Exhibit 1.01
8,918,395 SHARES
TRAVELERS PROPERTY CASUALTY CORP.
CLASS A COMMON STOCK
UNDERWRITING AGREEMENT
----------------------
June , 1998
To the Representative or Representatives
named in the Terms Agreement referred to
in Section 3 hereto
Ladies and Gentlemen:
Certain holders (the "Selling Stockholders") of Class A Common
Stock, $0.01 par value per share (the "Class A Common Stock"), of Travelers
Property Casualty Corp., a Delaware corporation (the "Company") propose to sell
from time to time up to an aggregate of 8,918,395 shares of Class A Common Stock
(the "Registered Securities"). Particular offerings of the Registered Securities
will be sold pursuant to Terms Agreements referred to in Section 3 hereto, for
resale in accordance with terms of the offering determined at the time of sale.
The Registered Securities involved in any such offering are hereinafter referred
to as the "Offered Securities." The firm or firms which agree to purchase the
Offered Securities are hereinafter referred to as the "Underwriters" of such
securities, and the representative or representatives of the Underwriters, if
any, specified in a Terms Agreement referred to in Section 3 hereto are
hereinafter referred to as the "Representatives," provided, however, that if the
Terms Agreement does not specify any representative of the Underwriters, the
term "Representatives," as used in this Agreement (other than in the second
sentence of Section 3), shall mean the Underwriters.
The Class A Common Stock, including the Registered Securities,
and the Company's Class B Common Stock, $0.01 par value per share, are
hereinafter referred to collectively as the "Common Stock." The Company is a
majority-owned subsidiary of The Travelers Insurance Group Inc. ("TIGI"), which
in turn is an indirect wholly owned subsidiary of Travelers Group Inc.
("Travelers Group").
The Company and the Selling Stockholders wish to confirm as
follows their agreements with the Underwriters in connection with the purchase
of the Registered Securities by the Underwriters.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, the Underwriters and each of the
Selling Stockholders as of the date of the applicable Terms Agreement that:
(a) A registration statement (No. 333-56249) relating to the
Registered Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended
(the "Act"), and has become effective. Such registration statement (including
all financial schedules and exhibits), as amended at the time of the Terms
Agreement referred to in Section 3 hereto (a "Terms Agreement"), is hereinafter
referred to as the "Registration Statement," and the prospectus included in such
Registration Statement, as supplemented as contemplated by Section 3 hereto to
reflect the terms of offering of the Offered Securities, as first filed with the
Commission pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under
the Act, including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus". If it is contemplated, at the time
this Agreement is executed, that a post-effective amendment to the Registration
Statement will be filed and must be declared effective before the offering of
the Offered Securities may commence, the term "Registration Statement" as used
in this Agreement means the registration statement as amended by said
post-effective amendment No document has been or will be prepared or
distributed in reliance on Rule 434 under the Act.
(b) The Prospectus complies in all material respects with the
provisions of the Act. The Commission has not issued any order preventing or
suspending the use of the Prospectus.
(c) The Company meets the requirements for the use of Form S-3
under the Act. The Registration Statement in the form in which it became
effective and also in such form as it may be when any post-effective amendment
thereto shall become effective, and the Prospectus and any supplement thereto
when filed with the Commission under Rule 424(b) under the Act, complied or will
comply in all material respects with the provisions of the Act and did not or
will not at any such times contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, and on the date of the applicable Terms
Agreement, the Registration Statement and Prospectus will conform in all
material respects to the requirements of the Act and the rules and regulations
thereunder, and neither the Registration Statement nor the Prospectus will
include any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, except that this representation and warranty does not apply to
statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information relating to the
Underwriters furnished to the Company in writing through the Representatives by
or on behalf of the Underwriters expressly for use therein.
(d) All the outstanding shares of capital stock of the Company
(including the Offered Securities) have been duly authorized and validly issued,
are fully paid and nonassessable and are free of any preemptive or similar
rights, except as set forth in Section 5 of the Shareholders Agreement, dated as
of April 2, 1996, as amended on June 20, 1997 and November 5, 1997, among TIGI
and the other shareholders party thereto (the "Shareholders Agreement") and
Section 5.1 of the Intercompany Agreement, dated as of April 2, 1996, between
Travelers Group and the Company (the "Intercompany Agreement"); and the capital
stock of the Company conforms in all material respects to the description
thereof included or incorporated by reference in the Registration Statement and
the Prospectus.
(e) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus, and is duly registered and qualified to conduct its business and is
in good standing in each jurisdiction or place where the nature of its
properties or the conduct of
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its business requires such registration or qualification, except where the
failure or failures (individually or in the aggregate) so to register or qualify
does not have a material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole.
(f) There are no legal or governmental proceedings (including,
without limitation, actions or proceedings by any insurance regulatory agency or
body) pending or, to the knowledge of the Company, threatened, against the
Company or any of the Company's "significant subsidiaries," as determined in
accordance with Regulation S-X under the Act (such "significant subsidiaries"
being hereinafter referred to collectively as the "Subsidiaries" and
individually as a "Subsidiary"), or to which the Company or any of the
Subsidiaries is a party, or to which any of their respective properties is
subject, that are required to be described in the Registration Statement or the
Prospectus that are not described as required by the Act.
(g) The Company is not (i) in violation of its certificate of
incorporation or bylaws, or (ii) in violation of any law, ordinance,
administrative or governmental rule or regulation applicable to the Company, or
(iii) in violation of any decree of any court or governmental agency or body
having jurisdiction over the Company, or (iv) in default in the performance or
any obligation, agreement or condition contained in any bond, debenture, note or
any other evidence of indebtedness or in any agreement, indenture, lease or
other instrument to which the Company is a party or by which it or any of its
properties may be bound, except, in the case of clauses (ii), (iii) and (iv),
where any such violation or default would not, net of reinsurance, reserves and
taxes, have a material adverse effect (individually or in the aggregate) on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and its subsidiaries taken as a whole.
(h) Neither the execution, delivery or performance of the
applicable Terms Agreement by the Company, nor the consummation by the Company
of the transactions contemplated thereby (i) requires any consent, approval,
authorization or other order of or registration or filing with, any court,
regulatory body (including any insurance regulatory body), administrative agency
or other governmental body, agency or official (except such as may be required
for the registration of the Registered Securities under the Act and compliance
with the securities or Blue Sky laws of various jurisdictions, all of which have
been or will be effected in accordance with this Agreement), except where the
failure to obtain such consent, approval, authorization or other order or make
such registration or filing would not have (individually or in the aggregate) a
material adverse effect on the condition (financial or other), business,
properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole, or (ii) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the certificate
or articles of incorporation or bylaws, or other organizational documents, of
the Company or any of the Subsidiaries, or (iii) conflicts or will conflict with
or constitutes or will constitute a breach of, or a default under, any
agreement, indenture, lease or other instrument to which the Company or any of
the Subsidiaries is a party or by which any of them or any of their respective
properties may be bound, or (iv) violates or will violate any statute, law,
regulation or filing or judgment, injunction, order or decree of any government,
government instrumentality (including, without limitation, any insurance
regulatory agency or body) or court, domestic or foreign, applicable to the
Company or any of the Subsidiaries or any of their respective properties, or (v)
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be
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bound or to which any of the property or assets of any of them is subject,
except, in the case of clauses (iii), (iv) and (v) of this paragraph (h), any
such conflict, breach or default, violation or any such lien or encumbrance that
would not (individually or in the aggregate) have a material adverse effect on
the condition (financial or other), business, properties, net worth or results
of operations of the Company and its subsidiaries taken as a whole.
(i) The accountants, KPMG Peat Marwick LLP, who have certified
or shall certify the financial statements included in the Registration Statement
and the Prospectus (or any amendment or supplement thereto) are independent
public accountants as required by the Act.
(j) The consolidated financial statements, together with related
schedules and notes, included and/or incorporated by reference in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto), comply as to form in all material respects with the requirements of
the Act. Such statements present fairly the consolidated financial position of
the Company and its subsidiaries and the combined financial position of
Travelers Casualty and Surety Company (formerly The Aetna Casualty and Surety
Company) and The Standard Fire Insurance Company and their subsidiaries, in each
case at the respective dates indicated, and the results of their operations and
their cash flows for the respective periods indicated in accordance with
generally accepted accounting principles consistently applied throughout such
periods. The other financial and statistical information relating to the
Company and its subsidiaries and Travelers Casualty and Surety Company and The
Standard Fire Insurance Company and their subsidiaries and data included and/or
incorporated by reference in the Registration Statement and the Prospectus (and
any amendment or supplement thereto), historical and pro forma, that are
identified as being prepared in accordance with generally accepted accounting
principles, are, in all material respects, accurately presented and prepared on
a basis consistent with such financial statements and the books and records of
the Company and its subsidiaries or Travelers Casualty and Surety Company and
The Standard Fire Insurance Company and their subsidiaries, as the case may be.
No pro forma financial statements prepared in accordance with Article 11 of
Regulation S-X under the Act are required to be included or incorporated by
reference in the Registration Statement or Prospectus.
(k) The statutory financial statements of the Company's
insurance subsidiaries from which certain ratios and other statistical data
included and/or incorporated by reference in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) have been derived, have
been prepared for each relevant period in conformity with accounting practices
prescribed or permitted by the National Association of Insurance Commissioners
and the insurance departments of the states of domicile of such subsidiaries, in
effect at such time of preparation, except as otherwise stated therein.
(l) The execution and delivery of, and the performance by the
Company of its obligations under the applicable Terms Agreement has been duly
and validly authorized by the Company, and the applicable Terms Agreement has
been duly executed and delivered by the Company and constitutes the valid and
legally binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent that (i) enforcement thereof may
be limited by (x) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally
and (y) general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity) and (ii) the rights to indemnity
and contribution thereunder may be limited by United States federal or state
securities laws.
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(m) Except as disclosed in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), (i)
neither the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business (including any material addition, or any development
involving a prospective material addition, to the Company's consolidated reserve
for insurance claims and claims expense, other than as contemplated by the
Registration Statement or the Prospectus), that is material to the Company and
its subsidiaries taken as a whole, (ii) there has not been any change in the
capital stock of the Company nor any material increase in the short-term debt or
long-term debt of the Company or any of its subsidiaries, and (iii) there has
not been any material adverse change, or any development involving or which may
reasonably be expected to involve, a prospective material adverse change, in the
condition (financial or other), business, net worth or results of operation of
the Company and its subsidiaries taken as a whole.
(n) The Company has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Offered Securities, will not distribute any offering materials in connection
with the offering and sale of the Offered Securities other than the Registration
Statement, the Prospectus or other materials, if any, permitted by the Act.
(o) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and with
statutory accounting principles, and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(p) No holder of any security of the Company has any right to
require registration of shares of Common Stock or any other security of the
Company because of the filling of the registration statement or the consummation
of the transactions contemplated by this Agreement, other than any such rights
that have been complied with or waived in writing.
(q) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(r) The documents incorporated by reference in the Registration
Statement and the Prospectus (the "Incorporated Documents") heretofore filed
were filed in a timely manner and, when they were filed (or, if any amendment
with respect to any such document was filed, when such amendment was filed),
conformed with the requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
(s) The Offered Securities have been approved for listing on the
New York Stock Exchange, Inc.
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2. REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDERS.
Each Selling Stockholder, severally and not jointly, represents and warrants to
the Underwriters and to the Company as of the date of the applicable Terms
Agreement that:
(a) Such Selling Stockholder has, and on the Closing Date (as
defined herein) will have, valid and unencumbered title to the Offered
Securities to be delivered by such Selling Stockholder on the Closing Date and
has full right, power and authority to enter into this Agreement and to sell,
assign, transfer and deliver the Offered Securities to be delivered by such
Selling Stockholder on the Closing Date pursuant to the applicable Terms
Agreement; and upon the delivery of any payment for the Offered Securities on
the Closing Date, and assuming the Underwriters take delivery of such Shares in
good faith and without notice of any adverse claim within the meaning of the
Uniform Commercial Code as in effect in the State of New York (the "UCC"), the
Underwriters will acquire valid and unencumbered title to such Offered
Securities to be delivered by such Selling Stockholder on the Closing Date.
(b) Such Selling Stockholder has reviewed the information
relating to such Selling Stockholder contained in the Registration Statement and
the Prospectus and the information relating to such Selling Stockholder in the
Registration Statement and the Prospectus does not contain any untrue statement
of a material fact relating to such Selling Stockholder or omit to state any
fact required to be stated therein or necessary to make the statements therein
relating to such Selling Stockholder not misleading in any material respect.
(c) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required to be obtained or
made by such Selling Stockholder for the consummation of the transactions
contemplated by this Agreement in connection with the sale of the Offered
Securities to be sold by such Selling Stockholder under the applicable Terms
Agreement, except such as have been obtained and made under the Act and such as
may be required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Offered Securities.
(d) Neither the execution, delivery and performance of the
applicable Terms Agreement by such Selling Stockholder nor the consummation of
the transactions therein contemplated by such Selling Stockholder will result in
a breach or violation of any of the terms and provisions of, or constitute a
default under, (A) any statute, rule, regulation or order of any governmental
agency or body or any court having jurisdiction over such Selling Stockholder or
any of its properties, (B) any agreement or instrument to which such Selling
Stockholder is a party or by which such Selling Stockholder is bound or to which
any of the properties of such Selling Stockholder is subject or (C) the
certificate or articles of incorporation or by-laws or other organizational
documents of such Selling Stockholder.
(e) The applicable Terms Agreement has been duly authorized,
executed and delivered by such Selling Stockholder and is the valid and binding
agreement of such Selling Stockholder enforceable against such Selling
Stockholder in accordance with its terms, except as rights to indemnity and
contribution thereunder may be limited by federal or state securities laws or
principles of public policy and except as enforcement thereof may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and
other laws relating to or affecting creditors' rights generally and the rights
of creditors of insurance companies generally and by general equitable
principles.
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3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. The
obligation of the Underwriters to purchase the Offered Securities will be
evidenced by an agreement or exchange of other written communications (including
the provisions of this Agreement incorporated by reference therein in accordance
with the next succeeding sentence, a "Terms Agreement") at the time the Selling
Stockholders determine to sell the Offered Securities. The applicable Terms
Agreement will incorporate by reference the provisions of this Agreement, except
as otherwise provided therein, and will specify the firm or firms which will be
Underwriters, the names of any Representatives, the number of shares to be
purchased by each Underwriter, the number of shares to be sold by each Selling
Stockholder and the purchase price to be paid by the Underwriters. The
applicable Terms Agreement will also specify the time and date of delivery and
payment (such time and date, or such other time not later than seven full
business days thereafter as the Underwriter first named in such Terms Agreement
(the "Lead Underwriter") and the Selling Stockholders agree as the time for
payment and delivery, being herein and in the applicable Terms Agreement
referred to as the "Closing Date"), the place of delivery and payment and any
details of the terms of offering that should be reflected in the prospectus
supplement relating to the offering of the Offered Securities. For purposes of
Rule 15c6-1 under the Exchange Act, the Closing Date (if later than the
otherwise applicable settlement date) shall be the date for payment of funds and
delivery of securities for all the Offered Securities sold pursuant to the
applicable Terms Agreement. The obligations of the Underwriters to purchase,
and of the Selling Stockholders to sell, the Offered Securities will be several
and not joint.
The certificates for the Offered Securities delivered to the
Underwriters on the Closing Date will be in definitive form, in such
denominations and registered in such names as the Lead Underwriter requests.
4. TERMS OF THE PUBLIC OFFERING. It is understood that the
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with
the Underwriters as follows:
(a) The Company will advise the Lead Underwriter promptly and,
if requested by the Lead Underwriter, will confirm such advice in writing: (i)
of any request by the Commission for amendment of or a supplement to the
Registration Statement or the Prospectus or for additional information; (ii) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or of the suspension of qualification of the Offered
Securities for offering or sale in any jurisdiction or the initiation of any
proceeding for such purpose; and (iii) within the period of time referred to in
paragraph (d) below, of any change in the condition (financial or other),
business, properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole, or of the happening of any event, which makes any
statement of a material fact made in the Registration Statement or the
Prospectus (as then amended or supplemented) untrue or which requires the making
of any additions to or changes in the Registration Statement or the Prospectus
(as then amended or supplemented) in order to state a material fact required by
the Act or the regulations thereunder to be stated therein or necessary in order
to make the statements therein not misleading, or of the necessity to amend or
supplement the Prospectus (as then amended or supplemented) to comply with the
Act or any other law. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company will
make every reasonable effort to obtain the withdrawal of such order at the
earliest possible time.
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(b) The Company will furnish to the Underwriters, without
charge, copies of the registration statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits thereto and Incorporated Documents, in such quantities as the
Underwriters may reasonably request.
(c) The Company will not (i) file any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus of
which the Lead Underwriter shall not previously have been advised or to which
the Lead Underwriter shall reasonably object after being so advised or (ii) so
long as, in the opinion of counsel for the Underwriters, a prospectus is
required to be delivered in connection with sales by the Underwriters or any
dealer, file any information, documents or reports pursuant to the Exchange Act,
without delivering a copy of such information, documents or reports to the
Underwriters prior to or concurrently with such filing.
(d) As soon after the execution and delivery of the applicable
Terms Agreement as possible and thereafter from time to time for such period as
in the opinion of counsel for the Underwriters a Prospectus is required by the
Act to be delivered in connection with sales by the Underwriters or any dealer,
the Company will expeditiously deliver to the Underwriters and each dealer,
without charge, as many copies of the Prospectus (and of any amendment or
supplement thereto) as the Underwriters may reasonably request. The Company
consents to the use of the Prospectus (and of any amendment or supplement
thereto) in accordance with the provisions of the Act and with the securities or
Blue Sky laws of the jurisdictions in which the Offered Securities are offered
by the Underwriters and by all dealers to whom Offered Securities may be sold,
both in connection with the offering and sale of the Offered Securities and for
such period of time thereafter as the Prospectus is required by the Act to be
delivered in connection with sales by the Underwriters or any dealer. If during
such period of time any event shall occur that in the judgment of the Company or
in the opinion of counsel for the Underwriters is required to be set forth in
the Prospectus (as then amended or supplemented) or should be set forth therein
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus, or to file under the Exchange Act any document which upon
filing becomes an Incorporated Document, to comply with the Act, the Exchange
Act or any other law, the Company will forthwith prepare and, subject to the
provisions of paragraph (c) above, file with the Commission an appropriate
supplement or amendment thereto or Incorporated Document and will expeditiously
furnish to the Underwriters and dealers a reasonable number of copies thereof.
(e) The Company will cooperate with the Underwriters and with
counsel for the Underwriters in connection with the registration or
qualification of the Offered Securities for offering and sale by the
Underwriters and by dealers under the securities or Blue Sky laws of such
jurisdictions as the Lead Underwriter may designate and will file such consents
to service of process or other documents necessary or appropriate in order to
effect such registration or qualification; provided that in no event shall the
Company be obligated to qualify to do business in any jurisdiction where it is
not now so qualified or take any action which would subject it to service of
process in suits, other than those arising out of the offering or sale of the
Offered Securities, in any jurisdiction where it is not now so subject.
(f) As soon as practicable after the date of the applicable
Terms Agreement, the Company will make generally available to its
securityholders an earnings statement, which need not be audited, covering a
period of at least 12 months beginning after the later of (i) the
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effective date of the registration statement relating to the Registered
Securities and (ii) the effective date of the most recent post-effective
amendment to the Registration Statement to become effective prior to the date of
such Terms Agreement, which will satisfy the provisions of Section 11(a) of the
Act.
(g) During the period of two years after the date of the
applicable Terms Agreement, the Company will furnish to the Underwriters, upon
the Underwriters' request, a copy of each report of the Company mailed to
stockholders filed by the Company with the Commission under the Exchange Act.
(h) If Rule 430A of the Act is employed, the Company will timely
file the Prospectus pursuant to Rule 424(b) under the Act and will advise the
Underwriters of the time and manner of such filing.
(i) Except as stated in this Agreement and in the Prospectus,
the Company has not taken, nor will it take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Common Stock to facilitate the
sale or resale of the Offered Securities.
(j) The Company agrees to pay the following costs and expenses
and all other costs and expenses incident to the performance by it of its
obligations hereunder: (i) the preparation, printing or reproduction, and
filing with the Commission of the Registration Statement (including financial
statements and exhibits thereto) and the Prospectus or any related preliminary
prospectus and each amendment or supplement to any of them; (ii) the printing
(or reproduction) and delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of the registration
statement, the Prospectus, the Incorporated Documents (as defined below) and all
amendments or supplements to any of them as may be reasonably requested for use
in connection with offerings and sales of the Offered Securities; (iii) the
preparation, printing, authentication, issuance and delivery of certificates for
the Offered Securities, including any stamp taxes in connection with the
original issuance and sale of the Offered Securities; (iv) the printing (or
reproduction) and delivery of this Agreement, Blue Sky Memoranda and all other
agreements or documents printed (or reproduced) and delivered in connection with
offerings of the Offered Securities; (v) the registration or qualification of
the Offered Securities for offer and sale under the securities or blue sky laws
of the several states as provided in Section 5(e) hereof (including the
reasonable fees, expenses and disbursements of counsel for the Underwriters
relating to the preparation, printing or reproduction, and delivery of Blue Sky
Memoranda and such registration and qualification); (vi) the filing fees and the
reasonable fees and expenses of counsel for the Underwriters in connection with
any filings required to be made with the National Association of Securities
Dealers, Inc.; (vii) the transportation and other expenses incurred by or on
behalf of Company management in connection with presentations to prospective
purchasers of the Offered Securities; and (viii) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Company and the Selling Stockholders.
6. AGREEMENTS OF THE SELLING STOCKHOLDERS. Each of the Selling
Stockholders agrees, severally and not jointly, with the Underwriters as
follows:
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(a) Such Selling Stockholder will cooperate to the extent
necessary to cause any post-effective amendment to the Registration Statement to
become effective at the earliest possible time.
(b) Such Selling Stockholder will pay all federal and other
taxes, if any, on the transfer or sale of any Offered Securities that are sold
by such Selling Stockholder to the Underwriters.
(c) Such Selling Stockholder will do or perform all things
required to be done or performed by it prior to the Closing Date to satisfy all
conditions precedent to the delivery of the Offered Securities by such Selling
Stockholder pursuant to the applicable Terms Agreement.
(d) Except as stated in the applicable Terms Agreement or in the
Prospectus, such Selling Stockholder will not take, directly or indirectly, any
action designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Common Stock to facilitate the
sale or resale of the Offered Securities.
(e) Such Selling Stockholder will advise the Underwriters
promptly, and if requested by the Underwriters, will confirm such advice in
writing, within the period of time referred to in Section 5(d) hereof, of any
change in information relating to such Selling Stockholder that suggests that
any statement relating to such Selling Stockholder made in the Registration
Statement or the Prospectus (as then amended or supplemented, if amended or
supplemented) is or may be untrue in any material respect or that the
Registration Statement or Prospectus (as then amended or supplemented, if
amended or supplemented) omits or may omit to state a material fact or a fact
necessary to be stated therein in order to make the statements therein relating
to such Selling Stockholder not misleading in any material respect.
(f) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal Responsibility
Act of 1982, as amended, with respect to the transactions contemplated by the
applicable Terms Agreement, such Selling Stockholder agrees to deliver to the
Underwriters prior to or on the Closing Date a properly completed and executed
United States Treasury Department Form W-9 if required by Treasury Department
regulations (or any other applicable form or statement specified by Treasury
Department regulations in lieu thereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase and pay for the Offered Securities
on any Closing Date will be subject to the accuracy in all material respects of
the representations and warranties on the part of the Company and the Selling
Stockholders in the applicable Terms Agreement and to the performance by the
Company and the Selling Stockholders of its obligations under the applicable
Terms Agreement in all material respects and to the following additional
conditions precedent:
(a) The Prospectus shall have been filed with the Commission in
accordance with the Commission's rules and regulations. Prior to the Closing
Date, no stop order suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company, threatened by the Commission.
(b) Subsequent to the execution and delivery of the applicable
Terms Agreement, there shall not have occurred (i) any change, or any
development or event involving
10
a prospective change, in the financial condition, business or results of
operations of the Company or its subsidiaries which, in the judgment of the Lead
Underwriter, would materially and adversely affect the market for the Offered
Securities; (ii) any suspension or material limitation of trading in securities
generally on the New York Stock Exchange, the American Stock Exchange or the
Nasdaq National Market; (iii) any general banking moratorium declared by U.S.
federal or New York authorities; or (iv) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in the judgment of the Lead Underwriter, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the public offering or the sale of and
payment for the Offered Securities.
(c) The Underwriters shall have received on the Closing Date, an
opinion of Xxxxx X. Xxxxxxxx, Esq., General Counsel of the Company, dated the
Closing Date and addressed to the Underwriters, and otherwise in form and
substance satisfactory to the Underwriters, covering the matters referred to in
Exhibit A hereto. All capitalized terms not defined in Exhibit A shall have the
meaning ascribed to them herein.
(d) The Underwriters shall have received on the Closing Date,
opinions of Xxxxxxx X. Xxxxxxx, Esq., Vice President and Deputy General Counsel
to Aetna Services Inc., and Xxxxxx Xxxx, Esq., Managing Director and Assistant
Legal Counsel, X.X. Xxxxxx & Co. Incorporated, counsel to X.X. Xxxxxx Capital
Corporation and Sixty Wall Street Fund, L.P., respectively, each dated the
Closing Date and addressed to the Underwriters, and otherwise in form and
substance satisfactory to the Underwriters, covering the matters referred to in
Exhibits B-1 and B-2 hereto, respectively. All capitalized terms not defined in
Exhibits B-1 and B-2 shall have the meaning ascribed to them herein.
(e) The Underwriters shall have received on the Closing Date an
opinion of Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters, dated the Closing
Date and addressed to the Underwriters, with respect to the Registration
Statement, the Prospectus and such other related matters as the Underwriters may
reasonably require.
(f) The Underwriters shall have received letters dated the date
of the applicable Terms Agreement and the Closing Date from KPMG Peat Marwick
LLP, independent certified public accountants, substantially in the forms
heretofore approved by the Underwriters.
(g) The Underwriters shall have received a certificate, dated
the Closing Date, of any two of the Chairman, President and Chief Executive
Officer; Vice Chairman; Chief Financial Officer; General Counsel and Secretary
of the Company; or such other officers as are acceptable to the Underwriters, in
which such officers, to the best of their knowledge, shall state that: the
representations and warranties of the Company in the applicable Terms Agreement
are true and correct in all material respects; the Company has performed or
complied with all agreements on its part required to be performed or complied
with pursuant to the applicable Terms Agreement at or prior to such Closing
Date; no stop order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been instituted or are
contemplated by the Commission; and, subsequent to the date of the most recent
financial statements included or incorporated by reference in the Prospectus,
there has been no material adverse change, in the financial condition, business
or results of operations of the
11
Company and its subsidiaries taken as a whole except as set forth in or
contemplated by the Prospectus.
(h) The Company and the Selling Stockholders shall have
furnished the Underwriters and their counsel with such conformed copies of such
certificates and documents as the Underwriters shall reasonably request. The
Lead Underwriter may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters under the
applicable Terms Agreement.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each of
the Representatives and each other Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act from and against any and all losses, claims, damages,
liabilities or expenses (or actions in respect thereof) arising out of or based
upon any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement, the Prospectus, or any amendment or
supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, or arising out of or based upon any 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 will reimburse the
Underwriters for any legal or other expenses reasonably incurred by such
Underwriters in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, except insofar as
such losses, claims, damages, liabilities, actions or expenses arise out of or
are based upon any untrue statement or omission or alleged untrue statement or
omission which has been made therein or omitted therefrom in reliance upon and
in conformity with information relating to such Underwriter furnished in writing
to the Company by or on behalf of such Underwriter through the Representatives
expressly for use in connection therewith, it being understood and agreed that
the only such information furnished by the Representatives consists of the
information described as such in the applicable Terms Agreement; PROVIDED,
HOWEVER, that the indemnification contained in this paragraph (a) with respect
to any preliminary prospectus or preliminary prospectus supplement shall not
inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) to the extent that any such loss, claim, damage,
liability or expense arises from the sale of the Offered Securities by such
Underwriter to any person if it shall be established that a copy of the
Prospectus shall not have been delivered or sent to such person within the time
required by the Act and the regulations thereunder, and the untrue statement or
alleged untrue statement or omission or alleged omission of a material fact
contained in such preliminary prospectus or preliminary prospectus supplement
was corrected in the Prospectus and such correction would have cured the defect
giving rise to such loss, claim, damage, liability or expense; PROVIDED that the
Company delivered the Prospectus to the Underwriters in requisite quantity on a
timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.
(b) Each Selling Stockholder, severally and not jointly, agrees
to indemnify and hold harmless each of the Representatives and each other
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages, liabilities or expenses (or actions
in respect thereof) arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement, the
Prospectus, or any
12
amendment or supplement thereto, or any related preliminary prospectus or
preliminary prospectus supplement, or arising out of or based upon any 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 will
reimburse the Underwriters for any legal or other expenses reasonably incurred
by such Underwriters in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred; in each
case to the extent, but only to the extent, that such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) arise out of or are
based upon information relating to such Stockholder furnished in writing by or
on behalf of such Selling Stockholder expressly for use in the Registration
Statement, the Prospectus, any amendment or supplement thereto, or any related
preliminary prospectus or preliminary prospectus supplement, it being understood
and agreed that the only such information furnished by the Representatives
consists of the information described as such in the applicable Terms Agreement;
PROVIDED, HOWEVER, that the indemnification contained in this paragraph (b) with
respect to any preliminary prospectus or preliminary prospectus supplement shall
not inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) on account of any such loss, claim, damage,
liability or expense arising from the sale of the Offered Securities by such
Underwriter to any person if it shall be established that a copy of the
Prospectus shall not have been delivered or sent to such person within the time
required by the Act and the regulations thereunder, and the untrue statement or
alleged untrue statement or omission or alleged omission of a material fact
contained in such preliminary prospectus or preliminary prospectus supplement
was corrected in the Prospectus and such correction would have cured the defect
giving rise to such loss, claim, damage, liability or expense; PROVIDED that the
Company delivered the Prospectus to the Underwriters in requisite quantity on a
timely basis to permit such delivery or sending. The foregoing indemnity shall
be in addition to any liability which the Selling Stockholders may otherwise
have.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company and each Selling Stockholder and any
person who controls the Company or any Selling Stockholder within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act against any losses,
claims, damages or liabilities to which the Company or any Selling Stockholder
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions 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, the Prospectus, or any amendment or
supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, 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 each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Underwriters specifically for use therein, and will reimburse any legal or other
expenses reasonably incurred by the Company or the Selling Stockholders in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being understood and
agreed that the only such information furnished by the Representatives consists
of the information described as such in the applicable Terms Agreement. The
foregoing indemnity agreement shall be in addition to any liability which the
Underwriters may otherwise have.
(d) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is
13
to be made against the indemnifying party under subsection (a), (b) or (c)
above, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under
subsection (a), (b) or (c) above. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, including the employment of counsel.
Such indemnified party shall have the right to employ separate counsel in any
such action, suit or proceeding and to participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party has agreed in writing to pay
such fees and expenses, (ii) the indemnifying party has failed to assume the
defense and employ counsel or (iii) the named parties to any such action, suit
or proceeding (including any impleaded parties) include both such indemnified
party and the indemnifying party and such indemnified party shall have been
advised by its counsel that the representation of such indemnified party and the
indemnifying party by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by the
same counsel has been proposed) due to actual or potential differing interests
between them (in which case the indemnifying party shall not have the right to
assume the defense of such action, suit or proceeding on behalf of such
indemnified party). It is understood, however, that the indemnifying party
shall, in connectio with any one such action, suit or proceeding or separate but
substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for (i) the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for such indemnified
parties not having actual or potential differing interest with the Underwriters
or among themselves, which firm shall be designated in writing, in the care of
the Underwriters, by the Lead Underwriter and (ii) the reasonable fees and
expenses of only one separate firm of attorneys (in addition to any local
counsel) at any time for all such Selling Stockholders not having actual or
potential differing interest among themselves, which firm shall be designated in
writing by the Selling Stockholders selling a majority of the Offered
Securities, and that all such fees and expenses shall be reimbursed as they are
incurred. The indemnifying party shall not be liable for any settlement of any
such action, suit or proceeding effected without its written consent, but if
settled with such written consent, or if there be a final judgment for the
plaintiff in any such action, suit or proceeding, the indemnifying party agrees
to indemnify and hold harmless any indemnified party, to the extent provided in
paragraphs (a), (b) or (c) of this Section 8, from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a), (b) or (c)
above (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriters on the other from the offering of the Offered Securities or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Selling Stockholders 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 as well as any other relevant equitable
considerations. The relative benefits received by the Company and
14
the Selling Stockholders 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 Selling Stockholders bear
to the total underwriting discounts and commissions received by the
Underwriters. The relative fault of the parties shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, the Selling Stockholders or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities referred to in the first sentence of this subsection () shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (e). Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Offered Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(f) The obligations of the Company and the Selling Stockholders
under this Section shall be in addition to any liability which the Company and
the Selling Stockholders may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls each Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section shall be in addition to any liability which the Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed the
Registration Statement and to each person, if any, who controls the Company or
any Selling Stockholder within the meaning of the Act or the Exchange Act.
(g) Notwithstanding any other provision of this Section 8, the
total liability of any Selling Stockholder for indemnification and contribution
under this Section 8 shall not exceed an amount equal to the number of shares of
Offered Securities sold by such Selling Stockholder under the applicable Terms
Agreement multiplied by the purchase price per share set forth in the applicable
Terms Agreement.
9. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters
default in their obligations to purchase Offered Securities under the applicable
Terms Agreement and the aggregate number of shares of Offered Securities that
such defaulting Underwriter or Underwriters agreed but failed to purchase does
not exceed 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on the Closing Date, the Lead Underwriter
may make arrangements satisfactory to the Company for the purchase of such
Offered Securities by other persons, including any of the Underwriters, but if
no such arrangements are made by the Closing Date, the non-defaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments under the applicable Terms Agreement, to purchase the Offered
Securities that such defaulting Underwriters agreed but failed to purchase on
the Closing Date. If any Underwriter or Underwriters so default and the
aggregate number of shares of Offered Securities with respect to which such
default or defaults occur exceeds 10% of the total number of shares of Offered
Securities that the Underwriters are
15
obligated to purchase on the Closing Date and arrangements satisfactory to the
Lead Underwriter and the Company for the purchase of such Offered Securities by
other persons are not made within 36 hours after such default, the applicable
Terms Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
10. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers, of the Selling Stockholders and of
the Underwriters set forth in or made pursuant to the applicable Terms Agreement
will remain in full force and effect, regardless of any investigation, or
statement as to the results thereof, made by or on behalf of the Underwriters,
the Company, any Selling Stockholder or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If for any reason the purchase of the
Offered Securities by the Underwriters is not consummated pursuant to the
applicable Terms Agreement (otherwise than pursuant to clause (ii), (iii) or
(iv) of Section 7(b) or Section 9 hereto), the Company shall remain responsible
for the expenses to be paid or reimbursed by it pursuant to Section 5(j) hereto
and the respective obligations of the Company, the Selling Stockholders and the
Underwriters pursuant to Section 8 hereto shall remain in effect, and if any
Offered Securities have been purchased hereunder the representations and
warranties in Sections 1 and 2 and all obligations under Sections 5 and 6 hereto
shall also remain in effect. If the purchase of the Offered Securities by the
Underwriters is not consummated for any reason other than solely because of the
occurrence of any event specified in clause (ii), (iii) or (iv) of Section 7(b),
the Company will reimburse the Underwriters for all out-of- pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the Offered Securities.
11. NOTICES. All communications hereunder will be in writing and
will be mailed, delivered or telegraphed and confirmed to them (i) if to the
Company, at the office of the Company at Xxx Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx
00000, Attention: Xx. Xxx X. Xxxxxxx, Vice Chairman, with copies to: Xxxxx X.
Xxxxxxxx, Esq., General Counsel, and Xxxxxxxxx X. Xxxxxx Esq., Deputy General
Counsel of Travelers Group; (ii) if to the Selling Stockholders, at the offices
of (a) Aetna Services, Inc., Law & Regulation Affairs RC4A, 151 Farmington
Avenue, Hartford, Connecticut 06156-3124, Attention: Xx. Xxxxxxx X. Xxxxxxx,
with a copy to: Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxxx X. Xxxxxxx, Esq.; (b) X.X. Xxxxxx Capital Corporation,
00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: J. Xxxxxx Xxxxxxxx, Esq.,
with a copy to: Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxxx X. Xxxxxxx, Esq.; and (c) Sixty Wall Street Fund,
L.P., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: J. Xxxxxx Xxxxxxxx,
Esq., with a copy to: Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx,, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxxx X. Xxxxxxx, Esq.; or (iii) if to the
Underwriters, to the Lead Underwriter as set forth in the applicable Terms
Agreement, with a copy to Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxx X. Xxxxxx, Esq.
12. SUCCESSORS. Each Terms Agreement (including the provisions
of this Agreement) is and has been made solely for the benefit of the several
Underwriters, the Company, the Company's directors and officers, the Selling
Stockholders and the controlling persons referred to in Section 8 hereof and
their respective successors and assigns, to the extent
16
provided herein, and no other person shall acquire or have any right under or by
virtue of this Agreement or any Terms Agreement. Neither the term "successor"
nor the term "successors and assigns" as used in this Agreement shall include a
purchaser from any Underwriter of any of the Offered Securities in his status as
such purchaser.
13. COUNTERPARTS. This Agreement and any Terms Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
Agreement.
14. APPLICABLE LAW. Each Terms Agreement (including the
provisions of this Agreement) shall be governed by, and construed in accordance
with, the laws of the State of New York, without regard to principles of
conflicts of laws.
17
Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Selling Stockholders and the Underwriters.
Very truly yours,
TRAVELERS PROPERTY CASUALTY CORP.
By:
-------------------------------------
Name:
Title:
AETNA SERVICES, INC.
By:
-------------------------------------
Name:
Title:
X.X. XXXXXX CAPITAL CORPORATION
By:
-------------------------------------
Name:
Title:
SIXTY WALL STREET FUND, L.P.
By:
-------------------------------------
Name:
Title:
18
Confirmed as of the date first
above mentioned.
By X.X. XXXXXX SECURITIES INC.
By:
----------------------------
Managing Director
19
EXHIBIT A
---------
(OPINION OF XXXXX X. XXXXXXXX)
1. The Company is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such registration or
qualification, except where the failure or failures (individually or in the
aggregate) so to register or qualify does or do not have a material adverse
effect on the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a whole.
2. Each of the Subsidiaries is a corporation duly incorporated and
validly existing in good standing under the laws of the jurisdiction of its
incorporation and has the corporate power and authority to own, lease, and
operate its properties and to conduct its business as described in the
Prospectus; and all the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable, and are owned by the Company directly or indirectly, free and
clear of any lien, adverse claim, security interest or other encumbrance.
3. Each of the Subsidiaries has full corporate power and authority,
and the Company and each of the Subsidiaries has all necessary governmental
authorizations, approvals, orders, licenses, certificates, franchises and
permits of and from all governmental regulatory officials and bodies (including,
without limitation, insurance licenses from the insurance regulatory agencies of
the various states where it conducts business) (except where the failure so to
have any such authorizations, approvals, orders, licenses, certificates,
franchises or permits, individually or in the aggregate, would not have a
material adverse effect on the condition (financial or other), business,
properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole), to own their respective properties and to
conduct their respective businesses as now being conducted, as described in the
Prospectus.
4. Neither the Company nor any of the Subsidiaries is in violation
of its respective certificate or articles of incorporation or by-laws, or other
organizational documents, or to the best knowledge of such counsel, is in
default in the performance of any obligation, agreement or condition contained
in any bond, debenture, note or other evidence of indebtedness or in any
agreement, indenture, lease or other instrument to which the Company or any of
the Subsidiaries is a party or to which any of them or any of their respective
properties may be bound other than any such violation or default that would not,
net of reinsurance, reserves and taxes, have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and its subsidiaries taken as a whole.
5. Neither the execution, delivery or performance of the Terms
Agreement by the Company, nor the consummation by the Company of the
transactions contemplated thereby (A) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the certificate
or articles of incorporation or by-laws of the Company or any of the
Subsidiaries, (B) conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, (i) any agreement, indenture, lease
or other instrument to which the Company is a party or by which it or any of its
properties may be bound or (ii) any material agreement, indenture, lease or
other instrument to which any of the Subsidiaries is a party or by which any of
them or any of their respective properties may be bound, in each case that is an
exhibit to the Registration Statement or any Incorporated Document or that is
known to such counsel, (C) will result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of
the Subsidiaries, or (D) violate or will violate any statute, law,
regulation, filing, ruling (assuming compliance with all applicable state
securities and Blue Sky laws), judgment, injunction, order or decree of any
government, governmental instrumentality (including, without limitation, any
insurance regulatory agency or body), or court, domestic or foreign, known to
such counsel, applicable to the Company or any of the Subsidiaries or any of
their respective properties, except, in the case of clauses (B), (C) and (D) of
this paragraph (5), any such conflict, breach or default or any such lien or
encumbrance that would not (individually or in the aggregate) have a material
adverse effect on the condition (financial or other), business, properties, net
worth or results of operations of the Company and its subsidiaries taken as a
whole.
6. No consent, approval, authorization or other order of or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or official (except such as has been
obtained under the Act or such as may be required under state securities or Blue
Sky laws governing the purchase and distribution of the Offered Securities) is
required on the part of the Company for the execution, delivery or performance
of the Terms Agreement, except, in each case, where the failure to obtain such
consent, approval, authorization or other order to make such registration or
filing would not have (individually or in the aggregate) a material adverse
effect on the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a whole.
7. Each of the Subsidiaries is duly organized and licensed as an
insurance company in the state of its incorporation and is duly licensed or
authorized as an insurer or reinsurer in each other jurisdiction where it is
required to be so licensed or authorized to conduct its business as described in
the Prospectus, except where the failure (individually or in the aggregate) to
be so licensed or authorized in any such jurisdiction does not have a material
adverse effect on the condition (financial or other), business, properties, net
worth or results of operations of the Company and its subsidiaries taken as a
whole.
8. Except as described in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and there is no
commitment, plan or arrangement to issue any shares of capital stock of the
Company or any security convertible into or exchangeable or exercisable for
capital stock of the Company.
9. Except as described in the Prospectus, there is no holder of any
security of the Company or any other person who has the right, contractual or
otherwise, to cause the Company to sell or otherwise issue to them, or to permit
them to underwrite the sale of, the Offered Securities or the right to have any
Common Stock or other securities of the Company included in the Registration
Statement or the right, as a result of the filing of the Registration Statement,
to require registration under the Act of any shares of Common Stock or other
securities of the Company.
10. The Company has corporate power and authority to enter into the
Terms Agreement, and the Terms Agreement has been duly authorized, executed and
delivered by the Company and is a valid, legal and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
enforcement of rights to indemnity and contribution thereunder may be limited by
federal or state securities laws or principles of public policy and subject to
the qualification that the enforceability of the Company's obligations
thereunder may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally and by general equitable principles.
A-2
11. All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued, and are fully paid and
nonassessable; and the Class A Common Stock conforms in all material respects as
to legal matters to the description thereof incorporated by reference in the
Prospectus.
12. The Incorporated Documents (except for the financial statements
and the notes thereto and the schedules and other financial and statistical
information included therein, as to which no opinion need be expressed), at the
time they were filed with the Commission (or, if any amendment with respect to
any such document was filed, when such document was filed), complied as to form
in all material respects with the requirements of the Exchange Act.
13. The Registration Statement was declared effective under the Act,
and, to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or have been communicated
by the Commission to the Company as being contemplated by it under the Act. The
Registration Statement, as of its effective date, and the Prospectus, as of its
date and as of the Closing Date, comply as to form in all material respects with
the requirements of the Act and the applicable rules and regulations thereunder
(except as to the financial statements or other data of a financial or
statistical nature, as to which no opinion need be expressed); such counsel has
no reason to believe that the Registration Statement, as of its effective date,
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, as of its date or as of the
Closing Date, contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading (except as to the financial statements or
other data of a financial or statistical nature, as to which no opinion need be
expressed). The descriptions in the Registration Statement and the Prospectus of
statutes, legal and governmental proceedings and contracts and other documents
are accurate and fairly present the information required to be shown; and such
counsel does not know of any legal or governmental proceedings required to be
described in the Registration Statement or Prospectus which are not described as
required or of any contracts or documents of a character required to be
described in the Registration Statement or Prospectus or to be filed as exhibits
to the Registration Statement or any Incorporated Document which are not
described and filed as required; except that such counsel need not express any
opinion as to the financial statements or other data of a financial or
statistical nature contained in the Registration Statement or the Prospectus.
While such counsel need not independently verify nor assume any responsibility
for the accuracy, completeness or fairness of the statements, except as
expressly referred to in the immediately preceding sentence, contained in the
Registration Statement or the Prospectus, the foregoing opinion in the second
and third sentences in this paragraph 13 shall be based upon such counsel's
review and discussion with members of the Travelers Group Inc. legal staff who
participated in the preparation of the Registration Statement and the Prospectus
(including any Incorporated Documents) and any amendments and supplements
thereto (including any such Incorporated Documents), review and discussion of
the contents thereof and the knowledge such counsel has gained in such counsel's
capacity as Senior Vice President, General Counsel and Secretary to the Company,
but without any independent check or verification on such counsel's part.
X-0
XXXXXXX X-0
-----------
(OPINION OF XXXXXXX X. XXXXXXX)
(i) No consent, approval, authorization or order of, or filing with, any
court or governmental agency or body of the United States or the State of
New York or the State of Connecticut is required on behalf of Aetna
Services, Inc. ("Aetna") for the sale of the Offered Securities in
accordance with the Terms Agreement, except for such consents, approvals,
authorizations, orders or filings as have been made or obtained under the
Securities Act of 1933, as amended, and such consents, approvals,
authorizations, orders or filings as may be required under state
securities or Blue Sky laws or insurance securities laws of any such
jurisdiction in connection with the purchase and sale and distribution of
the Offered Securities by the Underwriters, and except those which, if
not made or obtained, would not have a material adverse effect on the
sale of the Offered Securities;
(ii) Aetna has the corporate power and authority to sell, assign, transfer and
deliver the Offered Securities to the Underwriters on the Closing Date as
provided in the Terms Agreement; and, upon delivery of such Offered
Securities and payment therefor as contemplated by the Terms Agreement
and assuming the several Underwriters purchased such Offered Securities
in good faith and without notice of an adverse claim within the meaning
of Section 8-102 of the Uniform Commercial Code of the State of New York,
under such Uniform Commercial Code the several Underwriters will acquire
the Offered Securities free of any adverse claim (as defined in such
Section 8-102);
(iii) To my knowledge: the sale of the Offered Securities and the performance
by Aetna of its obligations under the Terms Agreement will not conflict
with or result in a breach or violation by Aetna of any of the terms or
provisions of, or constitute a default by Aetna under, any indenture,
mortgage, deed of trust, loan agreement or other similar agreement or
instrument to which Aetna is party or by which Aetna is bound or to which
any of the property or assets of Aetna is subject, except, in all such
cases, for such conflicts, breaches, violations or defaults as would not
have a material adverse effect on the sale of the Offered Securities; the
sale of the Offered Securities and the performance by Aetna of its
obligations under the Terms Agreement will not result in any violation of
the provisions of the Amended and Restated Certificate of Incorporation
or By-Laws of Aetna; and the sale of the Offered Securities and the
performance by Aetna of its obligations under the Terms Agreement will
not result in any violation of any statute of the United States or the
State of New York or the State of Connecticut or any order, rule or
regulation of any court or governmental agency or body of the United
States or the State of New York or the State of Connecticut having
jurisdiction over Aetna or any of its properties, except such violations
as would not have a material adverse effect on the sale of the Offered
Securities; provided that, with respect to this paragraph (iii) I do not
express any opinion as to any violation of any fraudulent transfer laws
or other antifraud laws or as to any violation of any federal or state
securities laws or Blue Sky or insurance securities laws; and provided
further that, insofar as performance by Aetna of its obligations under
the Terms Agreement is concerned, I do not express any opinion as to
bankruptcy, insolvency, reorganization, moratorium and other similar laws
now or hereafter in effect relating to or affecting creditors' rights
generally and the rights of creditors of insurance companies generally;
and
(iv) The Terms Agreement has been duly authorized, executed and delivered by
Aetna.
EXHIBIT B-2
-----------
(OPINION OF XXXXXX XXXX)
(i) No consent, approval, authorization or order of, or filing with, any
governmental agency or body or any court is required by on behalf of X.X
Xxxxxx Capital Corporation ("Xxxxxx Capital") or Sixty Wall Street Fund,
L.P. ("60WSF") for the sale of the Offered Securities by Xxxxxx Capital
or 60WSF pursuant to the Terms Agreement, except (A) such consents,
approvals, authorizations, orders or filings as have been obtained or
made under the Act, (B) such consents, approvals, authorizations, orders
or filings as may be required under state securities laws and (C) such
consents, approvals, authorizations, orders or filings which if not
obtained would not have a material adverse effect on the sale of the
Offered Securities by Xxxxxx Capital or 60WSF.
(ii) Each of Xxxxxx Capital and 60WSF has the requisite corporate or
partnership power and authority to sell, assign, transfer and deliver the
Offered Securities on the Closing Date as provided in the Terms
Agreement; and, upon delivery of such Offered Securities and payment
therefor as contemplated by the Terms Agreement and assuming the several
Underwriters purchased such Offered Securities in good faith and without
notice of an adverse claim within the meaning of the UCC as in effect in
the State of New York (the "UCC"), the several Underwriters will acquire
the Offered Securities free and clear of any adverse claim within the
meaning of the UCC.
(iii) To my knowledge, neither the execution, delivery and performance of the
Terms Agreement by Xxxxxx Capital or 60WSF or the sale of the Offered
Securities by Xxxxxx Capital or 60WSF will result in (A) a breach or
violation of any of the terms and provisions of, the charter, by-laws or
other organizational documents of either Xxxxxx Capital or 60WSF; (B) the
violation of any statute, any rule, regulation or order of any New York
State or federal governmental agency or body or any New York State or
federal court having jurisdiction over Xxxxxx Capital or 60WSF or any of
their properties; or (C) conflict with, or result in a breach or default
under, any material agreement, indenture, mortgage or other instrument to
which Xxxxxx Capital or 60WSF is a party or by which Xxxxxx Capital or
60WSF is bound, except in the case of clause (A), (B) or (C) above for
any breach, violation, conflict or default that would not have a material
adverse effect on the sale of the Offered Securities by Xxxxxx Capital or
60WSF.
(iv) The Terms Agreement has been duly authorized, executed and delivered by
each of Xxxxxx Capital and 60WSF.
TRAVELERS PROPERTY CASUALTY CORP.
(A DELAWARE CORPORATION)
CLASS A COMMON STOCK
TERMS AGREEMENT
---------------
June __, 1998
Aetna Services, Inc.
Law & Regulation Affairs RC4A
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
X.X. Xxxxxx Capital Corporation
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Sixty Wall Street Fund, L.P.
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Travelers Property Casualty Corp.
Xxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Dear Sirs:
Reference is made to that certain Underwriting Agreement, dated June
__, 1998 (the "Underwriting Agreement"), among certain stockholders (the
"Selling Stockholders") named therein of Travelers Property Casualty Corp., a
Delaware corporation (the "Company"), X.X. Xxxxxx Securities Inc. ("X.X.
Xxxxxx") and the Company. A copy of the Underwriting Agreement is attached
hereto as Annex A. The provisions of the Underwriting Agreement are incorporated
by reference herein and shall be deemed to be part of this Terms Agreement as if
such provisions had been set forth in full herein.
We understand that, as contemplated by the Underwriting Agreement, the
Selling Stockholders propose to sell, and the Underwriters referred to below,
for whom X.X. Xxxxxx will act as representative (the "Representative"), propose
to purchase, an aggregate of 8,918,395 shares of Class A Common Stock (the
"Common Stock"), $.01
par value per share, of the Company (the "Registered Securities"). The number
of shares to be sold by each of the Selling Stockholders is set forth on
Schedule I hereto, and the number of shares to be purchased by each of the
Underwriters is set forth on Schedule II hereto.
The statements set forth in the prospectus supplement dated June __,
1998 (the "Prospectus Supplement") under the caption "Underwriting" constitute
the only information furnished by or on behalf of the Underwriters through the
Representative as such information is referred to in Section 8 of the
Underwriting Agreement. The statements set forth in the Prospectus under the
caption "Selling Stockholders" and in the Prospectus Supplement under the
caption "Selling Stockholders" constitute the only information furnished by or
on behalf of the Selling Stockholders as such information is referred to in
Section 8 of the Underwriting Agreement
Subject to the terms and conditions set forth or incorporated by
reference herein, the Underwriters hereby agree, severally and not jointly, to
purchase all of the Registered Securities on the terms set forth below:
Purchase price per share: $
Date, time and location
of delivery of shares: At or about 9:00 a.m
New York City Time
June __, 1998
X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Closing date and location: June __, 1998
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
2
If the terms set forth above are acceptable to you, please indicate
your acceptance of this offer by signing a copy of this Terms Agreement in the
space set forth below and returning the signed copy to us no later than [7:00]
p.m. (New York City time) on June __, 1998.
Very truly yours,
X.X. XXXXXX SECURITIES INC.
By:
-------------------------------------
Name:
Title
Accepted:
AETNA SERVICES, INC.
By:
-------------------------------------
Name:
Title
X.X. XXXXXX CAPITAL CORPORATION
By:
-------------------------------------
Name:
Title
SIXTY WALL STREET FUND, L.P.
By:
-------------------------------------
Name:
Title
TRAVELERS PROPERTY CASUALTY
CORP.
By:
-------------------------------------
Name:
Title
3
SCHEDULE I
SELLING STOCKHOLDERS
Name Number of Shares to be Sold
---- ---------------------------
Aetna Services, Inc. . . . . . . . . . . . 4,270,697
X.X. Xxxxxx Capital Corporation. . . . . . 4,598,410
Sixty Wall Street Fund, L.P. . . . . . . . 50,997
---------
Total. . . . . . . . . . . . . 8,918,395
=========
4
SCHEDULE II
UNDERWRITERS
Name Number of Shares
---- ----------------
X.X. Xxxxxx Securities Inc. . . . . . . . .
Total. . . . . . . . . . . . . . 8,918,395
=========
5
ANNEX A
UNDERWRITING AGREEMENT
----------------------
