As filed with the Securities and Exchange Commission on April 16, 1998
Registration No. 333-49431
Registration No. 333-49431-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PRE-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
MASON-DIXON BANCSHARES, INC.
MASON-DIXON CAPITAL TRUST II
(Exact name of registrants as specified in their Charters)
<TABLE>
<S> <C> <C>
Maryland 6712 52-1764929
Delaware 6719 51-6507171
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification
incorporation or organization) Classification Code Numbers) Numbers)
45 W. Main Street, Westminster, Maryland 21157 (410) 857-3401
(Address, including zip code, and telephone number, including area code, of registrants' principal executive offices)
Thomas K. Ferguson, 45 W. Main Street, Westminster, Maryland 21157 (410) 857-3401
(Name, address, including zip code, and telephone number, including area code, of agent for service)
With copies to:
Abba David Poliakoff, Esquire Steven Kaplan, Esquire
Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC Arnold & Porter
233 E. Redwood Street, Baltimore, Maryland 21202 555 12th Street, N.W., Washington, D. C. 20004
(410) 576-4067 (202) 942-5998
</TABLE>
Approximate date of commencement of the proposed sale to public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being 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, check the following box. |_|
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. |_|
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<CAPTION>
====================================================================================================================================
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
Title of each Class of Securities Amount to be Proposed Maximum Proposed Maximum Amount of
to be Registered Registered Offering Price Per Unit Aggregate Offering Price(1) Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
___% Preferred Securities of Mason-Dixon
Capital Trust II (4) 1,000,000 (4) $20 (4) $20,000,000 $5,900 (4)
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___% Junior Subordinated Deferrable Interest _______ ________ ________ ________
Debentures of Mason-Dixon Bancshares, Inc. (2)
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Guarantee of Mason-Dixon Bancshares, Inc. of _______ ________ ________ ________
certain obligations under the Preferred
Securities (3)
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Total Registration Fee _______ ________ ________ $5,900 (4)
====================================================================================================================================
<FN>
(1) Estimated solely for the purpose of calculating the registration fee, exclusive of accrued interest and dividends, if any.
(2) The Junior Subordinated Deferrable Interest Debentures will be
purchased by Mason-Dixon Capital Trust II. Such securities may later be
distributed for no additional consideration to the holders of the
Preferred Securities upon the dissolution of the Issuer Trust and the
distribution of its assets.
(3) This Registration Statement is deemed to cover the Guarantee. Pursuant
to Rule 457(n) under the Securities Act, no separate registration fee
is payable for the Guarantee.
(4) The Company initially registered 800,000 Preferred Securities having a
par value of $25 per share and an aggregate par value and Proposed
Maximum Aggregate Offering Price of $20,000,000, and paid a
registration fee of $5,900. The Company changed the par value to $20
per share and increased the number of shares to be issued to 1,000,000
shares. Because the aggregate par value and the Proposed Maximum
Offering Price is unchanged at $20,000,000, the registration fee for
which was paid with the initial filing, no additional filing fee is
required to be paid herewith.
</FN>
</TABLE>
The Registrants hereby amend this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrants 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 the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
EXPLANATORY NOTE
The prospectus contained in this Registration Statement will be used in
connection with the offering of the following securities: (1) _________%
Preferred Securities of Mason-Dixon Capital Trust II; (2) _________% Junior
Subordinated Deferrable Interest Debentures of Mason-Dixon Bancshares, Inc.; (3)
a Guarantee of Mason-Dixon Bancshares, Inc. of certain obligations under the
Preferred Securities.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16. Exhibits
The exhibits listed on the Exhibit Index on page II-3 of this
Registration Statement are filed herewith or will be filed by amendment.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant 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 amendment to
the registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Westminster, State of Maryland, on
April 16, 1998.
MASON-DIXON BANCSHARES, INC.
By: /s/ Thomas K. Ferguson
Thomas K. Ferguson, President
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following persons
in the capacities and on the dates indicated.
Signature Title Date
/s/ Thomas K. Ferguson Chief Executive Officer April 16, 1998
Thomas K. Ferguson and Director (Principal
Executive Officer)
/s/ Mark A. Keidel Chief Financial Officer April 16, 1998
Mark A. Keidel (Principal Financial and
Accounting Officer)
/s/ David S. Babylon, Jr.* Director April 16, 1998
David S. Babylon, Jr.
/s/ Henry S. Baker, Jr.* Director April 16, 1998
Henry S. Baker, Jr.
/s/ Miriam F. Beck* Director April 16, 1998
Miriam F. Beck
II-1
<PAGE>
Director _____________
Donald H. Campbell
/s/ William B. Dulany* Director April 16, 1998
William B. Dulany
/s/ R. Neal Hoffman* Director April 16, 1998
R. Neal Hoffman
Director _____________
S. Ray Hollinger
/s/ J. William Middelton* Director April 16, 1998
J. William Middelton
Director _____________
Edwin W. Shauck
Director _____________
James Snyder
/s/ Stevenson B. Yingling* Director April 16, 1998
Stevenson B. Yingling
*By: /s/ Thomas K. Ferguson
Thomas K. Ferguson, Attorney-in-Fact April 16, 1998
Pursuant to the requirements of the Securities Act of 1933, the Issuer
Trust has duly caused this amendment to the registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Westminster, State of Maryland, on April 16, 1998.
MASON-DIXON CAPITAL TRUST II
By: Mason-Dixon Bancshares, Inc.,
as Depositor
By: /s/ Thomas K. Ferguson
Thomas K. Ferguson, President
II-2
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
1.1 Form of Underwriting Agreement*
4.1 Form of Junior Subordinated Indenture
4.2 Form of Amended and Restated Trust Agreement
4.3 Form of Guarantee by Mason-Dixon Bancshares, Inc.
5.1 Opinion of Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC
5.2 Opinion of Richards, Layton & Finger
8.1 Tax opinion of Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC
23.1 Consent of Stegman & Company
23.2 Consent of Grabush, Newman & Co., P.A.
23.3 Consent of Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC
(included in Exhibits 5.1 and 8.1)
23.4 Consent of Richards, Layton & Finger (included in Exhibit 5.2)
24.1 Powers of Attorney of certain directors of Mason-Dixon Bancshares,
Inc.
25.1 Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of Bankers Trust Company, as trustee under the Junior
Subordinated Indenture, the Amended and Restated Trust Agreement and
the Guarantee
---------------------------
* Filed herewith.
II-3
<PAGE>
EXHIBIT 1.1
<PAGE>
MASON-DIXON CAPITAL TRUST II
$-------------
(Aggregate Liquidation Amount)
___% Preferred Securities
(Liquidation Amount $__ per Preferred Security)
by
BT ALEX. BROWN INCORPORATED
KEEFE, BRUYETTE & WOODS, INC.
UNDERWRITING AGREEMENT
______ __, 1998
BT ALEX. BROWN INCORPORATED
One South Street
Baltimore, Maryland 21202
KEEFE BRUYETTE & WOODS, INC.
Two World Trade Center
85th Floor
New York, New York 10048
Dear Sirs:
Mason-Dixon Capital Trust II (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C.
Section 3801 et seq.), and Mason-Dixon Bancshares, Inc., a Maryland corporation
(the "Company" and, together with the Trust, the "Offerors"), as depositor of
the Trust and as guarantor, propose, upon the terms and conditions set forth
herein, to issue and sell an aggregate liquidation amount of $__________ of the
Trust's ___% preferred securities (the "Preferred Securities") to the several
underwriters named in Schedule I hereto (each an "Underwriter" and collectively,
the "Underwriters").
The Preferred Securities and the Common Securities (as defined herein)
are to be issued pursuant to the terms of an Amended and Restated Trust
Agreement to be dated as of _____ __, 1998 (the "Trust Agreement"), among the
Company, as depositor, and Bankers Trust Company, a New York banking corporation
("Trust Company"), as property trustee ("Property Trustee") and Bankers Trust
(Delaware) ("Trust Delaware"), a Delaware banking corporation, as Delaware
trustee ("Delaware Trustee") and the
<PAGE>
holders from time to time of undivided interests in the assets of the Trust. The
Preferred Securities will be guaranteed by the Company (the "Guarantee") on a
subordinated basis and subject to certain limitations with respect to
distributions and payments upon liquidation, redemption or otherwise (the
"Guarantee") pursuant to the Guarantee Agreement to be dated as of _____ __,
1998 (the "Guarantee Agreement"), between the Company and the Trust Company, as
Trustee (the "Guarantee Trustee"). The assets of the Trust will consist of ___%
junior subordinated deferrable interest debentures, due _____ __, 2028 (the
"Subordinated Debentures") of the Company which will be issued under an
indenture to be dated as of _____ __, 1998 (the "Indenture"), between the
Company and the Trust Company, as Trustee (the "Indenture Trustee"). Under
certain circumstances, the Subordinated Debentures will be distributable to the
holders of undivided beneficial interests in the assets of the Trust. The entire
proceeds from the sale of the Preferred Securities will be combined with the
entire proceeds from the sale by the Trust to the Company of the Trust's common
securities (the "Common Securities"), and will be used by the Trust to purchase
an equivalent amount of the Subordinated Debentures.
The Company and the Trust have filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (Nos.
333-49431, 333-49431-1) and a related preliminary prospectus for the
registration of the Preferred Securities, the Subordinated Debentures and the
Guarantee under the Securities Act of 1933, as amended (the "Securities Act"),
and the rules and regulations thereunder (the "Securities Act Regulations"). The
Offerors have prepared and filed such amendments thereto, if any, and such
amended preliminary prospectuses, if any, as may have been required to the date
hereof, and will file such additional amendments thereto and such amended
prospectuses as may hereafter be required. The registration statement has been
declared effective under the Securities Act by the Commission. The registration
statement as amended at the time it became effective (including the Prospectus
(as hereinafter defined) and the documents incorporated by reference therein
pursuant to the section therein entitled "Incorporation of Certain Documents by
Reference" and all information deemed to be a part of the registration statement
at the time it became effective pursuant to Rule 430A(b) of the Securities Act
Regulations) is hereinafter called the "Registration Statement," except that, if
the Company files a post-effective amendment to such registration statement
which becomes effective prior to the Closing Date (as defined below),
"Registration Statement" shall refer to such registration statement as so
amended. Each prospectus included in the registration statement, or amendments
thereof, before it became effective under the Securities Act and any prospectus
filed with the Commission by the Company with the consent of the Underwriters
pursuant to Rule 424(a) of the Securities Act Regulations (including the
documents incorporated by reference therein) is hereinafter called the
"Preliminary Prospectus." The term "Prospectus" means the final prospectus
(including the documents incorporated by reference therein), as first filed with
the Commission pursuant to paragraph (1) or (4) of Rule 424(b) of the Securities
Act Regulations. The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus.
- 2 -
<PAGE>
The Company and the Trust hereby agree with the Underwriters as
follows:
SECTION 1. Representations and Warranties.
(a) Each of the Offerors represents and warrants to the Underwriters as
follows:
(i) The Registration Statement conforms, and the Prospectus
and any further amendments or supplements thereto will, when they
become effective or are filed with the Commission, as the case may be,
conform, in all material respects with the requirements of the
Securities Act, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the applicable rules and regulations under said
acts; the Trust Agreement, the Guarantee Agreement, and the Indenture
conform in all material respects with the requirements of the Trust
Indenture Act, and the applicable rules and regulations thereunder; the
Registration Statement did not, and any amendment thereto will not, in
each case as of the applicable effective date, contain any untrue
statement of a material fact or omit to state a material fact necessary
in order to make the statements made not misleading; and the Prospectus
and any amendment or supplement thereto will not,
as of the applicable filing date and at the Closing Date (as
hereinafter defined), contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the
statements made, in the light of the circumstances under which they
were made, not misleading; provided, however, that the representations
and warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in
reliance upon and in conformity with information furnished to the Trust
or the Company by or on behalf of the Underwriter, the Property
Trustee, the Guarantee Trustee or the Indenture Trustee expressly for
use in the Registration Statement or Prospectus.
(ii) The documents incorporated by reference in the
Prospectus pursuant to the section therein entitled "Incorporation of
Certain Documents by Reference," at the time they were filed with the
Commission, complied in all material respects with the requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations of the Commission thereunder, and did not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made, in the
light of the circumstances under which they were made, not misleading.
(iii) Neither the Company nor the Trust is an open-end
investment company, unit investment trust or face-amount certificate
company that is, or is required to be, registered under Section 8 of
the Investment Company Act of 1940, as amended (the "Investment Company
Act"), nor is either a closed-end investment company required to be
registered, but not registered, thereunder.
(iv) The Trust and the Company meet the requirements for the
use of Form S-3 under the Securities Act.
- 3 -
<PAGE>
(v) The Company is a duly incorporated and subsisting
corporation in good standing under the laws of the State of Maryland
with corporate power and authority to own and lease its properties and
to conduct its business as described in the Prospectus and to enter
into and perform its obligations under this Agreement, the Trust
Agreement, the Guarantee Agreement, the Indenture and the Preferred
Securities; the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction, if any,
in which its ownership or leasing of properties or the conduct of its
business requires such qualification, except where the failure to so
qualify would not have a material adverse effect on the conduct of the
business, condition (financial or otherwise), earnings or operations of
the Company and its subsidiaries considered as one enterprise; and the
Company is duly registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended.
(vi) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise disclosed therein, (A) there has been no material adverse
change in the condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise, or in the earnings or
operations of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business,
(B) there have been no material transactions entered into by the
Company or its subsidiaries other than those in the ordinary course of
business, and (C) the Company has not sustained any material loss or
interference with its assets, businesses or properties (whether owned
or leased) from fire, explosion, earthquake, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or any
court or legislative or other governmental action, order or decree.
(vii) The Preferred Securities have been duly and validly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when executed and authenticated in accordance with the
terms of the Trust Agreement and delivered to the Underwriters against
payment of the consideration set forth herein, will constitute valid
and legally binding obligations of the Trust enforceable in accordance
with their terms and entitled to the benefits provided by the Trust
Agreement (except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, receivership, readjustment of
debt, moratorium, fraudulent conveyance or similar laws relating to or
affecting creditors' rights generally, or general equity principles
(whether considered in a proceeding in equity or at law)). The Trust
Agreement has been duly authorized and, when executed by the proper
officers of the Company and delivered by the Company, will have been
duly executed and delivered by the Company and will constitute the
valid and legally binding instrument of the Company, enforceable in
accordance with its terms (except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, receivership,
readjustment of debt, moratorium, fraudulent conveyance or similar laws
relating to or affecting creditors' rights generally, or general equity
principles (whether considered in a proceeding in equity or at law)).
The Subordinated Debentures have been duly
- 4 -
<PAGE>
and validly authorized for delivery by the Company and when duly
authenticated in accordance with the terms of the Indenture and
delivered to the Trust against payment of the consideration set forth
herein, will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their terms
(except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, readjustment of debt,
moratorium, fraudulent conveyance or similar laws relating to or
affecting creditors' rights generally, or general equity principles
(whether considered in a proceeding in equity or at law)) and entitled
to the benefits provided by the Indenture. The Indenture has been duly
authorized and, when executed by the proper officers of the Company and
delivered by the Company, will have been duly executed and delivered by
the Company and will constitute the valid and legally binding
instrument of the Company, enforceable in accordance with its terms,
(except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, readjustment of debt,
moratorium, fraudulent conveyance or similar laws relating to or
affecting creditors' rights generally, or general equity principles
(whether considered in a proceeding in equity or at law)). The
Guarantee has been duly authorized and, when executed by the proper
officers of the Company and delivered by the Company, will have been
duly executed and delivered by the Company and, assuming due
authorization and execution of the Guarantee by each other party
thereto, will constitute valid and legally binding instrument of the
Company, enforceable in accordance with its terms, (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium,
fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally, or general equity principles (whether
considered in a proceeding in equity or at law)). The Trust Agreement,
the Guarantee Agreement and the Indenture have been duly qualified
under the Trust Indenture Act and the Preferred Securities, the Common
Securities, the Trust Agreement, the Guarantee Agreement, the
Subordinated Debentures and the Indenture conform in all material
respects to the descriptions thereof contained in the Registration
Statement and the Prospectus.
(viii) This Agreement has been duly authorized, executed and
delivered by the Trust and the Company and constitutes the valid and
binding agreement of the Trust and the Company enforceable against the
Trust and the Company in accordance with its terms, (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium,
fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally, Section 7 hereof or general equity
principles (whether considered in a proceeding in equity or at law)).
(ix) Neither the Trust, nor the Company or any of its
subsidiaries is in violation of its charter or in default in any
material respect in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to
which it is a party or by which it or any of its
- 5 -
<PAGE>
properties may be bound and which is material to either the Trust or
the Company and its subsidiaries considered as one enterprise and the
execution and delivery of this Agreement, the Trust Agreement, the
Guarantee Agreement, and the Indenture, the issue and sale of the
Preferred Securities, the issue and sale of the Subordinated
Debentures, the compliance by the Trust and the Company with the
provisions of the Preferred Securities and the Subordinated Debentures,
this Agreement, the Trust Agreement, the Guarantee Agreement, and the
Indenture, and the consummation of the transactions herein and therein
contemplated will not conflict with or constitute a breach of, or
default under, the organization documents of the Trust or the articles
of incorporation or by-laws of the Company or any of its subsidiaries
or a material breach or default under any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Trust or the Company or any of its subsidiaries is a party or by which
it or any of its or their properties may be bound and which is material
to the Trust or the Company and its subsidiaries considered as one
enterprise, nor will such action result in any material violation on
the part of the Trust or the Company or any of its subsidiaries of any
applicable law or regulation or of any applicable administrative,
regulatory or court decree.
(x) There are no actions, suits, claims or proceedings
pending or, to the knowledge of the Trust or the Company, threatened
against the Trust or the Company or any of its subsidiaries before any
court or administrative agency or otherwise which are required to be
disclosed in the Registration Statement and are not so disclosed which,
if determined adversely to the Trust or the Company or any of its
subsidiaries would individually or in the aggregate have a material
adverse effect on the business, condition (financial and otherwise),
earnings or operations of the Trust or the Company and its subsidiaries
considered as one enterprise or prevent the consummation of the
transactions contemplated hereby.
(xi) To the Company's knowledge, the Commission has not
issued an order preventing or suspending the use of the Prospectus, nor
instituted proceedings for that purpose.
(xii) The independent certified public accountants who
audited the consolidated financial statements included or incorporated
by reference in the Prospectus are independent public accountants as
required by the Securities Act and the Securities Act Regulations.
(xiii) The consolidated financial statements of the Company,
including the notes thereto and the supporting schedules, included or
incorporated by reference in the Prospectus present fairly, the
financial position, results of operations and cash flows of the Company
and its subsidiaries at the dates indicated, and the results of their
operations for the periods specified; such consolidated financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis except as otherwise
stated therein. The consolidated financial statements of Rose Shanis &
Co., Inc.,
- 6 -
<PAGE>
Rose Shanis Sons, Inc., Rose Shanis & Co. and Stephen Corporation
(collectively, the "Rose Shanis Companies"), including the notes
thereto and the supporting schedules, included or incorporated by
reference in the Prospectus present fairly, the financial position,
results of operations and cash flows of the Rose Shanis Companies at
the dates indicated, and the results of operations for the periods
specified; such consolidated financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis except as otherwise stated therein. The pro forma
financial statements and other pro forma information, including the
notes thereto and the supporting schedules, included or incorporated by
reference in 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, have
been properly compiled on the pro forma bases described therein, and,
in the opinion of the Company, the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are appropriate
to give effect to the transactions or circumstances referred to
therein.
(xiv) The Company and it subsidiaries have good and
marketable title to all of the properties and assets owned by them
reflected in the consolidated financial statements (or as disclosed in
the Registration Statement), subject to no lien, mortgage, pledge,
charge or encumbrance of any kind except those reflected in such
consolidated financial statements (or as disclosed in the Registration
Statement or which are not material in amount).
(xv) The Company and its subsidiaries have filed all federal,
state and local tax returns which have been required to be filed and
have paid all taxes indicated by said returns and all assessments
received by them or any of them to the extent that such taxes have
become due and are not being contested in good faith. All tax
liabilities have been adequately provided for in the consolidated
financial statements of the Company.
(xvi) No approval, authorization, consent, registration,
qualification or other order of any public board or body is required in
connection with the execution and delivery of this Agreement, the Trust
Agreement, the Guarantee Agreement, or the Indenture, or the issuance
and sale of the Preferred Securities, the issuance and sale of the
Subordinated Debentures, or the consummation by the Trust and the
Company of the other transactions contemplated by this Agreement, the
Trust Agreement, the Guarantee Agreement, or the Indenture, except such
as have been described in the Prospectus or been obtained, or will have
been obtained at the Closing Date, under the Securities Act, the
Exchange Act and the Trust Indenture Act and such as may be required
under the blue sky or securities laws of various states in connection
with the offering of the Preferred Securities.
(xvii) The Company and its subsidiaries possess all material
licenses, certificates, authorities or permits issued by the
appropriate state or
- 7 -
<PAGE>
federal regulatory agencies or bodies necessary to conduct their
businesses as described in the Prospectus, and neither the Company nor
its subsidiaries have received any notice of proceedings relating to
the revocation or modification of any such license, certificate,
authority or permit which, individually or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would have a
material adverse effect on the conduct of the business, condition
(financial or otherwise), earnings or operations of the Company and its
subsidiaries considered as one enterprise. Neither the Company nor any
of its subsidiaries is party to or otherwise the subject to any consent
decree, memorandum of understanding, written commitment or other
supervisory agreement with the Board of Governors of the Federal
Reserve System or any Federal Reserve Bank (the "Federal Reserve"), the
Federal Deposit Insurance Corporation ("FDIC"), the Office of the
Comptroller of the Currency, or any other federal or state authority or
agency responsible for the supervision, regulation or insurance of
depository institutions and consumer finance companies or their holding
companies.
(xviii) There are no contracts or other documents which are
required to be filed as exhibits to the Registration Statement by the
Securities Act or by the Securities Act Regulations which have not been
filed as exhibits to the Registration Statement.
(xix) The Company has applied for the listing of the
Preferred Securities on the Nasdaq National Market and shall use its
best efforts to have the Preferred Securities quoted on the Nasdaq
National Market or listed or quoted on a similar exchange.
(xx) The Company is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and
published interpretations thereunder.
(xxi) The Company and its subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as is adequate
for the conduct of their respective businesses and the value of their
respective properties and as is customary for companies engaged in
similar businesses.
(b) Any certificate signed by any officer of the Trust or the
Company and delivered to you or to your counsel shall be deemed a representation
and warranty by the Trust or the Company to you as to the matters covered
thereby.
SECTION 2. Sale and Delivery to Underwriter, Closing.
On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Trust and the Company,
as the case may be, agree that the Trust will sell to the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from the
Trust, the aggregate liquidation amount of
- 8 -
<PAGE>
Preferred Securities set forth opposite its name on Schedule I hereto, at a
purchase price of $___ per Preferred Security.
Payment of the purchase price for, and delivery of, the Preferred
Securities shall be made at the offices of Arnold & Porter, 555 Twelfth Street,
N.W., Washington, D.C. 20004, or at such other place as shall be agreed upon by
the Underwriters, the Trust and the Company, at 10:00 A.M. Eastern Time, on the
fourth business day following the date of this Agreement, or such other time not
later than ten business days after such date as shall be agreed upon by the
Underwriters, the Trust and the Company (such time and date of payment and
delivery being herein called the "Closing Date").
As compensation for the commitments of the Underwriters contained in
this Section 2, and in view of the fact that the proceeds of the sale of the
Preferred Securities will be used by the Trust to purchase the Subordinated
Debentures of the Company, the Company hereby agrees to pay to the Underwriters
on the Closing Date an amount equal to $___ per Preferred Security times the
total number of Preferred Securities purchased by the Underwriters on the
Closing Date as commissions for the sale of such Preferred Securities under this
Agreement.
Payment for the Preferred Securities shall be made to the Trust by wire
transfer of immediately available funds, against delivery of the Preferred
Securities to the Underwriters. The Preferred Securities shall be issued in the
form of one or more fully registered global notes (the "Global Notes") in
book-entry form in such denominations and registered in the name of the nominee
of The Depository Trust Company (the "Depository") or in such names as the
Underwriters may request in writing at least two business days before the
Closing Date. The Global Notes representing the Preferred Securities shall be
made available for examination by the Underwriters not later than 10:00 A.M.
Eastern Time on the last business day prior to the Closing Date.
SECTION 3. Offering by the Underwriter. The Trust and the Company are
advised that the Underwriters propose to make a public offering of the Preferred
Securities, on the terms and conditions set forth in the Registration Statement
from time to time as and when the Underwriters deem advisable after the
Registration Statement becomes effective. Because the National Association of
Securities Dealers, Inc. ("NASD") is expected to view the Preferred Securities
as interests in a direct participation program, the offering of the Preferred
Securities is being made in compliance with the applicable provisions of Rule
2810 of the NASD's Conduct Rules.
SECTION 4. Covenants of the Offerors. Each of the Trust and the Company
covenants with the Underwriters as follows:
(a) The Trust and the Company will prepare the Prospectus in a form
approved by the Underwriters and will file such Prospectus with the Commission
pursuant to subparagraph (1) or (4) of Rule 424(b) not later than the
Commission's close of business on the second business day following the
execution and delivery of this
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Agreement. The Trust and the Company will notify the Underwriters immediately,
and confirm the notice in writing, (i) of the effectiveness of the Registration
Statement and any amendment thereto (including any post-effective amendment),
and of the filing of the Prospectus pursuant to Rule 424(b), (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 the Prospectus, of the suspension of the qualification of the
securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceeding for such purpose. The Trust and the Company will
make every reasonable effort to prevent the issuance of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification and, if any such order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) The Trust and the Company will deliver to the Underwriters notice
of their intention to prepare or file any amendment to the Registration
Statement relating to the Preferred Securities (including any post-effective
amendment) or any amendment or supplement to the Prospectus (including documents
deemed to be incorporated by reference into the Prospectus and including any
revised prospectus which the Trust and the Company propose for use by the
Underwriters in connection with the offering of the Preferred Securities which
differs from the prospectus on file at the Commission at the time the
Registration Statement becomes effective, whether or not such revised prospectus
is required to be filed pursuant to Rule 424(b) of the Securities Act
Regulations), will furnish the Underwriters and counsel for the Underwriters
with copies of any such amendment or supplement a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file any
such amendment or supplement or use any such prospectus to which the
Underwriters or counsel for the Underwriters shall reasonably object.
(c) The Trust and the Company will deliver to the Underwriters one
manually executed copy of the Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated by reference into the Prospectus),
such number of conformed copies of the Registration Statement as originally
filed and of each amendment thereto (including documents incorporated by
reference into the Prospectus but without exhibits) as the Underwriters may
reasonably request and copies of each Preliminary Prospectus, the Prospectus and
any amended or supplemented Prospectus.
(d) The Trust and the Company will furnish to the Underwriters, from
time to time during the period when the Prospectus is required to be delivered
under the Securities Act, such number of copies of the Prospectus (as amended or
supplemented, if applicable) as they may reasonably request for the purposes
contemplated by the Securities Act or the Securities Act Regulations.
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(e) If any event shall occur as a result of which it is necessary, in
the reasonable opinion of counsel for the Underwriters, to amend or supplement
the Prospectus in order to make the Prospectus not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, the Trust
and the Company will forthwith amend or supplement the Prospectus by preparing
and furnishing to the Underwriters a reasonable number of copies of an amendment
of or supplement to the Prospectus (in form and substance satisfactory to
counsel for the Underwriters) so that, as so amended or supplemented, the
Prospectus will not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in the
light of the circumstances existing at the time it is delivered to a purchaser,
not misleading.
(f) The Trust and the Company, during the period when the Prospectus is
required to be delivered under the Securities Act, will file promptly all
documents required to be filed with the Commission pursuant to Section 13, 14 or
15 of the Exchange Act subsequent to the time the Registration Statement becomes
effective.
(g) Both the Trust and the Company will endeavor, in cooperation with
the Underwriters, to qualify the Preferred Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions of
the United States as the Underwriters may designate, and will maintain such
qualifications in effect for as long as may be required for the distribution of
the Preferred Securities, except that neither the Trust nor the Company shall be
required in connection therewith to qualify as a foreign corporation or to
execute a general consent to service of process in any state or other
jurisdiction. The Trust and the Company will file such statements and reports as
may be required by the laws of each jurisdiction in which the Preferred
Securities have been qualified as above provided.
(h) The Company will make generally available to its security holders,
as soon as it is practicable to do so, but in any event not later than 15 months
after the effective date of the Registration Statement, an earnings statement
(which need not be audited) in reasonable detail, covering a period of at least
12 consecutive months beginning on the first day of the first full fiscal
quarter after the effective date of the Registration Statement, which earnings
statement shall satisfy the requirements of Section 11(a) of the Securities Act
and Rule 158 of the Securities Act Regulations and will advise you in writing
when such statement has been so made available. If such fiscal quarter is the
last fiscal quarter of the Trust's fiscal year, such earnings statement shall be
made available not later than 90 days after the close of the period covered
thereby and in all other cases shall be made available not later than 45 days
after the close of the period covered thereby.
(i) The Trust and the Company will take such action as may be necessary
to comply with the rules and regulations of the Nasdaq National Market in
respect of the offering of the Preferred Securities.
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(j) The Trust and the Company, from the date hereof until the Closing
Date, will not offer, sell, contract to sell or otherwise dispose of any
securities issued or guaranteed by the Trust or the Company that in the
reasonable judgment of the Underwriters are substantially similar to the
Preferred Securities or any securities convertible or exchangeable for the
Preferred Securities, without the prior written consent of the Underwriters.
(k) For a period of five years after the Closing Date (but not beyond
any such date on which no Securities shall be outstanding), the Trust and the
Company will furnish to the Underwriters copies of all reports and
communications delivered to the Company's shareholders or to holders of the
Preferred Securities and will also furnish copies of all reports (excluding
exhibits) filed with the Commission on Forms 8-K, 10-Q and 10-K, and all other
reports and information furnished to such shareholders or security holders
generally, not later than the time such reports or information are first
furnished to such shareholders or security holders generally.
(l) The Trust shall apply the net proceeds of its sale of the Preferred
Securities, combined with the entire proceeds from the sale by the Trust to the
Company of the Trust's Common Securities, to purchase an equivalent amount of
the Subordinated Debentures of the Company. All the net proceeds to be received
by the Company from the sale of the Subordinated Debentures of the Company will
be used for general corporate purposes, as described more fully in the
Prospectus.
(m) Neither the Company nor the Trust shall enter into any contractual
agreement with respect to the distribution of the Preferred Securities except
for the arrangements with the Underwriters.
SECTION 5. Costs and Expenses. The Company will pay all costs, expenses
and fees incident to the performance of its obligations under this Agreement
(except for the fees and disbursements of counsel for the Underwriters other
than pursuant to item (vi) of this Section 5), including: (i) the printing and
filing of the Registration Statement as originally filed and any amendments and
exhibits thereto, (ii) the filing fee of the National Association of Securities
Dealers, Inc. and expenses relating to any review of the offering and the
listing of the Preferred Securities on the Nasdaq National Market, (iii) all
expenses (including reasonable fees and disbursements of counsel to the Company
and the Trust) payable pursuant to Section 4 of this Agreement, (iv) all costs
and expenses incurred in connection with the preparation, issuance and delivery
of the Preferred Securities to the Underwriters, (v) the fees and disbursements
of the Trust's and the Company's counsel and accountants, (vi) the expenses in
connection with the qualification of the Preferred Securities under state
securities laws in accordance with the provisions of Section 4(g), including
filing fees and the reasonable fees and disbursements of counsel to the
Underwriters in connection therewith and in connection with the preparation of
the preliminary and final blue sky memoranda and Legal Investment Surveys, (vii)
the printing and delivery to the Underwriters of copies of the preliminary and
final blue sky memoranda and Legal Investment surveys, (viii) all costs and
expenses incurred in the preparation and the printing (including word processing
and duplication costs) of the
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Preferred Securities, the Indenture, the Guarantee Agreement, the Trust
Agreement and all other documents relating to the issuance and public offering
of the Preferred Securities, and (ix) the fees and expenses of the Property
Trustee, the Delaware Trustee, the Indenture Trustee, and the Guarantee Trustee,
and any agent of the Property Trustee, the Delaware Trustee, the Indenture
Trustee, and the Guarantee Trustee, and the fees and disbursements of the
Property Trustee's counsel, in connection with the Trust Agreement and the
Preferred Securities.
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 6 or Section 9(a) or (c), the Company shall reimburse
the Underwriters for all of their reasonable out-of-pocket expenses, including
the reasonable fees and disbursements of counsel for the Underwriters, incurred
in connection with investigating, marketing and proposing to market the
Preferred Securities.
SECTION 6. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase and pay for the Preferred Securities
at the Closing Date are subject to the accuracy of the representations and
warranties of the Trust and the Company herein contained at and as of the date
hereof and the Closing Date, to the performance by the Trust and the Company of
their respective obligations hereunder, and to the following further conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 4(a); and at the Closing Date, no stop order suspending
the effectiveness of the Registration Statement or any part thereof shall have
been issued under the Securities Act or proceedings therefor initiated or
threatened by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus shall
have been complied with and there shall not have come to the attention of the
Underwriters any facts that would cause the Underwriters to believe that the
Prospectus, at the time it was required to be delivered to a purchaser of the
Preferred Securities, contained any untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements made,
in light of the circumstances existing at such time, not misleading.
(b) On the Closing Date, the Underwriters shall have received:
(i) The favorable opinion, dated as of the Closing Date, of
Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC counsel for the
Company, in form and substance substantially in the form attached
hereto as Exhibit A.
In rendering such opinion, counsel may state that they are
passing only on matters of Maryland law and United States federal law.
In rendering such opinion, counsel may rely upon an opinion or
opinions, each dated the Closing Date, of other counsel retained by
them or the Company as to laws of any jurisdiction other than the
United States or the State of Maryland, provided that (A) such reliance
is expressly authorized by each opinion so relied upon and a copy of
each such
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opinion is delivered to the Underwriters, and (B) counsel shall state
in their opinion that they and the Underwriters are justified in
relying thereon. Insofar as such opinions involve factual matters, such
counsel may rely, to the extent such counsel deems proper, upon
certificates of officers of the Company, its subsidiaries and the Trust
and certificates of public officials.
(ii) The favorable opinion, dated the Closing Date, of White
& Case, counsel to the Trust Company and Trust Delaware, substantially
in the form attached hereto as Exhibit B.
(iii) The favorable opinion, dated the Closing Date, of
Richards, Layton & Finger, special Delaware counsel to the Company and
the Trust, substantially to the effect and in the form attached hereto
as Exhibit C.
(iv) The favorable opinion, dated the Closing Date, of Arnold
& Porter, counsel to the Underwriters as to such matters as the
Underwriters shall reasonably request.
In rendering such opinion, counsel may rely upon an opinion or
opinions, each dated the Closing Date, of other counsel retained by
them or the Company as to laws of any jurisdiction other than the
United States or the State of New York, provided that (A) such reliance
is expressly authorized by each opinion so relied upon and a copy of
each such opinion is delivered to the Underwriters, and (B) counsel
shall state in their opinion that they believe that they and the
Underwriters are justified in relying thereon. Insofar as such opinions
involve factual matters, such counsel may rely, to the extent such
counsel deems proper, upon certificates of officers of the Company, its
subsidiaries and the Trust and certificates of public officials.
(c) At the time of the execution of this Agreement, the Underwriters
shall have received from Stegman & Company a letter dated such date, in form and
substance satisfactory to the Underwriters, to the effect that (i) they are
independent public accountants as required by the Securities Act and the
Securities Act Regulations; (ii) it is their opinion that, except for the
audited financial statements of the Rose Shanis Companies, the financial
statements included or incorporated by reference in the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the Securities Act and the Exchange Act and the applicable rules
and regulations thereunder; (iii) with respect to the unaudited pro forma
financial statements included in the Registration Statement, based upon limited
procedures set forth in detail in such letter, nothing has come to their
attention that caused them to believe that the unaudited pro forma financial
statements included in the Registration Statement do not comply as to form in
all material respects with the applicable accounting requirements of Rule 11-02
of Regulation S-X or that the pro forma adjustments have not been properly
applied to the historical amounts; (iv) based upon limited procedures set forth
in detail in such letter and without accounting for the acquisition of the
assets of the Rose Shanis Companies by the Company, nothing has come to their
attention which causes them to
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believe that during the period from December 31, 1997 to a specified date not
more than five days prior to the date of this Agreement, there has been any
decrease in the capital stock or increase in long-term debt of the Company or
its subsidiaries or any decrease in consolidated total assets of the Company and
its subsidiaries as compared with the amounts shown in the December 31, 1997
consolidated balance sheet incorporated by reference in the Registration
Statement, or any decrease, as compared with the corresponding period in the
preceding year, in net income or net interest income of the Company and its
subsidiaries on a consolidated basis, except in each case as set forth or
contemplated in the Registration Statement; (v) they have read the Registration
Statement and certain dollar amounts, percentages and other financial
information specified by the Underwriters which is included or incorporated by
reference in the Registration Statement and have performed the procedures set
forth in detail in such letter and have found such amounts, percentages or other
financial information to be in agreement with the relevant accounting and
financial records of the Company and its subsidiaries.
(d) On the Closing Date, the Underwriters shall have received from
Stegman & Company a letter, dated as of the Closing Date, to the effect that
they reaffirm the statements made in the letter furnished pursuant to paragraph
(c) of this Section, except that the "specified date" referred to shall be a
date not more than five days prior to the Closing Date.
(e) At the time of the execution of this Agreement, the Underwriters
shall have received from Grabush, Newman & Co., P.A. a letter dated such date,
in form and substance satisfactory to the Underwriters, to the effect that (i)
they are independent public accountants as required by the Securities Act and
the Securities Act Regulations and (ii) it is their opinion that the audited
financial statements of the Rose Shanis Companies included or incorporated by
reference in the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the Securities Act and
the Exchange Act and the applicable rules and regulations thereunder.
(f) At the time of the execution of this Agreement, the Underwriters
shall have received from the Chief Financial Officer ("CFO") of the Company a
letter dated such date, stating that nothing has come to the CFO's attention
which causes him to believe that when the financial statements of the Company
are adjusted to account for the acquisition of the assets of the Rose Shanis
Companies there will be any decrease in the capital stock or increase in
long-term debt of the Company or any decrease in consolidated total assets of
the Company as compared with the amounts shown in the December 31, 1997
consolidated balance sheet incorporated by reference in the Registration
Statement, or any decrease, as compared with the corresponding period in the
preceding year, in net income or net interest income of the Company on a
consolidated basis, except in each case as set forth or contemplated in the
Registration Statement.
(g) On the Closing Date, the Underwriters shall have received from the
CFO a letter, dated as of the Closing Date, to the effect that the CFO reaffirms
the statements made in the letter furnished pursuant to paragraph (f) of this
Section.
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(h) On the Closing Date, the Underwriters shall have received a
certificate signed by the President and the Chief Executive Officer and the
principal financial or accounting officer of the Company, dated the Closing
Date, to the effect that the signers of such certificate have carefully examined
the Registration Statement 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 in all material respects with all the
agreements and satisfied in all material respects all the conditions on
its part to be performed or satisfied at or prior to the Closing Date;
and
(ii) Since the date of the most recent financial statements
included in the Registration Statement (exclusive of any supplement
thereto), there has been no material adverse change in the condition
(financial or other), earnings, business or properties of the Company
and its subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Registration Statement (exclusive of any
supplement thereto).
(i) On the Closing Date, there shall not have been, since the
respective dates as of which information is given in the Registration Statement,
any material adverse change in the condition, financial or otherwise, of the
Company and its subsidiaries considered as one enterprise, or in the earnings or
operations of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, and the Underwriters
shall have received a certificate of the President and Chief Executive Officer
and the principal financial or accounting officer of the Company, dated as of
the Closing Date, to the effect that there has been no such material adverse
change and to the effect that the condition set forth in Section 6(a) has been
fulfilled.
(j) Prior to the Closing Date, the Company shall have furnished to the
Underwriters such further information, certificates and documents as the
Underwriters may reasonably request in connection with the offering of the
Preferred Securities.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party except as provided in Section 5 and except that Sections 7 and 8
hereof shall survive such termination.
SECTION 7. Indemnification.
(a) Each of the Company and the Trust jointly and severally agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls such Underwriter within the meaning of the Securities Act against any
losses, claims, damages
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or liabilities to which such Underwriter or such controlling person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
subject to Section 7(c) hereof, will reimburse each Underwriter and each such
controlling person for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that 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 an untrue statement or alleged untrue statement, or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or such amendment or supplement, in reliance upon and in conformity
with written information furnished to the Company by the Underwriters
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which the Company or the Trust may otherwise
have.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, each of its directors, each of its officers who
have signed the Registration Statement and each person, if any, who controls the
Company, against any losses, claims, damages or liabilities to which the Company
or any such director, officer, or controlling person may become subject under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made, and
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, action or
proceeding; provided, however, that an Underwriter will be liable in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission has been made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through such Underwriter specifically
for use in the preparation thereof. For purposes of this Section 7, the only
written information furnished by the Underwriters for use in the Registration
Statement and the Prospectus is the information in the last paragraph of the
cover page of the Prospectus (regarding stabilizing transactions) and the third,
fifth and eighth paragraphs under the caption "Underwriting" in the Prospectus.
This indemnity agreement will be in addition to any liability which an
Underwriter may otherwise have.
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(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to this Section 7, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing. No indemnification provided for in Section
7(a) or (b) shall be available to any party who shall fail to give notice as
provided in this Section 7(c) if the party to whom notice was not given was
unaware of the proceeding to which such notice would have related and was
materially prejudiced by the failure to give such notice, but the failure to
give such notice shall not relieve the indemnifying party or parties from any
liability which it or they may have to the indemnified party for contribution
under Section 7(d) hereof or otherwise than on account of the provisions of
Section 7(a) or (b). In case any such proceeding shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall retain counsel reasonably satisfactory to
the indemnified party to defend the indemnified party and shall pay as incurred
the fees and disbursements of such counsel related to such proceeding. The
indemnifying party shall be entitled to participate therein and, to the extent
that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party. In any such proceeding, any indemnified party shall have
the right to retain its own counsel at its own expense. Notwithstanding the
foregoing, the indemnifying party shall pay as incurred the fees and expenses of
the counsel retained by the indemnified party in the event (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention of
such counsel, (ii) the indemnifying party has failed to assume the defense of
such proceeding or shall have failed to retain counsel reasonably satisfactory
to the indemnified party, or (iii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel under
applicable rules of professional conduct, would be inappropriate due to actual
or potential differing interests between them. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm (and appropriate local counsel) for all
such indemnified parties. Such firm shall be designated in writing by the
Underwriters in the case of parties indemnified pursuant to Section 7(a) and by
the Company in the case of parties indemnified pursuant to Section 7(b). The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment.
(d) If the indemnification provided for in this Section 7 is
unavailable (other than by reason of the exception contained in the second
sentence of Section 7(c) hereof) to or insufficient to hold harmless an
indemnified party under Section 7(a) or (b) above in respect of any losses,
claims, damages or liabilities (or actions or proceedings in respect thereof
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
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damages or liabilities (or actions or proceedings in respect thereof) 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 from the offering of
the Preferred Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under Section 7(c) above,
then each indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings 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 net proceeds from the offering (before deducting
expenses) received by the Company bears to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault 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 on the one hand or the
Underwriter on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(e) The Company, the Trust and the Underwriters agree that it would not
be just and equitable if contributions pursuant to this Section 7 were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in
Section 7(d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in Section 7(d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (e): (i) except with respect to information
contained or omitted from the Registration Statement, 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 or through an
Underwriter specifically for use in the preparation thereof, such Underwriter
shall not be required to contribute any amount in excess of the underwriting
discounts and commissions applicable to the Preferred Securities purchased by
such Underwriter and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(f) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 7 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and
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consents to the service of such process and agrees that any other contributing
party may join him or it as an additional defendant in any such proceeding in
which such other contributing party is a party.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. The reimbursement, indemnification and contribution agreements
contained in this Agreement and the representations, warranties and covenants
contained in this Agreement shall remain in full force and effect, regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of an Underwriter or by or on behalf of any person controlling such
Underwriter, or by or on behalf of the Company, and (c) delivery of and payment
for the Preferred Securities to the Underwriters.
SECTION 9. Termination of Agreement. The Underwriters may terminate
this Agreement, by notice to the Company, at any time at or prior to the Closing
Date (a) if there has been, since the respective dates as of which information
is given in the Registration Statement, any material adverse change in the
condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise, or in the earnings or operations of the Company
and its subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (b) if there has occurred any new outbreak of
hostilities or escalation of any existing hostilities or other calamity or
crisis the effect of which on the financial markets of the United States is such
as to make it, in the reasonable professional judgment of the Underwriters,
impracticable to market the Preferred Securities or to enforce contracts for the
sale of the Preferred Securities, or (c) if trading in the securities of the
Company has been suspended by the Commission or if trading or quotation
generally on the Nasdaq National Market has been suspended, or minimum or
maximum prices for trading have been fixed, or maximum ranges of prices for
securities have been required by the Nasdaq National Market or by order of the
Commission or any other governmental authority, or (d) if a banking moratorium
has been declared by either federal or Maryland authorities. If this 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 7, and
provided further that Sections 5, 7 and 8 hereof shall survive such termination.
SECTION 10. Pro rata Purchase in Certain Events. If on the Closing Date
any one or more of the Underwriters shall fail or refuse to purchase Preferred
Securities that it or they have agreed to purchase hereunder and the aggregate
liquidation amount of Preferred Securities that such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than one-tenth
of the aggregate liquidation amount of Preferred Securities to be purchased on
such date, the other Underwriters shall be obligated severally in the
proportions which the aggregate liquidation amount of Preferred Securities set
forth opposite their names in Schedule I to this Agreement bears to the
aggregate liquidation amount of Preferred Securities set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions as
the Underwriters may specify, to purchase the Preferred Securities that such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date. If on the Closing Date any Underwriter or Underwriters shall fail
or refuse to purchase Preferred Securities
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<PAGE>
and the aggregate liquidation amount of Preferred Securities with respect to
which such default occurs is more than one-tenth of the aggregate liquidation
amount of Preferred Securities to be purchased on such date, and arrangements
satisfactory to the Underwriters and the Company for the purchase of such
Preferred Securities are not made within 36 hours after such default, this
Agreement shall thereupon terminate without liability on the part of any
non-defaulting Underwriters or of the Company or the Trust. In any such case,
either the Underwriters or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement or in any other
documents or arrangements may be affected. An action taken under this Section 10
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
SECTION 11. Reimbursement upon Termination in Certain Circumstances. If
this Agreement shall be terminated by the Underwriters or any of them, because
of any failure or refusal on the part of the Company to comply in any material
respect with the terms or to fulfill in any material respect any of the
conditions of this Agreement, or if for any reason the Company shall be unable
to perform in any material respect its obligations under this Agreement, the
Company shall reimburse the Underwriters or such Underwriters as have so
terminated the Agreement, with respect to themselves, severally, for all
reasonable out-of-pocket expenses reasonably incurred by such Underwriters in
connection with the offering of the Preferred Securities.
SECTION 12. 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 telecommunications. Notices to the
Underwriters shall be directed to them in care of BT Alex. Brown Incorporated,
One South Street, Baltimore, Maryland 21202, Attention of Howard J. Loewenberg.
Notice to the Company and the Trust shall be directed to Mason-Dixon Bancshares,
Inc., 45 West Main Street, Westminster, Maryland 21158, Attention of Thomas K.
Ferguson, President and CEO, with a copy to Abba Poliakoff, Esquire, Gordon,
Feinblatt, Rothman, Hoffberger & Hollander, LLC, 233 East Redwood Street,
Baltimore, Maryland 21202.
SECTION 13. Parties. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
parties hereto and their respective successors and the controlling persons and
officers and directors referred to in Sections 7 and 8 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and their respective successors, and
said controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from an Underwriter shall be deemed to be a successor by
reason merely of such purchase.
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<PAGE>
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. SPECIFIED TIMES OF DAY REFER
TO EASTERN TIME.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement among the
Underwriters, the Company and the Trust in accordance with its terms.
Very truly yours,
MASON-DIXON CAPITAL TRUST II
By: Mason-Dixon Bancshares, Inc.,
as depositor, on behalf of
Mason-Dixon Capital Trust II
By:
Name:
Title:
MASON-DIXON BANCSHARES, INC.
By:
Name:
Title:
Confirmed and accepted, as of the date first above written.
BT ALEX. BROWN INCORPORATED
By:
Name:
Title:
KEEFE, BRUYETTE & WOODS, INC.
By:
Name:
Title:
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SCHEDULE I
Underwriter Amount
BT Alex. Brown Incorporated $______________
Keefe, Bruyette & Woods, Inc. $______________
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EXHIBIT A
The opinion of counsel to the Company to be delivered pursuant to
Section 6(b)(i) of the Underwriting Agreement shall be substantially to the
effect that:
1. The Company is a corporation validly organized and presently
subsisting under the laws of the State of Maryland, with requisite corporate
power and authority to own its properties and conduct its business as described
in the Registration Statement, except for such power and authority the absence
of which would not have a material adverse effect on the Company, and is duly
registered as bank holding company under the Bank Holding Company Act of 1956,
as amended.
2. Carroll County Bank and Trust Company ("Carroll County Bank") is a
Maryland state-chartered trust company validly existing in good standing under
the laws of the State of Maryland, with all requisite corporate power and
authority to own, lease and operate its properties and conduct its business as
described in the Registration Statement, except for such power and authority the
absence of which would not have a material adverse effect on Carroll County
Bank.
3. Bank of Maryland ("Bank of Maryland") is a Maryland state-chartered
commercial bank validly existing in good standing under the laws of the State of
Maryland, with all requisite corporate power and authority to own, lease and
operate its properties and conduct its business as described in the Registration
Statement, except for such power and authority the absence of which would not
have a material adverse effect on Bank of Maryland.
4. Rose Shanis Loans LLC ("Rose Shanis Loans") is single member
Maryland limited liability company validly existing in good standing under the
laws of the State of Maryland with all requisite limited liability company power
and authority to own, lease and operate its properties and conduct its business
as described in the Registration Statement, except for such power and authority
the absence of which would not have a material adverse effect on Rose Shanis
Loans.
5. Bay Insurance LLC ("Bay Insurance") is a single member Maryland
limited liability company validly existing in good standing under the laws of
the State of Maryland with all requisite limited liability company power and
authority to own, lease and operate its properties and conduct its business as
described in the Registration Statement, except for such power and authority the
absence of which would not have a material adverse effect on Bay Insurance.
6. All of the outstanding shares of capital stock of Carroll County
Bank and Bank of Maryland have been duly and validly authorized and issued, are
fully paid and
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nonassessable, and, except as otherwise set forth in the Registration Statement,
all outstanding shares of capital stock of Carroll County Bank and Bank of
Maryland are owned by the Company, free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, any other
security interests, claim, liens or encumbrances.
7. All of the outstanding shares of capital stock of Carrollco
Insurance, Inc. and Skylight Investment Corporation have been duly and validly
authorized and issued, are fully paid and nonassessable, and, except as
otherwise set forth in the Registration Statement, all outstanding shares of
capital stock of Carrollco Insurance, Inc. and Skylight Investment Corporation
are owned by Carroll County Bank, free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, and other
security interests, claims, liens or encumbrances.
8. All of the outstanding limited liability interests of Rose Shanis
Loans and Bay Insurance have been duly an validly authorized and the Company is
the single and only member of both Rose Shanis Loans and Bay Insurance, and
except as otherwise set forth in the Registration Statement, all outstanding
limited liability interests of Rose Shanis Loans and Bay Insurance are owned by
the Company, free and clear of any perfected security interest and, to the
knowledge of such counsel, after due inquiry, and other security interests,
claims, liens or encumbrances
9. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
10. The Trust Agreement has been duly authorized, executed and
delivered by the Company, and is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium, fraudulent
conveyance or similar laws relating to or affecting creditors' rights generally,
or general equity principles (whether considered in a proceeding in equity or at
law)) and an implied covenant of good faith and fair dealing.
11. The Guarantee Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, readjustment of debt, moratorium, fraudulent
conveyance or similar laws relating to or affecting creditors' rights generally,
or general equity principles (whether considered in a proceeding in equity or at
law)) and an implied covenant of good faith and fair dealing.
12. The Indenture has been duly authorized, executed and delivered by
the Company, has been duly qualified under the Trust Indenture Act, and is a
valid and binding agreement of the Company, enforceable against the Company in
accordance with its terms, (except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership, readjustment of
debt, moratorium, fraudulent conveyance or
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similar laws relating to or affecting creditors' rights generally, or general
equity principles (whether considered in a proceeding in equity or at law)) and
an implied covenant of good faith and fair dealing.
13. The Subordinated Debentures have been duly authorized, executed and
delivered by the Company and when duly authenticated in accordance with the
Indenture and delivered and paid for in accordance with the Underwriting
Agreement, will be valid and binding obligations of the Company, entitled to the
benefits of the Indenture and enforceable against the Company in accordance with
their terms, (except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, receivership, readjustment of debt,
moratorium, fraudulent conveyance or similar laws relating to or affecting
creditors' rights generally, or general equity principles (whether considered in
a proceeding in equity or at law)) and an implied covenant of good faith and
fair dealing.
14. The Trust is not an "investment company" or an entity "controlled"
by an "investment company," as such terms are defined in Investment Company Act
of 1940, as amended.
15. The statements set forth in the Registration Statement under the
captions "Supervision, Regulation and Other Matters," "Description of Preferred
Securities," "Description of the Junior Subordinated Debentures," "Description
of Guarantee" and "Relationship Among the Preferred Securities, the Junior
Subordinated Debentures and the Guarantee," insofar as they purport to describe
the provisions of the laws and documents referred to therein, fairly summarize
the matters described therein; and the Preferred Securities, the Debentures and
the Guarantee conform to the descriptions contained in the Registration
Statement in all material respects.
16. The statements of law or legal conclusions and opinions set forth
in the Registration Statement under the caption "Certain Federal Income Tax
Consequences," subject to the assumptions and conditions described therein,
constitute such counsel's opinion.
17. The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion and, to the
best of such counsel's knowledge and information, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Securities
Act and no proceedings therefor have been initiated or threatened by the
Commission.
18. The Registration Statement and the Prospectus and any amendment or
supplement thereto made by the Company prior to the Closing Date (other than the
financial statements and financial and statistical data included therein, as to
which no opinion need be rendered), when it or they became effective or were
filed with the Commission, as the case may be, and in each case at the Closing
Date, complied as to form in all material respects with the requirements of the
Securities Act, the Trust Indenture Act and the applicable rules and regulations
under said acts and the documents incorporated by
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reference into the Prospectus (other than the financial statements and financial
and statistical data included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder, and
such counsel have no reason to believe that the Registration Statement, at the
time it became effective, contained any untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
contained therein, not misleading, or that the Prospectus, at the time it was
mailed to the Commission for filing or at the Closing Date, contained any untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading.
19. Such counsel has no knowledge of material legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property of the Company or any of its subsidiaries is the
subject which are required to be disclosed in the Registration Statement or
which would affect the consummation of the transactions contemplated in this
Agreement, the Indenture or the Preferred Securities; and such counsel has no
knowledge of such proceedings which are threatened or contemplated by
governmental authorities or threatened by others.
20. Such counsel has no knowledge of contracts, indentures, mortgages,
loan agreements, notes, leases or other instruments required to be described in
the Registration Statement or to be filed as exhibits thereto other than those
described therein or filed or incorporated by reference as exhibits thereto, and
such instruments as are summarized in the Registration Statement are fairly
summarized in all material respects.
21. No approval, authorization, consent, registration, qualification or
other order of any public board or body is required in connection with the
execution and delivery of this Agreement, the Trust Agreement, the Guarantee
Agreement, and the Indenture or the issuance and sale of the Preferred
Securities or the consummation by the Company of the other transactions
contemplated by this Agreement, the Trust Agreement, the Guarantee Agreement, or
the Indenture, except such as have been described in the Prospectus or been
obtained under the Securities Act, the Exchange Act and the Trust Indenture Act
or such as may be required under the blue sky or securities laws of various
states in connection with the offering and sale of the Preferred Securities (as
to which such counsel need express no opinion).
22. The execution and delivery of this Agreement, the Trust Agreement,
the Guarantee Agreement, and the Indenture, the issue and sale of the Preferred
Securities and the Subordinated Debentures, the compliance by the Company with
the provisions of the Preferred Securities, the Subordinated Debentures, the
Indenture, the Trust Agreement, the Guarantee Agreement and this Agreement and
the consummation of the transactions herein and therein contemplated will not
conflict with or constitute a breach of, or default under, the articles of
incorporation or by-laws of the Company or any of its subsidiaries or, to the
knowledge of such counsel, a breach or default under any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which either the
Company or
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any of its subsidiaries is a party or by which either of them or any of their
respective properties may be bound except for such breaches as would not have a
material adverse effect on the Company and its subsidiaries considered as one
enterprise, nor will such action result in a violation on the part of the
Company or any of its subsidiaries of any applicable law or regulation or of any
administrative, regulatory or court decree known to such counsel.
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<PAGE>
EXHIBIT B
The opinion of counsel to the Trust Company and Trust Delaware to be
delivered pursuant to Section 6(b)(ii) of the Underwriting Agreement shall be
substantially to the effect that:
1. The Trust Company is duly incorporated and is validly existing in
good standing as a banking corporation with trust powers under the laws of the
State of New York.
2. The Indenture Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Indenture, and has taken
all necessary corporate action to authorize the execution, delivery and
performance by it of the Indenture.
3. The Guarantee Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Guarantee Agreement, and
has taken all necessary corporate action to authorize the execution, delivery
and performance by it of the Guarantee Agreement.
4. The Property Trustee has the requisite power and authority to
execute and deliver the Trust Agreement, and has taken all necessary corporate
action to authorize the execution and delivery of the Trust Agreement.
5. Each of the Indenture and the Guarantee Agreement has been duly
executed and delivered by the Indenture Trustee and the Guarantee Trustee,
respectively, and constitutes a legal, valid and binding obligation of the
Indenture Trustee and the Guarantee Trustee, respectively, enforceable against
the Indenture Trustee and the Guarantee Trustee, respectively in accordance with
its respective terms, except that certain payment obligations may be enforceable
solely against the assets of the Trust and except that such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium, liquidation,
fraudulent conveyance and transfer or other similar laws applicable to New York
banking corporations affecting the enforcement of creditors' rights generally,
and by general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
6. The Subordinated Debentures delivered on the date hereof have been
duly authenticated by the Indenture Trustee in accordance with the terms of the
Indenture.
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EXHIBIT C
The opinion of counsel, as special Delaware counsel to the Company and
the Trust to be delivered pursuant to Section 6(b)(iii) of the Underwriting
Agreement shall be substantially to the effect that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
Section 3801 et seq. (the "Delaware Act"), and all filings required under the
laws of the State of Delaware with respect to the creation and valid existence
of the Trust as a business trust have been made.
2. Under the Delaware Act and the Trust Agreement, the Trust has the
trust power and authority to own its property and to its conduct its business,
all as described in the Prospectus.
3. The Trust Agreement constitutes a valid and binding obligation of
the Company and the Property Trustee and the Delaware Trustee, and is
enforceable against the Company and the Trustees, in accordance with its terms.
4. Under the Delaware Act and the Trust Agreement, (a) the Trust has
the trust power and authority to execute and deliver, and to perform its
obligations under, the Underwriting Agreement and (b) to issue and perform its
obligations under the Preferred Securities and the Common Securities.
5. Under the Delaware Act and the Trust Agreement, the execution and
delivery by the Trust of the Underwriting Agreement, and the performance by the
Trust of its obligations thereunder, have been duly authorized by all necessary
trust action on the part of the Trust.
6. The Preferred Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the qualifications set
forth herein, fully paid and nonassessable undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement. The
Holders, as beneficial owners of the Trust, will be entitled to the same
limitations of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware. We note that the Holders may be obligated pursuant to the Trust
Agreement, (a) to provide indemnity and/or security in connection with and pay
taxes or governmental charges arising from transfers or exchanges of Preferred
Securities Certificates and the issuance of replacement Preferred Securities
Certificates, and (b) to provide security or indemnity in connection with
requests of or directions to the Property Trustee to exercise its rights and
powers under the Trust Agreement.
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7. The Common Securities have been duly authorized by the Trust
Agreement and are duly and validly issued undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement.
8. Under the Delaware Act and the Trust Agreement, the issuance of the
Preferred Securities and Common Securities is not subject to preemptive rights.
9. The issuance and sale by the Trust of the Preferred Securities and
Common Securities, the purchase by the Trust of the Subordinated Debentures, the
execution, delivery and performance by the Trust of the Underwriting Agreement,
the consummation by the Trust of the transactions contemplated by the
Underwriting Agreement and the compliance by the Trust with its obligations
thereunder will not violate (i) any of the provisions of the Certificate of
Trust or the Trust Agreement or (ii) any applicable Delaware law or
administrative regulation.
10. The Delaware Trustee is duly incorporated and is validly existing
in good standing as a banking corporation with trust powers under the laws of
the State of Delaware.
11. The Delaware Trustee has the requisite power and authority to
execute and deliver the Trust Agreement, and has taken all necessary corporate
action to authorize the execution and delivery of the Trust Agreement.
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