<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) October 30, 1996
------------------
THE MONEY STORE INC.
-------------------------------------------------------------
(Exact name of registrant as specified in its charter)
NEW JERSEY 001-10785 22-2293022
- ---------------------------------- ----------- -------------
(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) ID Number)
2840 Morris Avenue, Union, New Jersey 07083
- -------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number,
including area code: (908) 686-2200
--------------
Not Applicable
-------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events.
- ------ ------------
Attached as exhibits hereto are (i) an Underwriting Agreement dated
October 30, 1996 among the registrant, Prudential Securities
Incorporated, Bear Stearns & Co. Inc., Montgomery Securities and
Oppenheimer & Co., Inc., as representatives of the several underwriters
named therein and (ii) the Pricing Agreement dated October 30, 1996
among the registrant, Prudential Securities Incorporated, Bear, Stearns
& Co. Inc., Montgomery Securities and Oppenheimer & Co., Inc., as
representatives of the several underwriters named therein.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
- ------ ------------------------------------------------------------------
(c) Exhibits.
--------
The following exhibits are filed herewith:
Exhibit No. Description of Exhibit
----------- ----------------------
1.1 Underwriting Agreement dated October 30, 1996 among the
registrant, Prudential Securities Incorporated, Bear
Stearns & Co. Inc., Montgomery Securities and
Oppenheimer & Co., Inc., as representatives of the
several underwriters named therein.
1.2 Pricing Agreement dated October 30, 1996 among the
registrant, Prudential Securities Incorporated, Bear,
Stearns & Co. Inc., Montgomery Securities and
Oppenheimer & Co., Inc., as representatives of the
several underwriters named therein.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE MONEY STORE INC.
By: /s/ MORTON DEAR
-------------------------------
Name: Morton Dear
Title: Executive Vice President and
Chief Financial Officer
Dated: October 30, 1996
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit
- ----------- ----------------------
<S> <C>
1.1 Underwriting Agreement dated October 30, 1996 among the
registrant, Prudential Securities Incorporated, Bear, Stearns &
Co. Inc., Montgomery Securities and Oppenheimer & Co., Inc., as
representatives of the several underwriters named therein.
1.2 Pricing Agreement dated October 30, 1996 among the registrant
Prudential Securities Incorporated, Bear, Stearns & Co. Inc.,
Montgomery Securities and Oppenheimer & Co., Inc., as
representatives of the several underwriters named therein.
</TABLE>
<PAGE>
EXHIBIT 1.1
THE MONEY STORE INC.
4,600,000 SHARES/1/
$1.72 MANDATORY CONVERTIBLE PREFERRED STOCK
UNDERWRITING AGREEMENT
New York, New York
October 30, 1996
PRUDENTIAL SECURITIES INCORPORATED
BEAR, STEARNS & CO. INC.
MONTGOMERY SECURITIES
OPPENHEIMER & CO., INC.
As Representatives of the Several Underwriters
c/o Prudential Securities Incorporated
One New York Plaza
New York, New York 10292
Dear Sirs:
Subject to the terms and conditions hereof, The Money Store Inc., a
New Jersey corporation (the "Company"), proposes to issue and sell to the
underwriters named in Schedule II hereto (the "Underwriters"), for whom you are
acting as representatives (the "Representatives"), 4,600,000 shares (the
"Initial Shares") of the Company's $1.72 Mandatory Convertible Preferred Stock,
no par value per share (the "Preferred Stock"). Subject to the terms and
conditions hereof, the Initial Shares are to be sold to each Underwriter, acting
severally and not jointly, in such amounts as are listed in Schedule II opposite
the name of each Underwriter. The Company also grants to the Underwriters,
severally and not jointly, the option described in Section 2(c) to purchase up
to 690,000 additional shares of Preferred Stock (the "Option Shares"). The
Option Shares together with the Initial Shares shall be referred to herein as
the "Shares". The Preferred Stock is more fully described in the Final
Prospectus referred to below. If the firm or firms listed in Schedule II hereto
include only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representatives," as used herein, each shall be deemed to
refer to such firm or firms.
- ----------------
/1/ Plus an option to purchase from the Company up to 690,000 additional shares
to cover over-allotments.
1
<PAGE>
1. Representations and Warranties. The Company represents and
------------------------------
warrants to, and agrees with, each Underwriter, that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement on such Form (the file number of which is set forth in Schedule I
hereto), which has become effective, for the registration under the Act of
the Shares. Such registration statement, as amended at the date of this
Agreement, meets the requirements set forth in Rule 415 under the Act and
complies in all other material respects with said Rule. The Company will
file with the Commission pursuant to Rule 434 and/or Rule 424(b) under the
Act a supplement to the form of prospectus included in such registration
statement relating to the Shares and the plan of distribution thereof and
has previously advised you of all further information (financial and other)
with respect to the Company to be set forth therein. Such registration
statement, including all financial schedules and exhibits thereto, as
amended at the time when it was declared effective, is hereinafter called
the "Registration Statement"; such prospectus in the form in which it
appears in the Registration Statement is hereinafter called the "Basic
Prospectus"; such supplemented form of prospectus, in the form in which it
shall be filed with the Commission pursuant to Rule 434 and/or 424(b)
(including the Basic Prospectus as so supplemented), together with the Term
Sheet (as hereinafter defined), if any, relating to the shares that is
first filed pursuant to Rule 424(b)(7) under the Act, is hereinafter called
the "Final Prospectus"; and the abbreviated term sheet that satisfies the
requirements of Rule 434 under the Act is called the "Term Sheet". Any
preliminary form of the Final Prospectus which has heretofore been filed
pursuant to Rule 424(b) hereinafter is called the "Supplemented
Prospectus." Any reference herein to the Registration Statement, the Basic
Prospectus, any Supplemented Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein that were filed under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), on or before the date of this Agreement, or
the issue date of the Basic Prospectus, any Supplemented Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, the Supplemented Prospectus or the Final
Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act after the date of this Agreement, or the
date of such Registration Statement, Basic Prospectus, Supplemented
Prospectus or the Final Prospectus, as the case may be, and deemed to be
incorporated therein by reference.
(b) (i) When the Supplemented Prospectus and any amendment or
supplement thereto was filed with the Commission, the Supplemented
Prospectus, as amended or supplemented as of any such time, complied in all
material respects with the applicable requirements of the Act, the Exchange
Act and the respective rules and regulations thereunder, and did not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
2
<PAGE>
make the statements therein, in light of the circumstances under which they
were made, not misleading; (ii) when the Final Prospectus (or any Term
Sheet that is a part thereof) or any amendment or supplement to the Final
Prospectus is filed with the Commission pursuant to Rule 424(b), on the
date when the Final Prospectus is amended or supplemented, on the Closing
Date (as hereinafter defined) and the Date of Delivery (as hereinafter
defined), the Final Prospectus, as amended or supplemented as of any such
time, complied or will comply in all material respects with, the applicable
requirements of the Act, the Exchange Act and the respective rules and
regulations thereunder, and did not or will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, and
(iii) when the Registration Statement or any amendment thereto was or is
declared effective (including the filing of any document incorporated by
reference in the Registration Statement), the Registration Statement, as
amended as of any such time, complied or will comply in all material
respects with, the applicable requirements of the Act, the Exchange Act and
the respective rules and regulations thereunder, and did not or will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading; provided, however, that the Company
makes no representations or warranties as to the information contained in
or omitted from the Supplemented Prospectus, the Final Prospectus or the
Registration Statement or any amendment thereof or supplement thereto in
reliance upon and in conformity with information furnished in writing to
the Company by or on behalf of any Underwriter through the Representatives
specifically for use in connection with the preparation of the Supplemented
Prospectus, the Final Prospectus or the Registration Statement. The
Commission has not issued any order preventing or suspending the use of any
Supplemented Prospectus.
2. Purchase and Sale. (a) Subject to the terms and conditions and
-----------------
in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, the respective number
of the Initial Shares set forth opposite such Underwriter's name in Schedule II
hereto.
(b) The initial public offering price and the purchase price of the
Initial Shares shall be set forth in a separate written instrument (the "Pricing
Agreement") signed by the Representatives and the Company, the form of which is
attached hereto as Schedule III. From and after the execution and delivery of
the Pricing Agreement, this Agreement shall be deemed to include the Pricing
Agreement. The purchase price per share to be paid by the several Underwriters
for the Initial Shares shall be an amount equal to the initial public offering
price, less an amount per share to be determined by agreement among the
Representatives and the Company.
(c) In addition, on the basis of the representations and warranties
contained herein, and subject to the terms and conditions set forth herein, the
Company grants an option
3
<PAGE>
to the Underwriters, severally and not jointly, to purchase up to an additional
690,000 Option Shares at the same price per share determined as provided above
for the Initial Shares. The option granted hereby may, only for the purpose of
covering over-allotments, be exercised as to all or any part of the Option
Shares from time to time within thirty days after the date of the Final
Prospectus (or, if such 30th day shall be a Saturday or Sunday or a holiday, on
the next business day thereafter when the New York Stock Exchange is open for
trading), upon notice by the Representatives to the Company setting forth the
number of Option Shares as to which the several Underwriters are exercising the
option, and the time and date of payment and delivery thereof. Such time and
date of Delivery (the "Date of Delivery") shall be determined by the
Representatives but shall not be later than five full business days after the
exercise of such option and not in any event prior to the Closing Date. If the
option is exercised as to all or any portion of the Option Shares, the Option
Shares as to which the option is exercised shall be purchased by the
Underwriters severally and not jointly, in proportion to, as nearly as
practicable, their respective Initial Shares underwriting obligations as set
forth on Schedule II.
3. Delivery and Payment. Delivery of and payment for the Initial
--------------------
Shares shall be made on the date, at the time and at the location specified in
the Pricing Agreement, which date and time may be postponed by agreement between
the Representatives and the Company or as provided in Section 9 hereof (such
date and time of delivery and payment for the Initial Shares being herein called
the "Closing Date"). Delivery of the Initial Shares shall be made to the
Representatives for the respective accounts of the several Underwriters against
payment by the several Underwriters through the Representatives of the purchase
price therefor in the manner set forth in Schedule I hereto. One or more
certificates in definitive form for the Initial Shares that the several
Underwriters have agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the Representatives
request upon notice to the Company at least 48 hours prior to the Closing Date,
shall be delivered by or on behalf of the Company to the Representatives for the
respective accounts of the Underwriters.
The Company agrees to have the Initial Shares available for inspection,
checking and packaging by the Representatives in New York, New York, not later
than 1:00 PM on the business day prior to the Closing Date.
In addition, in the event that any or all of the Option Shares are
purchased by the Underwriters, delivery and payment for the Option Shares shall
be made at the office specified for delivery of the Initial Shares in the
Pricing Agreement, or at such other place as the Company and the Representatives
shall determine, on the Date of Delivery as specified in the notice from the
Representatives to the Company. Delivery of the Option Shares shall be made to
the Representatives against payment by the Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company in the manner set forth in Schedule I hereto. If the option is exercised
as to all or any portion of the Option Shares, one or more certificates in
definitive form for the Option Shares, in such denomination or denominations and
registered in such name or names as the Representatives request upon notice to
the Company at least 48 hours prior to the Date of Delivery, shall be delivered
by or
4
<PAGE>
on behalf of the Company to the Representatives for the respective accounts of
the Underwriters.
The Company agrees to have the Option Shares available for inspection,
checking and packaging by the Representatives in New York, New York, not later
than 1:00 PM on the business day prior to the Date of Delivery.
4. Agreements. The Company covenants and agrees with the several
----------
Underwriters that:
(a) During any time when a prospectus relating to the Shares is
required to be delivered under the Act, the Company (i) will comply with
all requirements imposed upon it by the Act and the Exchange Act and the
respective rules and regulations of the Commission thereunder to the extent
necessary to permit the continuance of sales of or dealings in the Shares
in accordance with the provisions hereof and of the Final Prospectus, as
then amended or supplemented, and (ii) will not file any amendment to the
Registration Statement, any amendment or supplement (including the Final
Prospectus) to the Basic Prospectus or the Term Sheet unless the Company
has furnished you a copy for your review prior to filing and will not file
any such proposed amendment, supplement or Term Sheet to which you
reasonably object. Subject to clause (ii) of the foregoing sentence, the
Company will cause the Final Prospectus (including any Term Sheet
constituting a part thereof) and any amendment or supplement thereto to be
filed with the Commission pursuant to Rules 434 and 424(b). The Company
will advise the Representatives promptly (i) when the Final Prospectus (or
any part thereof) or any amendment or supplement thereto shall have been
filed with the Commission, (ii) when any amendment to the Registration
Statement relating to the Shares shall have become effective, (iii) of any
request by the Commission for any amendment of the Registration Statement
or amendment of or supplement to the Final Prospectus or for any additional
information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any post
effective amendment thereto or any order directed at any document
incorporated by reference in the Registration Statement or the Final
Prospectus or any amendment or supplement thereto or any order preventing
or suspending the use of any Supplemented Prospectus or the Final
Prospectus or any amendment or supplement thereto or the institution or
threatening of any proceeding for that purpose and (v) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose. The Company will use its
best efforts to prevent the issuance by the Commission of any stop order
and, if issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Shares is
required to be delivered under the Act, any event occurs as a result of
which the Final Prospectus as then amended or supplemented would include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the
5
<PAGE>
circumstances under which they were made, not misleading, or if for any
other reason it shall be necessary to amend or supplement the Final
Prospectus to comply with the Act or the Exchange Act or the respective
rules and regulations thereunder, the Company promptly will notify the
Representatives thereof and will prepare and file with the Commission, at
the Company's expense, subject to the first sentence of paragraph (a) of
this Section 4, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance.
(c) The Company, as soon as practicable, will make generally available
to its security holders and to the Representatives a consolidated earnings
statement of the Company and its subsidiaries that satisfies the provisions
of Section 11(a) of the Act and Rule 158 thereunder.
(d) The Company will furnish to the Representatives and counsel for the
Underwriters, without charge, (i) copies of the Registration Statement
(including exhibits thereto) and each amendment thereto which shall become
effective on or prior to the Date of Delivery and (ii) so long as delivery
of a prospectus by an Underwriter or dealer may be required by the Act, as
many copies of any Supplemented Prospectus and the Final Prospectus and any
amendments thereof and supplements thereto as the Representatives may
reasonably request; it being understood that (without limiting the
application of the foregoing clause (ii) the Company, not later than (A)
6:00 PM, New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 10:00 AM, New
York City time, on such date or (B) 12 Noon, New York City time, on the
business day following the date of determination of the public offering
price, if such determination occurred after 10:00 AM, New York City time,
on such date, will deliver to the Underwriters, without charge, as many
copies of the Final Prospectus and any amendment or supplement thereto as
the Underwriters may reasonably request for purposes of confirming orders
that are expected to settle on the Closing Date. The Company will pay the
expenses of printing all documents relating to the offering.
(e) The Company will arrange for the qualification of the Shares for
offer and sale under the securities or blue sky laws of such jurisdictions
as the Representatives may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of the
Shares and will arrange for the determination of the legality of the Shares
for purchase by institutional investors; provided, however, that the
Company shall not be required to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action which would subject
it to general or unlimited service of process of any jurisdiction where it
is not now so subject.
(f) The Company will not, directly or indirectly, without the prior
written consent of Prudential Securities Incorporated, on behalf of the
Underwriters, offer, sell, offer to sell, contract to sell, pledge, grant
any option to purchase or otherwise sell or dispose (or announce any offer,
sale, offer of sale, contract of sale, pledge,
6
<PAGE>
grant of any option to purchase or other sale or disposition) of any shares
of Common Stock or any other capital stock of the Company or any securities
convertible into, or exchangeable or exercisable for, any shares of Common
Stock or other capital stock of the Company, for a period of 120 days after
the date hereof, except pursuant to this Agreement and except for issuances
pursuant to the exercise of employee stock options outstanding on the date
hereof and the grant of options to purchase shares of the Company's Common
Stock pursuant to the Company's 1991 Stock Option Plan or the grant of
Common Stock-based incentive awards pursuant to the 1995 Stock Incentive
Plan which options in each case are not exercisable or do not vest prior to
the expiration of 120 days from the date hereof; provided, however, that
-----------------
this provision shall not prohibit the Company from issuing shares of Common
Stock or other capital stock of the Company or any securities convertible
into, or exchangeable or exercisable for, any shares of Common Stock or
other capital stock of the Company in connection with an acquisition by the
Company. The Company will use its best efforts to obtain the agreements
referred to in Section 6(h) hereof prior to the Closing Date.
(g) The Company will cause the Shares to be duly included for quotation
in the Nasdaq Stock Market's National Market (the "Nasdaq National Market")
prior to the Closing Date.
(h) The Company will not, directly or indirectly, (i) take any action
designed to cause or result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale
of the Shares or (ii) (A) sell, bid for, purchase, or pay any person any
compensation for soliciting purchases of, the Shares or (B) pay or agree to
pay any person any compensation for soliciting another to purchase any
other securities of the Company (except in each case for the sale of Shares
under this Agreement).
5. Payment of Expenses. The Company will pay all costs and
-------------------
expenses incident to the performance of its obligations under this Agreement,
whether or not the transactions contemplated herein are consummated or this
Agreement is terminated pursuant to Section 10 hereof, including, but not
limited to, all costs and expenses incident to (i) the printing or other
production of documents with respect to the transactions, including any costs of
printing the registration statement originally filed with respect to the Shares
and any amendment thereto, the Basic Prospectus, the Supplemented Prospectus and
the Final Prospectus and any amendment or supplement thereto, this Agreement,
(ii) all arrangements relating to the delivery to the Underwriters of copies of
the foregoing documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company, (iv)
preparation, issuance and delivery to the Underwriters of any certificates
evidencing the Shares, including transfer agent's and registrar's fees, (v) the
qualification of the Shares under state securities and blue sky laws, including
filing fees and fees and disbursements of counsel for the Underwriters relating
thereto, (vi) the filing fees of the Commission relating to the Shares, (vii)
the quotation of the Shares on the Nasdaq National Market, (viii) meetings with
prospective investors in the Shares (other than shall have been
7
<PAGE>
specifically approved by the Representatives to be paid for by the Underwriters)
and (ix) advertising relating to the offering of the Shares (other than shall
have been specifically approved by the Representatives to be paid for by the
Underwriters). If the sale of the Shares provided for herein is not consummated
because any condition to the obligations of the Underwriters set forth in
Section 6 hereof is not satisfied, because this Agreement is terminated pursuant
to Section 10(a)(i) or (ii) hereof or because of any failure, refusal or
inability on the part of the Company to perform all obligations and satisfy all
conditions on their part to be performed or satisfied hereunder other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally upon demand for all reasonable out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the
Shares. The Company shall not in any event be liable to any of the Underwriters
for the loss of anticipated profits from the transactions covered by this
Agreement.
6. Conditions to the Obligations of the Underwriters. The
-------------------------------------------------
obligations of the Underwriters to purchase the Initial Shares shall be subject,
in the Representatives' sole discretion, to the accuracy in all material
respects of the representations and warranties on the part of the Company
contained herein as of the date hereof, as of the date of the effectiveness of
any amendment to the Registration Statement filed prior to the Closing Date
(including the filing of any document incorporated by reference therein) and as
of the Closing Date, to the accuracy in all material respects of the statements
of the Company and the Company's officers made in any certificates pursuant to
the provisions hereof, to the performance by the Company in all material
respects of its obligations hereunder and to the following additional
conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto and no order directed at
any document incorporated by reference in the Registration Statement or the
Final Prospectus or any amendment or supplement thereto shall have been
issued and no proceedings for that purpose shall have been instituted or
threatened; and the Final Prospectus shall have been filed with the
Commission within the time period and in the manner prescribed by the
Commission.
(b) The Company shall have furnished to the Representatives an opinion,
dated the Closing Date, of Eric R. Elwin, Esq., Vice President and
Corporate Counsel for the Company, in substantially the form attached as
Exhibit A hereto.
(c) The Company shall have furnished to the Representatives an opinion,
dated the Closing Date, of Stroock & Stroock & Lavan, counsel for the
Company, substantially in the form attached as Exhibit B hereto.
(d) The Company shall have furnished to the Representatives an opinion,
dated the Closing Date, of Sills Cummis Zuckerman Radin Tischman Epstein &
Gross, New Jersey counsel for the Company, substantially in the form
attached as Exhibit C hereto.
8
<PAGE>
(e) The Representatives shall have received from Cleary, Gottlieb,
Steen & Hamilton, counsel for the Underwriters, such opinion or opinions,
dated the Closing Date, with respect to the issuance and sale of the
Initial Shares, the Registration Statement, the Final Prospectus and other
related matters as the Representatives may reasonably require, and the
Company shall have furnished to such counsel such documents as counsel for
the Underwriters may request for the purpose of enabling them to pass upon
such matters.
(f) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chief Executive Officer and the
Chief Financial Officer of the Company, dated the Closing Date, to the
effect that the signers of such certificate have carefully examined the
Registration Statement, the Final Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date;
and the Company has complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied at or prior to
the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement, as amended, and no order directed at any
document incorporated by reference in the Registration Statement or the
Final Prospectus or any amendment or supplement thereto has been issued
and no proceedings for that purpose have been instituted or threatened
or, to the best of the Company's knowledge, are contemplated by the
Commission; and
(iii) subsequent to the respective dates as of which information
is given in the Registration Statement and the Final Prospectus, there
has not been any material adverse change, or any development involving
a prospective material adverse change, in the condition (financial or
otherwise), management, net worth or results of operations of the
Company and its subsidiaries, considered as a whole, except in each
case as described in or contemplated by the Final Prospectus.
(g) At the date hereof and the Closing Date, KPMG Peat Marwick LLP
shall have furnished to the Representatives a letter or letters (which may
refer to letters previously delivered to one or more of the
Representatives), dated, respectively, the date hereof and the Closing
Date, in form and substance satisfactory to the Representatives, confirming
that the response, if any, to Item 10 of the Registration Statement is
correct insofar as it relates to them and to the effect that:
(i) they are independent accountants within the meaning of the Act
and the Exchange Act and the respective applicable published rules and
regulations thereunder;
9
<PAGE>
(ii) in their opinion, the consolidated financial statements of
the Company and its subsidiaries (the "Financial Statements") in the
Company's report on Form 10-K for the year ended December 31, 1995,
which Financial Statements have been audited by them and incorporated
by reference in the Registration Statement and the Final Prospectus,
comply as to form in all material respects with the applicable
accounting requirements of the Act and the regulations thereunder with
respect to registration statements on Form S-3 and the Exchange Act and
the related published rules and the regulations thereunder;
(iii) on the basis of certain specified procedures (but not an
audit in accordance with generally accepted auditing standards)
consisting of:
(a) reviewing in accordance with standards established by
the American Institute of Certified Public Accountants any interim
unaudited consolidated condensed financial statements of the
Company and its consolidated subsidiaries as indicated in their
reports incorporated in the Registration Statement and the Final
Prospectus;
(b) reading the latest available interim unaudited
consolidated condensed financial statements of the Company and its
consolidated subsidiaries;
(c) reading the amounts included in any unaudited "capsule"
information included in the Registration Statement and the Final
Prospectus and of any unaudited consolidated financial statements
of the Company and its consolidated subsidiaries for the periods
from which such amounts are derived, carrying out certain
specified procedures (which do not constitute an examination made
in accordance with generally accepting auditing standards) that
would not necessarily reveal matters of significance with respect
to the comments set forth in this paragraph (iii);
(d) reading the minutes of the meetings of the shareholders,
the board of directors, executive committee and audit committee of
the Company and the boards of directors and executive committees
of its consolidated subsidiaries as set forth in the minute books
through a specified date not more than five business days prior to
the date of delivery of such letter;
(e) making inquiries of certain officials of the Company and
its consolidated subsidiaries who have responsibility for
financial and accounting matters of the Company and its
consolidated subsidiaries regarding the specific items for which
representations are requested below;
10
<PAGE>
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that: (1) the unaudited
consolidated condensed financial statements of the Company and its
consolidated subsidiaries included in the Registration Statement and
the Final Prospectus do not comply in form in all material respects
with the applicable accounting requirements of the Act, the Exchange
Act and the related published rules and regulations thereunder, or are
not in conformity with generally accepted accounting principles applied
on a basis substantially consistent with that of the audited
consolidated financial statements included in the Registration
Statement and the Final Prospectus, (2) the amounts included in the
unaudited "capsule" information included in the Registration Statement
and the Final Prospectus do not agree with the amounts set forth in the
unaudited consolidated financial statements for those same periods or
are not in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the
corresponding amounts in the audited consolidated financial statements
included in the Registration Statement and the Final Prospectus, (3) at
a specified date not more than five business days prior to the date of
the delivery of such letter, there were any changes in the capital
stock, notes payable or subordinated debt (other than scheduled
repayments of such debt) or any decreases in total assets or
shareholders' equity of the Company and its consolidated subsidiaries
as compared with the amounts shown on the June 30, 1996 unaudited
consolidated balance sheet included in the Registration Statement and
the Final Prospectus or (4) for the period from July 1, 1996 to such
specified date, there were any decreases, as compared with the
corresponding period in 1995, in consolidated gain on sale of
receivables, finance income, fees earned or other income or increases
in salaries and employee benefits, other operating expenses, provision
for credit losses or interest expense or decreases in income before
taxes or net income of the Company and its consolidated subsidiaries
except in all instances for changes or decreases set forth in such
letter.
(iv) The letter shall also state that KPMG Peat Marwick LLP has
carried out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information which are included or incorporated by reference in the
Registration Statement and Final Prospectus and which are specified by
the Representatives and has found such amounts, percentages and
financial information to be in agreement with the relevant accounting,
financial and other records of the Company and its subsidiaries
identified in such letter.
In the event that the letters referred to above set forth any such
changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriters that (A) such letters shall be accompanied
by a written explanation of the Company as to the significance thereof,
unless the Representatives deem such explanation unnecessary, and (B) such
changes, decreases or increases do not, in the
11
<PAGE>
sole judgment of the Representatives, make it impractical or inadvisable to
proceed with the purchase and delivery of the Shares as contemplated by the
Registration Statement, as amended as of the date hereof.
References to the Registration Statement and the Final Prospectus in
this paragraph (f) with respect to either letter referred to above shall
include any amendment or supplement thereto at the date of such letter.
(h) The Representatives shall have received from each person who is a
director or executive officer of the Company an agreement to the effect
that such person will not, directly or indirectly, without the prior
written consent of Prudential Securities Incorporated, offer, sell, pledge,
offer to sell, contract to sell, grant any option to purchase or otherwise
sell or dispose (or announce any offer, sale, offer of sale, contract of
sale, pledge, grant of an option to purchase or other sale or disposition)
of any shares of Common Stock or any other capital stock of the Company or
any securities convertible into, or exchangeable or exercisable for, any
shares of Common Stock or other capital stock of the Company, including any
such securities beneficially owned or otherwise controlled by them, for a
period of 30 days after the date of this Agreement, except that the
directors and executive officers of the Company may, without the prior
written consent of Prudential Securities Incorporated, (A) transfer shares
of Common Stock to members of their respective immediate families or to
trusts for the benefit of their respective immediate families; provided,
that, any transferee agrees to the transfer restrictions described above,
(B) use previously-owned shares of Common Stock for the purpose of
exercising options to purchase the Company's Common Stock or using shares
of Common Stock to pay withholding taxes with respect to the issuance of
shares upon the exercise of options and/or (C) continue to hold shares of
Common Stock in any margin account presently maintained by a director or
executive officer or transfer shares of Common Stock into any such
brokerage account; provided that no sale, offer to sell, contract to sell
or grant of an option to purchase or other sale or disposition of such
shares shall be made without the prior written consent of Prudential
Securities Incorporated, on behalf of the Underwriters.
(i) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions, certificates, letters and documents mentioned above
or elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be canceled
at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
telegraph confirmed in writing.
12
<PAGE>
7. Conditions to Purchase of Option Shares. In the event the
---------------------------------------
Underwriters exercise the option granted in Section 2(c) hereof to purchase
all or any portion of the Option Shares and the Date of Delivery determined
by the Representatives pursuant to Section 2 is later than the Closing
Date, the obligations of the several Underwriters to purchase and pay for
the Option Shares that they shall have respectively agreed to purchase
hereunder are subject to the accuracy in all material respects of the
representations and warranties of the Company contained herein, to the
performance by the Company in all material respects of its obligations
hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto and no order directed at
any document incorporated by reference in the Registration Statement or the
Final Prospectus or any amendment or supplement thereto shall have been
issued and no proceedings for that purpose shall have been instituted or
threatened; and the Final Prospectus shall have been filed with the
Commission within the time period and in the manner prescribed by the
Commission.
(b) At the Date of Delivery, the Representatives shall have received,
each dated the Date of Delivery and relating to the Option Shares:
(i) the favorable opinion of Eric R. Elwin, Esq., Vice President
and Corporate Counsel to the Company, in form and substance
satisfactory to the Representatives and counsel for the Underwriters,
to the same effect as the opinion required by Section 6(b);
(ii) the favorable opinion of Stroock & Stroock & Lavan, counsel
for the Company, in form and substance satisfactory to the
Representatives and counsel for the Underwriters, to the same effect as
the opinion required by Section 6(c);
(iii) the favorable opinion of Sills Cummis Zuckerman Radin
Tischman Epstein & Gross, New Jersey counsel for the Company, in form
and substance satisfactory to the Respresentatives and counsel for the
Underwriters, to the same effect as the opinion required by Section
6(d);
(iv) the favorable opinion of Cleary, Gottlieb, Steen & Hamilton,
counsel for the Underwriters, to the same effect as the opinion
required by Section 6(e);
(v) a certificate, of the Chairman of the Board and Chief
Executive Officer or Senior Vice President of the Company and of the
principal financial or accounting officer of the Company with respect
to the matters set forth in Section 6(f);
13
<PAGE>
(vi) a letter from KPMG Peat Marwick LLP, in form and substance
satisfactory to the Representatives and counsel for the Underwriters,
and substantially the same in scope and substance as the letter
furnished to the Representatives pursuant to Section 6(g) except that
the "specified date" in the letter furnished pursuant to this Section
7(b)(vi) shall be a date not more than five days prior to the Date of
Delivery; and
(vii) such other information, certificates and documents as the
Representatives may reasonably request.
If any of the conditions specified in this Section 7 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions, certificates, letters and documents mentioned above
or elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be canceled
at, or at any time prior to, the Date of Delivery by the Representatives.
Notice of such cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.
8. Indemnification and Contribution. (a) The Company agrees to
--------------------------------
indemnify and hold harmless each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages, liabilities, joint or several, to which they or
any of them may become subject under the Act, the Exchange Act or other Federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement (A) made by the Company in Section 1 of this Agreement, (B) of a
material fact contained in the Registration Statement for the registration of
the Shares as originally filed or in any amendment thereof, or in the Basic
Prospectus, the Supplemented Prospectus or the Final Prospectus, or in any
amendment of any of them or supplement to any of them, (C) of a material fact
contained in any application or other document, or any amendment or supplement
thereto, executed by the Company or based upon written information furnished by
or on behalf of the Company filed in any jurisdiction in order to qualify the
Shares under the securities or blue sky laws thereof or filed with the
Commission or any securities association, securities exchange or state
securities commission (each, an "Application") or (D) of a material fact
contained in any audio or visual materials supplied by the Company to the
Representatives expressly for use in connection with the marketing of the
Shares, including without limitation, slides, videos, films and tape recordings,
or (ii) the omission or alleged omission to state in the Registration Statement
or in any amendment thereof, or in the Basic Prospectus, the Supplemented
Prospectus or the Final Prospectus, or in any amendment of any of them or
supplement to any of them, or in any Application, a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
agrees to reimburse, as incurred, each such indemnified party for any legal or
other expenses reasonably incurred by it in connection with investigating or
defending or appearing as a third party witness
14
<PAGE>
in connection with any such loss, claim, damage, liability or action; provided,
however, that (i) the Company will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon
any such untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement or in any amendment thereof, or in
the Basic Prospectus, the Supplemented Prospectus or the Final Prospectus, or in
any amendment of any of them or supplement to any of them or in any Application
in reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter through the Representatives
specifically for use in connection with the preparation thereof, and (ii) the
Company will not be liable to any Underwriter or any person controlling such
Underwriter with respect to any such untrue statement or omission made in the
Basic Prospectus or any Supplemented Prospectus that is corrected in the Final
Prospectus (or any amendment or supplement thereto) if the person asserting any
such loss, claim, damage or liability purchased Shares from such Underwriter but
was not sent or given a copy of the Final Prospectus (as amended or
supplemented), other than the documents incorporated by reference therein, at or
prior to the written confirmation of the sale of such Shares to such person in
any case where such delivery of the Final Prospectus (as amended or
supplemented) is required by the Act, unless such failure to deliver the Final
Prospectus (as amended or supplemented) was a result of noncompliance by the
Company with Section 4(b) and (d) of this Agreement. This indemnity agreement
will be in addition to any liability which the Company may otherwise have. The
Company will not, without the prior written consent of the Underwriter or
Underwriters purchasing, in the aggregate, more than fifty percent (50%) of the
Shares, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not any such Underwriter or
any person who controls any such Underwriter within the meaning of the Act or of
the Exchange Act is a party to such claim, action, suit or proceeding), unless
such settlement, compromise or consent includes an unconditional release of all
of the Underwriters and such controlling persons from all liability arising out
of such claim, action, suit or proceeding.
(b) Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who signs
the Registration Statement and each person who controls the Company within the
meaning of either the Act or the Exchange Act, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereto, any
Supplemented Prospectus or the Final Prospectus or any amendment or supplement
thereto, or any Application or (ii) the omission or the alleged omission to
state therein a material fact required to be stated in the Registration
Statement or any amendment thereto, any Supplemented Prospectus or the Final
Prospectus or any amendment or supplement thereto, or any Application or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information relating to the Underwriter furnished to the
Company by or on behalf of the Underwriter through the Representatives
specifically for use therein; and, subject to the
15
<PAGE>
limitation set forth immediately preceding this clause, will reimburse, as
incurred, each such indemnified party for any legal or other expenses reasonably
incurred by it in connection with investigating or defending or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or any action in respect thereof. This indemnity agreement will be in addition
to any liability which such Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 8. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and, to the extent
that it may elect by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, jointly with
any other indemnifying party that has given similar written notice, to assume
the defense thereof, with counsel satisfactory to such indemnified party;
provided, however, that if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying party
to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel (in addition to local counsel) in any one action
or separate but substantially similar actions in the same jurisdiction arising
out of the same general allegations or circumstances, approved by the
Representatives in the case of subparagraph (a) of this Section 8, representing
the indemnified parties under subparagraph (a) who are parties to such action),
(ii) the indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense of
the indemnifying party. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such action effected by such indemnified party
without the consent of the indemnifying party.
16
<PAGE>
(d) In circumstances in which the indemnity agreement provided for in the
preceding paragraphs of this Section 8 is unavailable or insufficient, for any
reason, to hold harmless an indemnified party in respect of any losses, claims,
damages or liabilities (or actions in respect thereof), each indemnifying party,
in order to provide for just and equitable contribution, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect (i) the relative benefits received by
the indemnifying party or parties on the one hand and the indemnified party on
the other from the offering of the Shares or (ii) if the allocation provided by
the foregoing clause (i) is not permitted by applicable law, not only such
relative benefits but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions or alleged statements or omissions that
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), 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 shall be deemed to be in the same proportion as the total proceeds from
the offering (before deducting expenses) received by the Company bear to the
total underwriting discounts and commissions received by the Underwriters. The
relative fault of the parties shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters, the parties' relative intents,
knowledge, access to information and opportunity to correct or prevent such
statement or omission, and any other equitable considerations appropriate in the
circumstances. The Company and the Underwriters agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to above in this paragraph (d).
Notwithstanding any other provision of this paragraph (d), no Underwriter shall
be obligated to make contributions hereunder that in the aggregate exceed the
total public offering price of the Shares purchased by such Underwriter under
this Agreement, less the aggregate amount of any damages that such Underwriter
has otherwise been required to pay in respect of the same or any substantially
similar claim, and no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute hereunder are several in proportion to
their respective underwriting obligations and not joint, and contributions among
Underwriters shall be governed by the provisions of the Prudential Securities
Incorporated Master Agreement Among Underwriters. For purpose of this paragraph
(d), each person, if any, who controls an Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange 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
Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Company.
17
<PAGE>
9. Default of Underwriters. If one or more Underwriters default in
-----------------------
their obligations to purchase Initial Shares or Option Shares hereunder and the
aggregate number of such Shares that such defaulting Underwriter or Underwriters
agreed but failed to purchase is ten percent or less of the aggregate number of
Initial Shares or Option Shares to be purchased by all of the Underwriters at
such time hereunder, the other Underwriters may make arrangements satisfactory
to the Representatives for the purchase of such Shares by other persons (who may
include one or more of the non-defaulting Underwriters, including the
Representatives), but if no such arrangements are made by the Closing Date or
the related Date of Delivery, as the case may be, the other Underwriters shall
be obligated severally in proportion to their respective commitments hereunder
to purchase the Initial Shares or Option Shares that such defaulting Underwriter
or Underwriters agreed but failed to purchase. If one or more Underwriters so
default with respect to an aggregate number of Shares that is more than ten
percent of the aggregate number of Initial Shares or Option Shares, as the case
may be, to be purchased by all of the Underwriters at such time hereunder, and
if arrangements satisfactory to the Representatives are not made within 36 hours
after such default for the purchase by other persons (who may include one or
more of the non-defaulting Underwriters, including the Representatives) of the
Shares with respect to which such default occurs, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Company
other than as provided in Section 11 hereof. In the event of any default by one
or more Underwriters as described in this Section 9, the Representatives shall
have the right to postpone the Closing Date or the Date of Delivery, as the case
may be, established as provided in Section 3 hereof, for not more than seven
business days in order that any necessary changes may be made in the
arrangements or documents for the purchase and delivery of the Initial Shares or
Option Shares, as the case may be. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section 9. Nothing herein shall relieve any defaulting Underwriter from
liability for its default.
10. Termination. (a) This Agreement may be terminated with respect to
-----------
the Initial Shares or any Option Shares in the sole discretion of the
Representatives by notice to the Company given prior to the Closing Date or the
related Date of Delivery, respectively, in the event that the Company shall have
failed, refused or been unable to perform all obligations and satisfy all
conditions on its part to be performed or satisfied hereunder at or prior
thereto or, if at or prior to the Closing Date or such Date of Delivery,
respectively:
(i) there shall have been in the sole judgment of the
Representatives any material adverse change, or any development
involving a prospective material adverse change, in the condition
(financial or otherwise), management, net worth or results of
operations of the Company and its subsidiaries, taken as a whole,
except in each case as described in or contemplated by the Final
Prospectus (exclusive of any amendment or supplement thereto);
(ii) trading in the Common Stock shall have been suspended by the
Commission or the Nasdaq National Market;
18
<PAGE>
(iii) trading in securities generally on the New York Stock
Exchange or the Nasdaq National Market shall have been suspended or
minimum or maximum prices shall have been established on either such
exchange or market system;
(iv) a banking moratorium shall have been declared by New York or
United States authorities; or
(v) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or (C) any other calamity or crisis or
material adverse change in general economic, political or financial
conditions having an effect on the U.S. financial markets that, in the
sole judgment of the Representatives, makes it impractical or
inadvisable to proceed with the public offering or the delivery of the
Shares as contemplated by the Registration Statement, as amended as of
the date hereof.
(b) Termination of this Agreement pursuant to this Section 10 shall be
without liability of any party to any other party except as provided in Section
11 hereof.
11. Representations and Indemnities to Survive. The respective
------------------------------------------
agreements, representations, warranties, indemnities and other statements of the
Company, its officers and the Underwriters set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Underwriter or the Company or any of the officers,
directors or controlling persons referred to in Section 8 hereof, and will
survive delivery of and payment for the Shares. The provisions of Section 5 and
8 hereof and this Section 11 shall survive the termination or cancellation of
this Agreement
12. Information Supplied by Underwriters. The statements set forth in
------------------------------------
the last paragraph on the front cover page and in the paragraphs relating to
stabilization and passive market making on the inside front cover page and under
the heading "Underwriting," in any Supplemented Prospectus or the Final
Prospectus (to the extent such statements relate to the Underwriters) constitute
the only information furnished by or on behalf of any Underwriter through the
Representatives to the Company for the purposes of Sections 1(b) and 8 hereof.
The Underwriters confirm that such statements (to such extent) are correct.
13. Notices. All communications hereunder will be in writing and
-------
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telegraphed and confirmed to them, at the address specified in
Schedule I hereto; or, if sent to the Company, will be mailed, delivered or
telegraphed and confirmed to it at The Money Store Inc., 2840 Morris Avenue,
Union, New Jersey 07083, Attention of the Secretary; with a copy to Stroock &
Stroock & Lavan, 7 Hanover Square, New York, New York 10004, Attention: James R.
Tanenbaum.
19
<PAGE>
14. Successors. This Agreement shall inure to the benefit of and shall
----------
be binding upon the several Underwriters, the Company and each of their
respective successors and legal representatives and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained, this Agreement and all conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company contained in Section 8 of this Agreement shall
also be for the benefit of any person or persons who control any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
and (ii) the indemnities of the Underwriters contained in Section 8 of this
Agreement shall also be for the benefit of the directors of the Company, the
officers of the Company who have signed the Registration Statement and any
person or person who control the Company within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act. No purchaser of Shares from any
Underwriter shall be deemed a successor because of such purchase.
15. Applicable Law. This Agreement will be governed by and construed
--------------
in accordance with the internal laws of the State of New York, without giving
effect to principles of conflict of laws.
20
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
THE MONEY STORE INC.
By: /s/ MORTON DEAR
______________________________
Morton Dear
Executive Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
PRUDENTIAL SECURITIES INCORPORATED
BEAR, STEARNS & CO. INC.
MONTGOMERY SECURITIES
OPPENHEIMER & CO., INC.
By: PRUDENTIAL SECURITIES INCORPORATED
By: /s/ JEAN-CLAUDE CANFIN
__________________________________
Jean-Claude Canfin, Director
For itself and on behalf of the Underwriters
21
<PAGE>
SCHEDULE I
Underwriting Agreement dated October 30, 1996
Registration Statement No. 33-98972
Representatives: Prudential Securities Incorporated
Bear, Stearns & Co. Inc.
Montgomery Securities
Oppenheimer & Co., Inc.
Address of Representatives: c/o Prudential Securities Incorporated
One New York Plaza
New York, New York 10292
Title, Purchase Price and Description of Shares:
Title: $1.72 Mandatory Convertible Preferred Stock
Purchase price shall be paid by wire transfer of federal funds to accounts
previously designated to the Representatives by the Company.
Other provisions:
Closing Date, Time and Location: November 5, 1996
9:30 A.M., New York City time
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, New York 10006
Additional items to be covered by the letter from KPMG Peat Marwick LLP
delivered pursuant to Section 6(g) at the time this Agreement is executed:
<PAGE>
SCHEDULE II
Aggregate Number
of Initial Shares to be
Underwriter Purchased
- ------------------------------------- -----------------------
Prudential Securities Incorporated 1,075,000
Bear, Stearns & Co. Inc. 1,075,000
Montgomery Securities 1,075,000
Oppenheimer & Co., Inc. 1,075,000
CS First Boston Corporation 100,000
Merrill Lynch, Pierce, Fenner & Smith 100,000
Incorporated
Salomon Brothers Inc 100,000
Total 4,600,000
=========
<PAGE>
EXHIBIT 1.2
SCHEDULE III
4,600,000 Shares
The Money Store Inc.
(a New Jersey corporation)
$1.72 Mandatory Convertible Preferred Stock
PRICING AGREEMENT
-----------------
October 30, 1996
PRUDENTIAL SECURITIES INCORPORATED
BEAR, STEARNS & CO. INC.
MONTGOMERY SECURITIES
OPPENHEIMER & CO., INC.
As Representatives of the several Underwriters
c/o Prudential Securities Incorporated
One New York Plaza
New York, New York 10292
Dear Sirs:
Reference is made to the Underwriting Agreement, dated October 30,
1996 (the "Underwriting Agreement"), relating to the purchase by the several
Underwriters named in Schedule II thereto (the "Underwriters"), for whom you are
acting as representatives (the "Representatives"), of the above shares of $1.72
Mandatory Convertible Preferred Stock (the "Initial Shares") of The Money Store
Inc. (the "Company").
We confirm that the Closing Date (as defined in Section 3 of the
Underwriting Agreement) shall be at 9:30 AM., New York City time, on November 5,
1996 at the offices of Cleary, Gottlieb, Steen & Hamilton.
Pursuant to Section 2 of the Underwriting Agreement, the Company
agrees with each Underwriter as follows:
1. The initial public offering price per share for the Initial
Shares, determined as provided in said Section 2, shall be $26.50.
2. The purchase price per share for the Initial Shares to be paid by
the several Underwriters shall be $25.64, being an amount equal to the initial
public offering price set forth above less $0.86 per share.
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and deliver to Mr. Morton Dear a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Company in accordance with its terms.
Very truly yours,
THE MONEY STORE INC.
By: /s/ MORTON DEAR
__________________________
Morton Dear
Executive Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first written
above.
PRUDENTIAL SECURITIES INCORPORATED
BEAR, STEARNS & CO. INC.
MONTGOMERY SECURITIES
OPPENHEIMER & CO., INC.
By: PRUDENTIAL SECURITIES INCORPORATED
By: /s/ JEAN-CLAUDE CANFIN
____________________________________
Jean-Claude Canfin, Director
For itself and on behalf of the Underwriters
<PAGE>
EXHIBIT A
Form of opinion of Eric R. Elwin, Esq.
pursuant to Section 6(b) of the Underwriting Agreement
1. The Company has been duly incorporated and is validly existing and in good
standing under the laws of the State of New Jersey.
2. The Company has all requisite corporate power and authority to issue the
Shares, to issue the shares of Common Stock issuable upon conversion of the
Shares, to execute, deliver and perform its obligations under the
Underwriting Agreement and the Certificate of Designations for the Shares
and to carry on its business and own or lease its real property as
described in the Registration Statement and the Final Prospectus.
3. Each of the subsidiaries listed on Exhibit ___ hereto (the "Material
Subsidiaries") which is incorporated in the State of New Jersey (the "New
Jersey Material Subsidiaries") has been duly incorporated and is validly
existing and in good standing under the laws of the State of its
incorporation.
4. Each New Jersey Material Subsidiary has all requisite corporate power and
authority to carry on its respective businesses and own or lease its
respective real property as described in the Registration Statement and the
Final Prospectus.
5. The issued shares of capital stock of each New Jersey Material Subsidiary
have been duly authorized and validly issued, are fully paid and
nonassessable, and are owned beneficially directly by the Company free and
clear of any perfected security interests or, to my knowledge, any other
security interests, liens, encumbrances or claims.
6. The Company has authorized capital stock as set forth in the Final
Prospectus under the caption "Capitalization"; all of the issued shares of
capital stock of the Company have been duly authorized and validly issued
and are fully paid and nonassessable and were not issued in violation of or
subject to any preemptive or other rights to subscribe for or purchase
securities.
7. The Shares have been duly authorized by all necessary corporate action of
the Company and, when issued and delivered to and paid for by the
Underwriters pursuant to the Underwriting Agreement, will be validly
issued, fully paid and nonassessable; the certificates for the Shares are
in valid and sufficient form; the shares of Common Stock issuable upon
conversion of the Shares have been duly authorized and reserved for
issuance upon conversion of the Shares and, when issued upon conversion,
will be validly issued, fully paid and nonassessable; no holders of the
outstanding shares of capital stock of the Company are entitled as such to
any preemptive or other rights to subscribe for or purchase any of the
Shares or any shares of Common Stock issuable upon conversion of the
Shares; and no holders of securities of the Company are entitled to have
such securities registered under the Registration Statement.
<PAGE>
8. The statements included in the Basic Prospectus under the captions
"Description of Securities--Common Stock" and "Description of Securities--
Preferred Stock", insofar as such statements purport to summarize certain
provisions of the capital stock of the Company, provide a fair summary of
such provisions.
9. The Statements included in the Final Prospectus under the caption
"Description of Preferred Shares", insofar as such statements purport to
summarize certain provisions of the Shares, provide a fair summary of such
provisions.
10. The execution and delivery of the Underwriting Agreement and the
Certificate of Designations for the Shares and the consummation of the
transactions contemplated thereby have been duly authorized by all
necessary corporate action of the Company; the Underwriting Agreement and
the Certificate of Designations for the Shares have been duly executed and
delivered by the Company; and the Certificate of Designations for the
Shares has been duly filed with the Secretary of State of the State of New
Jersey as an amendment to the Company's Certificate of Incorporation.
11. The issuance, offering and sale of the Shares to the Underwriters by the
Company pursuant to the Underwriting Agreement, the issuance of the shares
of Common Stock issuable upon conversion of the Shares, the compliance by
the Company with the other provisions of the Underwriting Agreement and the
consummation of the other transactions therein contemplated do not (i)
require the consent, approval, authorization, registration or qualification
of or with any governmental authority, except as may be required under
federal or state securities or blue sky laws (as to which I express no
opinion), (ii) conflict with or violate (A) the Certificate of
Incorporation, the Bylaws or the charter documents or bylaws of any New
Jersey Material Subsidiary, or (B) any statute, rule or regulation
applicable to the Company or any of the Material Subsidiaries, or (C) any
judgment, decree or order of any court or other governmental authority or
any arbitrator and applicable to the Company or any of the Material
Subsidiaries, or (iii) conflict with or result in a breach or violation of
any of the terms and provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, lease or other agreement or instrument
to which the Company or any of the Material Subsidiaries or any of their
respective properties are bound; except in the case of clauses (ii)(C) or
(iii) for such conflicts, violations, breaches, defaults or liens that,
individually or in the aggregate, will not have a material adverse effect
on the Company and its subsidiaries taken as a whole.
12. To my knowledge, after due inquiry, no Material Subsidiary of the Company
is currently prohibited, directly or indirectly, from paying any dividends
to the Company, from making any other distribution on such Material
Subsidiary's capital stock, from repaying to the Company any loans or
advances to such Material Subsidiary from the Company or from transferring
any of such Material Subsidiary's property or assets to the Company or any
other Material Subsidiary of the Company, except as described in or
contemplated by the Final Prospectus.
<PAGE>
13. To my knowledge, after due inquiry, neither the Company nor any of the
Material Subsidiaries is in violation of any federal or state law or
regulation relating to their respective lending activities, including,
without limitation, rules and regulations of the United States Small
Business Administration, rules and regulations of the Guaranteed Student
Loan Program and applicable banking laws, rules and regulations, except for
any such violation of law or regulation which would not, individually or in
the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
14. To my knowledge, after due inquiry, the Company and each of its
subsidiaries possesses all certificates, authorizations and permits issued
by the appropriate federal, state or foreign regulatory authorities
necessary to conduct their respective businesses as described in the Final
Prospectus, and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
15. To my knowledge, after due inquiry, no default exists, and no event has
occurred which, with notice or lapse of time or both, would constitute a
default in the due performance and observance of any term, covenant or
condition of any indenture, mortgage, deed of trust, lease or other
agreement or instrument to which the Company or any of the Material
Subsidiaries is a party or by which the Company or any of the Material
Subsidiaries or any of their respective properties is bound or may be
affected, except for defaults which would not, individually or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
16. There is no pending or, to my knowledge, threatened action, suit or
proceeding before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its subsidiaries or any of
their respective properties of a character required to be described in the
Registration Statement or the Final Prospectus; and, to my knowledge, there
is no contract or other document of a character required to be described in
the Registration Statement or the Final Prospectus, or to be filed as an
exhibit to the Registration Statement, which is not described or filed as
required.
17. The statements set forth under the subheadings "Home Equity Loans," "SBA
Loans," "Student Loans," "Loan Funding and Borrowing Arrangements,"
"Regulation" and "Environmental Policies" under the heading "Item 1.
Business" and under the heading "Item 3. Legal Proceedings" in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995,
insofar as such statements constitute a summary of the legal matters,
documents or proceedings referred to therein, provide a fair summary of
such legal matters, documents and proceedings.
18. Each of the Material Subsidiaries is duly qualified and in good standing as
a foreign corporation in each state listed on Exhibit ___ hereto (except as
otherwise indicated on Exhibit ___ hereto) and (ii) to my knowledge, after
due inquiry, in each other jurisdiction
<PAGE>
where each such entity owns or leases real property or where the conduct of
its business requires such qualification, except where the failure to be so
qualified or in good standing will not have a material adverse effect on
the Company and its subsidiaries, taken as a whole.
19. Insofar as any of the foregoing opinions relate to the validity or issuance
of the Shares under the law of the State of New Jersey, I have, with the
Underwriters' consent, relied as to all such matters on the opinion of
Sills Cummis Zuckerman Radin Tischman Epstein & Gross, special New Jersey
counsel to the Company.
<PAGE>
EXHIBIT B
Form of opinion of Stroock & Stroock & Lavan
pursuant to Section 6(c) of the Underwriting Agreement
1. Each of the subsidiaries of the Company listed on Exhibit ___ hereto (the
"Material Subsidiaries") that is incorporated under the laws of the State of
Delaware (the "Delaware Material Subsidiaries") has been duly incorporated and
is validly existing and in good standing under the laws of the State of
Delaware.
2. Each Delaware Material Subsidiary has all requisite corporate power to
carry on its business and own or lease its real property as described in the
Registration Statement and the Final Prospectus.
3. The issued shares of capital stock of each Delaware Material Subsidiary
have been duly authorized and validly issued, are fully paid and nonassessable
and are, to our knowledge, owned, directly or indirectly, beneficially by the
Company free and clear of any perfected security interests or any other security
interests, liens, encumbrances or claims.
4. All of the issued shares of capital stock of the Company (i) have been
issued in compliance with all applicable federal securities laws and (ii) to our
knowledge, were not issued in violation of or subject to any preemptive or other
rights to subscribe for or purchase securities (other than statutory preemptive
rights as to which we express no opinion); the Shares and the Common Stock
issuable upon conversion of the Shares have been duly included for trading on
the Nasdaq National Market; and, to our knowledge, no holders of outstanding
shares of capital stock of the Company are entitled to any preemptive or other
rights to subscribe for or purchase any of the Shares or any shares of Common
Stock issuable upon conversion of the Shares (other than statutory preemptive
rights as to which we express no opinion).
5. To our knowledge, (i) no legal or governmental proceedings are pending to
which the Company or any of the Material Subsidiaries is a party or to which the
property of the Company or any of the Material Subsidiaries is subject that are
required to be described in the Registration Statement or the Final Prospectus
("Proceedings") and are not described therein, (ii) no Proceedings have been
threatened against the Company or any of the Material Subsidiaries or with
respect to any of their respective properties and (iii) no contract or other
document is required to be described in the Registration Statement or the Final
Prospectus or to be filed as an exhibit to the Registration Statement that is
not described therein or filed as required.
6. The issuance, offering and sale of the Shares to the Underwriters
pursuant to the Underwriting Agreement, the compliance by the Company with the
other provisions of the Underwriting Agreement and the consummation of the other
transactions therein contemplated do not (i) require the consent, approval,
authorization, registration or qualification of or with
<PAGE>
any governmental authority, except such as have been obtained and such as may be
required under state securities or blue sky laws (as to which we express no
opinion), (ii) conflict with or violate (A) the certificate of incorporation or
bylaws of any of the Delaware Material Subsidiaries, or (B) any statute, rule or
regulation applicable to the Company or any of the Material Subsidiaries, or
(iii) conflict with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any agreement or document listed
on Exhibit ___ attached hereto (the "Material Agreements").
7. The Registration Statement is effective under the Act; any required
filing of the Final Prospectus pursuant to Rule 424(b) has been made in the
manner and within the time period required by Rule 424(b); and, to our
knowledge, no stop order suspending the effectiveness of the Registration
Statement and no order directed at any document incorporated by reference in the
Registration Statement or the Final Prospectus has been issued, and no
proceedings for that purpose have been instituted or threatened or are
contemplated by the Commission.
8. The Registration Statement and the Final Prospectus (in each case,
including the documents incorporated by reference therein but not including the
financial statements and related notes, financial statement schedules and other
financial and statistical information and exhibits included or incorporated by
reference therein or omitted therefrom, as to which we express no opinion)
comply as to form in all material respects with the applicable requirements of
the Act and the Exchange Act and the rules and regulations of the Commission
thereunder.
9. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
10. To our knowledge, no default exists, and no event has occurred which,
with notice or lapse of time or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any indenture,
mortgage, deed of trust, lease or other agreement or instrument listed on
Exhibit ___ hereto, except where such default or event will not have a material
adverse effect on the Company and its subsidiaries taken as a whole.
We have participated in conferences with officers and other representatives
of the Company, representatives of the independent certified public accountants
of the Company and your representatives at which the contents of the
Registration Statement, the Final Prospectus and related matters were discussed,
and, although we have not undertaken to investigate or verify independently, and
assume no responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Final Prospectus, on
the basis of the foregoing (relying as to materiality to a large extent upon the
opinions of officers and other representatives of the Company) no facts have
come to our attention which lead us to believe (i) that the Registration
Statement (other than the financial statements and related notes, financial
statement schedules and other financial and statistical information and exhibits
included or incorporated by reference therein or omitted therefrom, as to which
we express no belief) at the time it became effective contained an untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the
<PAGE>
statements therein not misleading or (ii) that the Final Prospectus (other than
the financial statements and related notes, financial statement schedules and
other financial and statistical information and exhibits included or
incorporated by reference therein or omitted therefrom, as to which we express
no belief), as of the date thereof and the date of this opinion, contained or
contains an untrue statement of a material fact or omitted or omits to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
<PAGE>
EXHIBIT C
Form of opinion of Sills Cummis Zuckerman Radin
Tischman Epstein & Gross, pursuant to Section 6(d)
of the Underwriting Agreement
1. The Shares have been duly authorized by all necessary corporate action of
the Company and, when issued and delivered to and paid for by the
Underwriters pursuant to the Underwriting Agreement, will be validly issued,
fully paid and nonassessable.
2. The Certificate of Designations for the Shares has been duly authorized and
executed by the Company and has been duly filed in accordance with the laws
of the State of New Jersey with the Secretary of State of the State of New
Jersey as an amendment to the Company's Certificate of Incorporation.
3. The certificates for the Shares are in valid and sufficient form.
4. The shares of Common Stock issuable upon conversion of the Shares have been
duly authorized and reserved for issuance by the Company, and when the
Shares are converted in accordance with the terms of the Certificate of
Designations for the Shares, the shares of Common Stock issued therefor will
be validly issued, fully paid and nonassessable.
5. The issuance and sale by the Company of the Shares and the Common Stock
issuable upon conversion thereof pursuant to the Underwriting Agreement and
the Certificate of Designations for the Shares will not violate or conflict
with any New Jersey statute, rule or regulation or the Certificate of
Incorporation or by-laws of the Company.
