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor specified
in such Terms Agreement, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except (a) as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law); (b)
the waiver contained in Section 514 of the Indenture may be deemed
unenforceable; and (c) as enforcement thereof may be limited by
requirements that a claim with respect to any Debt Securities
payable in a foreign or composite currency (or a foreign or
composite currency judgment in respect of such claim) be converted
into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law, or by governmental authority
to limit, delay or prohibit the making of payments outside the
United States, and will be in the form contemplated by, and
entitled to the benefits of, the Indenture.
(xi) Authorization of the Indenture. The Indenture has been
duly authorized by the Company and qualified under the 1939 Act and
duly executed and delivered by the Company and (assuming the due
authorization, execution and delivery by the Trustee) constitutes a
valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except (a) as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law) and
(b) the waiver contained in Section 514 of the Indenture may be
deemed unenforceable.
(xii) Descriptions of the Underwritten Securities and the
Indenture. The Underwritten Securities and the Indenture, as of
each Representation Date, will conform in all material respects to
the respective statements relating thereto contained in the
Prospectus and will be in substantially the respective forms filed
or incorporated by reference, as the case may be, as exhibits to
the Registration Statement.
(xiii)Absence of Defaults and Conflicts. The performance by
the Company of its obligations under this Underwriting Agreement,
the applicable Terms Agreement, the Indenture and the Underwritten
Securities (including the issuance and sale of the Underwritten
Securities) will not violate, conflict with, result in a breach of,
or constitute a default (or an event which with the giving of
notice or the lapse of time or both would be reasonably likely to
constitute a default) under (a) the charter or by-laws of the
Company or any of the Subsidiaries, (b) any order, law, treaty,
rule, regulation, judgment or determination applicable to the
Company or any of the Subsidiaries of any court, governmental
agency or body (including, without limitation, any insurance
regulatory agency or body) or arbitrator having jurisdiction over
the Company or any of the Subsidiaries (other than any violation of
or conflict with any such order, law, treaty, rule, regulation,
judgment or determination that would not adversely affect the
performance by the Company of its obligations under this
Underwriting Agreement, the applicable Terms Agreement, the
Indenture or the Underwritten Securities (including the issuance
and sale of the Underwritten Securities) and would not have, singly
or in the aggregate with all such other violations or conflicts, a
Material Adverse Effect) or (c) the terms of any bond, debenture,
note, other evidence of indebtedness, agreement, indenture, lease
or other instrument to which the Company or any of the Subsidiaries
is a party or by which any of them is bound or by which any of
their respective properties is subject, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the
assets of the Company or any of the Subsidiaries pursuant to the
terms of any such bond, debenture, note, other evidence of
indebtedness, agreement, indenture, lease or other instrument
(other than any conflict, breach or default or lien, charge or
encumbrance that would not adversely affect the performance by the
Company of its obligations under this Underwriting Agreement, the
applicable Terms Agreement, the Indenture or the Underwritten
Securities (including the issuance and sale of the Underwritten
Securities) and would not result in a Material Adverse Effect).
(xiv) Absence of Proceedings. Except as described in the
Prospectus, there is no pending or, to the best knowledge of the
Company, threatened action, suit, proceeding or investigation
before any court, governmental agency or body (including, without
limitation, any insurance regulatory agency or body) or arbitrator
having jurisdiction over the Company or any of the Subsidiaries,
involving any of them that (a) would adversely affect the execution
by the Company of this Underwriting Agreement, the applicable Terms
Agreement, the Indenture or the Underwritten Securities or the
performance by the Company of its obligations hereunder or
thereunder (including the issuance and sale of the Underwritten
Securities), or (b) would have, singly or in the aggregate with all
such actions, suits, proceedings or investigations, a Material
Adverse Effect or (c) is of a character required to by disclosed in
the Registration Statement or the Prospectus.
(xv) Exhibits. There are no contracts or documents 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 or
filed as required.
(xvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental agency or
body (including, without limitation, any insurance regulatory
agency or body) is required for the execution by the Company of
this Underwriting Agreement or the applicable Terms Agreement or
for the performance by the Company of its obligations under this
Underwriting Agreement, such Terms Agreement, the Indenture or the
Underwritten Securities (including the issuance and sale of the
Underwritten Securities), except as disclosed in the Prospectus and
such as have been already obtained or as may be required under the
1933 Act or the 1933 Act Regulations or state securities laws and
except for the qualification of the Indenture under the 1939 Act.
(xvii)Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses")
issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies (including, without limitation, any
Governmental Licenses from any insurance regulatory agencies or
bodies) necessary to own their respective properties or to conduct
the business now operated by them, except such as would not have,
singly or in the aggregate with all such other Governmental
Licenses that have not been obtained, a Material Adverse Effect;
the Company and its subsidiaries are in compliance with the terms
and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses
(including, without limitation, any Governmental Licenses from any
insurance regulatory agencies or bodies) are valid and in full
force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not have a Material Adverse Effect; and
neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification of
any such Governmental Licenses (including, without limitation, any
Governmental Licenses from any insurance regulatory agencies or
bodies) which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xviii) Compliance with Cuba Act. The Company has complied
with, and is and will be in compliance with, the provisions of that
certain Florida act relating to disclosure of doing business with
Cuba, codified as Section 517.075 of the Florida statutes, and the
rules and regulations thereunder (collectively, the "Cuba Act") or
is exempt therefrom.
(xix) Investment Company Act. The Company is not, and upon
the issuance and sale of the Underwritten Securities as
contemplated herein and in the applicable Terms Agreement and the
application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "1940 Act").
(xx) Reinsurance Treaties and Arrangements. All reinsurance
treaties and arrangements to which Ambac Assurance Corporation, a
Wisconsin stock insurance corporation and a wholly owned subsidiary
of the Company ("Ambac Assurance"), is a party are in full force
and effect and Ambac Assurance is not in violation of, or in
default in the performance, observance or fulfillment of, any
obligation, agreement, covenant or condition contained therein,
except to the extent that any such violation or default would not
have, singly or in the aggregate with all such other violations or
defaults, a Material Adverse Effect; Ambac Assurance has not
received any notice from any of the other parties to such treaties,
contracts or agreements that such other party intends not to
perform in any material respect such treaty, contract or agreement,
and, to the best knowledge of the Company, Ambac Assurance has no
reason to believe that any of the other parties to such treaties or
arrangements will be unable to perform such treaty or arrangement.
(xxi) Absence of Dividend Restrictions. Other than as
described in the Prospectus, there are no restrictions upon the
declaration or payment of any dividend or distribution on any
shares of capital stock of any Subsidiary pursuant to the charter
or by-laws of any of them, any agreement or other instrument to
which any of them is a party or by which any of them is bound, or
any order, law, rule, regulation, judgment or determination of any
court, governmental agency or body (including, without limitation,
any insurance regulatory agency or body) or arbitrator having
jurisdiction over any of them.
(b) Officers' Certificates. Any certificate signed by any officer
of the Company or any subsidiary and delivered to the Representative(s)
or to counsel for the Underwriters in connection with the offering of the
Underwritten Securities shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby and not
a personal representation and warranty by any such officer.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Underwritten Securities. The several commitments of the
Underwriters to purchase the Underwritten Securities pursuant to the
applicable Terms Agreement shall be deemed to have been made on the basis
of the representations, warranties and agreements herein contained and
shall be subject to the terms and conditions herein set forth.
(b) Payment. Payment of the purchase price for, and delivery of,
the Underwritten Securities shall be made at the offices of Brown & Wood
LLP or at such other place as shall be agreed upon by the
Representative(s) and the Company, at 9:00 A.M. (Eastern time) on the
third (fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on
any given day) business day after the date of the applicable Terms
Agreement (unless postponed in accordance with the provisions of Section
10 hereof), or such other time not later than ten business days after
such date as shall be agreed upon by the Representative(s) and the
Company (such time and date of payment and delivery being herein called
"Closing Time").
Payment shall be made to the Company by wire transfer of
immediately available funds to the Company, against delivery to the
Representative(s) for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representative(s), for its account,
to accept delivery of, receipt for, and make payment of the purchase
price for, the Underwritten Securities which it has severally agreed to
purchase. Any Representative, individually and not as representative of
the Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Underwritten 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.
(c) Denominations; Registration. The certificates for the
Underwritten Securities shall be in such denominations and registered in
such names as the Representative(s) may request in writing at least one
full business day prior to the Closing Time. The certificates for the
Underwritten Securities shall be made available for examination and
packaging by the Representative(s) in The City of New York not later than
9:00 A.M. (Eastern time) on the business day prior to the Closing Time.
SECTION 3. Covenants of the Company. The Company covenants with
each Underwriter participating in the offering of Underwritten
Securities, as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with
the requirements of Rule 430A or Rule 434, as applicable, and will
notify the Representative(s) 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 Underwritten Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly
effect the filings necessary pursuant to Rule 424(b) and will take
such steps as it deems necessary to ascertain promptly whether the
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 Company 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.
(b) Filing of Amendments. During the period when the
Prospectus is required to be delivered under the 1933 Act, the
Company will give the Representative(s) notice of its 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 Representative(s) 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 Representative(s) or counsel for the
Underwriters shall object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the Representative(s) and counsel for
the Underwriters, without charge, conformed 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 conformed copies of all
consents and certificates of experts.
(d) Delivery of Prospectuses. The Company will deliver to
each Underwriter, without charge, as many copies of each
preliminary prospectus as such Underwriter may reasonably request,
and the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Company will furnish to
each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the
1934 Act, such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request.
(e) Continued Compliance with Securities Laws. If at any time
when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Debt 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 for the Company, to
amend the Registration Statement or to 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
Company 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
Company will furnish to the Underwriters, without charge, such
number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the Underwriters, to qualify the
Underwritten Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions of the
United States as the Representative(s) may designate and to
maintain such qualifications in effect for a period of not less
than one year from the date of the applicable Terms Agreement;
provided, however, that the Company shall not be obligated to file
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 Underwritten Securities have been so qualified, the Company
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 date of such Terms
Agreement.
(g) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make
generally available to its 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.
(h) Use of Proceeds. The Company will use the net proceeds
received by it from the sale of the Underwritten Securities in the
manner specified in the Prospectus
under "Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect
the listing of the Underwritten Securities, prior to the Closing
Time, on any national securities exchange or quotation system if
and as specified in the applicable Terms Agreement.
(j) Restriction on Sale of Securities. Between the date of
the applicable Terms Agreement and the Closing Time or such other
date specified in such Terms Agreement, the Company will not,
without the prior written consent of the Representative(s),
directly or indirectly, issue, sell, offer or contract to sell,
grant any option for the sale of, or otherwise dispose of, the
securities specified in such Terms Agreement.
(k) Reporting Requirements. The Company, during the period
when the 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 4. Payment of Expenses. (a) Expenses. The Company will pay
all expenses incident to the performance of its obligations under this
Underwriting Agreement or the applicable Terms 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 Underwriting Agreement, any Terms Agreement, any
Agreement among Underwriters, the Indenture and such other documents as
may be required in connection with the offering, purchase, sale and
delivery of the Underwritten Securities, (iii) the preparation, issuance
and delivery of the certificates for the Underwritten Securities to the
Underwriters, including any transfer taxes or other duties payable upon
the sale, issuance or delivery of the Underwritten Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors or agents, (v) the qualification of the
Underwritten Securities under state securities laws in accordance with
the provisions of Section 3(f) 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 any Blue
Sky Survey, any supplement thereto and any Legal Investment Survey, (vi)
the printing and delivery to the Underwriters of copies of each preliminary
prospectus, any Term Sheet, and the Prospectus and any amendments or
supplements thereto, (vii) the preparation, printing and delivery to the
Underwriters of copies of any Blue Sky Survey, any supplement thereto and
any Legal Investment Survey, (viii) the fees and expenses of the Trustee,
including the fees and disbursements of counsel for the Trustee in
connection with the Indenture and the Debt Securities, (ix) the fees
charged by nationally recognized statistical rating organizations for the
rating of the Underwritten Securities, if applicable and (x) the fees and
expenses incurred with respect to the listing of the Underwritten
Securities, if applicable.
(b) Termination of Agreement. If the applicable Terms Agreement is
terminated by the Representative(s) in accordance with the provisions of
Section 5 or Section 9(b)(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 Underwriters to purchase and pay for the Underwritten Securities
pursuant to the applicable Terms Agreement are subject to the accuracy of
the representations and warranties of the Company contained in Section 1
hereof, to the accuracy of the statements made in certificates of any
officer of the Company delivered pursuant to the provisions hereof, to
the performance by the Company of its covenants and other obligations
hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has
become effective and 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 the Commission for
additional information shall have been complied with. A prospectus
containing information relating to the description of the
Underwritten Securities, the specific method of distribution and
similar matters shall have been filed with the Commission in
accordance with Rule 424(b) (or any required post-effective
amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule
430A), or, if the Company has elected to rely upon Rule 434, a Term
Sheet including the Rule 434 Information shall have been filed with
the Commission in accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the
Representative(s) shall have received (i) the favorable opinion,
dated as of Closing Time, of Skadden, Arps, Slate, Meagher & Flom
LLP, counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, together with signed
or reproduced copies of such letter for each of the other
Underwriters; (ii) the favorable opinion, dated as of Closing Time,
of Richard B. Gross, Esq., Senior Vice President, General Counsel
and Secretary of the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, together with signed
or reproduced copies of such letter for each of the other
Underwriters; (iii) the favorable opinion, dated as of Closing
Time, of counsel for Ambac Assurance, in form and substance
reasonably satisfactory to counsel for the Underwriters, together
with signed or reproduced copies of such letter for each of the
other Underwriters; and (iv) the favorable opinion, dated as of the
Closing Time, of Cadwalader, Wickersham & Taft, special counsel for
the Company, in form and substance reasonably satisfactory to
counsel for the Underwriters, together with reproduced copies of
such letter for each of the other Underwriters, to the effect that
the Company is not an "investment company," as such term is defined
in the 1940 Act.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representative(s) shall have received the favorable opinion, dated
as of Closing Time, of Brown & Wood LLP, counsel for the
Underwriters, together with signed or reproduced copies of such
letter for each of the other Underwriters, with respect to the
matters set forth in (i), (iii), (iv), (v) (solely as to the
statements in the Prospectus under the heading "Description of Debt
Securities" and any other heading purporting to described the
Underwritten Securities), (vi) and the last two paragraphs of
Exhibit B hereto. In giving such opinion, such counsel may rely, as
to all matters governed by the laws of jurisdictions other than the
law of the State of New York, the federal law of the United States
and the General Corporation Law of the State of Delaware, upon the
opinions of counsel satisfactory to the Representative(s). Such
counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper,
upon certificates of officers of the Company and its subsidiaries
and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not
have been, since the date of the applicable Terms 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, and the Representative(s) shall have received a
certificate of the President, a Vice Chairman or an Executive or
Senior Vice President of the Company and of the chief financial or
chief accounting officer of the Company, dated as of Closing Time,
to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Section 1(a)
hereof are true and correct with the same force and effect as
though expressly made at and as of the Closing Time, (iii) the
Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to
the 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,
to the best of their knowledge, are pending or are contemplated by
the Commission.
(e) Accountant's Comfort Letter. At the time of the execution
of the applicable Terms Agreement, the Representative(s) shall have
received from the Company's independent accountants a letter dated
such date, in form and substance satisfactory to the
Representative(s), 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.
(f) Bring-down Comfort Letter. At Closing Time, the
Representative(s) shall have received from the Company's
independent accountants a letter, dated as of Closing Time, to the
effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section 5, except that
the specified date referred to shall be a date not more than three
business days prior to the Closing Time.
(g) Maintenance of Ratings. At Closing Time, if and as
specified in the applicable Terms Agreement, the Underwritten
Securities shall have the ratings accorded by any "nationally
recognized statistical rating organization", as defined by the
Commission for purposes of Rule 436(g)(2) of the 1933 Act
Regulations, and the Company shall have delivered to the
Representative(s) a letter, dated as of such date, from each such
rating organization, or other evidence satisfactory to the
Representative(s), confirming that the Underwritten Securities have
such ratings. Since the time of execution of such Terms Agreement,
there shall not have occurred a downgrading in the rating assigned
to the Underwritten Securities or any of the Company's other debt
securities or the Company's financial strength or claims paying
ability by any such rating organization, and no such rating
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of the Underwritten Securities or any of the Company's other
debt securities or the Company's financial strength or claims
paying ability.
(h) Approval of Listing. At Closing Time, the Underwritten
Securities shall have been approved for listing, subject only to
official notice of issuance, if and as specified in the applicable
Terms Agreement.
(i) Lock-up Agreements. On the date of the applicable Terms
Agreement, the Representative(s) shall have received, in form and
substance reasonably satisfactory to them, each lock-up agreement,
if any, specified in such Terms Agreement as being required to be
delivered by the persons listed therein.
(j) Additional Documents. At Closing Time, counsel for the
Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling
them to pass upon the issuance and sale of the Underwritten
Securities as contemplated herein and in the applicable Terms
Agreement, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, contained herein; and all proceedings taken by the
Company in connection with the issuance and sale of the
Underwritten Securities as contemplated herein and in the
applicable Terms Agreement shall be reasonably satisfactory in form
and substance to the Representative(s) and counsel for the
Underwriters.
(k) Termination of Terms Agreement. If any condition
specified in this Section 5 shall not have been fulfilled when and
as required to be fulfilled, the applicable Terms Agreement may be
terminated by the Representative(s) by notice to the Company at any
time at or prior to the 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 and 7 shall
survive any such termination and remain in full force and effect.
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
or Section 20 of the 1934 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 statement of a material fact contained
in the Registration Statement (or any amendment thereto), including
the Rule 430A Information and 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 contained
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 therein, 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 any of claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, referred to under (i) above; provided that (subject to
Section 6(d) below) any such settlement is effected with the prior
written consent of the Company; and
(3) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representative(s)), 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, or any such alleged untrue statement or
omission, referred to under (i) above, 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 untrue statement or omission
made in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the Representative(s)
expressly for use in the Registration Statement (or any amendment
thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto); and provided,
further, that the foregoing indemnity is subject to the condition that,
insofar as it relates to any untrue statement or omission or alleged
untrue statement or omission made in any preliminary prospectus but
eliminated in the Prospectus (or any amendment or supplement thereto),
such indemnity shall not inure to the benefit of any Underwriter if a
copy of such Prospectus, excluding documents incorporated by reference
therein, (or amendment or supplement thereto) was not delivered to the
person asserting any such loss, liability, claim or damage, if such
delivery was required by the 1933 Act, and the delivery thereof would
have cured the defect giving rise to such loss, liability, claim or
damage.
(b) Indemnification of Company, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Company,
its directors, each of its officers 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
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 430A Information
and 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
Company by such Underwriter through the Representative(s) expressly for
use in the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) 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 the
Representative(s), 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.
(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of
the nature contemplated by Section 6(a)(2) effected without its written
consent if (i) such settlement is entered into more than 60 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such
settlement at least 45 days prior to such settlement being entered into
and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of
such settlement; provided, however, that an indemnifying party shall not
be liable for any such settlement effected without its consent if such
indemnifying party (x) reimburses such indemnified party in accordance
with such request to the extent it considers such request to be
reasonable and (y) provides written notice to the indemnified party
substantiating the unpaid balance as unreasonable, in each case prior to
the date of such settlement.
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 Underwritten
Securities pursuant to the applicable Terms Agreement or (ii) if the
allocation provided 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 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 Underwritten Securities pursuant to the applicable Terms Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of such Underwritten Securities (before
deducting expenses) received by the Company and the total underwriting
discount 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 such Underwritten 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 Underwritten 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 any 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 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 principal
amount of Underwritten Securities set forth opposite their respective
names in the applicable Terms Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in
this Underwriting Agreement or the applicable Terms Agreement or in
certificates of officers of the Company submitted pursuant hereto or
thereto, 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 Company, and shall survive
delivery of the Underwritten Securities to the Underwriters.
SECTION 9. Termination.
(a) Terms Agreement. The Representative(s) may terminate the
applicable Terms Agreement, by notice to the Company, at any time at or
prior to the Closing Time, (i) if there has been, since the time of
execution of such Terms 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, or (ii) if there has occurred any material
adverse change in the financial markets in the United States or, if the
Underwritten Securities are denominated or payable in, or indexed to, one
or more foreign or composite currencies, in the international financial
markets, or 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 reasonable judgment of the Representative(s), impracticable to market
the Underwritten Securities or to enforce contracts for the sale of the
Underwritten Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the
New York Stock Exchange, or if trading generally on the New York Stock
Exchange or the American Stock Exchange or in the Nasdaq National Market
has been suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required, by
either of said exchanges or by such system or by order of the Commission,
the National Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) if a banking moratorium has been declared
by either Federal or New York authorities or, if the Underwritten
Securities are denominated or payable in, or indexed to, one or more
foreign or composite currencies, by the relevant authorities in the
related foreign country or countries, or (v) if there shall have occurred
a downgrading in the rating assigned to the Underwritten Securities or
any of the Company's other debt securities or the Company's financial
strength or claims paying ability by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the 1933 Act), or any such statistical rating organization shall
have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of the Underwritten Securities
or any of the Company's other debt securities or the Company's financial
strength or claims paying ability.
(b) Liabilities. If this Underwriting Agreement or the applicable
Terms Agreement is terminated pursuant to this Section 9, 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 and 7 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 the Closing Time to purchase the
Underwritten Securities which it or they are obligated to purchase under
the applicable Terms Agreement (the "Defaulted Securities"), then the
Representative(s) 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 Representative(s) shall not have
completed such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities
does not exceed 10% of the aggregate principal amount of
Underwritten Securities to be purchased on such date pursuant to
such Terms Agreement, 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 under such Terms Agreement bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the aggregate principal amount of Underwritten
Securities to be purchased on such date pursuant to such Terms
Agreement, such Terms Agreement shall terminate without liability
on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 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 the applicable Terms Agreement, either the
Representative(s) or the Company shall have the right to postpone
the Closing Time for a period not exceeding seven days in order to effect
any required changes in the Registration Statement or the Prospectus or
in any other documents or arrangements.
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 Representative(s) at the address
specified in the applicable Terms Agreement; and notices to the Company
shall be directed to it at One State Street Plaza, New York, New York
10004, attention: General Counsel.
SECTION 12. Parties. This Underwriting Agreement shall inure to the
benefit of and be binding upon the Company and, upon execution of the
applicable Terms Agreement, upon the Company and any other Underwriters
and their respective successors. Nothing expressed or mentioned in this
Underwriting Agreement or such Terms Agreement is intended or shall be
construed to give any person, firm or corporation, other than the
Underwriters 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 Underwriting Agreement
or such Terms Agreement or any provision herein or therein contained.
This Underwriting Agreement and such Terms Agreement and all conditions
and provisions hereof and thereof are intended to be for the sole and
exclusive benefit of the parties hereto and thereto 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 Underwritten Securities from
any Underwriter shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS UNDERWRITING AGREEMENT AND
ANY APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY
REFER TO NEW YORK CITY TIME.
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 Company a counterpart hereof,
whereupon this Underwriting Agreement, along with all counterparts, will
become a binding agreement between the Representative(s) and the Company
in accordance with its terms.
Very truly yours,
AMBAC FINANCIAL GROUP, INC.
By:-------------------------------
Name: Frank J. Bivona
Title: Executive Vice President,
Chief Financial Officer
and Treasurer
CONFIRMED AND ACCEPTED,
as of the date first
above written:
By:---------------------------
Authorized Signatory
