5,000,000 Shares
AmerUs Life Holdings, Inc.
Class A Common Stock
(no par value)
SUBSCRIPTION AGENCY AGREEMENT
______________, 1996
The Chicago Corporation
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Gentlemen:
SECTION 1. INTRODUCTION. AmerUs Life Holdings, Inc., an Iowa
corporation, (the "Company"), and AmerUs Group Co., an Iowa Corporation (the
"Selling Shareholder" and, together with the Company, the "Offerors") are
offering to certain policyowners of AmerUs Life Insurance Company, an Iowa
corporation, ("AmerUs Life") nontransferable rights to subscribe for up to
5,000,000 shares of the Class A Common Stock, no par value of the Company (the
"Class A Common Stock") pursuant to a subscription offering (the "Subscription
Offering") contemplated by a plan of reorganization approved by the Iowa
Commissioner of Insurance (the "Iowa Insurance Commissioner"). One-half of the
shares of Class A Common Stock being offered in the Subscription Offering are
being sold by the Company, and the other half are being sold by the Selling
Shareholder. The Company has a total of 125,000,000 shares of authorized common
stock divided into two classes consisting of 75,000,000 shares of Class A Common
Stock, no par value (the "Class A Common Stock"), and 50,000,000 shares of Class
B Common Stock, no par value (the "Class B Common Stock"). The price per share
of Class A Common Stock being offered in the Subscription Offering has been
fixed at $_____ (the "Subscription Price"), subject to adjustment as hereinafter
provided.
It is acknowledged that the purchase of shares of Class A Common Stock
in the Subscription Offering for each subscriber is subject to a maximum
purchase limitation of 5,000 shares and a minimum purchase limitation of 100
shares. It is currently the intention of the Offerors to offer all or a portion
of the Class A Common Stock not subscribed for in the Subscription Offering to
the public in a public offering (the "Public Offering"). If the price in the
public offering (the "Public Offering Price") is less than
the Subscription Price, then the Offerors shall issue refunds to subscribing
policyowners equal to the amount of such difference multiplied by the number of
shares subscribed for. In the event that the Offerors determine that the
closing of the Subscription Offering shall occur without a subsequent Public
Offering and provided that the Offerors elect to proceed with the Subscription
Offering, a bona fide determination will be made by the Offerors after
consultation with their financial advisors of the price per share at which the
Class A Common Stock would trade in the public market on the closing of the
Subscription Offering (the "Revised Subscription Price"). If the Revised
Subscription Price is less than the Subscription Price, then the Offerors will
issue refunds to subscribing policyowners equal to the amount of such difference
multiplied by the number of shares subscribed for.
The Offerors have heretofore prepared and delivered to the Agent (as
hereinafter defined) copies of the final Prospectus dated ____________, 1996
included as part of the Registration Statement (as such term is defined in
Section 5(c)) when it was declared effective by the SEC (the "Prospectus"),
except that if the Prospectus filed by the Offerors pursuant to Rule 424(b) of
the rules and regulations of the SEC under the Securities Act of 1933 (the
"Act") and the rules and regulations of the SEC thereunder (the "SEC Rules and
Regulations") differs from the Prospectus on file at the time the Registration
Statement initially became effective, the term "Prospectus" shall refer to the
prospectus filed pursuant to Rule 424(b) from and after the time said prospectus
is filed with or mailed to the SEC for filing. The Prospectus contains, among
other things, information with respect to the Company and the Class A Common
Stock.
The Offerors desire to retain The Chicago Corporation (the "Agent") to
act as the Offerors' exclusive subscription agent in connection with the
Subscription Offering. The Offerors hereby confirm their agreements contained
herein with the Agent with respect to the appointment of the Agent as their
agent to assist in the sale of the Class A Common Stock in the Subscription
Offering.
SECTION 2. APPOINTMENT OF THE AGENT. Subject to the terms and
conditions of this Agreement, the Offerors hereby appoint the Agent, as their
exclusive subscription agent, to consult with and advise the Offerors in
connection with the Subscription Offering, and to solicit subscriptions for
shares of Class A Common Stock in the Subscription Offering. On the basis of
the representations, warranties and agreements herein contained, the Agent
accepts such appointment and agrees to assist the Offerors in the
Subscription Offering through selling Class A Common Stock on a "best
efforts" basis through the Agent's distribution system and potentially
through other NASD (as such term is hereinafter defined) registered
broker/dealers; provided, however, that the Agent shall not be responsible
for obtaining subscriptions for any specific number of shares of Class A
Common Stock and shall not be
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obligated to take any action which is inconsistent with any applicable laws,
rules, regulations, decisions or orders. Subscriptions will be offered by means
of Stock Order Forms. The appointment of the Agent hereunder shall terminate
upon the termination of the Subscription Offering.
The Offerors hereby agree and acknowledge that the Agent may utilize,
if deemed appropriate by the Agent, other broker/dealers which are members of
the National Association of Securities Dealers, Inc. (the "NASD"). The Agent
hereby agrees that prior to utilizing other broker/dealers, the Agent will
consult with the Offerors regarding its determination and will not take any
action in this regard which is not approved in writing by the Offerors.
The Offerors hereby further agree and acknowledge that, having
appointed the Agent hereunder, only personnel employed by the Agent, and such
other personnel as are assigned for specific purposes or services contemplated
by this Agreement to be performed by the Agent, will be involved in providing
the services described herein.
All subscription funds received by the Agent or by other
broker/dealers soliciting subscriptions (if any) shall be promptly
transmitted (either by U.S. Mail or similar type of transmittal) to the
Offerors' escrow and transfer agent by noon of the following business day.
SECTION 3. FEES. In addition to the expenses specified in Sections 7
and 8 hereof, as compensation for the Agent's services under this Agreement, the
Offerors will pay the following fees or expenses to the Agent:
(a) A fee of one percent of the total aggregate proceeds of the
Subscription Offering shall be paid to the Agent for the first $10,000,000 of
aggregate proceeds of the Subscription Offering and a fee of one half of one
percent shall be paid for aggregate proceeds of the Subscription Offering in
excess of $10,000,000 (if any); provided, however, that the Agent's minimum
compensations for services rendered hereunder shall be $25,000.
(b) As stated above, the Agent may use other selected broker/dealers
to assist in the subscription or purchase of the shares. Any fees payable to
such persons or broker/dealers shall be paid by the Agent out of the fees
received by the Agent pursuant to subparagraph (a). The decision to use
selected broker/dealers shall be made by the Agent in consultation with the
Offerors.
(c) Reimbursement for reasonable out-of-pocket expenses (including
expenses related to attorneys' fees and expenses), provided that the retention
of outside counsel has previously been approved by the Offerors.
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SECTION 4. CLOSING. In the event that the Subscription Offering is
not consummated for any reason, including but not limited to the inability to
sell the Class A Common Stock during the Subscription and Public Offering
(including any permitted extension thereof), this Agreement shall terminate and
any persons who have subscribed for any of the shares of Class A Common Stock
shall have refunded to them the full amount which has been received from such
person, together with interest, if any, as provided in the Prospectus relating
to the Subscription Offering. In the event of an over-subscription of the
Subscription Offering, the Offerors shall allocate the shares to subscribers in
accordance with the terms of the Subscription Offering. The Offerors hereby
agree that the Agent shall be held harmless from any liability arising out of
any allocation of shares of Class A Common Stock. A closing shall be held at
such place as shall be agreed upon between the Offerors and the Agent, as of the
close of business on a business day to be selected by the Offerors and
contemporaneous with the closing of the Public Offering or at such other time as
shall be agreed upon between the Offerors and the Agent. The Offerors shall
notify the Agent by telephone, confirmed in writing, when funds shall have been
received for all shares of the Class A Common Stock purchased in the
Subscription Offering. At the closing, the Offerors shall deliver to the Agent
in next day funds the fees and expenses due and owing to the Agent as set forth
in Sections 3, 7 and 8 hereof, any certificates required hereby and other
documents deemed reasonably necessary by the Agent shall be executed and
delivered to effect the sale of the Class A Common Stock as contemplated hereby
and pursuant to the terms of the Prospectus. The hour and date upon which the
Offerors shall release for delivery all shares of Class A Common Stock, in
accordance with the terms hereof, are referred to herein as the "Closing Date."
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE OFFERORS. The
Company and the Selling Shareholder, each severally on behalf of and as to
itself, represents and warrants to, and agrees with, the Agent that:
(a) This Agreement has been duly authorized, executed and delivered
by each of the Company and the Selling Shareholder and is a valid and binding
agreement and obligation of each of the Company and the Selling Shareholder
except as (i) rights to indemnity and contribution hereunder may be limited by
federal or state securities laws or the public policy underlying such laws; (ii)
the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting the
enforcement of creditors' rights generally or by general equity principles,
regardless of whether such enforceability is considered in a proceeding in
equity or at law; and (iii) the remedy of specific enforcement and injunctive
and other forms of equitable relief may be subject to certain equitable defenses
and to the discretion of the court before which any proceeding therefor may be
brought.
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(b) As of the Closing Date, each of the Company and the Selling
Shareholder will have satisfied the conditions precedent to its consummation of
the Subscription Offering in all material respects in accordance with the
Subscription Offering, all applicable laws, regulations, decisions and orders,
including all terms, conditions, requirements and provisions precedent to the
Subscription Offering imposed upon it by the Iowa Insurance Commissioner. The
Iowa Insurance Commissioner has approved the Offerors' application for the
Subscription Offering and the Public Offering, and such approval remains in full
force and effect.
(c) A Registration Statement on Form S-1 (Registration No. 333-12239)
with respect to the Subscription Offering has been prepared by the Offerors, has
been filed with the SEC and has been declared effective by the SEC. Such
Registration Statement, including any documents incorporated by reference
therein and all financial schedules and exhibits thereto, as amended, including
post-effective amendments, is herein called the "Registration Statement." At
the time the Registration Statement became effective, and at all times
subsequent thereto up to the Closing Date, the Registration Statement and the
Prospectus, including any amendments or supplements thereto, conformed and will
conform as to form in all material respects to the requirements of the
Securities Act of 1933, as amended (the "Act") and the SEC Rules and
Regulations, and neither the Registration Statement nor the Prospectus,
including any amendment or supplement thereto, contained or will contain 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, in the light
of the circumstances under which they were made, not misleading; provided,
however, that none of the representations and warranties in this subsection
shall apply to statements in or omissions from any preliminary Prospectus, the
Prospectus, the Registration Statement or any supplement made in reliance upon
and in conformity with information furnished to the Offerors in writing by the
Agent expressly for use therein. All material contracts, agreements and other
documents described or referred to in the Prospectus to which each of the
Company and the Selling Shareholder is a party, or by which it or its properties
are bound or committed are, unless otherwise disclosed therein, to the knowledge
of each of the Company and the Selling Shareholder, in full force and effect;
the descriptions thereof or references thereto are correct in all material
respects; and no material default exists in the due performance or observance of
any material obligations, agreements or other document so described or referred
to therein, unless otherwise disclosed therein.
(d) Neither the SEC, nor any court or other governmental agency or
body has, by order or otherwise, prevented or suspended the use of the
Prospectus or the offer or sale of the shares of Class A Common Stock, or, to
the best knowledge of each of the Company and the Selling Shareholder, is any
such action threatened.
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(e) KPMG Peat Marwick LLP, which has expressed its opinion with
respect to certain of the financial statements and schedules filed as part of
the Prospectus and included in the Registration Statement, has, with respect to
the Offerors, informed the same that it is an independent certified public
accountant within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants and the published rules and
regulations of the SEC.
(f) The financial statements and schedule(s) of the Company and notes
related thereto included in the Prospectus present fairly the consolidated
financial condition of the Company as of the dates indicated and the results of
operations for the periods specified and comply as to form in all material
respects with the applicable accounting requirements. Such financial statements
have been prepared in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved. The tables and any
other financial and numerical data in the Prospectus fairly present in all
material respects the information purported to be shown thereby at the
respective dates thereof and for the respective periods covered thereby and were
prepared on a basis consistent with the audited financial statements of the
Company.
(g) Since the respective dates as of which information is given in
the Prospectus, except as may otherwise be stated therein, (i) there has not
been any material adverse change in the condition, financial or otherwise, of
the Company or in the results of operations, earnings, or business affairs of
the Company, whether or not arising from transactions in the ordinary course of
business or (ii) there have not been any material transactions entered into by
the Company other than those in the ordinary course of business. Neither the
Company nor AmerUs Life has any material liability of any kind, contingent or
otherwise, except as set forth in the Prospectus.
(h) Each of the Company and the Selling Shareholder is duly
incorporated and validly existing as a corporation in good standing under the
laws of the State of Iowa, with full corporate power and authority to own its
properties and conduct its business as described in the Prospectus; AmerUs Life
is duly incorporated and validly existing as a stock life insurance company in
good standing under the laws of Iowa, with full corporate power and authority to
own its properties and conduct its business as described in the Prospectus; the
Company and AmerUs Life have obtained all material licenses, permits and other
governmental authorizations currently required for the conduct of their
respective businesses, except where the failure to do so would not have a
material adverse effect on the businesses, results of operations or general
business affairs of the Company or AmerUs Life; all such material licenses,
permits and other governmental authorizations are in full force and effect, and
the Company and
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AmerUs Life are in all material respects complying therewith. Neither the
Company nor AmerUs Life is required to qualify as a foreign corporation in any
jurisdiction in which the failure to qualify would have a material adverse
impact on the conduct of the Company's or AmerUs Life's business, as described
in the Prospectus.
(i) The shares of Class A Common Stock offered in the Subscription
Offering have been duly and validly authorized for issuance and, with respect to
such shares held by the Selling Shareholder, have been duly issued and delivered
to the Selling Shareholder, and, when issued and delivered by the Company or
when delivered by the Selling Shareholder, as the case may be, against payment
of the consideration described herein, will be duly and validly issued and fully
paid and nonassessable; and the Class A Common Stock conforms in all material
respects to the description thereof contained in the Prospectus. Except as
provided in the Prospectus, there are no preemptive rights or other rights to
subscribe or to purchase, or, except as set forth in the Prospectus, Articles of
Incorporation and Bylaws of the Company, any restriction upon the voting or
transfer of, any shares of Common Stock pursuant to the Company's Articles of
Incorporation, Bylaws or other governing documents or any agreement or other
instrument to which each of the Company and the Selling Shareholder is a party
or by which it may be bound. Neither the filing of the Registration Statement
nor the offering or sale of the Class A Common Stock as contemplated by this
Agreement gives rise to any rights, other than those which have been waived or
satisfied, for or relating to the registration of any shares of Class A Common
Stock. Upon the issuance of the Class A Common Stock, good title to the Class A
Common Stock will be transferred from each of the Company and the Selling
Shareholder, as the case may be to the purchasers thereof against payment
thereof subject to such claims as may be asserted against the purchasers thereof
by third party claimants.
(j) The Company owns, directly or indirectly, all of the issued and
outstanding capital stock of AmerUs Life, the only direct subsidiary of the
Company, free and clear of any lien, charge or encumbrance and there are no
outstanding warrants, rights or options to acquire or instruments convertible
into, or exchangeable for any shares of capital stock or other equity interest
in AmerUs Life.
(k) Neither the Company or AmerUs Life nor the Selling Shareholder is
in violation of or in default, and no event has occurred which with notice of
lapse of time, or both, would constitute default on the part of the Company or
AmerUs Life or the Selling Shareholder in the performance or observance of any
material obligation, agreement, covenant or condition contained in any contract,
lease, loan agreement, mortgage, note, indenture or other material instrument to
which it is a party or by which it or
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its assets are bound, which default in any individual case or in the aggregate
would have a material adverse effect on the business, general business affairs,
operations or financial condition of the Company and AmerUs Life, on a
consolidated basis, or the Selling Shareholder, as the case may be, and the
execution and delivery of this Agreement, the incurrence of the obligations
herein set forth and the consummation of the transactions herein contemplated
will not conflict with or constitute a breach of, or default under, or result in
the creation of any material lien, charge or encumbrance upon any of the assets
of the Company or AmerUs Life or of the Selling Shareholder, as the case may be,
pursuant to the Articles of Incorporation or Bylaws of the Company or AmerUs
Life or of the Selling Shareholder, as the case may be, or any material
obligation, agreement, contract, franchise, license, lease, indenture, note,
mortgage, loan agreement or other material instrument to which any of them is a
party or in which any of them has a beneficial interest in, or by which any of
them may be bound, or materially violate or conflict with any law,
administrative regulation or administrative or court decree. No consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body is required for the execution
and delivery of this Agreement or the consummation of the transactions
contemplated by this Agreement, except such as has been obtained and except for
approval of the Iowa Insurance Commissioner and the SEC, compliance with the
Act, the state securities laws ("Blue Sky Laws") applicable to the offering of
the Class A Common Stock and the clearance of such offering with the NASD and
the National Association of Securities Dealers Automated Quotation System
("NASDAQ").
(l) Each of the Company and AmerUs Life and the Selling Shareholder
have good and marketable title to all their properties and assets material to
their respective businesses and to those properties and assets described in the
Prospectus as owned by each of them, free and clear of all liens, charges,
encumbrances or restrictions, except such as are described in the Prospectus or
are individually or in the aggregate are not materially significant or important
in relation to the business of the Company and AmerUs Life or the Selling
Shareholder, as the case may be; and all of the leases and subleases material to
the business of each of the Company and AmerUs Life, including those described
in the Prospectus, are, to the knowledge of each of the Company and the Selling
Shareholder, valid and binding leases and subleases in full force and effect.
(m) Each of the Company and AmerUs Life and the Selling Shareholder
are neither subject to nor in material violation of any directive from the Iowa
Insurance Commissioner, or to the knowledge of each of the Company and the
Selling Shareholder any other governmental authority, to make any material
change in the method of conducting their respective businesses or affairs; each
of the Company and AmerUs Life and the Selling Shareholder have
8
conducted and are conducting their respective businesses to comply in all
material respects with all applicable statutes and regulations (including,
without limitation, all regulations, decisions, directives and orders of the
Iowa Insurance Commissioner) and, except as set forth in the Prospectus, there
is, to the knowledge of each of the Company and the Selling Shareholder, no
charge, investigation, action, suit or proceeding before or by any court,
regulatory authority or governmental agency or body pending or threatened which
may materially and adversely affect the performance of this Agreement or the
consummation of the transactions herein contemplated or which may result in any
material adverse change in the condition (financial or otherwise), business or
operations of each of the Company and the Selling Shareholder, or which would
materially and adversely affect any of its properties and assets.
(n) Each of the Company and the Selling Shareholder has complied or
will comply in all material respects with each and every undertaking or
commitment made by it under the Blue Sky Laws, including, without limitation,
each and every undertaking or commitment made in connection with the
Subscription Offering.
SECTION 6. AGREEMENTS OF THE OFFERORS. The Company and the Selling
Shareholder, each severally on behalf of and as to itself, hereby agrees with
the Agent that:
(a) Each of the Company and the Selling Shareholder will use its best
efforts to cause the Registration Statement to be declared effective by the SEC
and the Subscription Offering to be approved by the Iowa Insurance Commissioner.
The Offerors will promptly notify you: (i) of any request by or the receipt of
any comments from the SEC with respect to the transactions contemplated by this
Agreement; (ii) of any request by or any comments or other communications
received from the SEC, and any request by the SEC for any amendment or
supplement to the Registration Statement or the Prospectus, or for additional
information with respect to the transactions contemplated therein; and (iii) of
the issuance by the SEC or any court or governmental agency or body of any stop
order or other order suspending or enjoining the effectiveness or approval of
the Registration Statement, the Prospectus or of the institution of any
proceedings for that purpose or of any notification of the suspension of
qualification of the Class A Common Stock in any jurisdiction or the initiation
or threatening of any proceeding for that purpose or the threat of any such
action. Each of the Company and the Selling Shareholder will make every
reasonable effort to prevent the issuance by the SEC and any court or
governmental agency or body of any stop order or other such order, or request
for amendment or additional information or the commencement of any proceeding
and, if any such order, request or proceeding shall at any time be issued or
commenced, to obtain the lifting thereof, to respond thereto or to obtain the
termination thereof at the earliest possible moment.
9
(b) The Offerors will deliver to you, without charge, from time to
time such number of copies of the Prospectus and related documents (as amended
or supplemented), as you may reasonably request. The Offerors authorize the
Agent, subject to all requirements of applicable law, to use the Prospectus (as
the same may be amended or supplemented) in connection with the sale of the
Class A Common Stock in the Subscription Offering.
(c) The Offerors have delivered to you one complete copy (including
exhibits) of their Registration Statement on Form S-1 as originally filed with
the SEC and of each amendment thereto.
(d) During such period as may be required by applicable law, the
Offerors will comply, so far as they are able and at their own expense, with all
requirements imposed upon them by the SEC and by the Act, the Exchange Act and
the SEC Rules and Regulations, in each case as from time to time in effect, so
far as necessary to permit the continuance of offers, sales or dealings in
shares of Class A Common Stock during such period in accordance with the
provisions hereof and the Prospectus.
(e) If, at any time during the period when the Prospectus is
required by law to be delivered, any event occurs as a result of which, in
the reasonable opinion of counsel to the Offerors or the Agent's counsel, the
Prospectus, including any amendments or supplements, would contain an untrue
statement of a material fact, or would omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, or
if it is necessary in the reasonable opinion of counsel to the Offerors or
the Agent's counsel at any time to amend or supplement the Prospectus,
including any amendments or supplements to comply in all material respects
with the Act and all other applicable laws, the Offerors will promptly advise
you thereof and will promptly prepare and file with the SEC and any other
authority with jurisdiction an amendment or supplement (in form and substance
satisfactory to your counsel) which will correct such statement or omission
or effect such compliance; the Offerors will not file any amendment or
supplement to the Registration Statement or to the Prospectus which is
material to the Agent or its counsel without first furnishing a copy to the
Agent and its counsel prior to such filing.
(f) Neither the Company nor AmerUs Life will, prior to the Closing
Date, incur any material liability or obligation, direct or contingent, or enter
into any material transaction, other than in the ordinary course of business,
except as disclosed or contemplated in the Prospectus.
(g) During the period of three years after the date of the
Prospectus, the Offerors will furnish to you upon request (i)
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as soon as practicable after the end of each fiscal year, the annual report of
the Company containing the balance sheet of the Company as of the close of such
fiscal year and corresponding statements of income, stockholders' equity and
changes in financial position for the year then ended, such financial statements
to be certified by independent public accountants; (ii) as soon as practicable
after the end of each fiscal quarter (other than the last quarter of each fiscal
year), an unaudited consolidated balance sheet and statements of consolidated
income, stockholders' equity and changes in financial position of the Company
and its consolidated subsidiaries as at the end of and for such quarter; (iii)
as soon as practicable after mailing to shareholders, a copy of each proxy
statement, financial statement and periodic and special reports of the Company
mailed to holders of any class of its securities registered under Section 12 of
the Exchange Act; and (iv) as soon as practicable after the filing thereof, of
each non-confidential report or other statement or document filed by the Company
with the SEC, or with any national securities exchange or quotation system on
which any securities of the Company may be listed or quoted;
(h) The Offerors shall promptly prepare and file with the SEC, from
time to time, such reports as may be required to be filed by the SEC Rules and
Regulations, including, without limitation, reports with respect to the sale of
the Class A Common Stock and the application of the proceeds thereof as may be
required in accordance with Rule 463 under the Act.
(i) The Company shall use the net proceeds from the sale of the Class
A Common Stock in the Subscription Offering in the manner set forth in the
Prospectus under the caption "Use of Proceeds."
(j) The Offerors will promptly take all steps necessary to register
its Class A Common Stock under Section 12(g) of the Exchange Act.
(k) The Offerors will qualify the Class A Common Stock under the Blue
Sky Laws of such jurisdictions as the Agent and the Offerors mutually agree
(subject to practicality in terms of cost and to the qualification that the
Offerors shall not be obligated to file any general consent to service of
process or to qualify to do business in any jurisdiction in which it is not so
qualified). The Offerors will make such applications, file such consents to
service of process or other documents and furnish such other information as may
be reasonably requested for that purpose and to comply with such laws so as to
permit the continuance of sales and dealings in such jurisdictions for as long a
period as the Agent may reasonably request. The Offerors will notify the Agent
immediately of, and confirm in writing, the suspension of qualification of the
Class A Common Stock or the threat of such action in any jurisdiction. In each
jurisdiction where any of the
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Class A Common Stock shall have been qualified as provided above, the Offerors
will make and file such statements and reports as are required by, or in the
future may be required by, the laws of such jurisdiction, provided that Agent's
counsel so notifies the Offerors in writing of such requirement.
SECTION 7. PAYMENT OF EXPENSES OF THE OFFERORS. Whether or not the
transactions contemplated hereunder are consummated or this Agreement becomes
effective or is terminated for any reason, the Offerors will pay all costs and
expenses incident to the performance of their obligations hereunder, including,
without limiting the generality of the foregoing:
(a) All fees and expenses of the accountants and counsel of the
Offerors, all costs and expenses incurred in connection with the preparation,
printing, filing and distribution, including costs of shipping and mailing, of
the Registration Statement and the Prospectus and all amendments and supplements
thereto and other documents in connection with the transactions contemplated by
this Agreement and the Prospectus (including all exhibits and financial
statements) and all agreements and supplements provided for therein and in this
Agreement.
(b) All registration fees and expenses, including without limitation
reasonable legal fees and disbursements of the Agent's or Offerors' counsel
incurred in connection with qualifying or registering all or any part of the
Class A Common Stock for offer and sale under the Blue Sky Laws.
(c) All fees and expenses of the escrow and transfer agent and any
special agents appointed for the transfer of the Class A Common Stock,
preparation, printing, issuance and delivery of the certificates representing
shares of the Class A Common Stock, all stock issue and transfer taxes, if any,
with respect to the sale and delivery of the Class A Common Stock, and all fees
of the NASD.
SECTION 8. REIMBURSEMENT OF AGENT'S EXPENSES. The Offerors shall
reimburse the Agent for any out-of-pocket expenses incurred by the Agent in
connection with the Subscription Offering or any of the transactions expressly
contemplated hereby, including, without limitation, the fees and disbursements
of its counsel (to the extent retention thereof has been previously approved by
the Offerors) and as to other out-of-pocket expenses incurred by the Agent,
including without limitation, communication and travel expenses. The
reimbursement provided for in this Section shall be in addition to all amounts
payable to the Agent pursuant to Sections 3 and 10 hereof and shall not be
conditioned upon the consummation of the transactions contemplated hereunder.
The Agent shall be reimbursed for all expenses within five days of receipt by
the Offerors of an itemized xxxx summarizing such expenses since the date of the
last xxxx, if any, to the date of
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the current xxxx. To the extent not previously paid, full payment of the
Agent's expenses shall be made in next day funds on the Closing Date provided
that the Offerors shall have received an itemized xxxx summarizing any
unreimbursed expenses at least two days before the Closing Date or on such later
date if the Offerors shall have received an itemized xxxx summarizing any
unreimbursed expenses at least two days before such date or, if the Subscription
Offering is not completed and is abandoned or terminated for any reason, within
five days of receipt by the Offerors of a reasonable accounting from the Agent
of its expenses.
SECTION 9. CONDITIONS TO THE OBLIGATIONS OF THE AGENT AND THE RELEASE
OF SHARES. The issuance and sale of the shares of Class A Common Stock, the
delivery of certificates in respect thereof, and the obligations of the Agent
hereunder shall be subject to the accuracy in all material respects of the
representations and warranties on the part of the Company and/or the Selling
Shareholder herein set forth as of the date hereof and as of the Closing Date,
to the accuracy in all material respects of the statements of the officers of
the Company and/or the Selling Shareholder made pursuant to the provisions
hereof, and to the performance in all material respects by the Company and/or
the Selling Shareholder of their respective obligations hereunder.
The issuance and sale of the shares of Class A Common Stock, the
delivery of certificates in respect thereof, and the obligations of the Agent on
the Closing Date shall also be subject to the following additional conditions
(which are solely for your benefit), unless waived in writing by the Agent:
(a) The Registration Statement shall have been declared effective by
the SEC; prior to the Closing Date, no stop order or other order suspending
the offering or the effectiveness of the Registration Statement or the
effectiveness of the Prospectus shall have been issued or proceedings therefor
instituted, initiated or threatened by the SEC, the Iowa Insurance Commissioner
or any court or governmental agency or body. The NASD, upon review of the terms
of this Agreement, shall not have objected to the Agent's performance of its
obligations hereunder or the terms set forth.
(b) The Agent shall have received on the Closing Date certificates on
behalf of each of the Company and the Selling Shareholder, dated as of the
Closing Date, signed by the chief executive officer or the chief financial
officer of each of the Company and the Selling Shareholder in form and substance
reasonably satisfactory to the Agent's counsel, to the effect that the signers
of each of such certificates have carefully examined the Registration Statement
and the Prospectus and that, in their opinion, at the time the Registration
Statement and the Prospectus became effective, neither the Registration
Statement nor the Prospectus contained any untrue statement of a material fact
or omitted to state any material fact required to be stated therein or
13
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and since the
respective effective or approval dates of the Registration Statement and the
Prospectus, no event has occurred which should have been set forth in an
amendment of or supplement to the Registration Statement or the Prospectus which
has not been so set forth; no order has been issued by the SEC to suspend the
offering or the effectiveness of the Prospectus and no action for such purposes
has been instituted or, to the best of its knowledge, threatened by the SEC; and
to the further effect that each of the Company and the Selling Shareholder has
performed all agreements and has satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Date and that all its
representations and warranties contained in Section 5 hereof are true and
correct in all material respects on and as of the Closing Date, with the same
force and effect as though expressly made on the Closing Date.
(c) The Class A Common Stock shall have been qualified or be exempt
from qualification under the Blue Sky Laws of such states where the Class A
Common Stock has been offered.
(d) All necessary approvals and consents (including the approval of
the Iowa Insurance Commissioner) to the consummation of the Subscription
Offering have been obtained or provided for.
(e) The Agent shall have received on the Closing Date an opinion of
Sidley & Austin, special counsel for the Company and special transaction counsel
for the Selling Shareholder, dated as of the Closing Date, addressed to you, in
form and substance reasonably satisfactory to you. As to matters of Iowa law
Sidley & Austin may rely upon the opinion of Xxxxx X. Xxxxxxxxxxxxx, Esq.
(f) At the time this Agreement is executed and also on the Closing
Date, there shall be delivered to the Agent a letter addressed to you, from KPMG
Peat Marwick LLP, independent accountants, the first one to be dated the date of
this Agreement, the second one to be dated the Closing Date, substantially
identical in form and substance to the unsigned form of letter heretofore
submitted to and approved by the Agent, and which shall contain information as
of a date within five business days of the date of such letter.
(g) The Agent's counsel shall have been furnished with such documents
as they may reasonably require for the purpose of enabling them to pass upon the
sale of the Class A Common Stock as herein contemplated and related proceedings
and in order to evidence the accuracy or completeness of any of the
representations or warranties or the fulfillment of any of the conditions herein
contained; and all proceedings taken by the Offerors in connection with sale of
the Class A Common Stock as herein contemplated shall
14
be reasonably satisfactory in form and substance to the Agent and its counsel.
(h) The representations and warranties of each of the Company and the
Selling Shareholder contained herein shall be true and correct in all material
respects on the date of this Agreement and on and as of the Closing Date; each
of the Company and the Selling Shareholder shall have performed in all material
respects all covenants and agreements contained herein to be performed on its
part at or prior to such Closing Date.
(i) The Company or AmerUS Life shall have not have sustained, since
the date of the latest financial statements included in the Registration
Statement, any material loss or interference with its business from fire,
explosion, 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, that is not set forth in the Prospectus.
(j) The Company and AmerUs Group shall have received gross
proceeds of at least $50 million from the Subscription Offering or a
combination of the Subscription Offering and the Public Offering.
SECTION 10. INDEMNIFICATION AND CONTRIBUTION.
(a) The Offerors hereby jointly and severally agree (i) to indemnify
and hold harmless the Agent, each of its directors, officers, other employees
and agents and any person who controls the Agent within the meaning of Section
15 or Section 20(a) of the Exchange Act (the Agent and each person being
indemnified hereinafter called an "Indemnified Party") against any and all
losses, claims, damages or liabilities, joint or several, to which an
Indemnified Party may become subject, under the Act, the Exchange Act or other
federal or state statutory law or regulation, at common law or otherwise; (ii)
to reimburse promptly such Indemnified Party for reasonable legal or other
expenses incurred by such Indemnified Party in connection with investigating any
claims or preparing for or defending any actions, commenced or threatened,
whether or not resulting in any liability; and (iii) to reimburse promptly such
Indemnified Party for any amount paid in settlement of any claim or action,
commenced or threatened, if such settlement is effected with the written consent
of the Company; insofar as such losses, claims, damages, liabilities, expenses,
actions, or settlements, referred to above, arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, Prospectus or any amendment or supplement thereto,
or any application filed under any Blue Sky Law, or in any other document
executed by the Offerors in connection with or in contemplation of the
transactions contemplated by this Agreement, or in the information furnished or
otherwise made available to the Agent by the Offerors, or arise out of or are
based upon the omission or alleged omission to state therein a 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 or arise
out of any action or omission to act by the Offerors, their officers, directors,
15
employees or agents, which action is willful or grossly negligent. The Offerors
shall be responsible for claims, liabilities, losses, damages or expenses
arising from or in connection with oral misstatements made by the Offerors which
are not based upon information provided by the Agent in writing or based upon
information contained in the Registration Statement, the Prospectus, any Blue
Sky Application or other information distributed in connection with the
Subscription Offering. The Offerors will not be liable in any such case to the
extent that any such loss, claim, damage, liability or expense arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement, the Prospectus or any
amendment or supplement thereto or in any Blue Sky Application in reliance upon
and in conformity with written information furnished to the Offerors by or on
behalf of the Agent specifically for use therein or oral misstatements made by
the Agent which are not based upon information provided by the Offerors or based
upon information contained in the Registration Statement, the Prospectus, any
Blue Sky Application or other information distributed in connection with the
Subscription Offering. In the event that the Offerors advance any amounts
alleged to be due under this Section 10(a) to the Indemnified Party and it is
determined by a court of competent jurisdiction that the Indemnified Party is
not entitled to indemnification hereunder, then the Indemnified Party shall
repay to the Offerors, without interest, any amounts so advanced. The
indemnification obligations of the Offerors as provided above are in addition to
any liabilities the Offerors have under other agreements, under common law or
otherwise. The obligation of indemnity provided for hereunder is effective
immediately in respect of all events prior to or after the date hereof and shall
survive any expiration, termination or the cessation of this Agreement.
(b) The Agent agrees (i) to indemnify and hold harmless the Offerors,
each of their respective directors and officers and each person who controls the
Offerors within the meaning of the Act (the Offerors and each person being
indemnified hereinafter called an "Indemnified Party") against any and all
losses, claims, damages or liabilities, joint or several, to which an
Indemnified Party may become subject, under the Act, the Exchange Act, or other
federal or state statutory law or regulations, at common law or otherwise; (ii)
to reimburse promptly such Indemnified Party for reasonable legal or other
expenses incurred by such Indemnified Party in connection with investigating any
claims or preparing for or defending any actions, commenced or threatened,
whether or not resulting in defending any liability; and (iii) to reimburse
promptly such Indemnified Party for any amount paid in settlement of any claims
or actions, commenced or threatened, if such settlement is effected with the
written consent of the Agent; insofar as such losses, claims, damages,
liabilities, expenses, actions or settlements referred to above arise out of or
are based upon any untrue or alleged untrue statement of any material fact
16
contained in the Registration Statement, the Prospectus or any amendment or
supplement thereto, or any Blue Sky Application, or arise out of or are based
upon 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
or arise out of any action or omission to act by the Agent, its officers,
directors, employees or agents, which action is willful or grossly negligent, 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 the
Registration Statement, the Prospectus, or any amendment or supplement thereto,
or in any Blue Sky Application, in reliance upon and in conformity with written
information furnished to the Offerors by the Agent specifically for use in the
preparation thereof. In the event that the Agent advances any amounts alleged
to be due under this Section 10(b) to an Indemnified Party and it is determined
by a court of competent jurisdiction that the Indemnified Party is not entitled
to indemnification hereunder, then the Indemnified Party, shall repay, without
interest, any amounts so advanced to the Agent. The indemnification obligations
of the Agent as provided above are in addition to any liabilities the Agent may
have under other agreements, under common law or otherwise. The obligation of
indemnity provided for hereunder is effective immediately in respect of all
events prior to or after the date hereof and shall survive any expiration,
termination or other cessation of this Agreement.
(c) Promptly after receipt by an Indemnified Party under this Section
of notice of the commencement of any action, such Indemnified Party shall, if a
claim in respect thereof is to be made against an Indemnified Party under this
Section, notify the indemnifying party in writing of the commencement thereof.
In no case shall an indemnifying party be liable under this Agreement with
respect to any loss, claim, damage, liability, expense, action or settlement
unless the indemnifying party shall have been notified in writing by the
Indemnified Party seeking indemnification, of the assertion or filing of the
claim or action giving rise to such loss, claim, damage, liability, expense,
action or settlement promptly after such Indemnified Party shall have been
advised of, or otherwise shall have received information as to, the assertion or
filing of such claim or action. In case any such action is brought against any
Indemnified Party, and such Indemnified Party notifies an indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
in, and, to the extent that it or he may wish, jointly with all other
Indemnifying Parties, similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such Indemnified Party; provided, however, if
the defendants in any such action include both the Indemnified Party and the
indemnifying party and the Indemnified Party shall have reasonably concluded,
based upon advice of its counsel, that there may be legal defenses available to
it or he and/or any other Indemnified Party which are
17
different from or additional to those available to the indemnifying party, the
Indemnified Party shall have the right to select separate counsel to assume such
legal defenses and to otherwise participate in the defense of such action on
behalf of such Indemnified Party. Upon receipt of notice from the Indemnified
Party to the indemnifying party of its election so to assume the defense of such
action, the indemnifying party will not be liable to such Indemnified Party
under this Section for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with defense thereof (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel) unless:
(i) the indemnifying party shall not have employed counsel
reasonably satisfactory to the Indemnified Party to represent the Indemnified
Party within a reasonable time after notice or commencement of the action; or
(ii) the indemnifying party has authorized the employment of
counsel at the expense of the indemnifying party.
(d) If the indemnification provided for in this section is
unavailable to an Indemnified Party in respect of any losses claims, damages or
liabilities referred to therein, then each indemnifying party, in lieu of
indemnifying such Indemnified Party, shall, subject to the limitations
hereinafter set forth, contribute to the amount paid or payable by such
Indemnified Party as a result of such losses, claims, damages or liabilities:
(i) in such proportion as is appropriate to reflect the relative
benefits received by the Offerors and the Agent from the offering of the Class A
Common Stock in the Subscription Offering; 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 Offerors and the Agent 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 respective relative benefits received by the Offerors and the
Agent shall be deemed to be in such proportion so that the Agent is responsible
for the portion of the losses, claims, damages or liabilities represented by the
percentage that the fee to be paid to the Agent in connection with the
solicitation of subscriptions described in Section 3 hereof bears to the actual
Purchase Price per share of the Class A Common Stock, and the Offerors are
responsible for the remaining portion. The relative fault of the Offerors and
the Agent shall be determined by reference to, among other things, whether the
untrue or alleged
18
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Offerors or by the Agent and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party as a
result of the losses, claims, damages and liabilities referred to above shall be
deemed to include, subject to the limitations set forth in paragraph (d) of this
Section, any legal or other fees or expenses reasonably incurred by such party
in connection with investigating or defending any action or claim.
The Offerors and the Agent agree that it would not be just and
equitable if contribution pursuant to this Section were determined by pro rata
or per capita allocation or by any other method or allocation which does not
take into account the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section, 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.
SECTION 11. EFFECTIVE DATE. This Agreement shall become effective
immediately.
SECTION 12. TERMINATION. Without limiting the right to terminate
this Agreement pursuant to any other provision hereof:
(a) This Agreement may be terminated by the Agent prior to the
Closing Date if, in the Agent's reasonable judgment:
(i) additional material governmental restrictions, not in force
and effect on the date hereof, shall have been imposed upon trading in
securities generally or a suspension or limitation in trading in securities
generally has occurred on the New York Stock Exchange or American Stock Exchange
or in the over-the-counter market, or quotations halted generally on the NASDAQ
System, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices for securities have been required by either of such exchanges
or the NASD or by order of the SEC or any other governmental authority; or the
engagement or continued engagement by the United States in major hostilities or
the declaration of a national emergency or war or a material decline in the
price of equity or debt securities if the effect of such hostilities, national
emergency or war or decline, in the Agent's reasonable judgment, makes it
impracticable or inadvisable to proceed with the Subscription Offering or the
delivery of shares on the terms and in the manner contemplated in the
Registration Statement and the Prospectus;
(ii) any event shall have occurred or shall exist which makes
untrue or incorrect in any material respect any statement or information
contained in the Registration Statement or
19
the Prospectus or which is not reflected in the Registration Statement or the
Prospectus but should be reflected therein in order to make the statements or
information contained therein, in light of the circumstances under which they
were made, not misleading in any material respect (unless the Registration
Statement or the Prospectus, as appropriate, is amended or supplemented
appropriately in a timely manner to the satisfaction of the Agent); or
(iii) the Company or AmerUs Life shall have sustained a loss by
fire, flood, accident or other calamity which is materially adverse to the
property, business or financial condition of the Company or AmerUs Life, whether
or not such loss shall have been insured, or there shall have been, since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the business, condition or business affairs of the
Company whether or not arising in the ordinary course of business, or, which in
the Agent's reasonable judgment shall render it inadvisable to proceed with the
delivery of the Class A Common Stock in the Subscription Offering.
(b) If the Agent elects to terminate this Agreement as provided in
this Section, the Offerors shall be notified promptly by the Agent by telephone
or telegram, confirmed by letter.
Any termination pursuant to this Section 12 shall be without liability
on the part of the Agent to the Offerors or on the part of the Offerors to the
Agent (except for the expenses to be paid or reimbursed by the Offerors pursuant
to Section 3 or Section 8 hereof and except as to indemnification to the extent
provided in Section 10 hereof).
SECTION 13. REPRESENTATION AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of each of the Company and the Selling Shareholder and its directors
and officers, and of the Agent set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or
on behalf of the Agent or Offerors or any of their respective partners,
officers, agents or directors or any controlling person, as the case may be, and
will survive delivery or any payment for the Class A Common Stock sold
hereunder.
SECTION 14. NOTICE. All communications hereunder will be in writing
and, if sent to the Agent will be mailed, delivered or telegraphed and confirmed
to you c/o The Chicago Corporation, 000 Xxxxx Xx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000; if sent to the Offerors will be mailed, delivered or telegraphed and
confirmed to each of the Company and the Selling Shareholder at 000 Xxxxx
Xxxxxx, Xxx Xxxxxx, Xxxx 00000.
20
SECTION 15. SUCCESSORS. This Agreement will inure to the benefit of
and be binding upon each of the Company and the Selling Shareholder and the
Agent (including the participating dealers as provided herein) and their
respective successors (other than pursuant to Section 10). Nothing in this
Agreement is intended or shall be construed to give any person or entity other
than the parties hereto and their successors and other than described in Section
10) any legal or equitable right, remedy or claim under or in respect of this
Agreement.
SECTION 16. PARTIAL UNENFORCEABILITY. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
SECTION 17. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Illinois.
SECTION 18. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties pertaining to the subject matter hereof
superseding any and all prior or contemporaneous oral or prior written
agreements, proposals, letters of intent and understandings, and cannot be
modified, changed, waived or terminated except by a writing which expressly
states that it is an amendment, modification or waiver, refers to this Agreement
and is signed by the party to be charged. No course of conduct or dealing shall
be construed to modify, amend or otherwise affect any of the provisions hereof.
SECTION 19. HEADINGS. Headings on the Sections in this Agreement are
for reference purposes only and shall not be deemed to have any substantive
effect.
SECTION 20. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but both of which
together shall constitute one and the same instrument.
21
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement between the Offerors and the Agent,
all in accordance with its terms.
Very truly yours,
AMERUS LIFE HOLDINGS,INC.
By:______________________
AMERUS GROUP CO.
By:______________________
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written.
THE CHICAGO CORPORATION
("Agent")
By:_____________________
Title:__________________
22
